Jackson paid $100,000 in sewer dispute
Monday, May 17, 2004
A court dispute over two sewer easements that cost Jackson $100,000 -- almost eight times the estimate of an appraiser -- has some members of the Jackson Board of Aldermen and the landowners upset over the city's handling of the issue.
The battle over the Friedrich family's two sewer easements began with a letter from the city, the same certified letter the city sent to every land owner involved with the $750,000 Goose Creek sewer project. It ended not long after the first of the year when a jury awarded the family a whopping $70,000 for an easement in one of two equal tracts. The award, mostly assumed damages in lost lots, was more than 10 times the amount an appraiser told the city a single easement was worth and more than four times what mediators later agreed upon. The award was $5,000 more than the amount suggested by an expert witness who testified on behalf of the family.
After the jury's decision on one easement, the city and family quickly settled on the other equal-sized tract. To avoid another trial, Jackson ended up paying $90,000 for both easements. Including court costs and the $9,500 the city paid its attorney once the case went to court, Jackson's bill for acquiring the 3/4-acre easements was more than $100,000.
But the story goes much deeper than the city's pockets. The deeply rooted family, which owns 40 acres of undeveloped property near Litz Park, says the city could have avoided the entire fiasco had it been willing to consider a different sewer route through the property. City aldermen say they were never made aware of this offer.
Once the Friedrich family decided not to donate the easement or sell it for the $2-per-foot offer the city generally makes early in the easement acquisition process, appraiser Bill Craig told the city the easement was worth about $6,500 for each tract.
Offer made in person
Some time afterward, Bob Friedrich, who died just after the jury settlement, made an offer through attorney John Lichtenegger that the family would be willing to donate easements if the city would reroute the sewer.
Lichtenegger said the offer was made in person to city attorney Tom Ludwig on Jan. 23, 2003, almost two years after the city's initial contact with the family and nearly six months before actual construction of the sewer line began on the property. The offer proposed a route that would run parallel to an old abandoned railroad bed. The route also would extend straight out from Rebecca Street, which has been stubbed at the beginning of the Friedrich property.
Lichtenegger, who is a developer himself, said if the property is eventually subdivided, it would make the most sense to run Rebecca Street perpendicular through the property as opposed to the diagonal route the city had proposed to run the sewer through. If the road is built perpendicular and the sewer built diagonally, fewer lots could be used because structures cannot be built over sewer lines.
Ludwig said he remembers talking with Lichtenegger about the offer but doesn't specifically recall the railroad bed proposal. He said the city did look into another route that would have placed the sewer behind a row of houses along Clark Street and that the route clearly was not feasible. He said he passed that information on to public works director Rodney Bollinger.
Bollinger, who negotiates easements for the city, said he doesn't remember seeing the railroad bed proposal until it was presented later after court depositions, which took place about 11 months after John Lichtenegger says that proposal was made. Court documents show Bollinger said he did not receive any communication from anyone about a request by the family for a different alignment.
By the time he saw the layout of the proposal, Bollinger said, it was too late for negotiations.
Ludwig doesn't dispute that Lichtenegger laid out the plans, but he can only remember one alternate proposal. He said the information he got back from the engineers was that one of the alternate routes -- the route behind several houses along Clark Street -- would require at least a 30-foot-deep cut. Cuts for this sewer line generally run 6 to 12 feet.
No calls to engineer
But Ed Sewing, an engineer with Horner & Shifrin, the firm hired by the city to design the project, testified in court that he never received any calls from city officials asking him to look at alternative sewer routes.
"With respect to the sewer alignments across the Friedrichs' property, the sewers were located and designed to maximize the potential future benefit to the property, to be cost-effective and to minimize future maintenance costs," Sewing wrote in an e-mail to the Southeast Missourian. He said all contacts, discussions and negotiations were made by city staff unless "the property owners had specific engineering or technical questions relating to the sewers on their property."
Sewing referred all other questions to city staff.
Bollinger said he doesn't remember the railroad bed offer, but he said that doesn't mean it didn't happen.
At the same time, Lichtenegger did not make the offer or proposal in writing for the city to refer back to.
Bollinger has hundreds of pages about the Goose Creek sewer project filed at his office but no written offers from the Friedrich family.
"Where's the paper trail?" he asked. "Where is it laid out in writing?"
No information about alternative proposals made its way to the board of aldermen, which had to make the ultimate decision on whether to take the issue to court.
Some aldermen are disappointed in the way the process worked.
"I feel that we should have very open lines of communication, and the mayor has mentioned that as one of his three top priorities," said Alderwoman Barbara Lohr. "I feel that any time when we have a project of major importance and major financial expenditure, the board should be aware of all offers before a decision is made and the board should be given the opportunity to have input."
'Totally on my shoulders'
Ludwig said he takes responsibility for word not reaching the board, but he said it's not reflective of his personal policy.
