Group files suit over Dranoff's Ardmore project: One Ardmore Place is 'misappropriation of public funds'

There was a feeling of relief among some in Ardmore last week when news broke that litigation, which had stalled redevelopment of the town’s Cricket Avenue Parking Lot, had been resolved. That relief may be short-lived.

A group opposed to the project announced Wednesday that it has filed suit in Pennsylvania Commonwealth Court over the planned use of state grant funds.

Scroll down for a full statement from Carl Dranoff:

The petition comes from the Save Ardmore Coalition and several individual members who are Ardmore residents. It seeks declaratory and injunctive relief to stop what it claims is the misappropriation of public funds to support a private development project.

The suit names as respondents Gov. Tom Wolf and his budget secretary, the Redevelopment Authority of Montgomery County, and Lower Merion Township and its board of commissioners.

At issue is the township’s planned use of $10.5 million of state Redevelopment Assistance Capital Program (RACP) grant funds as a part of financing for a mixed-use apartment/retail/public parking complex, One Ardmore Place, to be constructed on what is today a surface parking lot. Lower Merion is partnering with developer Dranoff Properties in the project as part of a long-planned downtown revitalization.

In the suit, the group asks the court to find that the grant funds were awarded to be used for redevelopment of the Ardmore Train Station, but have been redirected to the Cricket Lot project, at some distance from and not associated with improvements to the train station.

On Thursday, Lower Merion board President Liz Rogan said the township and board members had been served with the suit Aug. 10. While saying she could not comment in detail on the suit, Rogan called its filing “disappointing but not surprising.” She added, “I am confident the funds are being used appropriately.”

Comments by a spokesperson for the governor and other parties, as well as Dranoff Properties, were not immediately available.

The Save Ardmore Coalition, which formed a decade ago in opposition to Lower Merion Township’s potential use of its eminent domain powers for downtown redevelopment, has renewed activity in the past year as plans for the One Ardmore Place project moved forward.

While it has objected to the project, which would rise to eight stories in its tallest portions, as out of scale and character with Ardmore’s historic downtown and neighborhoods, it has focused on the use of the bulk of a total $15.5 million in RACP grants for Cricket development as “misappropriation of public funds for improper and inappropriate private use.”

In a press release issued Wednesday afternoon, the organization goes on to say that this use of the funds “will undermine the genuine redevelopment of the Ardmore Train Station, as well as the proper redevelopment of Ardmore, while depriving residents of continued use of the Cricket Parking Lot.”

In addition to the organization, five individual members are listed as petitioners. They include two Cricket Avenue residents, Beth Greenspan and Michael Frank; Sheila Murnaghan of Llanfair Road; Todd Hart of Chatham Road; and Douglas Muth of Montgomery Avenue.

The group is being represented by attorney Mark Freed of the Freed Firm in Berwyn.

The filing of the suit comes a week after Lower Merion commissioners voted Aug. 3 to authorize execution of a settlement agreement in a lawsuit brought by a group of business property owners whose parcels abut the parking lot over action related to its transfer through the redevelopment authority to Dranoff Properties. The authority is also the conduit for the state grant funds.

The legal challenge had stalled a start of construction of the project, which has received all needed land development approvals, for most of 2015.

It was a notable element of the proposed settlement that the property owners agreed not to later sue over the source of funds for development of One Ardmore Place. That agreement, if it receives court approval, would not prevent other parties from suing. In fact, a lawsuit addressing the use of the RACP funds had been thought to be waiting in the wings. Documents filed with the new suit indicate that it had been in preparation as long ago as late June.

Speaking for the Save Ardmore Coalition, its president, Philip Browndeis, stated in announcing the legal challenge that the organization “testified many times before the Lower Merion Township Board of Commissioners and we were mocked. We brought petitions signed by residents only to see them disregarded.”

“The RACP funds were meant for the redevelopment of the Ardmore Train Station,” Browndeis goes on to say. “There is no recourse left for us but to go to court to stop the misuse of RACP funds.”

