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City settles Kaleta lawsuits

City settles Kaleta lawsuits

Written by SUN contributor on . Posted in Community News, Holmes Beach.

HOLMES BEACH – City leaders may not be completely happy with the terms, but a settlement agreement has been reached between them and developer Shawn Kaleta concerning the Bali Hai Beach Resort, Islands West and the developer’s properties at the Coconuts Beach Resort.

Commissioners voted unanimously on Feb. 27 to approve the agreement reached during a recent shade (private) meeting, bringing to an end several different lawsuits. As a part of the agreement, each party is responsible for their own legal fees.

“Our position as a city is compliance,” Mayor Judy Titsworth said. “We felt really strongly on our side that regardless of where this took us, we didn’t have a site plan on Bali Hai. That’s why it was so important to me number one, to move on, but also to address all the different properties and have closure and compliance and something to move forward with.”

“It’s a fresh start and I think it’s good for both of us,” Commissioner Terry Schaefer said.

BALI HAI

In resolving the code compliance and permitting issues with the Bali Hai, the settlement agreement states that city leaders will cancel any outstanding fines and refund any fines already paid. In return, Kaleta agreed to submit a site plan for the property at 6900 Gulf Drive to the city’s building department within seven days to be processed as a minor site plan review.

City leaders also agree to review and sign off on any liquor license request for the hotel.

The hotel’s ownership also agrees to obtain any necessary after-the-fact permits needed for construction on the property.

Titsworth said that she was happy that the city will finally have a full site plan on file for the hotel.

COCONUTS BEACH RESORT

Regarding three units at the Coconuts Beach Resort, both parties agree to disagree on length of stay, however they agree that the units are allowed to be legally rented on a nightly basis. In return for Kaleta dismissing related lawsuits, city leaders agree to refund all code enforcement fines and administrative costs paid due to code compliance special magistrate hearings.

ISLANDS WEST

The Islands West property at 3605 Gulf Drive received legally nonconforming status as a result of the settlement, allowing the eight units on the property to be rented on a nightly basis. City leaders agreed to refund all fines and waive any unpaid fines incurred for renting the units on a nightly basis.

Kaleta and city leaders also agreed to issue a joint statement to be printed in both Anna Maria Island newspapers at the city’s expense. The statement, bearing both Kaleta’s and Titsworth’s names, states, “The city of Holmes Beach and Mr. Shawn T. Kaleta wish to publicly express their shared regret concerning any real or perceived animosity or ill-will between them. Although the current mayor and commissioners do not believe they have personally acted in this regard, no favor is gained by any city employee or official treating Mr. Kaleta or his partners and related entities differently than anyone else or unequally and targeting Mr. Kaleta and his properties will not be permitted as may have happened in the past. No benefit is gained by violating the city’s ordinances or performing work without appropriate permits. Compliance with all applicable statues, ordinances and regulations is expected of every citizen, property owner, business, visitor and the city. The city and Mr. Kaleta are committed to moving forward to working together to balance and advance the interests of all the city’s residents, visitors, tourists, businesses, property owners and stakeholders.”

Attorney Jay Diagnault, representing the city, said his office would monitor the actionable items in the agreement to make sure all of the terms of the settlement are properly executed.

Builder and city head back to court

Builder, city head back to court

Written by SUN contributor on . Posted in Community News, Holmes Beach.

HOLMES BEACH – City leaders and local developer/builder Shawn Kaleta are no strangers to meeting each other in court. This time, Kaleta’s attorney, Michelle Grantham, has filed a suit against city leaders in the U.S. District Court for the Middle District of Florida Tampa Division alleging that city leaders are discriminating against him and his various businesses in the city.

In the paperwork filed Dec. 31, Kaleta states he is filing for damages, along with declaratory and injunctive relief, alleging deprivation of property and civil rights by the city. The filing alleges that city leaders have violated Kaleta’s right to free speech and equal protection under the law, both protected by the First and Fourteenth Amendments to the U.S. Constitution.

