A years-long disagreement over a Public Works facility lease appears to be coming to a close, as the parties have agreed to settle their disputed issues.
At a work session on Tuesday night, city Solicitor Neil Grover told Harrisburg City Council that the city had reached an agreement to pay $725,000 to MEB Partners and Brenner Motors to settle outstanding rent, tax and repair issues arising from a three-year lease of the Public Works Department site on Paxton Street.
“We never disputed that we owed some rent and that we owed taxes related to a reimbursement, ” Grover told council members at the end of the four-hour work session. “It really was just a question of the amount that we had in dispute with each other. So, this is a fair resolution to a long problem that arose from a lease that was negotiated very quickly.”
For many years, the city’s Public Works Department was located on the site of the city incinerator in South Harrisburg. The department had to relocate quickly after the incinerator was sold in 2013 to the Lancaster County Solid Waste Management Authority.
The city eventually opted for the former home of Brenner Motors on the 1800-block of Paxton Street, signing a three-year lease with the expectation that it likely would purchase the property.
However, the city stopped paying its $16,000-a-month rent in 2017 after negotiations to buy the property stalled over price. MEB and Brenner then sued the city, and the case eventually went to mediation.
Council still must approve the agreement, which may happen during next week’s legislative session. Grover said that he was awaiting some “final language” from the opposing side.
Reached by phone, Brenner attorney Adam Klein said that his client looked forward to resolving the issue.
“I think both sides are happy to put this behind us,” he said.
The agreement announced on Tuesday night solves only the outstanding issues related to the lease. It does not resolve the continuing disagreement over the fair value of the land.
In 2018, the city initiated eminent domain proceedings, taking the property a year later. It paid $2.2 million, which, following an appraisal, the city deemed to be fair compensation. The city and Brenner, however, remain at odds over the price.
“There is a dispute in the court about the just compensation for the eminent domain, which is separate,” Grover said.
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