Lexington plans to fill in CentrePointe site if no work is done by March 30

The Lexington-Fayette Urban County Government plans to exercise its right to fill in the CentrePointe development if no work is done on the long-delayed downtown development by March 30, according to a letter sent last week by a lawyer for the city.

Attorney Mason Miller sent the letter Feb. 19 to Maxim Crane Works in Bridgeville, Pa., warning the crane company that if work on the three-level underground parking garage is not resumed by March 30, the “LFUCG intends to exercise its right to complete the restoration work, fill the site and return the property to its pre-excavation condition.”

Miller wrote that the city wanted to notify the company so it could “protect your interest in the cranes in such manner as you deem appropriate.”

In April 2015, the city issued an order to The Webb Companies demanding the site be filed in after the city said no substantial work had been completed in the previous 60 days, a charge The Webb Companies vehemently denied. That order was set aside several times when new developers led by Matt Collins of Lexington and Bridgeton Holdings of New York announced interest in taking over the project in August.

After the city and the new developers could not come to an agreement on whether to move the city’s government center to the proposed development, Collins and Bridgeton Holdings backed out of the project.

That left the city with the original April 28, 2015, order to fill in the site in the block bounded by Main, Vine, Upper and Limestone streets. Prior to the start of excavation for the underground garage, the site had been essentially a meadow for several years.

According to an email Miller sent the Urban County Council in mid-February, the extensions on the April order will run out March 30. The city and The Webb Companies signed an agreement in December 2013 as part of the city’s approval of tax increment financing for the development. Tax increment financing uses taxes generated from a project to pay for infrastructure.

Because CentrePointe is a private development, the agreement is the only leverage the city has over the project. As part of that agreement, CentrePointe agreed that if no work occurred on the site for 60 days, it would fill in the hole or reimburse the city any costs the city incurred, up to $4.4 million, to fill in the hole.

“The city was also granted a first priority mortgage on the property as security should CentrePointe fail to reimburse the city, and also the right to foreclose the property to be repaid those amounts,” Miller wrote.

Developer Dudley Webb has not returned calls to the Herald-Leader.

Miller’s letter is the first time the city has indicated it was going to enforce the April order. Miller said Monday that the letter was sent to ensure that the crane operators understood the agreement between The Webb Companies and the city so the Pennsylvania company could protect its interest. Miller said city officials have not heard from The Webb Companies since Collins and Bridgeton Holdings announced they were backing out of the project nearly two weeks ago.

“We have a signed agreement with the developers and we hope they live up to their obligations under that agreement,” Miller said. “The city negotiated that agreement for a reason. It was there to protect the citizens and taxpayers of Lexington.”

The proposed development has been delayed for eight years, since the original buildings on the block were torn down. The site has been excavated for the underground garage, and Maxim’s cranes sit on the site unused.

The proposed development originally was to include a hotel, apartment and extended-stay hotel, office tower, and retail and restaurant space.

This story was originally published February 22, 2016 at 11:51 AM with the headline "Lexington plans to fill in CentrePointe site if no work is done by March 30."