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County may appeal costly lawsuit

(ran NS, S editions of B)

The Hillsborough County Commission is facing a $13-million judgment in a lawsuit it could have settled months ago for $2.8-million.

The county also has spent more than $2-million defending itself in the case _ and the tab will rise if the commission follows its attorney's advice today.

County Attorney Emmy Acton said she will ask the commission today to appeal Friday's verdict in favor of Providence Venture Inc., a developer that claimed the commission failed to make good on a deal to build a sewage treatment plant in Riverview.

Acton said the appeal likely would focus on a series of rulings by the judge that she said prevented the county from making its case to the jury.

County Administrator Fred Karl was county attorney in 1989 when he recommended the commission change its deal with the developer. He said Monday that he is "just terribly disappointed" with the verdict and hopes the commission will appeal.

"We can't allow it to stand that way," Karl said. "If there's any way we can turn it around, we must do it."

The commission twice rejected offers to settle the case, the most recent coming at the beginning of the year for $2.8-million.

County officials offered $475,000. "Feeling as I do about the case, I could not have recommended any more than I did," Karl said.

The county pulled out all the stops on the case, hiring Atlanta lawyer Albert Phillips to argue the case and a consultant to help pick the jury.

Commissioner Joe Chillura said Monday that the commission ought to cut its losses and forget about an appeal. An appeal could cost another $2-million, he said.

The county has $22-million in its utility reserves account, and half of that already is committed to various projects, Chillura said.

But Commissioner Jan Platt, who made the motion three years ago that led to the lawsuit, supports an appeal. She was opposed to the public-private venture from the beginning.

"I was opposed to it, because it gave a major public service area to a group of developers without going out to bids," Platt said, "which in my opinion opened the door for them to reap windfall profits."

Platt said the developer breached its contract with the county when it restructured the company without the approval of the commission.

Providence Venture was started by four major developers who said they could build a sewage treatment plant faster and run it cheaper than the county could.

The developers, however, later sold their interests to Walton McMichael for $1 each. Platt said she wasn't aware of the change in ownership until she started preparing for the six-week trial that ended Friday.

At issue is a 4-3 vote by the commission in March 1989 to make Providence Venture return to the county $269 from every $2,507 fee to hook up to the sewer system the developer planned to build.

Those fees would amount to $4.2-million the county planned to spend on a plant to treat sludge, a byproduct of sewage treatment.

Providence Venture claimed that last-minute change made it impossible to close on its financing.

Karl argues that the developer couldn't have closed anyway, because there were so many other loose ends. "We did everything we could to make it possible for them to close, and they just simply could not have closed," he said.

Another trial will be held to determine how much money the developer should get. Providence Venture plans to seek up to $13-million, said John Bales, the company's lawyer.

If the commission approves an appeal, Acton said she likely will move to delay the second trial until the appeal is settled.