Residents, Contractors Blast Village Officials Over Radisson Debacle
Angry taxpayers and small business owners packed the Village Board meeting Monday and were met by silence from officials.
Menomonee Falls residents and unpaid contractors packed the Village Board meeting Monday to unleash anger at officials over the troubled Radisson Hotel project — with several calling on trustees to resign.
They were met with only silence.
“Get out of the private sector,” Mark Rattan of Menomonee Falls, told the board members, who listened stone-faced. “It’s not the role of government. What were you thinking?”
Even when one resident took the podium to tell the board she just wanted to hear trustees' side before making up her mind, board members said nothing.
“This isn’t a response session,” explained Village President Randy Newman to the crowd of people who filled nearly every seat in the board meeting room of Village Hall.
Only a few people had a chance to speak out of the several dozen in attendance when Newman said the 15 minutes typically allotted for the public comment session had run out. The short public venting session did little to alleviate residents’ and contractors’ concerns. If anything, people seemed angrier afterward, clustering in the hall to continue venting about the topic and calling village officials “smug” and unemotional.
"It's a joke. I think we should recall them."
Some mentioned the possibility of recalling village officials or just booting them out at election time. And the contractors said they are talking about banding together to launch a counter-suit against the village for not paying them for all of the work they did on the hotel.
“It’s a joke,” said Lee Georg Jr., a Menomonee Falls resident who attended the meeting with his wife. “I think we should recall them. Good loans can go bad. But bad loans never go good. And this was a bad loan from the start.”
“They don’t give a damn,” said Sylvia Block of Palmyra, whose husband is out $10,000 for computer work he did on the Radisson. “They have no emotion. I think they better not get too comfortable in their chairs.”
The village holds the nearly $18 million mortgage because it’s the primary lender on the property, which is now in foreclosure. That's the part that upsets residents the most — they say it wasn't the role of government to lend that much money to private business.
“Why put the taxpayers on the hook? “said Dennis Schultz of Menomonee Falls. “This was risky business.”
Officials promise answers soon
After the meeting, officials maintained their silence, saying it was on the advice of lawyers. But Village Manager Mark Fitzgerald said officials are planning a press conference soon in order to address residents’ concerns. The topic has also aired on talk radio.
“We can’t,” said Newman after the meeting, when asked by Patch for a response. “Our lawyers have advised us not to speak on it. There is nothing wrong with concerned citizens coming forward. I owe them that voice.”
“I can’t,” echoed Fitzgerald. “We are going to try to pull together a comprehensive press conference soon.”
The board met in closed session before the meeting with counsel and staff to discuss litigation strategies involving the project, but never came into open session on that discussion.
The village confirmed in mid-June that it has filed a foreclosure action in Waukesha County Circuit Court involving the village’s mortgage on the Radisson.
The village is trying to recoup $14.4 million in principal that it advanced, as well as interest and other costs. In the suit, the village is seeking property and collateral from five members of the ownership group of the hotel.
The hotel, banquet facilities and a restaurant remain open.
Things have gotten progressively worse, with contractors saying they weren’t paid, the Waukesha County District Attorney getting involved in looking into what happened to the contractors’ payments, and some of the money is going to payments for payroll.
The development agreement between the village and owners dates to 2010, when the village agreed to provide the nearly $18 million loan to jumpstart the hotel’s construction.
One of the developers quickly filed for bankruptcy. The village has already appointed a receiver to monitor day-to-day operations of the facility.
Menomonee Falls resident Dennis Barthenheier said before the meeting that the anger is a carry over from “the tea party and Scott Walker. The time is ripe for this” kind of protest, he said.
“What were they thinking?” he said, noting that the loan is the “equivalent of an entire year’s budget" in Menomonee Falls.
Lawmaker questions officials' lack of response
State Rep. Don Pridemore (R-Hartford) is running for re-election in a redrawn district that now includes a much larger portion of Menomonee Falls. He talked to residents and contractors before and after the meeting, although he didn’t address the board.
“It blows my mind, the amount of money involved here,” Pridemore said.
Pridemore said he was bothered that board members said nothing in response to residents' concerns on Monday.
“There wasn’t any reception. If someone was asking me to resign from my job, I don’t think I’d hide behind some rule," he said. "This is not going to help settle anyone’s fears that the taxpayers are going to get stuck with all of it.”
Pridemore said he hopes the village officials would address residents’ concerns soon. “They need to do so, if not tonight, then in the near future,” he said.
Bill Savage, a Pridemore staffer who is one of the officers in a newly formed Menomonee Falls Taxpayers Association group, passed out flyers on the group to residents. Steve Welcenbach, a Menomonee Falls small business owner who is president of the new group, told the board it needs to look to the future to ensure the success of the hotel, since taxpayers now own it.
The new taxpayers group is launching a petition drive to create a referendum that would require Village Board members to put any capital expenditures of more than $1 million to a binding referendum.
Contractors have a lot at stake
Jerry Block, a contractor, and Sylvia Block’s husband, echoed a similar theme, telling the board that it would make sense to maintain good relationships with the contractors since they spent “a lot of time and energy remodeling it.”
Thus, he said, it would take new contractors more time and money to get up to speed as issues arise with the building. People said they are worried the conflict and negative media attention would make it harder for the hotel to succeed.
However, Rattan said he didn’t think the village should “voluntarily make good” with the contractors, saying he was concerned about all of the costs being shouldered by taxpayers.
Former Village President Jefferson Davis gave a speech to the board that culminated in his saying, “Shame, shame, shame. You can’t be trusted.” But he said the village should pay the contractors. “Do the right thing,” he said. He said if the board was private stock with a CEO, there would be resignations.
Contractors are particularly incensed by news reports that the money is going to pay payroll.
Tom Malezewski, owner of Heritage Glass, told trustees that he has lived in Menomonee Fallls since 1959. He said he’s owed $57,149 for installing all of the Radisson’s glass work.
“This has put a terrible strain on my company,” he said. “I hope that I am not going to lose my company over this. And it looks like my taxes are going up. Just pay us. We just want to be paid.”
Applause erupted after his comment.
Before the meeting, Malezewski commented, “Taxpayers are going to be screwed.” As a contractor and a Menomonee Falls taxpayer, he said he’s going to get hit twice. “They (board members) need to be held to account.”
“They are suggesting we pound sand,” said Mark Mouradian, representing a company that did kitchen design work on the Radisson. “We turned down other work to do this that would have paid.”
Barry Bloom, of Brookfield, another contractor, said contractors received letters from the village that told them to continue working on the project. They want the district attorney to consider whether the village’s actions amount to criminal theft, saying the village is basically acting as a general contractor. But Bloom said District Attorney Brad Schimel didn’t agree that a criminal theft by contractor violation could be met at this time.
“They should be doing the right thing here,” he said of the board. “They promised to pay us.”
The contractors said that several of them have been attending the past few board meetings to air their concerns.