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Safety Harbor waits for usage rules before finalizing land buy from resort

SAFETY HARBOR — The city is eager to gain ownership of 15 acres of bayfront property owned by the Safety Harbor Resort and Spa. It wants to put a park there.

However, the City Commission isn't willing to sign a contract to buy the land without having a clear agreement with the spa about what it can do with the land.

The commission voted last month to pursue purchase of the land, which abuts Old Tampa Bay. But in a 5-0 decision last week, the commission voted to wait for a proposed use and easement agreement from the spa before finalizing a purchase.

The spa doesn't want the city to be able to sell goods of any kind, including food and alcohol, on the property because that would create direct competition with the spa.

The spa also doesn't want baseball or football fields, and it doesn't want structures to be built inside its 600-foot-wide view corridor of Old Tampa Bay.

"In theory, everyone in Safety Harbor is for it and wants to see it happen," Mayor Andy Steingold said of purchasing some of the spa's property. "But before we spend money, we need to have a complete contract."

The spa contends that such restrictions are to be expected.

"There is nothing that's going to be put in there (the agreement) that's going to surprise the city," said Howard P. Slomka, an attorney for the spa.

If the commission had voted to move forward with the purchase, the city would have been required to pay a $100,000 deposit within five days. In addition, the city would have to spend $20,000 for a land survey and property appraisal. That $20,000 is nonrefundable.

Commissioner Nina Bandoni made the motion to delay voting on the contract until the city determines exactly what it can do with the land. Bandoni said she hopes the city's decision sends a message to the spa and "encourages the spa to act expeditiously to get the use agreement."

The City Commission will revisit the issue at its July 18 meeting.

Safety Harbor gained an opportunity to purchase some of the spa's land as part of a debt-restructuring plan that would bring the resort out of bankruptcy. Last month, a federal judge reduced the resort's secured debt from $30 million to about $17.8 million.

Pending an appraisal, Safety Harbor is offering about $4 million for the property, which runs north from Veterans Memorial Lane at the city's marina to Mullet Creek.

Slomka said the city and the spa have the same things in mind when it comes to the use of the property.

"I think the city is going to be okay with the use restrictions," Slomka said. "We are not far apart in terms of our thinking. It's not going to bind the city, but we do want to restrict some types of things."

Olympia Development Group, whose president is William E. Touloumis, purchased the 22-acre resort in December 2004 for more than $20 million.

Touloumis said he has added another $20 million in upgrades to the facility that has 50,000 square feet of spa space, 30,000 square feet of meeting space, three swimming pools and two hot tubs.

The spa has been a downtown landmark for 60 years and is listed on the state's register of historic places. It is known for the mineral springs that run beneath the property.

Contact Demorris A. Lee at dalee@sptimes.com and (727) 445-4174.

Safety Harbor waits for usage rules before finalizing land buy from resort 06/25/11 [Last modified: Saturday, June 25, 2011 1:45pm]

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