The lawsuit argues that city leaders have passed regulations specifically targeting Kaleta and his businesses, particularly concerning the development and regulation of short-term rentals, and that he is held to a different standard by the city for the operation of his businesses than other business owners. It also argues that Kaleta, along with his development and rental properties, are singled out by the city for code enforcement and other potential violations and that city leaders publicly subject Kaleta to slander and blackballing.

Included in the lawsuit is the ongoing struggle between the city and Kaleta over the operation of a bar/lounge at the Bali Hai Beach Resort. Kaleta and Louis Najmy, serving as the attorney for the resort’s owners, have argued before the Holmes Beach code compliance special magistrate and city commissioners that there was a bar/lounge previously existing on the property, granting Kaleta the right to have one serving alcohol to patrons now. Due to the remodel of the space used as a bar/lounge at the Bali Hai, along with the introduction of a spa service area and construction work done at the site without prior building permits, the property ended up before city commissioners in 2021 for a site plan approval. After being discussed by commissioners at several meetings, commissioners eventually voted to not allow the operation of the bar/lounge on the resort property, one of the stipulations of the site plan approval. This action is listed in the current lawsuit as one example of how city leaders are allegedly discriminating against Kaleta and his businesses.

The lawsuit also alleges that the city and its special magistrate, attorney Michael Connolly, who is not mentioned by name in the paperwork, have arbitrarily regulated and fined Kaleta’s businesses.

The relief sought through the court by Grantham on Kaleta’s behalf includes having a trial by jury, a declaratory judgment on the city’s policies, interpretations, practices and actions as they related to the protection of Kaleta’s rights to free speech and equal protection clauses under the Constitution, an order by the court granting Kaleta injunctive relief ordering the city “to cease the unconstitutional and unlawful practices directed at plaintiff’s (Kaleta’s) ability to be properly notified and represented at code enforcement hearings, be treated fairly at code enforcement hearings, conduct his business, including hotel/motel and short-term vacation rentals, in compliance with city code and without arbitrary interruption by the city, and order the city, their officers, agents, employees and attorneys to cease from making false and slanderous public statements regarding plaintiff and his businesses and to record all future code enforcement hearings.” Other relief sought would require the city to issue a public apology to Kaleta through local newspapers and award Kaleta damages, pre-judgment interest, reasonable attorney’s fees and costs.

At press time for The Sun, the case had not been assigned to a judge and no hearings have been scheduled.

In the Manatee County Circuit Court, Kaleta had a win against the city as Judge Charles Sniffen denied the city of Holmes Beach’s motion to dismiss the second amended counterclaim submitted on behalf of the Bali Hai during a Jan. 5 hearing held by teleconference. The case before Sniffen concerns the operation of the bar/lounge and right of the bar/lounge to serve alcohol at the Bali Hai resort property.

Attorneys for the city argued that the second amended counterclaim failed to state a cause of action upon which relief could be granted and that the promissory estoppel claim listed in the second amended counterclaim should be dismissed with prejudice, arguing that city leaders never gave the Bali Hai’s representatives a promise that alcohol could be served indefinitely at the property.

With Sniffen’s denial of the city’s motion, the case will move forward in Manatee County Circuit Court.

Related coverage

 

Special magistrate reconsiders fines

 

Coconuts owner faces off with city code officers

 

Legal issues put a damper on wedding plans

Special magistrate reconsiders fines

Special magistrate reconsiders fines

Written by SUN contributor on . Posted in Community News, Holmes Beach.

HOLMES BEACH – This month’s code compliance special magistrate hearing was all about fines – reducing and eliminating them.

First up was a case involving 305 73rd St. and owners 305 73rd LLC. Though Special Magistrate Michael Connolly had already issued a final order imposing fines, attorney Louis Najmy asked for a reduction in fines on the owners’ behalf.

The violations found against the property in previous code compliance hearings included a dilapidated structure that the city had to secure against intrusion and engage a contractor to remove potentially dangerous building materials from the yard. The city also did not receive a timely response from the property owner, who did work outside the scope of permits.

