Monthly Archives: January 2023

In the Demolition Zone, January 2023, Project Pascalis 2022

Aiken City Council Stumbles on AMDC

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Council Calls Special Meeting to Vote on Future of its Municipal Development Commission Three Days After Dropping Agenda Item.

by Don Moniak

January 12, 2023

Aiken City Council announced today a “Special Meeting” for Tuesday, January 17th (1) at 5 p.m. to consider “an ordinance amending Section 11-2 of the Aiken City Code regarding the membership of the (Aiken) Municipal Development Commission.” (AMDC) The proposed re-organization of the AMDC involves returning it to its original composition of six appointees and three ex-officio voting members from City Council. That structure was amended in September 2020 after then ex-officio members Ed Woltz, Ed Girardeau, and Lessie Price chose to abstain from voting on issues that could arise during Council business.(2)

At least five of the nine commission members are required to be present to conduct business.  The commission officially holds title to ten properties, including the seven properties in the Project Pascalis demolition and redevelopment proposal. The absence of a quorum and inability to act leaves the future of these properties highly uncertain.

The nine-member AMDC was reduced to six members in June 2022, after three members were found to reside outside of the City—a violation of AMDC membership requirements defined in City code.  The commission was further reduced to two members after protest resignations in early December by Keith Wood and Chris Verenes; which were followed by resignations from David Jameson and Doug Slaughter. (Slaughter had also missed four of the six regular AMDC meetings in 2022, which warranted automatic removal under city code; making his resignation more symbolic than real.)

As reported on January 7th, in Pascalis Properties on Aiken City Council’s Closed Door Agenda, “placing three ex-officio voting members from City Council onto the AMDC would provide the necessary quorum for the commission to publicly meet, conduct business, and act to sell the property to the City of Aiken.” Councilman Ed Girardeau, who proposed the ordinance (3), appeared to confirm this motive when he told the Aiken Standard:

“Since we have only two members left, we need to complete some business for the Commission and the easiest way to move forward is to have three members to have a quorum.” 

The vote Monday night to drop the AMDC ordinance from the agenda was expected to be unanimous, but Councilwoman Andrea Gregory silently dissented. At the three minute mark of the meeting, Councilman Ed Woltz introduced a motion to change the agenda, without explanation or a description of the agenda item in question:

Councilman Ed Woltz: “Everything stands on that agenda with the exception of item number four we will be pulling item number four on our new business and with that change I will make a motion for approval. 

Mayor Rick Osbon: Very good thank you sir. We have a motion. Is there a second? (Councilwoman Price seconds). We have a motion. All those in favor of the agenda with item number four in our new business pulled please raise your hand and that’s unanimous thank you oh no. 

It’s not all all right. Uh, that’s um it’s all in favor …Councilman Woltz, Councilwoman Price, the Mayor, Councilwoman Diggs, Councilwoman Brohl, and Councilman Girardeau. All those opposed. Okay Councilwoman Gregory. The motion carries.” (2)

The next day, Councilwoman Gregory broke her silence and shared her thoughts with the Aiken Standard, stating that it was time to move forward and quit debating the issue: 

“We just need everybody to agree this just doesn’t work. It needs to get dissolved. We need to assume the properties under the city and we need to move forward.’” 

She reportedly added that “dissolving the AMDC is what the community wants,” probably referring to the fact that more than 3,000 signatures have been acquired for a petition that seeks, in part, to abolish the AMDC. If so, it was a departure from previous positions, as just three months ago Gregory described opponents to Project Pascalis as a “very small group” to the Aiken Standard; and referred to the litany of legal violations as “hiccups.”

But the future of the AMDC goes beyond the Pascalis properties to which it owns title. The commission also owns three properties on Williamsburg Street across from the Farmer’s Market, known as the Jackson Petroleum property, which it purchased in March, 2021, for $175,000.  Since that time the commission has sought to redevelop them into multi-family housing as part of the Williamsburg Street redevelopment effort. 

Like Project Pascalis, the Williamsburg Street effort lacks a redevelopment plan that was subjected to a public hearing and approved by City Council; and there has been no publicly advertised RFP for sale and redevelopment. 