"Did I go to the board and say that they'd give the easement for free if we redesigned it? No," Ludwig said. "My general philosophy is to keep the board informed as much as possible. But the difference in cost would have been so great, I didn't do that. I'm confident that if I would have taken it to the board, they would have said the same thing. It's totally on my shoulders."
Alderman Joe Bob Baker said he learned of the offer from Bob Friedrich, who stopped by Baker's business one day.
"He said, 'I can't believe you didn't take that offer,'" Baker said. "And I said, 'What offer?'
"We need to be well informed, especially on something where we're going to court or going through condemnation. We can only make good decisions when we have all the information."
Mayor Paul Sander said the staff usually goes out of its way to provide information to the board.
"We get an abundant amount of information on a weekly basis. I couldn't be more pleased with the information we get from the staff. Unfortunately when the council and the staff make decisions, you don't make everybody happy," Sander said.
Eric Friedrich, Bob Friedrich's son, is upset that a few individuals at the top of city management made the decision regarding the easement.
"What's the point of electing an alderman from your ward if they don't know about the information?" he said. "That's why we vote for these people. For them to make these decisions."
No estimates on cost
The city has no estimates on how much the railroad bed or Clark Street routes might have cost the city. The engineers, Horner & Shifrin, designed the sewer to go along the lowest portion of the property.
City administrator Jim Roach declined the Southeast Missourian's request for the city to calculate how much more the railroad bed route might have cost because he said there are too many unknowns about subsurface conditions to get a precise figure. However, he said, it is obvious that the change in design would have easily cost the city more money than the city believed the easements were worth.
Bollinger added that moving the sewers to higher ground would mean more headaches for the city and property owners down the road because builders would have to dig deeper to hook up houses to the sewer, and city workers would have to dig deeper to maintain the lines.
One engineer, speaking on the condition of anonymity for fear of jeopardizing future business, said all the land on the property generally flows in the same direction. He said it wouldn't have cost much more to move the sewer line.
Both sides generally agree that supplies alone would have cost roughly $6,000 to $8,000 more to use the Friedrichs' proposed route, but much of that would have been offset by the Friedrichs' offer to donate easements. City officials say labor and engineering costs would have been much higher.
During the mediation process, three mediators decided each tract was worth $15,000. The family said it was willing to take that settlement, but the city filed an exception and took the case to a jury. Once the city filed, Lichtenegger said, the family also filed an exception so the city couldn't drop the case and leave the family with unnecessary legal expenses.
Ludwig said juries usually come back with a figure somewhere in the middle. But not this one. In a 9-3 decision, the jury offered $70,000 to the Friedrichs.
During the trial, the city argued that the Friedrichs, whose family members have owned this piece of land since the Civil War, had no immediate intention of developing the property. They did not have a preliminary plat approved by the city.
The family argued that the sewer's location would have eliminated up to seven lots should the family decide to develop subdivisions.
Lichtenegger drew up a rough sketch of a potential subdivision as evidence during the mediation hearings, but the evidence was not admissible in the jury trial. However, Lichtenegger was apparently able to get his point across without the sketch.
"What the city offered was kind of ridiculous," said Eugene Kester, a juror. "If they ran it along that line, it wouldn't have caused any problems, but they went at an angle and messed up a few lots doing that."
Once the jury made its decision, the board discussed different settlement offers.
According to minutes from the closed Feb. 2, 2004, board of aldermen meeting, Ludwig recommended the city settle the first tract at $60,000 and negotiate with the Friedrichs to purchase the second tract.
Vote to settle
Baker, Lohr, and Aldermen Dale Rauh and David Reiminger voted to settle with the family, while Alderwoman Val Tuschhoff and Aldermen Larry Cunningham and Kerry Hoffman voted no. Alderman Phil Penzel was absent. The mayor vetoed the motion.
A vote was then taken on whether the city should appeal to a higher court. The motion passed 5-2, but the next day it was determined that the mayor can only veto ordinances, not motions, so the vote to settle with the family stood.
City officials say the family benefited greatly by having a sewer run through the property, an improvement that has little impact on the land. The easement was never about the money, the Friedrichs say, but about a piece of land that has belonged to the family for several generations.
The family also disputed whether the sewer should run through a site where the family thinks a slave and an American Indian were buried, but they could offer no proof. The city conducted the required historic preservation surveys. The contractor has yet to dig through the area.
The episode has been upsetting for the family.
"It helps the value of your property, and I've been for it since day one," said Jon Friedrich, Bob Friedrich's brother and part owner on both tracts of land. "But it seems like they run roughshod over the top of you."
Ludwig and Bollinger say the city went through all the proper procedures in this case and that the Friedrichs were not treated any differently than any of the other property owners whose easements were acquired for the project.