Pizza 'N Such owners file lawsuit against city of Claremont
Preliminary litigation is underway between the city of Claremont and a longtime Village eatery.
Mike and Sue Verbal, owners of Pizza ‘N Such restaurant in the Claremont Village since 1979, recently filed a complaint against the city of Claremont alleging city officials violated an agreement made in regard to more than $150,000 of in-lieu parking fees paid by the Verbals to the city.
The Verbals first filed a complaint last August, asserting that the city misused money paid for development of parking for use by customers dining at their restaurant.
Mr. Verbal paid $9000 a piece for 17 parking spaces under the impression that the money was going to be used to create additional parking in the Village area.
At the time of the agreement, the Village included businesses from Fourth Street south to First Street and from Indian Hill east to College Avenue, according to Mr. Verbal. According to the complaint, Mr. Verbal later learned that his money was used for the 4-story parking structure just west of the Packing House on First Street in Village West.
He approached the city in hopes of an explanation. Instead, Mr. Verbal said city staff peremptorily told him that if he sued, he would be liable for the city’s attorney fees. Not originally envisioning a lawsuit, Mr. Verbal now says he will do what it takes to ensure the city holds true to its “obligation.”
“I want my money back,” Mr. Verbal said. “[The city] didn’t do what they said they would do. If they had just explained why they used, I might not have sued.”
Mr. Verbal says it is a final effort to get some answers and to solve a wrong.
“We’ll let the courts decide,” he said.
Matters date back to the early 2000s, according to the complaint. For years Mr. and Ms. Verbal assert they had been encouraged by city management to expand their business because of the pizza restaurant’s popularity. However, the business owners never formally considered an expansion until the early 2000s. With their lease about to expire in June 2002, the Verbals finally decided to consider an expansion after encouragement from then City Manager Glenn Southard.
As they explored an expansion, the Verbals learned that city law dictates that business expansions include additional parking spaces to accommodate the growing business. The Verbals claim they were first told an additional 32 spaces would be needed, but eventually the city agreed upon 12 additional parking spaces.
Though a fixed number of spaces were agreed upon with city staff, city law created other issues. According to the complaint, city staff determined that “the location of the business, and the configuration of the Village, did not afford [the Verbals] the ability to provide for additional parking.” But that didn’t mean the end to the negotiations for an expansion.
If the area immediately surrounding an expanding business does not have room for additional parking—such as Pizza ‘N Such in the already built-out Village area—the business may pay “in lieu parking fees” to the city for use in creating more public parking throughout the city.
The city established its in-lieu parking fees in the early 1980s with the vision of the high-density Village that Claremont residents and visitors have come to know over the years. Instead of requiring every business to provide a certain amount of designated parking, particularly in those areas like the Claremont Village that already have a high density, a city may allow its business owners to pay the city a fee “in lieu of” that required parking.
“The idea was the fees could be used to provide ‘district parking,’ in a sense,” explained Brian Desatnik, director of community development. “In a downtown where you want buildings to be tightly grouped together, it makes more sense to try and consolidate parking facilities.”
With the economic downturn, in 2010 in-lieu parking fees were cut from $9,000 a parking space to $1,000 a parking space in order to assist businesses with moving into the increasing vacancies in the Village area at that time, according to Mr. Desatnik.
The Verbals formally agreed to pay in-lieu parking fees in the summer of 2002, before the rate change, to the tune of $108,000 for the previously agreed-upon 12 spots. According to the contract, “such fees are placed in a fund, which can only be spent for the acquisition and development of off-street parking for the Claremont Village, or reimbursement of private providers of such parking.”
The Verbals signed an agreement with the city to pay $108,000 with 5 percent interest over 10 years. They ended up paying the full amount plus interest by October 2006, bringing the total to $119,333.66.
A few years later, the Verbals sought to expand again after an upstairs tenant went out of business. They eventually decided against expanding after learning from the city that they would need to provide 30 spaces at $9000 per space, or $270,000, for in-lieu parking fees. However, the Verbals did opt to pay a fee in order to rescind a previously imposed occupancy restriction. In order to dissolve that contract, the city and the Verbals agreed to $45,000 in-lieu parking fees, worth 5 parking spaces.
Similar to their first in-lieu parking agreement, the second contract stated that the fees would be placed in a fund, which can only be spent for use in creating more off-street parking for the Claremont Village. If not used for that specific purpose, the agreement promised “reimbursement of private providers of such parking.”
After discovering their money was used for the Village West parking structure, the Verbals filed a claim last August, hoping for an explanation and possible reimbursement. With their request denied, Mr. Verbal felt driven to take matters a step further in filing a complaint leading toward possible litigation.
“We need a transparent government,” he said.
City Manager Tony Ramos confirmed on Wednesday that the city has responded to the Verbals’ complaint. Because it’s a matter of litigation, Mr. Ramos would not comment further.
“The city will respond through litigation,” he said.