Tag: mark brown

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No emergency: Judge rejects parking center petition for special receiver

After a judge denies the Charlottesville Parking Center’s petition for a third party to run the garage, CPC general manager Dave Norris says there are much bigger challenges facing parking downtown than one garage. Staff photo

A judge heard Charlottesville Parking Center’s emergency petition to appoint a receiver to run the Water Street Garage June 27, three days before the parking center’s contract with the city expired, and he concluded such a move wasn’t justified.

“This is an emergency of your own making,” said Judge Rick Moore in Charlottesville Circuit Court. “I don’t think there’s a compelling need for the court to intervene.”

The Water Street Parking Garage Condominium Association, the organization that owns the garage, has been deadlocked since late last year when its board, with four seats controlled by the city and four by the Mark Brown-owned CPC, was unable to approve a budget with the higher rates desired by Brown, and has operated without a budget since December 31.

CPC’s own agreement to manage the Water Street Garage expires June 30. “We are standing at the precipice of July 1,” said CPC attorney Christopher Malone.

The city, represented by Richmond attorney Tom Wolf, said the garage had been operating just fine the past six months, the city had okayed expenses, and there was no emergency and no evidence of irreparable harm.

Wolf said the Water Street Parking Garage Condominium Association’s articles of incorporation say owners do “not contemplate pecuniary gain or profit to the members.” Brown testified the city earned $596,000 in profit last year from the garage.

“We’re not saying there’s no profit,” said Wolf. “We’re saying the purpose is not to maximize profit.”

Brown testified he did not accept a city offer to implement the rate increase he wanted over years, instead of in 2016. “It was not acceptable,” said Brown, who has filed suit against the city contending he’s being forced to operate parking at below-market rates.

According to Wolf, Brown’s lawsuit is based on the “bogus theory” the city and CPC were involved in a joint venture and the city was breaching its fiduciary duty by not trying to maximize profits from the garage.

And while Brown, as a condo owner, has a fiduciary responsibility to keep the garage open, said Wolf, there were plenty of other companies that could manage the garage. “It’s not rocket science to run a garage,” he said. Ironically, the city earlier had challenged former mayor Dave Norris’ qualifications to become the parking center’s general manager.

The hearing came after the Downtown Business Association of Charlottesville sent a letter June 23 asking the city and Brown to knock off the “extreme threats” like eminent domain and closing the garage.

The next day, Norris sent a letter to the city offering a resolution in which the city could set whatever parking rates it wished—as long as it compensated CPC for lost revenues resulting from rates “lower than what the market would reasonably bear.”

City Councilor Bob Fenwick said that’s an offer the city has seen before. “That was old news repackaged,” he said after the hearing.

Also present at the latest parking wars skirmish were Susan Payne and Joan Fenwick, who rallied downtown businesses to petition City Council to not sell its shares in the garage to Brown.

susanPayneCraigBrown
Susan Payne and City Attorney Craig Brown after the city prevails in court. Staff photo

Up until a June 2 meeting hosted by the Downtown Business Association of Charlottesville at Violet Crown with 60 riled attendees, Norris says he thought the city and CPC were on the verge of a settlement. “Mark and CPC agreed to all of the conditions the city set forth,” including maintaining the validation system, honoring the monthly parking contracts in place and maintaining his ownership in the garage until the ground lease expires in 2024, says Norris.

The city offered to sell its 629 spaces in the garage for $10 million. CPC offered the appraised value of around $4 million plus a 20 percent premium, says Norris.

According to Norris, Mayor Mike Signer asked Brown to not send representation to the meeting. “He specifically asked Mark Brown to pull me from the meeting,” says Norris. He didn’t go, he says, “as a good-faith gesture because we believed the basic terms had been reached,” a decision he now calls a mistake.

Signer referred a request for comment to the city’s attorney. Wolf said he was not at that meeting.

Wolf also disputes that they were near a settlement. “Absolutely not the case,” he says. “There was absolutely no indication that we think this is a good offer we were inclined to take.” Had Brown offered the $10 million the city wanted, “that would have been a good offer,” says the attorney.

Instead, a “spooked” City Council voted June 6 to offer to buy out Brown’s spaces in the garage, a surprise move to CPC, according to Norris. “Basically it’s a story of how the city snatched defeat from the jaws of victory.”

Along with a June 8 offer to buy CPC’s share was a threat that if CPC didn’t sell, the city would begin eminent domain proceedings.

In a phone call June 24, Wolf backed off that. “The city has not irrevocably committed to eminent domain,” he says. “All we said is we were going to take the first steps.”

Fenton says she thinks eminent domain is a reasonable solution “once Mark Brown said he was going to shut down the garage.”

However, not everyone supports what Norris calls the “nuclear option” to settle the parking rate dispute. Says Charlottesville Regional Chamber of Commerce President Timothy Hulbert, “Eminent domain is a hammer that isn’t necessary.”

