Freeport council tables EDC settlement to finish six-house Skinner Street project, requests clearer contract terms

The Freeport City Council on Feb. 17 tabled consideration of a proposed Economic Development Corporation (EDC) settlement intended to finish a stalled six-house project on Skinner Street, saying the document needs clearer contract language on scope, timing, drainage and liability.

Pat Zvezda, the mediator appointed to the case, told the council the parties signed a confidentiality waiver so he could speak about the process and that "all the parties came together, went through the mediation process" to reach a compromise intended to avoid litigation. Herman Torres, managing member of GL and L Holdings, said his group — which he described as both a lender and developer — has paid for permits and has already invested in two house foundations. "We are the lender and we are the developer," Torres said, adding that his team would provide proof of funds by Friday and is willing to pay for its portion of Avenue M and to complete sidewalks and driveways.

Council members, however, pushed for more detail. Councilman Jay Pena asked a fundamental legal question: "Who owns the property? Legally," noting that ownership determines who would be liable if someone is injured on the site. Pena repeatedly pressed the city attorney to provide a definitive opinion rather than lay explanations. City and EDC counsel said title is a central risk in the underlying litigation; attorneys and the mediator explained that the settlement aims to resolve title issues and that the EDC would convey deed and provide title assurances to enable transfers to lenders or developers if the settlement is adopted.

Other council questions focused on engineering and construction detail. The mayor and other members pointed out that earlier plans included curbs and that prior conversations with the fire marshal had led to a narrower cross-section without curbs as a cost-saving measure. Council members also asked whether drainage studies had been completed; staff said no drainage study had been done while the project was litigated and that engineering and drainage work would be required and submitted for city review as part of the permitting process. Torres said contractors have been engaged for engineering and that the developer is willing to pay for engineering studies and the portion of the street the company committed to fund.

Council members sought enforceable schedule consequences if milestones are missed and asked that the settlement explicitly attach the permitted scope of work (lot-by-lot specifications, house square footage and quality), payment timing for the 50/25/25 cost split described in the agreement, and an explicit statement on who is responsible for curbs and stormwater. Torres said the parties can and will include a clear scope and are open to "hefty consequences" because they expect to finish the houses "way before" conservative timelines crafted by staff.

After more than an hour of questions and debate over proofs of financing, potential mold in partially built structures, and the legal effect of the settlement vis-à-vis pending judicial determinations, Mayor Cain moved to table the item so attorneys can insert clarifying language and present a revised settlement on a future agenda. The motion to table was seconded and adopted by the council.

Next steps: staff and counsel will work with the developer and EDC counsel to produce a revised agreement that specifies scope, payments, schedule, consequences for missed milestones and title assurances; the item will return to the council once those clarifications are incorporated.