Traverse City Record-Eagle

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August 10, 2011

Impasse at Leland courthouse property

SUTTONS BAY — Leelanau County officials have yet to figure out how to break an impasse with developers of the former courthouse site who've fallen more than $300,000 behind in their payments to the county.

The county Brownfield Redevelopment Authority and its lawyers met in closed session last week to discuss stalled development plans for the former courthouse property in Leland. The county sold the two-acre-plus site to local developers Varley-Kelly Properties II LLC for $2.4 million in 2007 prior to opening the new county government complex in Suttons Bay Township.

County officials said developers are more than $300,000 behind in payments, and brownfield officials are working with the county board's lawyers to try and resolve problems. County brownfield director Trudy Galla said she expects county commissioners and the brownfield board to meet soon to discuss the stalled development.

Officials await a recommendation from attorneys on how to proceed, she said.

The brownfield board did approve payment of about $2,700 in pending invoices for electrical and plumbing on one duplex that's been built on the site. Galla said the payments are contingent on developers securing permits and inspections for the work.

"We don't have all the permits pulled and it's not properly inspected," Galla said.

Developers remain frustrated with the county's refusal to renegotiate the purchase price, based on the real estate downturn. Robert "Gene" Kelly, a Bingham Township businessman and partner in Varley-Kelly Properties with retired Leland dentist James Varley, said the county's private discussions also complicate the issue.

"They keep going in these closed sessions," Kelly said. "So I don't know what they're going to do."

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