The next round in the ongoing saga is June 30, when the deadlocked Water Street condo association meets to make a plan to run the garage. Stay tuned.

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DBAC urges city and parking center to knock off bully tactics

Former mayor Dave Norris urges the city to stop kicking the can forward and resolve the Water Street Parking Garage morass once and for all. Staff photo

The Downtown Business Association of Charlottesville sent a letter to city councilors and Charlottesville Parking Center owner Mark Brown today requesting the city and the CPC “reach a quick agreement on the parking stalemate” over the Water Street Garage and withdraw “extreme threats” such as eminent domain and closing the garage.

Mary Beth Schellhammer wrote on behalf of the DBAC board of directors to ask the city and Brown to consider the “significant impact the lack of resolution is having on the image of downtown Charlottesville.”

An impasse over parking rates at the garage, jointly owned by the city and Brown, has escalated to lawsuits, with the city saying last week it had begun the condemnation process on the garage for eminent domain, while Brown filed to have an emergency receivership appointed to run the garage.

“I think this is a very welcome development,” says Dave Norris, CPC general manager and a former mayor of Charlottesville. “Anytime government threatens eminent domain, it really is pushing a nuclear button.”

Two weeks ago, members of the DBAC were circulating petitions urging the city not to sell its shares in the garage at the same time the parking center said it was on the verge of a settlement with the city. At the June 6 City Council meeting, councilors passed a surprise resolution to buy Brown’s shares of the garage.

“The consistent theme is DBAC communicating they want to see this matter resolved,” says Norris. “They want to be able to preserve affordable parking downtown. That’s their bottom line.”

Norris says he thinks some DBAC members were uncomfortable with the city’s threat to use eminent domain against fellow business owners. “If you read between the lines, they’re saying don’t use eminent domain in our name,” he says.

“The letter is not going back on anything we’ve said,” says Schellhammer. “Time is critical. We’re stressing to the city and Mark Brown not to let this drag on.” If a receiver is appointed to manage the garage, “this could go on for three, four, five years,” she says.

As for eminent domain, she says she doesn’t know that’s needed and there’s room for everyone downtown. “I believe Mark Brown deserves to own a business and be profitable. The city deserves to be able to provide affordable parking.”

The escalating dispute, she says, “is a bully fight.”

The Charlottesville Regional Chamber of Commerce also wants the city and CPC to negotiate a settlement. “Eminent domain is a hammer that isn’t necessary,” says its president, Timothy Hulbert.

Read the DBAC letter to Mark Brown and city councilors

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City lawyer: Condemnation of Water Street Garage has begun

Attorney Tom Wolf explains how the city is moving forward to condemn the Water Street Parking Garage. Staff photo

How many lawyers does it take to schedule a hearing? Well, if it has anything to do with the highly contentious battle between the city and Mark Brown’s Charlottesville Parking Center, that would be five attorneys in Charlottesville Circuit Court today to set a date for CPC’s petition for the appointment of an emergency receiver. During the hearing, the city’s lawyer from Richmond, Tom Wolf, told the judge the city had begun the condemnation process of the Water Street Parking Garage.

“We’re moving forward with the condemnation,” said Wolf outside the courthouse. That process involves getting an appraisal, making an offer and filing suit—not to be confused with the suit against CPC the city has already filed.

A June 22 hearing on the emergency receivership had been canceled, and CPC filed a motion claiming the city’s counsel falsely said that change of date was mutually agreeable to all parties. Judge Rick Moore said he was concerned with the representation that rescheduling was okay with everyone. “I don’t want that to happen,” he said.

Wolf blamed an assistant for the error.

The parking center’s attorney, Will Prince, said he was not required to give notice to all parties because of the emergency situation, with CPC’s management agreement to run the Water Street Garage expiring June 30. At that point, management of the garage reverts to the deadlocked Water Street Parking Garage Condominium Association, with its board evenly split between the city and CPC.

“It’s not an emergency,” said Wolf, who said the garage was an ongoing business and the city objected to appointing a stranger to run it.

“It’s not going anywhere,” observed Moore. He said that he wanted to hear from all parties to make an informed decision.

Ty Grisham represents the deadlocked condo association. “We’re in an untenable situation,” he said “It’s difficult for the association to have a position. We urge the court to consider all the concerns about timing.” He noted that the condo association board has to approve a management company. “Because of the stalemate, that’s not going to happen,” he said.

Prince said he had a problem with Wolf’s characterization of CPC “walking off the job,” and said the city had threatened to sue if CPC tried to close the garage. “CPC wants the garage to stay open,” he said.

Brown was not in court, but new CPC general manager Dave Norris was. Earlier today he called the city’s plan to take the parking garage “an egregious abuse of eminent domain power.”