Speaking on behalf of the city, attorney Erica Augello argued that the property has had two stop-work orders issued on it since code violations were first identified in September 2019. She said the property finally came into compliance with city codes and Connolly’s previous rulings on Aug. 31, 2021.

The total outstanding fines on the property were $51,900 plus $127.24 in administrative costs.

Najmy argued that his clients tried to work with the city but proceedings were delayed due to COVID-19 and other issues.

Connolly agreed to lessen the fines from $150 per day to $100 per day, bringing the total down to $34,500 plus the $127.24 administrative costs. Najmy said the reduction in fines should prevent the matter from being heard in Manatee County district court.

Another of Najmy’s clients, Bali Hai JV LLC, owners of the Bali Hai Beach Resort, had two matters involving fines heard by Connolly. In both cases, the city petitioned Connolly to rescind the fines against the property due to a due process issue where the hearing in which fines were levied against the resort’s ownership was not recorded. Since there is ongoing litigation in Manatee County circuit court between the resort owners and city leaders and the recording is a matter of due process, Augello asked Connolly to vacate the prior final orders and orders imposing fines in two of the nine code compliance cases against the resort. Augello stipulated that she would like the orders vacated without prejudice to allow the city to have the cases reheard and fines imposed for the alleged violations.

While Najmy said his clients do not object to the vacation of the fines, he does object to the reason for the city asking the fines to be vacated. He said he doesn’t believe that the city’s representatives were being totally honest about why they were asking for the reconsideration of the fines and final orders by the special magistrate.

Connolly ruled in favor of vacating the final orders and fines without prejudice.

The next code compliance special magistrate hearing is scheduled for Jan. 19 at Holmes Beach City Hall.

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Holmes Beach leaders and Bali Hai owners face off

 

Legal issues put a damper on wedding plans

 

Bali Hai legal dispute continues

 

Holmes Beach leaders and Bali Hai owners face off

Holmes Beach leaders and Bali Hai owners face off

Written by SUN contributor on . Posted in Community News, Holmes Beach.

HOLMES BEACH – No agreement has been reached concerning the operations of the Bali Hai Beach Resort between the hotel’s owners and the city of Holmes Beach, despite a pending court case, numerous code compliance hearings, fines and a pending site plan amendment approval.

Attorney Louis Najmy, representing the resort’s owners, including local developer Shawn Kaleta, appeared before commissioners on Sept. 15 for a site plan approval hearing. Due to issues with the site plan and a lack of compliance with city regulations, the site plan approval was postponed to the first meeting in October. This would allow the resort’s representatives additional time to work with city staff to create a site plan proposal that meets all of the city’s requirements and determine what action needs to be taken by the resort to come into compliance with city regulations until the proposed site plan for activities on the resort property.

During the Sept. 15 meeting, city commissioners agreed that they were unable to approve the site plan as presented but that they’d rather provide at least a partial approval instead of outright denying the presented site plan and risk going to mediation in the court system. Najmy argued that the site plan as presented has met all of the city’s expressed requirements. He said that his client has not complied with the code compliance order from a special magistrate to cease operations at the restaurant’s bar and lounge, obtain after-the-fact permits for construction work done and cease operations at an installed spa or cease holding special events at the resort. His reasoning for the non-compliance is that he thought his client should be able to continue with operations as-is until a site plan was approved and then the resort’s operations would have to come into compliance. City commissioners said that was not the case and that compliance has to be achieved and fines paid before the resort would be considered to be operating in good faith.

Najmy said he believes the $1,000 per day fine currently in force against the resort due to non-compliance with city codes was enacted erroneously and he is contesting it.

The issues between the city and the Bali Hai go back over a year to when work was done at the resort without permits from the Holmes Beach building department and a bar and spa were opened on the property for guest use without an approved site plan for the change in use.

The work done on the property includes installation of railings on the second floor of the resort, the demolition of an owner’s unit on the second floor of an accessory building and a storage room on the bottom floor of the same building, the conversion of those spaces into an office and bar/lounge area and the conversion of a resort laundry facility into a spa.