The Williamsburg Street properties further complicate the AMDC’s future due to potential conflict of interests held by City Council members Ed Woltz and Ed Girardeau. Mr. Girardeau is the Broker/Owner for the Re-Max/Tattersall Group, which listed the property and represented the seller during negotiations with the AMDC.

Jackson Petroleum Property before sale to AMDC. Photo by Kelly Cornelius

Mr. Woltz owns the neighboring properties where he operates Sutton Marine. Both have recused themselves in the past two years from discussion and voting on Williamsburg Street issues. 

Mayor Osbon recused himself from discussion of the Pascalis properties on December 12, 2022, due to the presence of Warneke’s Cleaners—which competes with Osbon Cleaners—as one of the properties. The AMDC is also presently Warneke’s Cleaners’ landlord.

Tuesday’s meeting, at 5 p.m. in City Council chambers at 111 Chesterfield Street, is open to the public and citizens comments of up to five minutes per speaker will be accepted. 

January 13, 2023: Aiken City Council Revises AMDC Ordinance


Footnotes

(1) The meeting annoucement:

(2) The meeting minutes for the AMDC’s August 4, 2020 meeting state:

“The Commission came out of executive session and continued discussion on the Hotel Aiken and the concerns about the condition of the building and how it affects looks of the downtown.

Mr. Gillam stated he would like to make a motion that a letter be addressed to City Council with the recommendation that the city address the owner of the Aiken Hotel with the request that the hotel be brought up to the building standards, and also request Council to remove the hotel from the Aiken Historic Register as an historic building. The motion was seconded by Mr. Wood.

The Commission discussed the motion. Mr. Dangerfield stated the motion is that the Municipal Development Commission write a letter to City Council asking them to take the Aiken Hotel off the Aiken Historic Register and address the condition of the Aiken Hotel and its renovation.
After discussion it was noted that the three Councilmembers would abstain from voting because they felt it might be a conflict of interest.

Also, Mr. Verenes stated he would abstain from voting because he has a conflict of interest. It was pointed out that one member was absent so with four members abstaining from voting, that would only leave four members to vote on the motion and a favorable motion would require the vote of five members in favor of a motion.”

At their next meeting, the AMDC passed a motion to recommend changing the commission membership to nine appointees.

The August 4, 2020 Executive Session was arguably illegal. There are no exemptions in SC FOIA’s Open Meeting rules that allow a closed-door session merely to discuss the condition of a building and the city’s building codes.

By the end of September, 2020, Mr. Dangerfield had resigned from the AMDC because he already was a member of another public body, and therefore was not legally qualified to hold a position on the commmission.

(3) The proposed ordinance amendment as it appeared in the January 9, 2023, City Council meeting agenda packet.



City Government, In the Demolition Zone, January 2023

Pascalis Properties on Aiken City Council’s Closed-Door Agenda?

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by Don Moniak

January 7, 2022

Aiken City Council is scheduled to meet in closed-door Executive Session prior to its regular public meeting on Monday, January 9, 2022. A “potential purchase of real property located in downtown Aiken” is the first item on the Executive Session agenda. (1)

Based on the following information, the downtown property in question is believed to be the seven properties owned by the Aiken Municipal Development Commission (AMDC) that collectively formed the basis for the commission’s second Project Pascalis effort; and which were referenced in the singular tense as “The Property” in the commission’s cancelled Purchase and Sale Agreement with RPM Development Partners, LLC.

1. For the second consecutive Council meeting, a planned, closed-door Executive Session will feature these identical items:

  • “Potential purchase of real property located in downtown Aiken.
  • A proposed contractual arrangement to lease property in downtown Aiken. “(2)

The previous discussion occurred prior to Council’s December 12, 2022, regular public meeting.

2. According to draft meeting minutes, the following attendees reportedly attended the two-hour long session on December 12th:

  • Councilmembers Kay Brohl, Gail Diggs, Ed Girardeau, Andrea Gregory, Lessie Price and Ed Woltz.
  • City Manager Stuart Bedenbaugh, City Attorney Gary Smith, City Clark Sara Ridout, Assistant City Manager Mary Tilton, AMDC member David Jameson, Attorney Daniel Plyler, City Economic Development Director Tim O’Briant, AMDC Ex-Officio member and Aiken Corporation CEO Buzz Rich; and Dr. Vahid Majidi and Sharon Marra of the Savannah River National Laboratory.