For more on parking garage battle, read this week’s story, “Escalation Clause: City threatens eminent domain of Water Street Garage.”

cpc response to rescheduling 6-14-16

 

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Escalation clause: City threatens eminent domain of Water Street Garage

The city could attempt to end its public/private marriage in hell with Mark Brown with eminent domain, a divorce surely headed to court. Photo: Matteus Frankovich/SkycladAP

In this week’s episode of Charlottesville v. Mark Brown over the Water Street Parking Garage, the city makes an offer to buy Brown’s shares of the garage. If he declines, it plans to initiate eminent domain proceedings, according to the city’s outside attorney.

“For months Mark Brown has been trying to bully the City into giving him control of the Water Street Parking Garage,” says Tom Wolf with LeClairRyan in Richmond in an e-mail. “He has even threatened to close down the garage, which he has no power or authority to do. Mr. Brown’s first lawsuit was meritless and this new one is a transparent attempt at further bullying. The City is not intimidated by Mr. Brown’s threats.”

Wolf calls the Water Street Garage “a public necessity,” confirmed by the recent public outcry demanding accessible, affordable parking in the city’s core. Downtown business owners have circulated petitions asking the city to not sell its spaces to Brown. 

On June 8, the city offered to buy spaces from Charlottesville Parking Center, which is owned by Brown, at the same price per space that CPC offered the city earlier this year. “According to CPC that price is above fair market value,” says Wolf. “If CPC refuses, the City will initiate the statutory procedure to make it possible to acquire CPC’s spaces through eminent domain.”

And that’s in a state that passed a constitutional amendment in 2012 prohibiting eminent domain for private enterprise, job creation, increased tax revenue or economic development.

Delegate Rob Bell wrote the constitutional amendment, and he says the key is that the use of a condemned property has to be public. He declines to weigh in on the city/Brown contretemps, but also notes that just compensation would have to be paid, including lost profits.

“The condemnor has the burden of proving it’s a public use,” he says. “Whether that’s a good use, the voters will decide. Ultimately it’s going to be settled by the court.”

“It’s unprecedented,” says CPC general manager and former mayor Dave Norris. “It’s a very extreme step that only escalates the current situation. Eminent domain is not designed to resolve a pricing dispute.”

The city’s move, says Norris, “creates a frightening precedent for any business wanting to do business downtown. If the city doesn’t see eye to eye on pricing or management, they’ll threaten to seize your property.”

While the two increasingly acrimonious sides had indicated they were going to attempt to settle their respective lawsuits, that conciliatory tone seemed to fall apart when council voted June 6 to make an offer to buy Brown’s spaces in the garage without his knowledge. Brown followed up the next day with a petition for an emergency receivership.

The petition cites the deadlock on the board of the Water Street Parking Garage Condominium Association, whose seats are evenly split between the city and Brown’s Charlottesville Parking Center. Because of a dispute over parking rates, the association has not approved a budget. CPC’s contract to manage the garage expires June 30, and a receiver is needed, says the petition, “to make necessary decisions related to the future operation” of the garage.

Those decisions include making a budget and approving rates. With the current deadlock, claims the petition, the condo association can’t negotiate with CPC to run the garage or hire a new managing agent. And CPC fears the deadlock will keep the association from maintaining appropriate insurance on the garage.

“A receiver is a fiduciary position like a trustee or guardian,” says legal expert David Heilberg. The receiver reports to the court about the assets and property for an entity, he says.

“Obviously Brown must feel like his hands are tied because the city won’t settle,” says Heilberg. “The receiver will sort it out until this is resolved. He’s saying, ‘I don’t want the responsibility of handling a disputed property.’”

And Brown wants $450-an-hour attorney Brian Jackson, a partner at white-shoe firm McGuireWoods, to be the receiver, with the help of $100-an-hour legal assistants.

“That’s pretty pricey,” says Heilberg.

But the city’s attorney, Wolf, is known to be pretty pricey himself. Wolf declines to reveal the rate he’s charging the city because, he says, he doesn’t want his other clients to know how steep a discount he’s offering.

“I agreed to a large discount in my hourly rate because my fees will be paid with taxpayer money and because I love litigating against bullies,” says Wolf.

He points out that all good trial lawyers with decades of experience are expensive and he knows for a fact there are many lawyers in Virginia whose normal hourly rate is significantly higher than his.

Brown declined to comment on the eminent domain threat. The emergency receivership petition was scheduled to be heard in court June 22. Another hearing on that scheduling will take place at 4:30pm today.

Says Heilberg, “It sounds like a mess.”

“The city has taken a situation that was messy and made it messier,” says Norris. “My sincere hope is that sanity prevails.”

Timeline of contention

August 12, 2014: Mark Brown buys Charlottesville Parking Center for $13.8 million.

