Jul 182014
 

Pennsylvania taxpayers are facing close to $1 million in legal fees as they struggle to control the August Wilson Center for African American Culture.  The dispute entails whether or not the center should be sold to a New York developer, 980 Liberty Partners, for $9.5 million.

The city’s Urban Redevelopment Authority (URA) and the state Attorney General’s Office object to this proposed sale in hopes of preserving the center as a “public asset.”  They claim “that deed covenants restrict the building’s use to a black cultural arts center.”

On the other hand, Dollar Bank, which the center is in debt to for $7.96 million, would rather see the sale go through than foreclose on the property.

Judith K. Fitzgerald, the court-appointed receiver to resolve the center’s debts, has acquired up to $691,000 in fees for herself, her legal counsel, and her consultants between November and June.  Fitzgerald defends such fees, which the court has approved by saying, “We’re filing fee applications with a lot of detail on what services we’re providing.”

However, the URA disagrees with these fees and finds them particularly unreasonable, especially since they are being paid before the interests of Dollar Bank are adhered to.  An authority attorney, Shelley V. Segal wrote, “The receiver has expended untold fees to delay this court’s consideration of the covenants.”  Fitzgerald denies such a delay and claims her main purpose is to attend to the community’s best interest as a whole.

The 980 Liberty Partners’ plan is to build a ten-story hotel on top of the two-story center if the sale goes through.  Although the developer promises to allow the center to continue operating, many are skeptical.

The URA, being one of the most skeptical of the center’s future plans, agreed to pay $60,000 to outside counsel to help handle the case.  With a total of $751,000 in legal fees between Fitzgerald and the URA, the state attorney general’s office has also stepped in to defend the center.  The attorney general’s office has employees reviewing the center’s assets and past finances.  Attorney general spokesman J.J. Abbott said, “If we find that there was a breach of fiduciary duties, we could seek further action.”  In that case, there may be hope for the center.