3. Aiken Mayor Rick Osbon recused himself from the December 12th proceeding: 

“Mayor Osbon recused himself from participating in the executive session discussion because the discussion may involve one of his direct economic competitors.”  (Page 7)

Rick Osbon co-owns and operates Osbon Dry Cleaners on Pendleton Street in downtown Aiken. Their only competitor in the downtown area is Warneke’s Cleaners on Newberry Street. Warneke’s Cleaners is on one of seven properties purchased by the AMDC in November, 2021, to become part of the proposed Project Pascalis demolition and redevelopment zone. The properties are owned by the AMDC, but acquired with a $9.6 million grant from City Council from borrowed taxpayer funds.

4. David Jameson resigned from the AMDC two days later, on December 14th, and began his resignation letter by writing:

“Thank you for allowing me to hear the legal briefing concerning the mechanics of the Aiken Municipal Development Commission (AMDC) Monday night. My understanding is that the Commission’s ability to function is being held hostage by our bylaws—essentially the quorum issue. With our current membership of three, we can meet but we cannot act.” 

5. During the public comment period for non-agenda items, Historic Aiken Foundation President Linda Johnson offered the following comments and questions:

“Partly because of some past events, Historic Aiken Foundation is especially interested anytime anything comes up about downtown.  So I understand that buying properties is something that you really have to talk about in executive session, but I was wondering is there anything you can share about what property this is, what you’re planning to do with it, and what’s going on with this potential purchase?” (22:30 mark of Meeting)

Aiken City Attorney Gary Smith—who has apparently chosen to stop recusing himself from the Pascalis process since the reported project “cancellation” by the AMDC— responded:

“The properties are located downtown, that’s really all we can tell you at this point. Before city council can do anything with acquiring the property there would have to be a public discussion. There would have to be a notice given to everybody and so you will get that information if that transaction actually goes forward.”

In response to a related followup question (3), Smith further stated:

I think that’d be fair to say the the transaction is such that all of the parties involved aren’t prepared for the public to be aware of what the transaction is. That’s why City Council is not allowed to discuss it at this point, okay, whereas a year ago both parties were there at the table.”

As described in Jameston’s resignation letter, the AMDC is currently not prepared for the public because it lacks a quorum. Since the AMDC technically owns the properties, City Council might believe the commission must be prepared to act on any sale of the properties.

6. Item #4 under new business for Council’s regular January 9th meeting is the “First Reading of an Ordinance Regarding the Membership of the Municipal Development Commission:”

According to the supporting memorandum from City Manager Stuart Bedenbaugh:

“Councilmember Girardeau has asked to bring forth an ordinance amending the membership section, which would have three of the nine-member board be City Council members serving as voting ex-officio members. Six members would continue to be citizens of the City of Aiken appointed by Aiken City Council. For Council consideration is an ordinance amending Section 11-2 of the Aiken City Code regarding the membership of the Aiken Municipal Development Commission.”

Placing three ex-officio voting members from City Council onto the AMDC would provide the necessary quorum for the commission to publicly meet, conduct business, and act to sell the property to the City of Aiken. Whether Council plans to dissolve the commission after such an actios—as suggested in AMDC member Doug Slaughter’s resignation letter—or maintain the latest proposed form of the AMDC is unknown.

The January 9th meeting will be City Council’s the eighth closed-door session (4) involving Project Pascalis since June 1, 2022. These were not all legal briefings. For example, on June 13 Council met with the developers—under the pretext of an Open Meetings exemption—to hear from them as a group for the first time, a lack of governmental oversight identified by Ed Woltz on May 9, 2022:

 “I would like to have a meeting with the builders for the project. Council as a whole has not done that. Some people individually have. The Mayor had spoken to them more than once, but as a Council we have not talked to the builder.”