October 15, 2015: CPC proposes new rates of $145 a month, $180 for reserved spaces and $2.50 an hour at the Water Street Garage.

October 28, 2015: The city counters with $125 and $140 for reserved spaces and an hourly rate of $2.

February 2, 2016: The city declines CPC’s offer to lease parking center spaces to the city, says it will consider a fair offer to sell its 629 spaces to CPC.

February 17: The city refuses CPC’s offer to pay $6,792 per space—nearly $4.3 million.

March 14: Brown sues the city, alleging he’s being forced to run the Water Street Garage at below market rate and below what the city-owned Market Street Garage charges.

March 28: Brown announces he’s hired former mayor Dave Norris to be general manager of Charlottesville Parking Center.

April 4: Chris Engel, Charlottesville director of economic development, sends a letter to Brown questioning Norris’ qualifications to run the parking garage.

April 6: Brown notifies the Water Street Parking Garage Condo Association that it’s in default of its agreement with CPC by not having a 2016 budget and gives the city 30 days to come up with one. Fears that the garage will close May 6 begin to foment.

April 28: Brown writes the city, urging them to work things out. brown letter to City Council 4-28-16

April 29: Charlottesville countersues CPC, claiming the city didn’t get its right of first refusal for Wells Fargo’s parking spaces that the bank sold to CPC. city counterclaim 4-29-16

May 25: Violet Crown hires PR firm Payne Ross, calls for petition urging city to hold onto its shares in the Water Street Garage.

June 6: City Council passes resolution authorizing the purchase of CPC’s spaces in the garage.

June 7: Brown petitions for an emergency receivership.

June 8: City offers to buy out CPC for the same price Brown offered to buy the city’s shares.

June 10: The lawyer representing Charlottesville says the city will use eminent domain if Brown doesn’t sell.

Updated 11:33pm June 15 with Dave Norris comments.

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Brown petitions for emergency receivership against Water Street Garage association

Former mayor Dave Norris urges the city to stop kicking the can forward and resolve the Water Street Parking Garage morass once and for all. Staff photo

 

For a few moments, it looked like the city and Charlottesville Parking Center owner Mark Brown were going to be able to settle out of court their differences about the Water Street Parking Garage. That was before City Council authorized a resolution June 6 to make an offer to buy Brown’s spaces in the garage without his knowledge, and before Brown filed a petition for an emergency receivership the next day.

The petition cites the deadlock on the board of the Water Street Parking Garage Condominium Association, the entity that runs the garage. Its seats are evenly split between the city and CPC, and because of a dispute over parking rates, the association has not approved a budget. CPC’s contract to manage the garage expires June 30, and a receiver is needed, says the petition, “to make necessary decisions related to the future operation” of the garage.

Those decisions include making a budget and approving rates. With the current deadlock, claims the petition, the condo association can’t negotiate with CPC to run the garage or hire a new managing agent. And CPC fears the deadlock will keep the association from maintaining appropriate insurance on the garage.

“A receiver is a fiduciary position like a trustee or guardian,” says legal expert David Heilberg. The receiver reports to the court about the assets and property for an entity, he says.

“Obviously Brown must feel like his hands are tied because the city won’t settle,” says Heilberg. “The receiver will sort it out until this is resolved. He’s saying, ‘I don’t want the responsibility of handling a disputed property.’”

And Brown wants $450-an-hour attorney Brian Jackson, a partner at white-shoe firm McGuireWoods, to be the receiver, with the help of $100-an-hour legal assistants.

“That’s pretty pricey,” says Heilberg.

But that rate may not even touch what the city is paying for its attorney, Tom Wolf with LeClairRyan in Richmond, who allegedly is one of the most expensive lawyers in Virginia.

City Attorney Craig Brown says he has to ask Wolf whether he can reveal his hourly rate, and he did not immediately respond to a Freedom of Information Act request.

The city attorney says he hasn’t seen the petition: “I’m not in a position to comment.”

As for whether the receivership request means a failure of the the city and Mark Brown’s efforts to settle their respective lawsuits out of court, Craig Brown says, “We haven’t made our offer” to buy CPC’s share of the garage. “We’ll have to see where that goes.”

Mark Brown declined to comment. The petition will be heard court June 22.

Says Heilberg, “It sounds like a mess.”

Timeline of contention

August 12, 2014: Mark Brown buys Charlottesville Parking Center for $13.8 million.

October 15, 2015: CPC proposes new rates of $145 a month, $180 for reserved spaces and $2.50 an hour at the Water Street Garage.

October 28, 2015: The city counters with $125 and $140 for reserved spaces and an hourly rate of $2.

February 2, 2016: The city declines CPC’s offer to lease parking center spaces to the city, says it will consider a fair offer to sell its 629 spaces to CPC.

February 17: The city refuses CPC’s offer to pay $6,792 per space—nearly $4.3 million.

