Developer will appeal Tarpon Springs’ pause on its Anclote apartment project

Texas-based Morgan Group asked for a bond to cover its losses from the delay, but city commissioners said no.
Vacant land butting up to the Anclote River can be seen Friday, Dec. 11, 2020 in Tarpon Springs where Morgan Group plans to build 404 apartments.
Vacant land butting up to the Anclote River can be seen Friday, Dec. 11, 2020 in Tarpon Springs where Morgan Group plans to build 404 apartments. [ CHRIS URSO | Times ]
Published July 7, 2022

TARPON SPRINGS — The City Commission’s decision to suspend construction on a 404-unit apartment complex along the Anclote River could cause $2.8 million in damages from the delay, the developer’s attorney warned on Wednesday.

Scott McLaren, an attorney representing the Texas-based Morgan Group, said the stay — which lasts until a citizen lawsuit challenging the project is over — violates their constitutional right to develop the land. He predicted that, with appeals, the legal battle could drag on at least 18 months.

But Jane Graham, an attorney for Concerned Citizens of Tarpon Springs, the nonprofit that is suing and requested the stay, said Morgan Group could not “in good faith” blame her client for an initial delay. The developer still needs permits before it can break ground anyway, she said.

Commissioners agreed and voted unanimously Wednesday not to require Concerned Citizens to post a bond to cover potential losses of the stay. If the lawsuit is still pending by the time Morgan Group obtains all permits and meets conditions of the city’s development agreement, the commission will meet to reconsider a bond.

“Tonight’s decision was based on local politics, not the law and the facts,” Ed Armstrong, an attorney representing Morgan Group, said in a statement to the Tampa Bay Times. “We will be exercising our appellate rights.”

The commission approved Morgan Group’s application in November by a 3-1 vote. Then in March, an election brought three new officials into office who all opposed the project during their campaigns.

But Graham said the commission’s decision was correct because Concerned Citizens should not be forced to shoulder Morgan Group’s business risk.

Morgan Group estimated that it could lose $45 million in profit if the project is derailed entirely.

“Instead of dealing with its merits, Morgan Group continued to bully and distract the commission with threats and misstatements throughout the process,” Graham said in a statement.

Commissioners acknowledged the unprecedented scenario provided no playbook to follow when considering Morgan Group’s request for a bond: No local government in Florida has ever halted construction on a development it had already approved.

City Attorney Tom Trask told the commission the bond would protect the developer “and possibly the city of Tarpon Springs” from legal exposure.

“I’m not a gambler and we’re asking to gamble tonight as far as setting a bond,” Mayor Costa Vatikiotis said.

And like most of the meetings on the Anclote Harbor project since the Commission first heard the application in December 2020, this one was peppered with conflicting information, accusations of wrongdoing and pleas from residents to save the nearly 74 acres of greenspace.

McLaren said Morgan Group was only waiting on its last permit from Florida Department of Transportation that is expected any day and a Southwest Florida Water Management District permit “hopefully next week.” He said their approval for a culvert extension completed all review from the U.S. Army Corps of Engineers.

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But Graham cast doubt over that assertion, saying she believes the developer is required to get a federal permit under the Clean Water Act related to dredging near wetlands.

Morgan Group insisted that was not true, but it cast confusion over the deliberations.

“I’ve got one attorney saying one thing, another attorney saying another,” Commissioner Jacob Karr said.

Commissioner Michael Eisner, elected in March, said he spent “two and half hours on the phone with the Army Corps of Engineers” on Tuesday and got a different answer on the permits than what McLaren presented.

Trask, the city attorney, told Eisner that was inappropriate because he is supposed to make his decision based on evidence presented at the hearing, not from outside information he gathered.

It prompted McLaren to ask Eisner to recuse himself from the vote on the bond.

Eisner declined, saying the outside information would not influence his decision.