With the exception of the repeal of the Newberry Street privatization ordinance, Aiken City Council has not held a public discussion regarding the Pascalis project or the AMDC properties since May 9, 2022. Even though it is increasingly evident that transfer of the properties from AMDC control to City of Aiken control is being contemplated and perhaps moving forward, Aiken City Council is choosing to continue its policies of secrecy and obfuscation even as it attempts to clean up after its $100 million plus Pascalis project failed; a failure due in part to a penchant for secrecy.

7:10 p.m. on December 12, 2022 when Aiken City Council closed-door meeting ran late.


For followup story, see January 12, 2023, Aiken City Council Stumbles on AMDC

Footnotes:


(1) The Executive Session Announcement:

2) The “proposed contractual arrangement to lease in downtown Aiken” likely involves a lease of City property to the Savannah River National Laboratory—possibly the former Municipal Building at 214 Park Avenue. This is based on the fact that December 12, 2022, Executive Session attendees included Dr. Vahid Majidi and Sharon Marra, who are the Director and Deputy Director of Operations, respectively, at the lab.

This appears to be the latest step towards an even stronger presence of Savannah River Site contractors in downtown Aiken, this time as part of an “Innovation District.” This began with the AECOM plan, which was referenced in Mayor Rick Osbon’s December 20, 2020 letter to Aiken County Council and the Aiken County legislative delegation. In his letter, Osbon included a $20 million request from Plutonium Settlement funds for an “Innovation District that involves the Department of Energy and USC-Aiken:

The Aiken Innovation and Impact District: The AECOM study released in December discussed catalytic investments to establish an innovative district near USC Aiken. This would be an opportunity to foster the clustering of businesses related to advanced manufacturing, software/ information technology and take advantage of synergies in the region. The district would be mixed use in nature, providing access to retail, dining, housing and other amenities, in support of new research and production facilities operated by the private sector/ universities.

The Aiken Innovation and Impact District would include a partnership with the U.S. Department of Energy Advanced Manufacturing Collaborative, the South Carolina National Guard Dream Port, and USC Aiken. The growth and success of the original partners will create opportunities for new public and private partnerships over time. In a rich, collaborative environment, businesses, entrepreneurs, investors, researchers, students and residents alike would be inspired to connect more, engage more and create more. The vision would be to recharge Aikens economy by attracting technologyand innovation-based companies. $20M is needed.

In December 2021, the AMDC and SRNL began discussions on locations with SRNL for a portion of an “Innovation Park.”

In June 2022, disbursement of the plutonium settlement was finalized and included $20 million for “Offsite Infrastructure SRS/National Laboratory” (Innovation District), and $10 million for the National Guard “Dream Port” cybercommand scheduled to be relocated from Columbia and expanded to network with cyber-defense capabilities at Fort Gordon.

Around the same time, a Ground Lease Survey Appraisal was completed for 214 Park Avenue that determined a long-term ground lease value of $2 million for the property. While the appraisal appears to have been commissioned to determine a price for leasing the facility to Newberry Hall after conversion to a conference center, it also could be applied to any other interested party with $20 million in plutonium funds.

At its last public meeting on June 13, 2022, the AMDC discussed locating the Innovation District downtown. According to the meeting minutes:

“Mr. Jameson stated he is the chairman of the Innovation District Committee. In the last few months the committee has met several times. It was to do research about what an Innovation District could and should look like and to understand how to move forward. He pointed out a request had been made for funds from the Plutonium Settlement to support the Innovation District and $20 million had been allocated for it. He said the committee began the conversations with where should we begin. Where should a building be located? What would make it the most successful? What would be the best location? They talked about the University area and downtown. The conclusion was that downtown Aiken would be the best location for the building. In collaboration with the center at USC-Aiken and the Site, there could be some permanent crew or revolving office crew in the downtown.”

  1. (3) At the 24 minute mark of the meeting, Don Moniak commented: 

“The Freedom of Information Act does say you may release information and you may discuss information in public as well. So what what is the big secret about this particular property, whereas a year ago at this time… there was another piece of property downtown that the city was considering selling. It was the Brinkley building, part of the Old City Hall, and you did meet an executive session to discuss it. But that was on the agenda as well as a Purchase and Sale agreement associated with that. Was it just further was along at that point? Why was that public but this one not public?” 