March 14: Brown sues the city, alleging he’s being forced to run the Water Street Garage at below market rate and below what the city-owned Market Street Garage charges. CPC v. Charlottesville

March 28: Brown announces he’s hired former mayor Dave Norris to be general manager of Charlottesville Parking Center.

April 4: Chris Engel, Charlottesville director of economic development, sends a letter to Brown questioning Norris’ qualifications to run the parking garage.

April 6: Brown notifies the Water Street Parking Garage Condo Association that it’s in default of its agreement with CPC by not having a 2016 budget and gives the city 30 days to come up with one. Fears that the garage will close May 6 begin to foment.

April 28: Mark Brown writes the city, urging them to work things out. brown letter to City Council 4-28-16

April 29: Charlottesville countersues CPC, claiming the city didn’t get its right of first refusal for Wells Fargo’s parking spaces that the bank sold to CPC. city counterclaim 4-29-16

May 25: Violet Crown hires PR firm Payne Ross, calls for petition urging city to hold onto its shares in the Water Street Garage.

June 6: City Council passes resolution authorizing the purchase of CPC’s spaces in the garage.

June 7: Brown petitions for an emergency receivership. brown petition receiver 6-7-16

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Surprise resolution: City makes move to buy Water Street Garage

The city didn’t tell Mark Brown it was passing a resolution to buy him out of the Water Street Garage. Staff photo

City Council unanimously passed a resolution June 6 authorizing City Manager Maurice Jones to make an offer to buy the parking spaces owned by Charlottesville Parking Center in the Water Street Garage. Both the city and CPC owner Mark Brown have said they are in talks to resolve issues that led to the entities suing each other, but Brown says he was unaware of the plan offered up Monday night.

Just when things seemed to be quietening down in the ongoing battle between the city and Brown over the fate of the Water Street Garage, downtown business owners, not reassured by the two sides promising to play nice and work things out, met June 2 for an “open and impartial discussion” that ended with the 60 or so attendees endorsing a petition brought by Violet Crown and its PR firm that opposes privatization of the garage.

The city’s handling of downtown parking also was roundly condemned.

“We have a parking problem,” said downtown property owner Aaron Laufer—several times. He also wondered whether eminent domain for the Water Street Garage was an option.

The latest consternation started a week earlier at a Downtown Business Association of Charlottesville meeting when Violet Crown’s Robert Crane, aided by Payne Ross’ Susan Payne, proposed a petition to the city that it not sell its share of the complicatedly owned Water Street Garage.

“We would not have come into this community without affordable parking,” said Violet Crown owner Bill Banowsky at the June 2 meeting. The theater had an agreement with the Charlottesville Parking Center to pay 35 cents an hour for validated parking, the same rate that Regal Cinema had. Brown bought CPC for $13.8 million in 2014, and the parking rate doubled, said Banowsky. The city agreed to subsidize 20 cents an hour, but that agreement only goes through the end of the year, he said.

“CPC has gone on record saying they want to drive up rates to what the market will bear,” said Banowsky.

IX complex owner Ludwig Kuttner was even blunter: “We have a maniac who decides to blackmail us. He plays crazy, we play crazy.”

ludwigKuttner
Play crazy in dealing with Mark Brown, advises Ix owner Ludwig Kuttner. Staff photo

While Kuttner said building a garage at IX was an option, he also suggested the group find properties suitable for parking. “I know 20 spots we could use that are not used now,” he said.

Brown claims the city is forcing him to keep Water Street Garage rates below market rate and below what the city charges at the Market Street Garage. He filed suit against the city in March, and the city countersued in April, alleging it didn’t get right of first refusal on parking spaces Wells Fargo sold to CPC.

Brown was not at the June 2 meeting, nor was anyone from CPC. Before the meeting, brand new general manager and former mayor Dave Norris pooh-poohed the notion that Brown would jack up rates. “That doesn’t make business sense,” he says, especially when Brown’s share of parking downtown is 19 percent.

Norris pointed out that Violet Crown has a monopoly downtown and it didn’t jack up its rates, nor did Brown with Main Street Arena or Yellow Cab, companies he owns. “He’s a business guy,” says Norris.

Jones sent a letter on behalf of the city to DBAC president George Benford to reassure those at the meeting that work was going to address long-term parking needs. “It is important to emphasize that despite increased recent attention, we do not have a parking crisis in downtown,” said the letter.

Tin Whistle owner Jacie Dunkle wasn’t buying it. “For Maurice to send that, that’s bull,” she said. “Quite frankly, I don’t trust the City Council to make a wise choice,” she said, mentioning the recent increase in the meals tax despite restaurant owners’ objections. “They already know we don’t want meters,” a plan recommended by a city study and by Brown.

City councilors Bob Fenwick and Wes Bellamy were at the meeting. “These things are being discussed in executive session,” said Fenwick.

