Notes on the

CLOSED SESSION OF THE CHAPEL HILL TOWN COUNCIL

MONDAY, MAY 24, 1999 AT 10:09 P.M.

Mayor Waldorf called the meeting to order at 10:09 p.m.

Council Members present were Flicka Bateman, Joyce Brown, Joe Capowski, Pat Evans, Kevin Foy, Julie McClintock, Lee Pavão, and Edith Wiggins.

Staff members present were Town Manager Cal Horton, Town Attorney Ralph Karpinos, Assistant Town Managers Sonna Loewenthal and Florentine Miller, Assistant to the Manager Ruffin Hall, and Acting Town Clerk Toni Pendergraph, Acting Clerk.

Michael Brough, Attorney, also attended.

Mr. Brough discussed the draft order prepared by the attorneys for the Plaintiffs and submitted to the Court and his concerns about the draft order, which does not provide for Council discretion. He said he has written a letter to Judge Wiley Bowen expressing his concerns. Mr. Brough stated he has also discussed the concerns with the Plaintiffs’ attorneys who have indicated they expect the order will be signed this week. He explained that the Court Order could (a) specify which of the Resolution the Council must approve or (b) indicate that the Council must issue the special use permit which could include reasonable conditions consistent with the Court Order.

Mr. Karpinos asked if the Judge might call all of the attorneys together to discuss the draft before he signs it. Mr. Brough responded that the Judge might do that, but would more likely issue the ruling without such a meeting. Mr. Brough said that when the order is received the Council must decide to appeal or not to appeal and will have 30 days to decide from the date it is signed. Mr. Brough said that the chances on appeal are difficult to predict but he believed that the Town had presented good arguments in Superior Court.

Council Member Bateman asked what were the strengths and weaknesses of the case in Superior Court. Mr. Brough responded that weakness was that the Council approved the Meadowmont Master Plan and the proposed plan for the project submitted by the Plaintiff was very close to the approved Master Plan, but a strength was that the size of the hotel and the office building is too large and their size is inconsistent with the Master Plan. He said the strength of the Plaintiff’s case are that: (a) that the Plaintiff presented their case well in Superior Court and (b) they can show that they believe they have complied with the approved Master Plan.

Mayor pro tem Capowski asked about the argument Mr. Brough presented regarding “borrowing” from one site for another within the project and whether this concept has been tested in a higher court. Mr. Brough responded that this argument had not yet been so tested.

Mayor Waldorf asked about the issues of the proposed proportion of commercial versus residential use. Mr. Brough responded that the Plaintiffs had taken the broad view that their overall proposed plan was consistent. He added that sometimes the Court of Appeals could be a bit of an abstract plane depending on the panel of judges.

Mayor pro tem Capowski asked Mr. Brough to explain the Plaintiffs’ argument regarding the Comprehensive Plan. Mr. Brough responded that the Plaintiffs had argued that the Comprehensive Plan did not hold in this case because it was so general and they argued that they did not have to pay attention to the Comprehensive Plan. But he said the Town argued regarding a very specific element of the Comprehensive Plan that had been written with this project in mind and was very specific.

Mayor Waldorf pointed out that in the Town’s Piney Mountain development case the Court of Appeals had said that the Comprehensive Plan was not a basis for denial of a special use permit. Mr. Brough responded that in the Estates case he had argued that very vague statements in the Comprehensive Plan do not articulate anything that is specific policy, but that in the Meadowmont case the Comprehensive Plan is very specific to the exact street and corridor, and he believes there is a significant distinction.

Mayor pro tem Capowski asked if the Town could argue that at the Master Use Plan stage the project is conceptual, but that when the details are submitted and the Council denies the permit, do we have to be sure that the details were included in the Master Use Plan? Mr. Brough responded that is the kind of argument he does make.

Council Member Evans asked when we approve the Master Use Plan can we then approve a conformance permit if the project meets 3 of the 4 findings? Mr. Karpinos responded to this question. Mayor Waldorf suggested that the discussion continue on the present situation.

