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Lawsuit asks court to permanently stop Project Pascalis from moving forward in Aiken

A lawsuit filed Tuesday morning could bring Aiken's Project Pascalis downtown redevelopment project to a halt. 

Six residents of the city, the Historic Aiken Foundation, the Green Boundary Foundation and the South Carolina Public Interest Foundation have filed suit over the downtown redevelopment project against the Aiken City Council, the Aiken Municipal Development Commission, the Aiken Design Review Board, RPM Development Partners, Raines, city attorney Gary Smith and John or Jane Does 1-10. 

The lawsuit asks the court to permanently stop the project after issuing an order declaring the actions of the city, the Design Review Board and the Aiken Municipal Development Commission are improper because those actions violate the South Carolina Community Development Law, the South Carolina Local Government Comprehensive Planning Act of 1994, the city's ordinances and customs, state ethics laws, and the South Carolina Freedom of Information Act. 

Project Pascalis is the city's name for the $75 million downtown Aiken redevelopment project being shepherded by the Aiken Municipal Development Commission. The project calls for redeveloping properties in the block surrounded by Laurens Street, Richland Avenue, Newberry Street and Park Avenue.

The plan, as proposed, calls for the demolition of the former Hotel Aiken and buildings next to it on Laurens Street and their replacement by a 100-room hotel. Several buildings at the corner of Newberry Street and Richland Avenue would be demolished and replaced by an apartment complex and a parking garage, with the new building footprint extending out into what is currently the southbound lane of Newberry Street. The former city municipal building on Park Avenue would be expanded into a conference center. 

The six residents of the city are David W. Blake, Luis E. Rinaldini, former Aiken City Councilman Dick Dewar, Jenne Stoker, Beatrice B. McGhee and Gail King. Rinaldini is a leader with the Do It Right Alliance, a group opposed to the city's current plans for Project Pascalis. 

Attorneys W. Andrew Gowder Jr. of Charleston, Michael T. Rose of Summerville and James G. Carpenter of Greenville filed the lawsuit Tuesday morning in the Aiken County Court of Common Pleas.

The named defendants are Aiken Mayor Rick Osbon and Aiken City Council members Kay Brohl, Gail Diggs, Ed Girardeau, Andrea Gregory, Lessie Price and Ed Woltz in their official capacity; the Aiken Municipal Development Commission; Aiken Economic Development Director and Aiken Municipal Development Commission Executive Director Tim O'Briant in his official capacity; Aiken Municipal Development Commission members Keith Wood, Catina Broadwater, Marty Gillam, J. David Jameson, Stuart MacVean, Philip Merry, Chad Matthews, Doug Slaughter and Chris Verenes in their official capacity; Aiken Design Review Board members McDonald Law, John McMichael, Katy Lipscomb, Ben Lott, Ahmad Mikell, Hannah Robbins and Josh Stewart in their official capacity; RPM Development Partners; Raines Company and Raines Development; and John or Jane Does 1-10. 

Plaintiffs allege multiple violations

The plaintiffs allege 15 violations of the South Carolina Community Development Law.

Most of the allegations center on a plan the Aiken City Council approved in 2020 on the recommendation of the Aiken Municipal Development Commission for Hotel Aiken. 

The plaintiffs allege that the Aiken Municipal Development Commission's approval of the plan was improper because it does not focus on a blighted or a conservation area, because no public hearing was held by the commission before the plan was selected and because the redevelopment plan approved doesn't resemble the current plans for Project Pascalis.

The plaintiffs also allege that the Aiken City Council authorized a purchase and sale agreement between the Aiken Municipal Development Commission and RPM without a properly selected redevelopment plan, and its issuance of $9.5 million in bonds was improper because no redevelopment plan was selected. 

They allege that the commission's purchase of the properties violate South Carolina Code, that the conveyance of part of Newberry Street to RPM was improper, and that five members of the commission can't serve because they aren't city residents or they had financial interests that would prevent them from serving. 

The plaintiffs also allege that the commission moving toward a selection of RPM Development Partners as master developer is improper because they have not yet been selected as the redeveloper for the project and the requests for proposal the city issued were improper because the plans approved aren't similar to the current Project Pascalis plans. The suit also alleges the requests for proposals issued are not proper because they were issued after the city entered into an exclusive negotiation with RPM.

The plaintiffs allege violations of the Local Government Comprehensive Planning Enabling Act of 1994, a state law related to zoning laws for overlay districts in cities and towns. The property to be redeveloped in the Project Pascalis plan is included the Old Aiken and Historic Aiken Overlay Districts.

The plaintiffs also allege 19 violations of the city's ordinances, regulations and customs. 

They argue that the Aiken Design Review Board should not have approved RPM's request to demolish the former Hotel Aiken building and three buildings near it because the application was "fatally flawed and incomplete," that the certificate issued to proceed with the demolition was improper because it was conditionally granted, that the board didn't request appropriate materials to review, that the board didn't comply with the city's zoning code and that the board didn't evaluate the attributes of the other buildings to be demolished before it approved the certificate of appropriateness. 

The plaintiffs say the board didn't require compliance with design guidelines and requirements of two overlay districts in downtown Aiken, that the board had failed to preserve structures related to the history of the city, that the board's approval of the demolition of Hotel Aiken was improper because the board didn't consider that the owner of the property had caused the decay that led to a need for demolition, and that members of the Aiken Design Review Board and Aiken Municipal Development Commission are not qualified because they are not residents of the city. 

The plaintiffs argue that Osbon violated state ethics laws by participating in discussions about the project despite it involving the location of his nearest business competitor, Warneke Cleaners, and that city attorney Smith violated ethics laws by offering advice on the project when his law partner, Ray Massey, is one of the partners in RPM Development Partners. 

The plaintiffs argue that the city violated the South Carolina Freedom of Information Act in seven ways. 

Those allegations include a lack of notice or inadequate notice of meetings, that the city's use of executive sessions is excessive and unjustified, that the city has failed to provide meeting minutes within a reasonable amount of time, failing to allow inspection or to produce documents without providing a reason, denying the public access to agendas or to attend meetings, failing to respond to requests under the act and failing to keep adequate records of meetings.

Next steps

Aiken City Manager Stuart Bedenbaugh said Tuesday the city was aware the lawsuit had been filed and copies of the suit have been provided to the city's attorneys. He added that he would have no further comment until city's lawyers review the suit. 

O'Briant also declined comment Tuesday afternoon. He said he was aware of the suit, that it was with the lawyers, and he would have no comment on pending litigation. 

Osbon declined comment when reached Tuesday afternoon. 

The suit filed Tuesday does not mention an emergency order to stop the project, but a motion for one could be filed later. 

It is the second lawsuit filed over Project Pascalis. A lawsuit alleging ethics violations by Smith was filed last month and remains pending

The city and everyone else named in Tuesday's suit will have 30 days to respond to the allegations contained in the suit. That number increases to 35 days if the defendants are served by mail. 

The next Aiken City Council meeting is scheduled for July 11.