Councilors pay close attention to e-mails from constituents, said Bellamy, and the voices he’s hearing on the issue are fragmented. “Unity is what’s going to move things through,” he said.

“If another 1,000 spaces were parachuted downtown, I don’t care if Mark Brown owns Water Street,” said Laufer, who added that Brown is a friend. He urged the city to buy out Brown.

The city had multiple opportunities to buy the garage before Brown did, says Norris, and he questions whether it will be able to afford millions to upgrade the garage when it cut $50,000 for the municipal band from the budget. “There are 300 empty spaces on the third floor with a 200-plus person waiting list,” he says. “How does that make sense?”

Charlottesville is facing parking issues on multiple fronts. Albemarle is looking at whether to remove its general district court from Court Square because of parking. New businesses need parking, as do employees and the Landmark Hotel.

“My concern with the petition in general is it’s going to prolong and maintain the litigiousness going on now,” says Norris. “We have an opportunity to resolve it. Let’s resolve the long-term issues with parking.” That was before the City Council resolution. Norris was unavailable at press time, and Brown declined to comment on the city’s latest plan.

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Parking petition: Violet Crown hires PR firm

The city didn’t tell Mark Brown it was passing a resolution to buy him out of the Water Street Garage. Staff photo

The Downtown Business Association of Charlottesville said in April it wasn’t taking sides in the parking wars fueled by litigation between the city and Mark Brown, owner of the Charlottesville Parking Center. That course changed when Violet Crown hired public relations firm Payne Ross, also a DBAC member, which circulated a petition calling for the city to maintain its ownership in the Water Street Parking Garage out of fear Brown will raise the rates.

“CPC wants to raise rates to market rates to as much as the market will bear,” says Robert Crane, an executive with Violet Crown Cinemas.

The Austin-based deluxe theater chain opened in November in the former Regal Cinema site and pays 35 cents an hour for the parking it validates, a rate Crane says the theater was given before it began construction. “We built our theater on reliance of that,” he says.

Brown bought CPC in 2014. By the time the theater was ready to open, says Crane, the rate had doubled.

Violet Crown went to the city, which pitched in 20 cents an hour for a rate of 55 cents an hour, says Chris Engel, director of economic development. “We thought it was important to keep the rate the same as Regal’s. They also bring a lot of people downtown.”

Merchants downtown can opt for different parking validation programs, all of which are subsidized to some extent, says Engel. “They don’t pay market rate. Validation is intended to make downtown more accessible to customers.”

George Benford is the new chair of the DBAC and he says the board voted on the April letter asking the two sides to settle the matter quickly because members didn’t want the Water Street Garage to close, something Brown at that time had not ruled out in his ongoing dispute with the city.

Brown filed suit against the city in March, claiming he’s being forced to keep the Water Street Garage rates below market rate—and below the rates charged in the city-owned Market Street Garage. The city sued Brown April 29, alleging it didn’t get right of first refusal on parking spaces Wells Fargo sold Brown.

Coming up with a petition on parking wasn’t on the agenda at the May 25 DBAC meeting, Benford says. “The gentleman from Violet Crown stood up and wanted to start a petition,” he says. “Emotions got a little high.”

When the question was asked whether parking should be like a public utility, Benford says he was one of two there who thought the garage should be private.

Susan Payne serves as chair of the DBAC marketing subcommittee. Photo Jackson Smith
Susan Payne serves as chair of the DBAC marketing subcommittee. Photo Jackson Smith

Payne Ross e-mailed a petition and a notice for a June 2 DBAC “open and impartial discussion on the future of parking garages” in downtown Charlottesville at Violet Crown. Payne Ross principal Susan Payne says DBAC hasn’t taken a position on the parking issue and she’s representing her client, Violet Crown. “This isn’t a DBAC petition,” she says.

“I think there’s been a lack of sunshine on this whole business,” says Payne. “People would like to know what going on. Misinformation or lack of information makes people uncomfortable.”

Citing litigation, Brown declines to comment on the petition. “The city and I are working toward a resolution,” he says.

Joan Fenton, owner of Quilts Unlimited and J. Fenton Too, says she pays $90 a month for parking validation. “I think the city should provide some of the parking downtown,” she says. “If you don’t have parking, you’ve killed the goose that laid the golden egg.”

Fenton doesn’t want the city to sell its share of the Water Street Garage because, she says, the city historically has sold properties they shouldn’t, such as the current McGuireWoods site on Court Square at a time when there was discussion about the courts needing to be enlarged.

“I think the city should be a partner in making neighborhoods thrive,” she says. “This neighborhood needs parking.”

Fenton has no problem with the city subsidizing Violet Crown. “That’s not unprecedented,” she says, pointing out that the city gave money to the Paramount and the Sprint Pavilion. “If that’s what helped get that theater here, great,” she says. “This is a huge draw.”

