The City of Milwaukee could have to pay the owners of Juneau Village Towers more than $614,000 for special assessments made on behalf of the downtown business improvement district, although the actual amount will likely be much less
The state Court of Appeals on Tuesday upheld a portion of a 2015 decision by Milwaukee County District Judge Pedro Colon that rejected arguments from the city that the buildings’ owners had voluntarily paid the special assessment and that the statute of limitations had passed.
The owners of the building, listed in the lawsuit as DJK 59 LLC, JBC 59 LLC, Juneau Village II Limited Parnership, Juneau Village Shopping Center LLC and 829 Cass LLC, filed a lawsuit in January 2014 seeking to recover money for taxes paid between 2005 and 2012 as part of the BID special assessment. State law prevents special assessments for properties used for purely residential purposes.
Many of the plaintiff organizations are affiliates of Daniel Katz. Katz Properties
manages Juneau Village Towers
The case was put on hold temporarily as the same appeals court decided a similar case involving Yankee Hill Housing Partners. The appeals court decided the case for Yankee Hill, enabling the property owners to recover $196,000.
In the Juneau Village case, the court upheld Colon’s decision that the owners could recover the money, but reversed his findings on whether the recovery was limited by the passage of time.
Colon had ruled that a six-year statute of limitations didn’t apply because state law provides a one-year period for recovery of special assessments. He went on to rule the one-year limit didn’t apply either because the city didn’t have the authority to collect the assessment in the first place.
Appeals Court Judge Patricia Curley wrote that one reading of the statutes suggests there is no limit and the buildings’ owners could bring claims “for years to come.”
“Such a result is not reasonable and we must avoid interpreting a statute in such a manner,” she wrote.
The appeals court ultimately ruled the six-year limit does apply and left it to the trial court to determine which claims would be included.
The result is that the city will likely have to pay less than the full amount to the building owners. If the six most recent years are included in the claim, the city would be looking at paying roughly $360,000 plus interest.
Assistant city attorney Allison Flanagan said the city is still reviewing the case and determining the next course of action. The city would have 30 days to decide if it wants to petition the Wisconsin Supreme Court for a review.
It is unclear if the downtown BID would be on the hook for repaying the money. Milwaukee Downtown, BID #21 is not listed in the litigation. Chief executive officer Beth Weirick could not be reached for comment.
Attorneys for the building owners did not respond to requests for comment.