The history of the provision of RACP funds for an Ardmore project is almost as lengthy and full of twists as Lower Merion’s initiative to spark revitalization in the downtown around improvement of its train station.

As Save Ardmore’s petition details, the Redevelopment Assistance Capital Program provides grants of public funds for improvement projects and is administered by the governor’s Office of the Budget. In 2008, under then-Gov. Ed Rendell, an initial $6 million RACP grant for an Ardmore Station project was announced. Over later years, during Rendell’s administration, the amount was increased to a total $15.5 million.

Lower Merion Township in 2009 entered what would become a much-amended and extended developer’s agreement with Dranoff Properties as the project scope changed and evolved. Initially, a large mixed-use project and parking garage were planned connecting the train station and the Township Building on the north side of Lancaster Avenue. Due to funding shortfalls and site issues, the project was split, with Dranoff pursuing, with the township’s encouragement, a project on the Cricket Lot south of Lancaster Avenue. The township board ultimately approved using $12 million of the RACP funds for the public parking component of what was now being called One Ardmore Place.

Under Gov. Tom Corbett, the project saw a significant reversal when the township was informed in December 2013 that the $12 million was being rescinded, and only the remaining $3.5 million would be authorized for improvements at the train station.

The lawsuit quotes a section of the notification: “Given the major project scope changes, the fact that matching funds have been committed only for Phase I [the train station], the residential development component that is outside of RACP’s scope, the fact that the project continues to be conceptual, and the demand for funding from competing proposed RACP projects, the Commonwealth has reconsidered its funding commitment,” it reads in part.

That was not the end of the story, however. After lobbying efforts by Dranoff, the Office of the Budget wrote in August 2014 that it was restoring $10.5 million of the RACP grants for One Ardmore Place, which the township has identified as Phase ii of its Ardmore project.

In the petition, however, Save Ardmore Coalition points to the state’s Budget Project Itemization Act of 2007-2008, which identified the use of the RACP funds as for the “acquisition, infrastructure, rehabilitation, construction and other costs related to the redevelopment of the Ardmore Train station including the abatement of hazardous materials.”

“The use of RACP funds for the Cricket Lot Project is a misappropriation of public funds for improper and inappropriate private use,” the organization maintains.

Statement from Carl Dranoff:

"Last week’s authorization by the Lower Merion Township Board of Commissioners to authorize the execution of a proposed settlement agreement brought us one step closer to an important step in Ardmore’s continued transformation. However, the excitement I felt was short-lived, as Wednesday was a sad day for those who love Ardmore and want the community to thrive.

"While this week’s lawsuit from the Save Ardmore Coalition may claim otherwise, the RACP funding for One Ardmore Place is completely compliant with all applicable statutes, goals of the program and mandates set forth by Lower Merion Township. Through this delay and misuse of our court system, the Save Ardmore Coalition is holding the community back, while purporting to be a savior. For this reason, I question what the Save Ardmore Coalition is trying to accomplish and what their vision of “saving Ardmore” really means? The RACP funds have been in place for more than five years and were vetted by three administrations – both Republican and Democrat. In fact, One Ardmore Place is exactly the kind of renewal that the program was intended to generate, and its bipartisan support at all levels of government underscores this fact.

"Undeterred by this delay, Dranoff Properties will continue in our commitment to transform a surface parking lot into a vibrant, exciting, transit-oriented community with covered parking, stellar quality apartments and brand new shops along Cricket Avenue. Upon completion, we will deliver a new downtown hub of activity to live, visit, shop and park. The project will create new tax ratables, new feet on the street, new jobs and revitalize an important part of Lower Merion Township.

"We are committed to working with our neighbors to minimize disruption during construction, keep attracting customers to Ardmore by providing funds to the Ardmore Initiative, and building quickly and well. Let’s get started and work together, rather than succumbing to more delays, disruptions and apprehension. The time has come to stop the nonsense. Instead, let’s begin now to work together, and to build a project that Ardmore will be very proud to add to its revitalized downtown."

Source: Main Line Media