“We bring 1,000 people a night downtown,” says Crane. “That’s a good thing for downtown and that’s a good thing for CPC.”

The DBAC meeting at the Violet Crown will be held at 5:30pm tonight and is open to the public.

 

 

 

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Parking wars: City fires back in Water Street Garage death match

The city didn’t tell Mark Brown it was passing a resolution to buy him out of the Water Street Garage. Staff photo

Despite concerns that the Water Street Garage could close should the company that manages it and Charlottesville not resolve their escalating legal battle, the city filed a counterclaim April 29 against Charlottesville Parking Center one day after owner Mark Brown sent a letter urging the city to sell the complicatedly owned garage to him.

And that’s on top of the city being in default of its agreement with CPC, which, if not resolved by May 6, could mean the garage will be without an operator. Rumors of the garage’s closing prompted George Benford, chair of the Downtown Business Association of Charlottesville, to write City Council and Brown and urge them to settle their differences.

“I don’t know what’s going to happen May 6,” says Brown.

“We’re working to avoid that,” says Chris Engel, director of the city’s economic development office, when asked on April 27 whether the garage could close, two days before the city’s latest volley.

The counterclaim alleges the parking center conspired with Wells Fargo when the bank sold its parking spaces in the garage to CPC without offering them to the city, which has a right of first refusal.

“Why wouldn’t the city sue Wells Fargo for not giving them right of first refusal?” wonders former CPC shareholder Richard Spurzem, who adds that he has used Tom Wolf, the Richmond LeClairRyan attorney the city has hired. “If anyone can get the city out of this legal morass, it is Tom Wolf,” says Spurzem. “But he is very expensive.”

On April 28, Brown sent a five-page letter to the city, detailing its tangled history of leasing the land for the parking garage from CPC in 1994 to an entity called the Water Street Parking Garage Condominium Association, whose board currently is deadlocked with the city and CPC, each holding four seats. Brown reminds the city its ground lease expires in 2024, and when it does, the municipality will likely be unable to afford to renew the lease at market rates.

He also notes there are 400 spaces in the garage that are usually empty and reserved for monthly parkers that could be freed up with state-of-the-art technology, which the city cannot afford, to more effectively manage demand. The lack of investment in the garage, he writes, has resulted in a “substandard garage that permits 400 parking spaces per day to sit unused.”

Exiting the garage can take an hour at peak times, which is “unacceptable,” says Brown. He urges the city to sell its shares in the garage to him so he can make the necessary improvements and free up the unused spaces.

“I sent the letter to the city in an attempt to find some common ground and de-escalate the situation,” says Brown. “I was very surprised to see the city’s counterclaim against us and I believe they are also accusing Wells Fargo of being our co-conspirator.”

Brown sued the city in February, accusing it of forcing him to run the garage at below-market rates.

The big question is will the city’s dispute with Mark Brown close the Water Street Garage. Both sides say no—while escalating the battle.

brown letter to City Council 4-28-16

city counterclaim 4-29-16

Correction 6-8-16: Tom Wolf’s name was misspelled in the original version.

Categories
News

Parking Garage Primer

The city didn’t tell Mark Brown it was passing a resolution to buy him out of the Water Street Garage. Staff photo

Who owns what at Water Street Garage?

Water Street Parking Garage Condo Association owns the structure

Charlottesville Parking Center

Has four seats on the condo association board

Owns 390 spaces

Owner: Mark Brown

Runs the garage operations

The city

Has four seats on the condo association board

Owns 629 spaces

Charlottesville Parking Center owns the land underneath the garage

Pooled Parking Unit Owners (city majority with CPC members) set the parking rates

City wants: $125 monthly, $2/hour  CPC wants: $145 monthly, $2.50/hour

Market Street Garage: Owned by the city, charges $135 monthly, $2.50/hour

Categories
News

Management issue(s): Mark Brown says city in default on Water Street Garage

Mark Brown says he’s not angry the city rebuffed scenarios to settle the Water Street Garage litigation, but he is selling the Main Street Arena and looking for more hospitable municipalities. Photo Jackson Smith

 

The battle between Charlottesville Parking Center owner Mark Brown and the city got more heated with an April 6 letter from Brown that said the entity that runs the Water Street Garage is in default and one of his remedies is to terminate the complicated agreement between the parking center and the city and to stop running the garage.

Relations between Brown and the city were already tense, thanks to Brown’s March 14 lawsuit that alleges the city is forcing him to run the garage below market rate.

It probably didn’t help that Mayor Mike Signer publicly reprimanded former CPC general manager/Downtown Business Association of Charlottesville co-chair Bob Stroh for his grammar, according to a Newsplex report. Within weeks, 40-year parking veteran and respected downtown booster Stroh decided to retire.

