From Crain’s Detroit Business

A new judge will preside in an old legal squabble with Farmington Hills-based Grand/Sakwa Properties Inc. and local government officials, as to whether the proposed Troy/Birmingham Multi-Modal Transit Center can go forward or whether Troy’s land reverts to private ownership.

Oakland County Circuit Judge John McDonald, who recently received the lawsuit by reassignment from fellow Judge Wendy Potts, may resolve a decade-old issue simply by defining two words.

“The only issue in the litigation that isn’t really spelled out as plain as day is what constitutes ‘full funding.’ It’s an interesting argument they raise, that if we don’t have bags of money in our back pocket, we don’t have funding,” said Jana Ecker, Birmingham city planning director and a coordinator of 15 Mile Transit, an organization of local transit center proponents.

“But we’ve got funding from several different sources, and there’s nothing in the (original) consent judgment that says what a transit center must be, and what defines it or what fully funds it. It doesn’t even have to be set aside versus already spent. It just has to be funded.”

At issue is a June 2000 consent judgment in a Grand Sakwa lawsuit against Troy, where the city agrees to acquire a portion of the land near 15 Mile and Coolidge Road for $1 to develop a transit center.

The agreement comes with a caveat that “if the transportation center is not funded by the city within 10 years…then all right, title and interest of the city in the property designated as the transportation center shall revert to (Grand/Sakwa).”

The cities of Troy and Birmingham have recently secured several funding commitments from state and federal agencies, as well as from their own budget, totaling more than $10.8 million for the transit proposal.

But Grand/Sakwa now contends the project did not reach full funding by this year’s deadline the way that its consent judgment requires.

Grand Sakwa filed a motion in July to revert Troy’s transit center site back to private ownership. Earlier this month Chief Circuit Judge Nanci Grant granted the company’s request to remove Wendy Potts, the original judge on the case, whose husband County Commissioner David Potts has been a supporter of the transit center project.

“The so-called ‘funding sources’ do not mean that the transportation center is funded at all by the city, but rather constitute only potential funds which are not yet secured or immediately available and, indeed, may be cancelled at any time,” the company’s motion states.

Troy has yet to respond in court to Grand/Sakwa’s motion for reversion of land ownership. But some said Grand/Sakwa may have a difficult case to prove that the center is not funded.

“They may be correct on the timing, but the amount is inconsequential,” said Alan Canady, director of governmental affairs in Lansing for Clark Hill plc, which represented Birmingham and helped the two cities seek state and federal funding.

“The one grant that fits their definition (cited in the motion) is for only $250,000 to pay for LED lighting. Even if they didn’t get that grant, they still have about $10 million available. That’s really a specious argument they’re making, if they’re hanging their hat on that.”

But Gerald Fisher, a professor of property law and state and local government law at Thomas M. Cooley Law School in Auburn Hills, said the company could make a case if it can prove some of the funding secured by June 2010 was discretionary or revocable.

“If a department has made a commitment to give you the money, for most purposes, that is funding. But I would ask someone within those departments, is that a firm commitment or something that can be withdrawn at any time?” he said. “Then if enough of those can be withdrawn, does the city involved have the wherewithal to replace that funding on its own?”

William Mathewson, general counsel for the Michigan Municipal League, said he has not followed the Troy case closely but that a judge can give “equitable consideration” to the city’s plight if there is no statute or case law directly on point.

“Basing a decision on the action or inaction by the federal government or other agencies in not funding the program sooner, if the city did all it could do, seems like it could be unfair,” he said. “The city could argue it has been put at a hardship due to the slowness of another party.”

Timothy Mullins, head of the municipal practice at Troy-based Giarmarco Mullins & Horton PC, said the case could come down to the context of the original consent judgment.

“It’s a good question, but some of the history or preamble to that consent judgment could also address things further (than the language itself),” he said. “And sometimes they actually go to Webster’s or Black’s Law Dictionary to elaborate on things, without a precedent or other law to cite. It’s been known to happen.”

Canady and Ecker said the language in the consent judgment is broad and does not define what a transit center is and how much money is necessarily to fully fund it. But Ecker said the proposal can be changed if Judge McDonald sides with Grand/Sakwa against Troy.

“We do have a plan B, that doesn’t involve the Grand Sakwa parcel. It could even potentially have all of the same services as the current proposal, except that without the Grand Sakwa piece there wouldn’t be a tunnel connecting the properties,” she said.

“So there wouldn’t be the same joint benefit (to both cities) as we’ve proposed, it could become only a benefit to Birmingham residents.”

Source:
http://www.crainsdetroit.com/article/20100819/FREE/100819866