Machinery Row lawsuit

The former Case Plow Works at 615 Marquette St. is shown The City Council agreed to buy this building as part of the Machinery Row development deal. A former tenant of the building is suing the city for relocation benefits.

RACINE — The City of Racine, the Redevelopment Authority and two city officials are named in a lawsuit seeking more than $659,000 tied to relocating for a development plan previously called Machinery Row.

Patrick Fagan of Mount Pleasant filed a lawsuit in Racine County Court this week requesting compensation related to damages he said he incurred because of the city’s handling of the development plan.

Machinery Row was the name for a riverfront development project planned for the city, which was announced in 2014. The plan involved an Iowa developer’s intent to build a $65 million commercial and residential project in a 20-acre area north of Water Street and east of Marquette Street. The project did not come to fruition, and the city opted in November to pursue a new development plan in the area.

Lawsuit details

The lawsuit names four defendants: the city, the Redevelopment Authority, RDA Chairman James Spangenberg and Matthew Sadowski, the assistant director of the City Development Department.

According to the complaint in the lawsuit, Fagan was a tenant of 615 S. Marquette St., where he ran P & P Products. He alleges the city and the RDA forced him to leave the property by Dec. 30, 2015, for which he incurred expenses related to moving, loading and transporting his business equipment and materials. The RDA purchased the property while it was acquiring buildings for the Machinery Row project, records show.

Fagan argues the defendants in the case “either intentionally or negligently failed to file a relocation plan for Fagan and the subject property.”

Because of that, the complaint alleges, Fagan had to move his equipment and property four times and has not be able to unload or re-establish the business.

Between September and December this year, Fagan filed three claims with the RDA, seeking compensation for his expenses, the complaint states. Another claim is in progress.

Fagan further alleges that his constitutional rights were violated because he argues he was not treated equally to other people in similar situations he claims received relocation assistance and benefits.

Fagan requested a jury trial in the matter. He is seeking $659,418.34 related to three of his moves — plus a cost to be named attached to his fourth move — less any payments the defendants make. He also seeks damages in unnamed amounts, according to the complaint, along with reimbursement for his legal costs. In addition, Fagan wants the defendants to produce a relocation plan.

Deputy City Attorney Nicole Larsen said in an email Friday that her office is in the process of reviewing the complaint and will not comment on specific allegations. She said the city has been working with Fagan for months on his claims and continues to do so.

“Reasonable consideration will be given to Mr. Fagan’s claims, whether they are presented to the RDA or presented to the court,” she wrote. “The City and RDA will, however, protect the interests of the taxpayers and defend against unsubstantiated and unwarranted claims made by Mr. Fagan or any other party.”

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Fagan is represented in the case by Todd A. Terry of Guttormsen & Terry, a law firm in Kenosha. Terry said the defendants were obligated to help Fagan find a comparable place to relocate his machining and woodworking business.

Relocation claims partially denied

The RDA has not yet paid any relocation benefits to Fagan, the suit claims.

The body voted on Dec. 7 to deny payment toward portions of claims he filed. The RDA followed the recommendation of the City Attorney’s Office, which addressed two claims by Fagan, according to a memo.

The memo states Fagan’s supporting documentation for the claims is uncorroborated and uses a calculation that is neither supported by law nor by “usual and customary practice.” The city determined the amount to reimburse Fagan by using an estimate from a professional mover retained by a relocation specialist, the memo states.

Fagan’s second claim is related to storage expenses. The claim, according to the memo, included the cost to purchase the storage trailers on top of rental expenses. The city recommended paying only the costs of storage in the trailers over 24 months.

The City Council in November authorized setting aside $350,000 to pay for relocation claims related to the project.

State previously weighed in

Fagan’s lawsuit follows a June determination by the Wisconsin Department of Administration that the RDA acquired the property where Fagan was a tenant as part of a public project.

The DOA said at the time it appeared to have not received a relocation plan for the Machinery Row project even though people were displaced in the planning process, according to the state’s finding. A plan should have been submitted for approval, and owners and tenants should have been informed of their rights, the state found.

“Mr. Fagan should receive relocation payments, as should others who were displaced from the related properties,” the DOA stated.

In the June finding, the state encouraged Fagan and the city to work together to resolve the matter. The state issued the finding in response to a complaint Fagan filed with the DOA in May.

At the time of the finding, Larsen told The Journal Times that the city was unaware Fagan was running a business out of the property.

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Sari Lesk covers the City of Racine, Gateway and UW-Parkside. She is new to the community and moonlights as an amateur baker.

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