Liens are first battleground in Watkins fight with JRA

by Ted Carter

Published: November 1,2013

Tags: business downtown, Farish Street, JACKSON, Mississippi

Farish Street_4262_rgbThe Jackson Redevelopment Authority has countered a lien filed recently by Watkins Development on behalf of the Farish Street Group and another by Dale Architects against the Farish Street redevelopment project with a court claim that the publicly property is immune from liens.

The JRA further claims that Watkins Development has no standing to initiate a lien, since the recently severed lease agreement for the redevelopment was with the Farish Stret Group — not Watkins Development. “The JRA is not indebted to Watkins Development for any sums whatsoever,” the JRA filing says.

» READ MORE — Displaced Farish St. developer says project ‘basis’ gives him edge in JRA fight

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The Dale Architects lien is separate and represents a claim for about $350,000 in services.

Watkins is both CEO of Watkins Development and managing partner of the Farish Street Group, LLC., which until Sept. 25 had a master lease to transform the long abandoned downtown block of Farish Street into an entertainment district.

Lance Stevens, lawyer for Watkins, said the liens are to ensure the return of the approximate $4.5 million of Farish Group money that went into the project. The liens, he said, would have priority over liens from other investors in the project, including the Mississippi Development Authority, which has a $5.4 million stake in the effort to transform Farish Street into an entertainment district.

Watkins Development “had a partnership with FSG and they know it,” Stevens said in an email.

In insisting it had immunity from liens, the JRA called the attempt by Watkins to secure his investment “incredible.”

“The property of the Jackson Redevelopment Authority is public property and it is not subject to any liens,” the JRA said in a press statement, though it did not cite a statute or legal precedent.

“Moreover, in its lease, the Farish Street Group committed that it would not allow any liens to be placed on Jackson Redevelopment Authority’s property and if any were attempted to be filed, it would satisfy them. It has failed to do so.”

The JRA did not detail why the promise not to file a lien would be necessary if a public property is not subject to liens.

An attorney with the Mississippi Senate who specializes in public lands said nothing appears in state statutes on either public lands or liens that would prohibit a private entity from entering a lien on publicly held property. “I don’t see why we would have something like that,” the lawyer said. “I just don’t know what they could possibly be referring to.”

An exception could be something in Mississippi case law, an area of law that attorneys for the Legislature do not follow closely, the lawyer said.

The JRA, for its part, advised in its press statement on the court filing that it would not field questions about the lien issue or any other aspect of the dispute with the Farish Group.

The Mississ Development Authority said last week the $5.4 million it has in the Farish Street redevelopment is in loans to Watkins and was used to pay off construction loans, a method the MDA noted is common in financing construction projects” in which it has an interest.

“The loans were not secured with the buildings but rather through future lease payments,” Tammy Craft, MDA spokeswoman, said.

“MDA is working with Jackson Redevelopment Authority and the Central Planning and Development District to determine the future course of action on how the loan will be recouped,” Craft said. “All legislated funds for this project have been expended.”

 

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