Gary Smith: “ I think that’d be fair to say the the transaction is such that all of the parties involved aren’t prepared for the public to be aware of what the transaction is. That’s why City Council is not allowed to discuss it at this point, okay, whereas a year ago both parties were there at the table.” 

The parties at the table for the Brinkley building included Smith’s law partner Ray Massey. Smith did not recuse himself from that meeting involving the sale of city property at a financial loss to CTR, LLC, a company represented by, and invested in, by Massey. In the Blake et al vs City of Aiken et al lawsuit, this incident is described as follows:

“The CTR Sale was documented in a fully negotiated Purchase and Sale agreement dated December 21, 2021, initialed on every page by, and signed by, Ray Massey and ready for City signatures. The Ordinance had signature blocks for Rick Osbon as Mayor, Gary Smith as City attorney, and Sara Ridout as City Clerk.”

As noted in The Pascalis Attorneys, members of the law firm of Smith, Massey, Brodie, Guynn, and Mayes were involved in early 2021 with Project Pascalis property acquisition efforts on behalf of Weldon Wyatt’s WTC Investment, LLC; and Ray Massey’s Aiken Alley Holdings, LLC owns property that was involved in both Pascalis efforts.

(4) Aiken City Council has met in closed-door Executive Session to discuss Project Pascalis on the following dates in 2022:

June 13, in a joint session with the AMDC and the Pascalis project developers for two hours.
June 27 for one hour.
July 11 for two hours with Attorney Daniel Plyler to receive legal advice following the filing of the the Blake et al vs City of Aiken et al lawsuit.
October 10 for 1.5 hours to receive legal advice.
October 24 for one hour to receive legal advice.
November 21 for nearly two hours with the AMDC.
December 12 for two hours to discuss “purchase of downtown property” and a lease of property.





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City Government, City Parks and Recreation, January 2023

Fencing After the Fact

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How the Absence of an Inexpensive Safety Fence Led to a $250,000 Payout by the City of Aiken


by Don Moniak

January 2, 2023

On the afternoon of July 2, 2019, with temperatures in the mid 90’s (F), an eighteen month old child under the care of her mother stepped onto a grated metal hatch covering a mechanical equipment vault that sits ten to twelve feet away from the Splash Pad at the City of Aiken’s Citizens Park. The child suffered second degree burns on both feet.

Burn injury photos submitted in January 29, 2021 Court of Common Pleas complaint.



In a personal injury lawsuit filed January 29, 2021, on behalf of the minor child and mother, as guardian, Lexington Attorney Melissa Mosier wrote that the mother:

“turned around to check on the other two children with her at the splashpad when she heard a child cry out, and turned back to find her daughter H.N.P.M just a few feet away, standing on the metal hatch screaming. She ran to her child, who was stunned and crying out in agony, and a crowd gathered to try to assist this mother and child.

H.N.P.M. sustained serious injuries, including second degree burns (blistered burns) on the bottoms of both of her feet. This required her to be placed under general anathesia in an attempt to repair her wounds. See photographs of H.N.P.M.’s feet, noting the grate pattern.”

The claims made in the initial complaint included:

  • It was foreseeable that a child would wander to the nearby mechanical system and hatch, which posed “an attractive nuisance for children.” 
  • The City of Aiken took no steps to “keep children away, protect them, or advise their parents of the dangers posed by the equipment vault or the hot metal surface concealing the mechanical equipment.”
  • “The City was on actual notice of the particular hazard posed by the unguarded and un protected equipment fault by virtue of a prior burn injury at the park – and despite this it failed to take any steps whatsoever to remedy the danger or even warn against it.”

In regard to the prior injury, Mosier contended the city was negligent for violating “its duty of reasonable care to fix known defects and hazardous conditions within a reasonable amount of time after notice;” and that the cost of fencing the hazard would be less than $1,000. That amounts to about 1/400th of the Splashpad site’s insured value. (1)

At the time, as seen in the photo below, there was no fenced area within the fenced splash-pad and grassy area. The metal hatch covering splash pad equipment, another grate, and an electrical juncture box had no signs indicating them as hazards, were not fenced separately, and were a part of the play area.