On behalf of his clients, Najmy argued that the resort’s owners do not need site plan approval from the city to open a bar/lounge on the property. City Planner Bill Brisson said he can find no record that a bar/lounge was ever approved for the site, meaning that a site plan approval from city commissioners is required for the amenity to operate legally within Holmes Beach city limits.

Najmy said that his client is seeking to operate in good faith with the city, though commissioners pointed out that his client is still operating the resort in violation of city regulations.

City Attorney Patricia Petruff said that there can be no approval of the site plan without the resort’s owners being willing to first come into compliance with city regulations. She added that a path forward needs to be determined to bring the issue to a conclusion before the courts truly get involved.

Though there is a court case pending in Manatee County Circuit Court, a hearing was not scheduled as of press time for The Sun.

The site plan is scheduled to come back before commissioners on Oct. 12.

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Legal issues put a damper on wedding plans

 

Bali Hai legal dispute continues

 

Bali Hai owners receive code fines

egal issues put a damper on wedding plans

Legal issues put a damper on wedding plans

Written by SUN contributor on . Posted in Community News, Featured, Holmes Beach.

UPDATED Aug. 30, 2021 at 12:05 p.m. – HOLMES BEACH – A local couple whose wedding plans were ruined by the Bali Hai Beach Resort was rescued by Island restaurateur Sean Murphy, who has offered them a wedding venue at one of his properties.

City Commissioner Terry Schaefer contacted Murphy after Bradenton couple David Naeher and Natalie Schofield appeared before commissioners on Aug. 24 to plead their case, hoping the city would approve their application for a special event permit to have their wedding on the beach in front of the Bali Hai.

Unknown to the couple, the resort – which advertises itself as a wedding venue – is not allowed to host weddings due to city permit violations.

Commissioners did approve the ceremony on the sand to take place pending a parking plan review by Police Chief Bill Tokajer, but gave the couple the bad news that their Oct. 16 reception cannot take place at the resort.

Ordinarily, Mayor Judy Titsworth said she would be able to approve or deny a special event permit, however, with the ongoing legal issues with the host resort, she felt it needed to come before commissioners.

City leaders’ issues with the Bali Hai and its ownership extend back for more than a year to when work was done on the property without permits and a bar and spa area were opened on the property without permits and an approved site plan amendment for the new uses at the resort. The resort’s owner, local builder Shawn Kaleta, is being fined $1,000 per day in code compliance fines and the site plan changes are outstanding. Titsworth said the site plan proposal is scheduled to come back before commissioners for discussion on Sept. 15.

Without an approved site plan or the proper permits and a pending court case in Manatee County Circuit Court, commissioners said that while they feel for the couple, they can’t approve any wedding events taking place at the Bali Hai. In addition, during a previous public hearing, attorneys for the Bali Hai said the resort would not be hosting weddings or seeking to host them in the future. In stark contrast to that statement, the Bali Hai’s website features a wedding planning page featuring events at the resort for up to 150 guests.

Grateful to Murphy, Naeher and Schofield both expressed their disappointment and anger at Bali Hai.

Schofield said she’s upset the resort sold her a wedding package that it wasn’t legally able to deliver. Now, she said, she has seven weeks to figure out what to do about the wedding and guests and has lost time that could be used to plan if they had found out up front that their reception couldn’t take place at their chosen venue.

Naeher said that when their application for the wedding was submitted to the city in July, he was told the reason it was denied was the lack of a parking plan for their 100 guests, something he thought could be easily remedied. Instead, while commissioners were willing to consider the wedding ceremony on the beach, an application for the reception, which would need to be submitted to the city for approval by representatives for the Bali Hai, would not be approved.

Commissioner Jayne Christenson said she thinks Bali Hai would go through with hosting the wedding reception whether it’s approved by commissioners or not.

If the wedding reception went forward at Bali Hai, the couple could end up with police officers or code compliance officers at their celebration and a fine being issued if there’s a noise complaint from nearby residential neighbors and a fine for the resort for hosting an event that’s not allowed to take place on the property and without a special event permit.

Titsworth said the court case is progressing as quickly as it can through the legal system and that the city will not give up the fight to bring the resort into compliance with city regulations.

