JOLIET – The city of Joliet would likely be forced to pay $7 million in additional court costs if it decides not to buy Evergreen Terrace, City Manager Jim Hock said Friday.
And there could be additional court-imposed costs, Hock said.
As the City Council prepares for a special meeting at 6 p.m. Monday on the Evergreen Terrace question, it is still getting information needed to decide whether to buy or not to buy the low-income housing complex over which Joliet won eminent domain after a 10-year legal battle with the owners.
Since the court victory, the city has done some of its first serious numbers-crunching on the potential costs of ownership at the insistence of new Mayor Bob O’Dekirk.
City officials are not clear yet on what it would cost to own, manage and redevelop Evergreen Terrace. But proposals submitted so far from consultant Holsten Real Estate Development and Management Corp. have indicated it could take as much as $70 million in city funds.
Holsten will be at the meeting to explain four potential ownership plans it has developed, including one to leave Evergreen Terrace as is.
Just how murky the outlook has been until now was indicated at a council meeting last week when Hock was asked what would happen if the city did not buy Evergreen Terrace after the lengthy and expensive court fight.
“I don’t know,” Hock answered.
Hock said Friday he did not want to give a wrong answer before consulting with lawyers. Since the Tuesday meeting, he said, he has been told there would be costs for walking away.
“It would be considered abandonment and would cost $7 million in legal fees, and there could be more,” Hock said.
The legal fees would be what Evergreen Terrace owners have paid to try to fight off the city’s takeover effort in court. If there are more costs, they could come if the court decides to impose penalties on Joliet to cover other costs in the legal battle.
If the city moves ahead with the acquisition, Joliet faces a Sept. 1 deadline to pay the $15 million price set by a federal jury. Hock has told the council that the city would get the $15 million out of its reserve funds.
City officials, however, are looking to Holsten to show them a way to take ownership of Evergreen Terrace with a plan that Joliet can afford.
Holsten previously developed two plans showing the city paying between $11 million and $70 million depending on how much redevelopment would be done at the 356-unit apartment complex. The company last week submitted two more plans, which indicate a net income off the property but do not appear to account for all the costs.
“I’ll remain open-minded,” O’Dekirk said when asked what he thought about the latest plans. “We’ve got to see our way out of this. But I don’t know if we’ve seen the right proposal yet.”