Meadville Tribune

September 14, 2013

Beach Club leaseholder seeks new avenue to get insurance money

By Jane Smith
Meadville Tribune

SUMMIT TOWNSHIP — The future of construction of a new Beach Club to replace the one which burned last month still remains in question — as does who gets the proceeds from an insurance policy. But Park Restoration LLC, which holds the lease on the Beach Club, is hopeful a new angle can help the company recoup some of the insurance money.

Last month when the club and adjacent Dockside burned, the only insurance on it was that carried by Park Restoration. However, the law is that if there are tax liens against the building, any insurance proceeds must be used to pay those before any other payments are made.

Conneaut Lake Park has nearly $900,000 in tax liens against its property, which includes the Beach Club and Dockside. The Trustees of Conneaut Lake Park, which oversees the park, had no insurance on the buildings.

Park Restoration filed suit asking Crawford County Court of Common Plea to order that the insurance be paid to its company as it had paid the premium.

However, Crawford County Court of Common Pleas Judge John Spataro ruled the insurance monies had to be paid toward the taxes. That means tax liens held by Summit Township, Conneaut School Board and Crawford County would be satisfied before proceeds would be paid to Park Restoration.

In a new suit filed Thursday, Park Restoration is asking the court to consider another angle. Park Restoration notes in its suit that the delinquent taxes are for the entire 55.3275 acres, which comprise Conneaut Lake Park. The entire park’s assessed value is $152,195 for all the buildings. The Beach Club and cafeteria (now Dockside) are assessed at $13,933 — or 9.2 percent of the assessed value.

The suit alleges that if the entire tax bill were paid it would “benefit Conneaut Lake Trust for its own extreme dereliction of duties.” It continues that if the payment of $478,260.75 were paid for delinquent taxes, the trust would receive a windfall since it has failed to pay taxes on any of the parcel and its buildings for approximately 17 entire years despite receiving “payment from the plaintiff” as per the agreement.

Park Restoration is asking the court to determine whether the “property” should include merely the tax assessment and delinquent taxes associated with the Beach Club or whether the “property” encompasses the entire park.

Park Restoration is asking the court to:

n Interpret whether the law applies to this case

n Determine what amount, if any, the taxing bodies should claim for just the Beach Club property

n Determine whether the township or Crawford County have any claim to the insurance proceeds

n Determine whether the Trustees has any interest in the insurance proceeds

No date for a hearing on the suit has been set.

Jack Moyers, chairman of the Trustees, said Thursday that procedurally the first lawsuit was “filed incorrectly. In the end, it accomplished the goal of stalling the payment,” adding “a second lawsuit is pending.”

Sutterlin said the insurance company has the funds and there is no deadline for payment.

In the meantime, plans are progressing to have the fire debris at the site cleaned up. Moyers said the Trustees had not received notice that the site had been released from the authorities that have jurisdiction, but he said the site cleanup is being scheduled very soon. Moyers said some legal papers that will begin the cleanup are being processed.

To rebuild or not to rebuild

In addition to the issue regarding the insurance, another decision to be made deals with rebuilding the Beach Club.

Sutterlin had said he would only rebuild if the Trustees would get a separate tax identification number for the Beach Club and Dockside so he could pay the taxes and keep them current. He said without that separate ID number, he would not consider rebuilding. He also asked Trustees to extend the lease to 30 years.

Asked what the status of that request is, Sutterlin said, “The Trustees refuse to meet or communicate in any manner. We are making attempts but they will not respond.”

Moyers, however, said, “The plan that was presented to the Trustees just four days after the fire contained criteria, stipulations and requests that were in some case beyond the board’s jurisdiction. Beyond that, the proposal’s only cure for the issues between the two parties was for the board to forgive all grievances against Park Restoration: No compromise, no settlement, no cure.”

Moyers was referring to another issue where the Trustees allege that Park Restoration is in breach of contract.

Sutterlin said Park Restoration is going ahead with sponsoring events to raise funds to be able to rebuild the Beach Club and Dockside. The first of such events — Rock 2 Rebuild — is being held through Sunday.