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Bali Hai legal dispute continues

 

Bali Hai owners receive code fines

 

Bali Hai site plan negotiations continue

Bali Hai site plan negotiations continue

Bali Hai site plan negotiations continue

Written by SUN contributor on . Posted in Community News, Holmes Beach.

HOLMES BEACH – Talks between the property owners at the Bali Hai Beachfront Resort and city leaders are planned to continue at a future meeting and it looks like both parties are moving closer to an agreement.

During a Feb. 23 work session, discussions on the proposed Bali Hai site plan amendment continued, with Assistant City Planner Austin Doles giving a presentation on what the property owners would like to do and how she recommends city leaders respond. And while city commissioners and attorney Louis Najmy, speaking on behalf of the resort’s owners, are closer to an agreement, there are a couple of sticking points where the two parties are not seeing eye to eye, primarily concerning how the resort should operate until the site plan is approved.

City staff suggested the unpermitted bar/lounge and spa on the premises at the Bali Hai should cease operations until the site plan amendment is approved, permits are received, the property passes all inspections, and receives a certificate of occupancy for those areas.

Najmy said it’s unfair of the city to request the bar/lounge and spa operations to cease while the details of the site plan are worked out with city leaders. He argues that the bar/lounge area was a pre-existing use on the property. Brisson said he’s been unable to find any permits, business tax receipts, or other records that prove the bar/lounge was in use prior to the current owners opening it. Mayor Judy Titsworth said her father built the property and the area underneath the old owner’s apartment currently being used as a bar/lounge for guests was previously an entertaining space for the prior owners.

Najmy also argued that his clients have put millions of dollars into the property to try and make it a five-star establishment. Commissioner Jayne Christenson said it would have benefitted his clients to present their plans to the city for approval before investing to make sure that their vision for the Bali Hai resort could be accommodated in the residential zone where the property is located.

While commissioners said they don’t want to prevent the resort from being profitable for its owners, they have to consider the surrounding residential neighbors and what’s allowed in the beachfront district when approving the site plan, particularly since construction work was completed and amenities were added without prior approval from the city or permits being applied for.

And while discussions ended Feb. 23 at an impasse, commissioners agreed to move the proposed site plan forward to a regular meeting and public hearing in the hopes of getting more input from the resort’s neighbors. Commissioners also hope to reach an agreement with the resort’s owners before a case seeking an injunction to stop operations at the resort until a new site plan is approved moves forward in Manatee County Circuit Court.

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Bali Hai site plan review hits a snag

Bali Hai site plan review hits a snag

Written by SUN contributor on . Posted in Community News, Holmes Beach.

HOLMES BEACH – City commissioners are willing to go to the table with the owner of the Bali Hai Beach Resort, but they still have questions about the submitted site plan currently under review.

Issues between the resort’s owner, local developer Shawn Kaleta, and the city arose in 2020 when code compliance officers and the building official discovered unpermitted work being done on the property along with a bar and lounge being operated without a site plan approval from the city. Despite a stop-work order, a pending case in Manatee County Circuit Court and an ongoing code compliance case before the special magistrate, photos presented to city commissioners during a Jan. 26 work session show that construction work continued at the property along with the continued operation of the bar and lounge area.

Assistant City Planner Austen Dole presented the proposed site plan amendment given to the planning and building departments by Bali Hai representatives, noting that in addition to the other unpermitted areas, two small spa service rooms had been constructed in the laundry building, also without permits from the city.

While the site plan is being considered by city leaders, Dole said staff recommends that all operations on the property cease until the proper permits can be approved. Despite the argument submitted by the resort’s representatives, City Planner Bill Brisson said that in records dating as far back as 1998 he couldn’t find any prior use of a bar or lounge existing on the property.

Attorney Erica Augello said that part of the issue is that the bar and lounge area is still operating despite the ongoing litigation and code violations. Mayor Judy Titsworth said she wanted commissioners to go ahead and start the site plan review process to hopefully bring a quick conclusion to the issues between the city and resort owner. To that end, she encouraged commissioners to carefully consider the site plan presented, what questions they have for the resort’s representatives and what conditions they would like to apply to the site plan approval, such as not allowing wedding festivities, including receptions, to take place at the Bali Hai due to its location amidst residential properties along Gulf Drive.

