W.P. Considers Legal Options of Dam Payments
The long-running saga of Cardinal Lake dam repair work took another turn Thursday night when the Whispering Pines Council asked its attorney, Mike Brough, to get involved.
The council voted to ask Brough to contact attorneys representing Whispering Woods Golf Club and gather information to determine whether a settlement is possible or the village would have to pursue legal action to enforce an agreement.
Fairway Golf Management and the Village Council have an agreement to repair Cardinal Lake dam, which is on the golf course. The village agreed to loan the club $84,00 for dam repairs, which would be paid back in annual payments of $5,600 over 15 years.
That agreement stipulates that if the golf course is sold, or if a majority ownership of the club changes, the remaining amount of the $84,000 loan is due immediately upon the completion of the sale.
Whispering Lakes LLC has a pending lease with an option to buy with Fairway Golf Management. That deal was made public in February.
There is disagreement between all sides involved as to whether or not the transaction constitutes a sale and would therefore force Fairway Golf Management to pay the village the remaining amount owed.
"Thus off we go to lawyer land," Mayor Bob Zschoche said.
Council members expressed a variety of opinions on what action should eventually be taken.
Council member Skip Geb-hardt urged the council to go ahead and pursue foreclosure.
"If we don't get the money now, we are not going to get it," he said.
Council members Molly Boggis and Paul Sams urged that the village take a more patient approach, hoping that a workable settlement could be negotiated.
"I would rather have some than none," Sams said. "Give them (lawyers) 30 days to talk and tell us what can be negotiated and then decide."
Both Sams and Boggis favored accepting an agreement that would net the village a lump sum payment and annual payments with interest.
Brough told the council that he has "a solid claim to make," but stopped short of predicting an outcome if the case goes to court.
"I'm not going to say we are going to win," Brough said. "That is something I just don't do, because it is way too hazardous to my professional health."
Council member Randy Saunders was out of town on business and unable to attend the meeting.
First Deal in 2007
In 2007, the club and the village reached an agreement that calls for the the village to pay the up-front cost of the dam repairs and to take ownership of the dam and the surrounding spillway ponds. In turn, Whispering Woods will pay $84,000 over 15 years and give the village land valued at $34,000. The golf course also receives an easement to use water from Cardinal Lake and its surrounding pond for irrigation.
The deal was contingent on residents who live around the dam paying $28,000 toward the repair costs, leaving the village to pay the rest.
At the time of the original deal, the remaining amount of the repair was estimated at $112,000. The original repair cost as estimated by village engineers was $224,000.
In March 2008, the village considered foreclosure action after the club defaulted on the loan and failed to make its required annual payment.
Instead, the two sides reached an agreement that gave the village an easement from the golf club to create a sediment bay for Cardinal Lake. The project involves building a spillway over which a golf cart path will run. The spillway will prevent sediment from seeping into Cardinal Lake. At the time of that agreement, the club also made its first payment on the loan.
In December, the council voted unanimously to reject a proposed lump sum payment of $52,000 - an amount less than the original agreed upon $84,000.
The club has made two payments on the loan. It still owes $72,800.
Over time, the cost of repairing the dam has gone up, leaving the village to bear the brunt of the expense.
In November, the council voted to have engineer John Eddy rebid the project after the lowest bid came back at $671,000.
After that meeting, Eddy said that the repair work had changed greatly in scope since he made his first estimate. He added that he expected the bids to come in at about $500,000.
Land Development Hearing
Also during the special meeting, the council held a public hearing on the new land development ordinance.
About 10 residents spoke, expressing concerns with the document. Topics discussed were home setbacks, signs, fences, open spaces, trees and plantings on home lots and the overall requirements in the document.
Council members assured them that the document was not set in stone and that the input would be considered and used to improve the document.
After the public hearing was closed, the council took no action.
The council voted unanimously to set a public hearing for April 14 on the possible voluntary annexation of the Shops of Whispering Pines retail development that includes new Food Lion. The shopping center, located near U.S. 22 and Sullivan Drive, is currently under construction.
Contact Tom Embrey at (910) 693-2484 or by e-mail at firstname.lastname@example.org.
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