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The City of Columbia, South Carolina Being Sued by Developers and
 Architects for Fees after Abandoning Public Hotel Project
By John C. Drake, The State, Columbia, S.C.
Knight Ridder/Tribune Business News

Jul. 29, 2005 - A third local firm has sued the city of Columbia for backing out of plans to publicly finance a convention center hotel.

Stevens & Wilkinson, the architectural firm that drew up the plans for a 300-room Hilton hotel, wants $1.3 million from the city. The city already faces a $2.1 million lawsuit filed in March by Gary Realty and Garfield Traub Development, members of the local team that worked on the public deal.

The city decided in March 2004 to seek private proposals for a convention center hotel in response to mounting public criticism of its plan to make taxpayers liable for $69.9 million in bonds for hotel construction. The city chose Windsor/Aughtry Co. of Greenville.

But the firms suing the city say that decision does not release the city of an obligation to pay for work done up to that point.

The city paid Stevens & Wilkinson $700,000 in 2003 to continue work on the project. That payment is cited in both lawsuits as proof the city should pay for all of the work the firms did.

"(The city) asked them to go forward with a number of things, and they were paid for a portion of that," said Dick Harpootlian, attorney for Stevens & Wilkinson. "They continued that work and have not been paid for that."

In April, the firm filed a "mechanic's lien" against the city's Vista property planned for the hotel. Such a lien is filed by a company that has not been paid for improvements to a property.

Stevens & Wilkinson is asking that the property be sold and revenue from the sale be used to pay off the debt.

Steve Gantt, senior assistant city manager, said a company cannot place a mechanic's lien on public property. He said the city has not contested the lien; he also said the lien is not delaying progress on the city's negotiations with Windsor/Aughtry.

Stevens & Wilkinson's lawsuit also claims the city never informed the firm it was abandoning the public hotel project.

"They've never been directed to cease working," Harpootlian said. "There was no vote by City Council to stop working on the project."

Gantt said he is not sure whether Stevens & Wilkinson was informed directly, but he said the city's intentions were well known. "They would have had to be on another planet not to know we ceased and desisted on that," he said.

Columbia Mayor Bob Coble also pointed out that Stevens & Wilkinson was a member of a reconstituted hotel development team that submitted a proposal for a private hotel after the public project was abandoned.

The city has yet to file a formal response to either lawsuit. Attorneys for Gary Realty and Garfield Traub have filed an amended complaint in circuit court because the city said the initial complaint was not specific enough. The city still has several weeks before it must respond to the Stevens & Wilkinson lawsuit.

Coble said the lawsuits have had no effect on the city's negotiations with Windsor/Aughtry.

"I don't think the issues in getting that project going have anything to do with a lawsuit," he said. "It's a matter of getting the cost to where, as a private sector deal, it can move forward."

Developer Bo Aughtry said last month his 222-room Hilton Hotel would cost $3 million to $5 million more than planned. Aughtry said he still was negotiating with contractors to make that project economically feasible. He still hopes to begin construction in August.

The city has committed to a $3 million cash subsidy for the private hotel deal.

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To see more of The State, or to subscribe to the newspaper, go to http://www.thestate.com.

Copyright (c) 2005, The State, Columbia, S.C.

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