Citizen’s Park Splash Pad. Circled area shows location of metal grates in play area. (Photo from Google Earth)

In the response on behalf of the City of Aiken, Columbia attorney Daniel Plyler either denied all allegations or demanded more information; and offered a total of sixteen defenses. These included a standard, generic defense asserting full negligence by the mother, as well as Plyler’s standard “Fifth Defense” for personal injury negligence complaints against the city, the “natural disease process:”

“Defendant would allege, upon information and belief, that any injuries or damages sustained by Plaintiff were due to and caused by the natural disease process over which Defendant had no control and, as such, Defendant pleads such a natural disease process as a complete bar to this action.” (1)

In August, 2021, Plyler filed a Motion to Compel a response to submitted discovery requests regarding the mother’s life and work history, whether she had “ever received counseling or treatment for alcohol or drug addiction or use,” or used social media.

In October, 2021, Mosier answered with another Motion to Compel to answer Plaintiff’s discovery requests. Sometime between the lawsuit being filed and the latter Motion to Compel, the City’s Parks and Recreation Department had opted to fence the hazards that were in dispute, leading to question 21:

When was the fencing installed around the metal grate and who directed the installation of the fence?

Citizen’s Park Splash Pad with added interior fence around play area hazards. (Photo: Don Moniak)



On February 22, 2022, Second District State Circuit Court Judge Courtney Clyburn Pope issued a settlement order granting a Petition for Approval of Minor Settlement filed by Mosier. The petition stated:

“The City of Aiken denies any liability for the injuries but, through its insurance carrier, the South Carolina Municipal Insurance and Risk Financing Fund, respectively, proposes to compromise and settle the claims. The terms of the settlement of the sum of One Hundred and Seventy-Five Thousand Dollars ($175,000).”

The terms of the settlement involved a “payment directed to Independent Assignment Company for payment of periodic payments upon the minor child reaching maturity.”

The settlement also required the city to pay attorney fees:

“IT IS FURTHER ORDERED that attorneys’ fees of $70,000.00 and the costs incurred in handling this action are reasonable, and they are hereby approved.”

In total, the City of Aiken and its insurance fund paid out $245,000 for a settlement and for Plaintiff attorney costs. The cost of the city’s defense is presently unknown. The accident that led to the settlement was avoidable and preventable, but no action was taken to mitigate safety risks until after a lawsuit was filed. The settlement that may have doubled the city’s liability costs (3) over a one year period was not reported in Aiken’s newspaper of record.

Footnotes

(1) The Splashpad’s insured value, including the restroom, is $405,410. the City pays an annual insurance premium of $636 for the facility that includes liability coverage.

From City of Aiken 2022 Coverage Contract With the SC Municipal Insurance and Risk Financing Fund


(2) Thirteen of the defenses were generic in nature, word for word identical to the defense made in 2021 to another lawsuit involving a child’s injury at Virginia Acres park in 2019. In that case, a minor child fell over an electrical box and sustained unidentified injuries. The case was dismissed in February, 2022; and no settlement was noted in the available court records.

The same set of generic defenses were also made in the case of another personal injury/premises liability lawsuit against the city and SC Dot involving an adult who suffered an injury on Boardman Road.

(3) In terms of liability, according to the The City of Aiken Annual Comprehensive Financial Report for Fiscal Year Ended June 2022, the city “participates in two self-insurance plans whereby the self-insurance funds from other members of South Carolina  local governments are pooled together for investment and administrative purposes. These pools  accumulate assets and assume risks for the following: 
1. Property and liability coverage with a limit of liability for the pool of one million dollars.” (Pages 83-84)

From City of Aiken Annual Financial Report for Fiscal Year Ending June 30, 2022.



The report also described litigation as a contingency in the budget, but did not address any underlying safety culture issues that might contribute to liability claims:

“The City is involved in several pending lawsuits. Liability, if any, which might result from these proceedings, would not, in the opinion of management and legal counsel, have a material adverse effect on the financial position of the City.”