CHARLESTOWN — Charlestown Mayor Bob Hall met in private and communicated via text message and email with developers to discuss redevelopment of Pleasant Ridge, documents supplied to media show.
An email between Neace Ventures developers as well as papers that appear to be notes taken from a meeting last summer suggest part of the plan entailed driving down property values in order to set lower prices for acquiring homes through eminent domain.
These notes, which are being attributed to Hampton taken during a meeting with Hall, state under a section labeled "plans" that "[boarded] up homes will lower values."
"If they talked to the mayor and got an impression that something might or might not happen, they're entitled to their impressions, their beliefs," city attorney Mike Gillenwater told the News and Tribune in a phone interview Wednesday. "You're talking about the note that [Neace Ventures agent] John Hampton took. Those are his impressions."
These documents — which include emails, text messages and meeting notes — were released by the Institute for Justice, which is party in a lawsuit against the city by residents of the Pleasant Ridge neighborhood. The documents were obtained during the discovery portion of the lawsuit.
Residents allege the city's rental inspection ordinance was designed to force Pleasant Ridge landlords to sell to a private developer. The Institute for Justice, a libertarian law firm based near Washington, D.C., is representing homeowners.
Charlestown Mayor Bob Hall will testify at a 9 a.m. hearing Friday in Scott County Court, according to an Institute for Justice spokesman.
"These documents provide concrete evidence that the city and developer have engaged in a secret plan to drive down home prices prior to using eminent domain," Anthony Sanders, Institute for Justice senior attorney, stated in a news release. "The city not only wants every home to go, but it wants it done on the cheap, with minimal compensation for property owners who are largely of modest means."
Gillenwater denies the city has coordinated to achieve this end.
"The plan is to redevelop and it's going to take a while, and they will eventually tear every single one of those boarded up houses down, and if I'm not mistaken that's going to happen sooner rather than later," he said.
Hall posted on his official Facebook page in January that "if [the city does] buy houses it will be at appraised value. I agree if the city buys property, paying less than what they are worth is wrong."
In July, Pleasant Ridge residents expressed concern that some 60-80 boarded up homes bought by Neace Ventures posed safety threats. Josh Craven, president of the Pleasant Ridge Neighborhood Association, told the News and Tribune he believed developers were intentionally keeping homes erected to drive down property values in the neighborhood.
"They’re not going to do us any favors,” Craven said. “They’re not going to tear them down to vacant lots and let our property values increase when they’re trying to buy our properties from us.”
A request made late Wednesday morning through Hall's assistant seeking comment from the mayor was not returned by 6:45 that evening.
"These documents are not a secret. They're exchanged in litigation," Gillenwater said. "We're sticking to the truth and the truth is that the only way cities and towns and counties can act is through official action. What the mayor may or may not want is important to prospective developers, but it's not controlling. Were there agreements, secret or otherwise, between Neace and the city and the mayor? Not that I know of, and I probably would have been consulted."
An email from Hampton to Neace Ventures co-chair John Neace as well as his handwritten notes reflect a plan to keep the city at "arm's length" during the process to purchase homes.
This email states the purchase price of the homes from willing sellers would set the values the city would use during an eminent domain process. Notes state, "Believe hand full [six] 20-40 may have to take by eminent domain."
Many of the homes developers have been bought for $10,000 apiece, though the Institute for Justice argues houses in the neighborhood appraise between $30,000 and $60,000.
"Bob [Hall] says for all of this to work properly for the condemnation of homes, we need to remain independent of the city as we are right now considered a developer with no contractual relationship with the city which is 100% factual," Hampton wrote in an email to Neace on July 6, 2016.
"Once the city starts condemnation proceedings, no purchases from that date forward can be used to determine value, only purchases prior to that point which are all arms length transactions between us and the owners and that is what sets the value for the condemnations."
Hampton's handwritten notes contain the phase "wrap around agreement" in the margin. What appears to be a memo from Hampton states, "On vacant lots the city will acquire [Hall] said we can do a 'wrap around agreement' to be sure we have the right to buy the lots from the city. I am not sure what that is."
An email sent from Hall's personal account in September 2016 to Hampton details what he should send in a letter to the Charlestown Board of Public Works. This list includes "that all properties that are currently vacant will be [boarded]"; "all properties that become vacant will not be rented back out but will be boarded up. Any exception must be [approved] by both the Building Commissioner and the Board of Works"; and "Once permanently vacated the property will be demolished within 60 days of notice to proceed with demolition from the city."
Text messages between Hampton and Hall on July 5, 2016, reflect the two scheduling a meeting. Hampton's notes are dated July 6, 2016.
In one text message also in July 2016, Hall asked what Hampton thought about a news report.
Hampton responded, "As long as they keep showing the dilapidated homes in the background we win. I have the reporter for WDRB and News and Tribune so I can start feeding them information as I want. Good plan huh!!!"
In a News and Tribune story published in September 2016, both Hall and Gillenwater indicated the city was not actively engaged in pursuing "eminent domain."
Charlestown hasn't filed for condemnation of any properties in Pleasant Ridge, but Gillenwater wouldn't say with certainty Wednesday whether city officials have verbally agreed with developers to use eminent domain on unwilling sellers.
"Developers are going to ask questions, like 'is eminent domain a possibility.' Do you answer questions like that? Yes, you do. But just because there was a question doesn't mean there was a plan to do it ..." Gillenwater said. "They're smart enough to know that's an option, and we've never said that wasn't an option."
Emails from Charlestown Building Commissioner Tony Jackson show he conducted asbestos inspections on purchased homes as contract work for Pleasant Ridge Redevelopment LLC, a Neace Ventures company. Jackson sent Hampton an invoice for work from his city email address on Oct. 27, 2016.
"It would be easier to coordinate the inspections with the guy you have boarding up the houses," Jackson wrote from his business email to Neace on Sept. 23, 2016. "Once the inspections are completed, it would be up to you as to the dates of which houses you want to bring [down]."
An email sent this June from Hampton to Jackson with the subject line "homes occupied with no water" lists the addresses of three houses. "Anything you can do to get [them] out would be helpful," Hampton wrote. "Also you said you were going to notify the other utilities to pull the meters from the vacant homes. Do you need an update list?" In response, Jackson replied "OK."
The city previously tried to redevelop the mostly low-income neighborhood by demolishing homes through blight elimination funds from the state, but that plan failed in 2014 because it failed to gain city council support.
Since then, Neace Ventures has purchased more than 150 homes in the neighborhood. A rental inspection ordinance passed by the city council resulted in hundreds and in some cases thousands of dollars in fines for code violations.
City officials have claimed the ordinance was designed to eliminate unsafe housing. Neace Ventures' redevelopment plan entails demolishing all homes in the neighborhood and building homes similar to those in Louisville's wealthy Norton Commons.