Brown announced March 28 he was hiring former mayor Dave Norris to succeed Stroh. Besides serving eight years on City Council, Norris has been the executive director of a couple of local nonprofits, including Big Brothers/Big Sisters of the Central Blue Ridge, and most recently worked as the director of community impact for the United Way of Greater Richmond & Petersburg.

In the next volley, Chris Engel, Charlottesville director of economic development, sent a letter April 4 to Brown questioning the qualifications of Norris to run the CPC, a move pretty much unprecedented in recent city history, at least officially.

Engel’s letter noted that the contract between the city and CPC requires that the general manager must have a minimum of six months successful parking management experience and three years service management experience. He requested Brown send a statement of Norris’ qualifications.

Brown declined to comment on the letter, and Norris says he hopes the differences between the city and CPC can be resolved before he starts the job.

“I am not going to get in the mud with Mike Signer and [City Manager] Maurice Jones,” says Norris. ”I am looking forward to starting this new job in June and working with all the key stakeholders to make the downtown a good place to live, work, play and run a business.”

Ironically, Jones faced some skepticism about his own qualifications when he applied for the city manager’s job in 2010. A former sports reporter for NBC29 who started work with the city as director of communications, Jones did not have the master’s degree the city job posting said it preferred, nor did he live in the city. Norris, who was mayor at that time, was an advocate for Jones getting the job.

City Council regular Louis Schultz says he finds the issue “hysterical,” and that Engel would not have sent the letter without Jones’ approval. “If the city manager doesn’t understand that being mayor is working in the ‘service industry,’ it’s no wonder we have such an unresponsive city government,” he says.

Brown replied to the city April 7 with a letter detailing Norris’ experience with parking issues, including serving on the Metropolitan Planning Organization, which deals with long-term transportation and parking issues for the region. He also notes that Stroh assembled a strong team to run the parking garages and will continue to serve as a consultant.

Should that not suffice for the city, says Brown, Norris will be named president of the Charlottesville Parking Center and Brown will assume the job of general manager at the higher salary commanded by the more experienced Stroh, resulting in higher operating costs for the management of the city’s Market Street Garage.

In a related move, Brown’s April 6 letter serves notice to the Water Street Parking Garage Condominium Association, which owns the structure, that it is in default of its agreement with the parking center by not having a 2016 annual budget.

To further complicate matters, the eight-member condo association is made up of four city employees and four CPC seats, including Brown, which means he also is a member of the association he says is in default. Six association members have to agree to pass the budget, and that didn’t happen because the city refused to approve the rates Brown wants.

Miriam Dickler, city spokesperson, declined to comment on the letter announcing the condo association is in default and to respond to the allegation Signer and Jones were “in the mud.”

The agreement between the condo association and CPC gives the city 30 days to come up with a budget. If that doesn’t happen, CPC can terminate the relationship and doesn’t have to assure an orderly transition, according to the agreement.

“The gist here is that clearly Mark Brown is in the midst of a chess game with the City where he has a legal strategy mapped out moves ahead,” writes former Charlottesville Parking Center shareholder Richard  Spurzem from a beach in Antigua. “The City, as usual, thinks they are in a checkers game.”

Spurzem has criticized the city in past for not buying the parking garage in 2008 when the CPC was for sale. Brown bought the parking center, which owns the land and some spaces in the Water Street Garage and the surface lot across the street, for $13.8 million in 2014. CPC also runs the city-owned Market Street Garage,.

The city, according to Spurzem, also should have corrected the “horrible” land lease and management agreement with the more city-friendly former CPC management.

A subset of the condo association is the Pooled Parking Unit Owners—the city and CPC—which are the only ones who can set parking rates for the Water Street Garage. The city owns approximately 629 parking spaces—65 percent—and CPC owns 344, according to Brown’s lawsuit.

The rates must be approved by two-thirds of the pooled parking owners, which put Brown at a disadvantage when he wanted to increase the Water Street rates to what he says in his suit are market value.

Last October, Brown proposed upping the rates to $145 a month, $180 for reserved spaces and $2.50 an hour. The city countered with monthly rates of $125 and $140 for reserved spaces and an hourly rate of $2, “significantly below the market rate,” and less than what the city-owned Market Street Garage charges, alleges the lawsuit. Market Street charges $135 a month and $2.50 an hour.

As a result of the city and Brown being unable to agree on what the suit calls the city’s “unlawful and oppressive demands for below-market rates,” the condo association was unable to get its city/CPC factions to approve a budget, and that now puts the association in default, claims Brown.

He has offered to sell the city CPC’s parking spaces or to buy the city’s spaces, both of which have been rejected by the city.

Spurzem predicts the city will either buy Brown’s ground lease and management agreement for “many times” what it could have bought CPC for earlier, or it will hand over its interests in the Water Street Garage “for next to nothing just to get out of the legal noose that Mark Brown will have them in.”