A Spokane developer says the Kennewick Irrigation District owes him about $297,000 for forcing him to build an irrigation pond twice as large as it needed to be.
Lowell McKee claims he had no choice but to meet KID's demand for the oversized pond before he could begin building the 118-unit Gooseridge Apartments in West Richland. The project is on seven acres, north of Arena Road and west of Bombing Range Road.
KID would not release easements, which blocked the development, until the pond issue was resolved.
A demand letter from McKee's company sent to KID claims that the irrigation district "improperly compelled (McKee) to expand and improve" the KID pond as "an unconstitutional exaction."
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Chuck Freeman, KID's district manager, said they would not discuss the demand for reimbursement because the dispute is heading into litigation.
"Obviously, we have a difference of opinion," Freeman said.
McKee's letter claims that KID's only explanation for up-sizing the pond was to have more irrigation water available to serve additional customers.
According to McKee, KID engineer Jason McShane told him in an email, "the usage increase is due to an increase in the irrigable acreage in 2008 for the 2009 assessments."
McKee told the Herald in an interview in January that he was "livid" about having to build a larger pond.
"We had their approval in 2005, and then they said it had to be bigger, all at our expense. They blackmailed us," McKee told the Herald for a story published Feb. 7.
McKee claimed that he had negotiated with KID to have its existing 69-acre-foot pond relocated about 100 feet to make room for the apartment complex. McKee alleges the agreement required him to build a replacement pond of the same size, but he later was ordered to make it a 146-acre-foot pond, which doubled the cost from $312,508 to $609,709.
Joe Hamell, a Spokane attorney representing McKee, said in the letter to KID that the agency's actions not only added cost for the developer but delayed the project.
"By changing the requirements for the pond relocation, KID delayed the completion of the project resulting in lost income," Hamell wrote.
KID didn't release its easement until October 2010, which cleared the way for construction on the apartments.
Hamell said in the demand letter that KID's actions show the intent was to have McKee's project pay for expansion of the pond for the purpose of serving future properties, as a Local Improvement District along Bretz Road.
Hamell claims KID violated state law by forcing property outside of the LID to pay for benefits that are exclusively for that LID.
Records obtained from KID show there was no response to McKee and Hamell.
Hamell has since filed a claim with the district for $297,201.
KID has retained Kennewick attorney George Fearing to handle the case.