Harris wary
By Gordon Y.K. Pang
of bailout in
Harbor Court plan
Star-Bulletin
City Council leaders and Mayor Jeremy Harris are at odds over who's to blame for the lack of progress in resolving a money dispute with the developer of Harbor Court.
Harbor Court Developers owes the city $12.4 million for the leased-fee interest of 84 units in the tower The developer purchased the fee interest on 36 other units by a July 1, 1997, deadline.
In an unusual step, Council members yesterday introduced and then approved, by a 6-2 vote, a plan to have the condominium's developers pay for an independent appraisal of the leased-fee interest not yet paid.
But Harris, as well as Council members Duke Bainum and Steve Holmes, oppose the resolution and think it's the first step in providing a bailout for developers.
Council Budget Chairman John Henry Felix, who co-introduced the resolution with Council Chairman Mufi Hannemann, said the administration's negotiators have been taking too long to act on finding a "global solution."An appraisal of the fee interest has never been done, and doing one now would get the ball rolling on negotiations, according to Felix.
Hannemann said settling now would help the city balance its budget. He noted the administration budgeted $2.5 million in anticipated revenues from the sale of some of the leased-fee interests, which he doubts will be realized.
Harris, however, said he's puzzled by the action because the city "already has an executed agreement with the developer that entitles the city to collect $12.4 million. Why in the world would you try to reduce the amount that is owed to you?" Harris said. "This is certainly tantamount to a bailout."
Bainum and Holmes said asking for an appraisal is needless and actually harmful to the city's position. Given that real estate values have dropped in recent years, it's likely the appraisal will come out less than the $12.4 million estimated in 1991 when the agreement was first struck, they said.
"Common sense tells us market conditions are very poor," Holmes said.
In response, Felix said the Council is not required to settle at whatever appraisal comes in.
"There is no obligation to sell at that price," he said. "We may want to wait it out."
Harris also said the Council is responsible for holding up negotiations with the developers.
The administration had a resolution introduced in August that allows the city to sue for the $12.4 million, but the measure owed has been stalled in committee, he said.