“We do want him to be successful,” Titsworth said of Kaleta and his venture with the Bali Hai, “but we do want him to play by the same rules everyone else plays by.” She noted that the property has repeatedly been in violation of city codes since Kaleta took over as owner.

City Attorney Patricia Petruff recommended commissioners submit their stipulations for site plan approval to city staff to be written up in some form for discussion at a future work session. Commissioners agreed to readdress the issue at their Feb. 23 work session. No representatives from the Bali Hai were present during the Jan. 26 work session meeting.

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Rental property owners could be fined in October

 

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Special magistrate to levy fines in October

Rental property owners could be fined in October

Written by SUN contributor on . Posted in Community News, Featured, Holmes Beach.

HOLMES BEACH – Special Magistrate Michael Connolly is offering one last chance for property owners to come into compliance with his previous rulings on code violations before he levies fines in October.

Code compliance officers presented several cases before Connolly during a Wednesday, Sept. 16 hearing held at Holmes Beach City Hall. Seven of the cases presented were continued to a future hearing for reasons including pending potential changes to the city’s sign ordinance.

While those cases are set to be heard at a future special magistrate hearing, the cases that most concerned Connolly are the five in which he’s already ruled on alleged code violations and property owners have yet to come into compliance with local and state codes or his rulings.

During the September hearing, he gave the property owners a warning – if they don’t come into compliance before the next special magistrate hearing, scheduled for 10 a.m. on Wednesday, Oct. 21, he’s going to start instituting fines.

Anna Maria Island Inn

Three cases involve The Anna Maria Island Inn, 3501 Gulf Drive.

Speaking for the city, attorney Erica Augello said that the property’s sign, advertising daily rentals in a short-term rental zone, has been changed, but that the property’s advertising had not been brought into compliance. According to the special magistrate order, the resort’s owner, Shawn Kaleta, had until Sept. 18 to achieve full compliance with the order.

The order also states that the owner needs new, valid vacation rental certificates for the new units and to apply for demolition permits and demolish two illegally-constructed rental units on the bottom floor of the building. During a previous hearing, it was determined that the two ground floor units, located beneath the flood level established by the Florida Building Code, were constructed by a prior owner without permits, however, it was ruled that they’re now the current owner’s problem and cannot be rented.

Najmy argued that the owner has applied for the permits but the applications didn’t meet the city’s requirements for approval. He said he felt the requirements for approving the permits supplied by Schwartz are “overreaching.”

Augello also said that city code compliance officers have photographs alleging that the units are still being rented in violation of city codes and the special magistrate order. Speaking on behalf of the owner, Najmy said that the units are not being rented but that there are owners using the property. Connolly advised that Najmy may want to have those owners testify during the next special magistrate hearing when he’ll consider the fines.

Bali Hai

Two of the cases involve the Bali Hai Beach Resort, which is also the subject of a lawsuit with the city of Holmes Beach. The first case concerns work done on an accessory building without permits in violation of local and state building codes. The second case concerns selling alcohol on the premises without an approved site plan from the city; the alcohol sales are taking place in the accessory building.

The September special magistrate hearing was held two days before the deadline Connolly gave the property owner to submit a site plan for review and get the required building permits.

Augello said that the site plan has been submitted and is currently under review. To be approved, she said the site plan has to first go through a development review committee, then go to city commissioners for a work session and then a public hearing.

“There’s no way that they could’ve come into compliance by that date,” she said of the Sept. 18 deadline given by Connolly.

Where the property owner is still out of compliance, Augello said, is that none of the required building permits for work already done have been granted.

Representing the property owner, Bali Hai JV LLC, and manager Shawn Kaleta, was attorney Louis Najmy. Najmy argued that the permits have been applied for, but the applications were denied by the city’s building official. Building Official Neal Schwartz said that additional information is needed and the permit applications have to be resubmitted to be considered for approval.

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