Council Member Julie McClintock asked Mr. Brough to describe the process if the Town appeals the Superior Court Decision. Mr. Brough responded that after the Order is received the next step is to file a Notice of Appeal, then the Town has 35 days to settle and file the record, and in this case the record is already prepared. He said that after the record is filed, a printed copy is sent to the attorneys by the Court of Appeals within 30 days, and the Town would then have 30 days to prepare and file a brief. Mr. Brough stated that after the brief is filed the panel of judges in the Court of Appeals decides whether to hold oral argument and that this stage of the process is often not logical. He said whether there are oral arguments or not, the Town could receive an opinion within six months or a year, but in his experience it can typically be approximately nine months to a year. Mr. Brough said when the decision is received, if the panel was unanimous the Town can request discretionary review by the Supreme Court; and if the panel’s vote was not unanimous the Town can file an appeal with the Supreme Court, or decide to drop the case, or possibly negotiate a settlement.

Council Member Foy asked Mr. Brough to describe the process if the Town were to plan to negotiate a settlement. Mr. Brough said the Town should decide whether to appeal and would then file a notice of appeal which starts the time running, and could then file the record, and at either point approach the other side to negotiate. Mr. Brough added that the Council should have a prepared proposal to discuss and that proposal would depend on what the Superior Court Judge rules.

Council Member Bateman asked if the Council could have a plan in place to negotiate before we file an appeal. Mr. Brough responded that the Council could certainly do that, and added that the Council would still have to conform to the Court’s time schedule and that the Council would have approximately 65 days before substantial work would have to be done on the appeal.

Mr. Karpinos said he was concerned that what the Council may want would require a substantial change and whether a public hearing would have to be scheduled and whether the other side is interested in going through the public hearing process.

Council Member Foy pointed out that the Council needs to decide on what to do on a conditional appeal and decide what the Council is willing to settle for. Mr. Karpinos responded that the Council needs to decide on what to do if the Judge signs the order the way Mr. Brough has requested, and reminded the Council that what it decides must be consistent with the order but that the Council would have some flexibility.

Council Member Foy said that his intent with a conditional appeal would be to ask the Plaintiffs to reduce the number of parking spaces and reduce the square footage, and if the Plaintiffs needed more time to consider then the Town would go ahead with the appeal, meet the deadlines, and continue to negotiate.

Mayor Waldorf summarized the proposal:

1. Ask the Plaintiff to reduce the square footage of the hotel.

2. Ask the Plaintiff to reduce the number of parking spaces at the office park.

3. Allow the Plaintiff to build the number of parking spaces needed to qualify for the loan they need and ask them to dedicate a number of the parking spaces for a park and ride lot.

Mayor Waldorf said she wants to be sure that a stipulation is included in the settlement regarding the Plaintiffs’ verbal agreement to the Council that an arrangement would be made regarding property taxes if the building(s) were sold to a non-profit.

COUNCIL MEMBER FOY MOVED TO AUTHORIZE THE APPEAL, SECONDED BY COUNCIL MEMBER MCCLINTOCK. THE MOTION WAS ADOPTED 5-4, WITH COUNCIL MEMBERS BROWN, BATEMAN, CAPOWSKI, FOY, AND MCCLINTOCK VOTING AYE, AND MAYOR WALDORF AND COUNCIL MEMBERS EVANS, PAVAO, AND WIGGINS VOTING NAY.

Mayor Waldorf pointed out that during the appeal process there may be a need for decisions and some Council Members will be out of town during the summer.

Council Member Foy pointed out that the Town’s attorneys need to know what point the Council needs to get to for an agreement.

Mayor pro tem Capowski stated that if our goal is to have a less visible building we should start with lowering that structure and that would reduce the square footage.

Mayor Waldorf asked if the request was either elimination of a floor or a reduction of square footage and to also ask for the minimum number of parking spaces required by the ordinance for the hotel?

Council Member Wiggins asked what would happen if we are successful on one negotiation and not the other, would there then be only one appeal. Ralph Karpinos responded that each Plaintiff is independent. Mayor Waldorf stated that the Council should deal with each Plaintiff separately.

Council Member Bateman asked Mr. Brough to notify Ralph Karpinos as soon as an order is received so he can notify the Council and the Council can be prepared to handle calls from the press.

Council Member Evans requested a copy of the order as soon as possible. Mr. Brough agreed.

Council Member Bateman requested that the Council be notified of any alternative proposals received from the Plaintiffs so that the Council could convene. Mr. Brough agreed.

Mayor Waldorf asked if the Council agreed that Michael Brough and Ralph Karpinos were authorized to begin the negotiations with the Plaintiffs and there was agreement.

The Closed Session adjourned at 11:10 PM.

By acclimation, the Council then moved into Open Session.

The Open Session was adjourned at 11:10 p.m.

The minutes of May 24, 1999 were adopted on the 11^th day of October, 1999.

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Joyce A. Smith, CMC