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There’s been a lot of talk this week in the news and social media about whether Peninsula Township properties could be sold to cover the nearly $50 million in damages awarded to the Wineries of Old Mission Peninsula (WOMP) earlier this month. Could that happen, and what would be involved? Could the Township file for bankruptcy? Will the Township shut down as we wait to see where things go in the winery lawsuit? And what does WOMP’s attorney have to say about all this?
First, a note about the most recent court filings in the lawsuit (see them all on the Township website here). These include WOMP’s petition for attorney’s fees, a Motion to Amend Judgment to Include Prejudgment Interest and Attorneys’ Fees, a Bill of Costs, and a Third Declaration of Joseph M. Infante (WOMP’s attorney).
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The Declaration is a 488-page document which includes details on the $2,194,137.69 attorney’s fees billed by Infante and other attorneys, along with details on the $46,259.38 for airfare, food, hotel and other travel costs for the attorneys and trial witnesses.
At the July 22 Township Board meeting, Township Supervisor Maura Sanders asked Treasurer Katie Clark to outline how the damages could be collected. Clark explained that the process involves the court clerk forwarding the judgment to Peninsula Township, where the supervisor would certify it and pass it to the treasurer for collection on the next Township tax roll.
Clark mentioned another option: the Township could issue a municipal bond to pay the full judgment upfront, then recover the cost through property tax assessments spread over several years. All of this, of course, is dependent on several things. WOMP could, in fact, choose not to collect on the judgment. WOMP and the Township could settle for a lesser amount (mediation is required by the Township’s insurers).
And then there’s the Township’s appeal, which will take place in the Sixth Circuit Court of Appeals. As with mediation, this appeal is also required by the Township’s insurers.
In a recent Traverse City Record-Eagle article by reporter Jordan Travis (no link because it’s behind a paywall), Infante expressed doubt that the Sixth Circuit will rule in the Township’s favor, but emphasized that other options remain before asking residents to cover the costs — a step he described as a last resort.
This could include liability insurance, as well as potential damages or malpractice coverage related to a lawsuit the Township filed against its former attorneys, Greg Meihn and Matthew Wise, and the firms Foley Mansfield and Gordon Rees Scully Mansukhani, alleging they failed to properly defend the Township in the early stages of the case, which began in 2020.
In the Record-Eagle story, Infante notes that the Township has money in various funds, some of which may be restricted, as well as assets that could potentially be sold. “There’s lots of ways they could decide to pay this voluntarily before it gets to an assessment,” Infante is quoted in the story.
Could the Township file for bankruptcy? State law provides a path for local governments facing a damages claim — tax the residents, as mentioned above.
However, Sanders pointed out that some township residents worry they could be priced out of Old Mission Peninsula if they’re required to cover the winery payments through increased taxes. She said the Township is open to settlement discussions with the wineries, but would plan for mediation and appeal as necessary “to protect the township and the fiduciary interests of residents.”
She also mentioned one part of her interview with Jordan Travis that didn’t make it into the Record-Eagle story. “I wanted to add that Peninsula Township is acutely aware that a special assessment of this magnitude will force some of our neighbors to sell and move off of Old Mission Peninsula. Several neighbors, many whose last names hold strong historical significance in the township, will no longer be residents.”
Sanders and other Township trustees have reached out to several winery owners, but as of August 1, only four have responded.
Below is a list of properties and assets owned by Peninsula Township, referenced by Sanders in her recent memo about suspending Township activities and services (this will be discussed at the August 12 Township Board meeting). But how viable is this option? Would it generate enough to cover a good portion of the $50 million? And what’s the market for these properties?
“Because these are not income producing assets, by and large, and I don’t know how one would generate revenue from these assets, even if it were possible,” said Township Trustee Dave Sanger.
“Clearly, one could sell the Township Hall and do a lease buy-back. But again, the point there being that even if we were to sell some of these assets like the fire station, the new owner is not going to let us use those facilities for free. [A lease buy-back] means that you then have to pay by the month just the same as a payment on the bond.”
Properties and Assets Owned by Peninsula Township
- 20-foot water access at the DNR boat launch on the corner of East Shore Road and Center Road
- Archie Park
- Bowers Harbor Park
- Bowers Harbor Natural Area on Devil’s Dive Road
- Bohemian Cemetery on Neahtawanta Road
- Ogdensburg Cemetery, corner of Center Road and Ladd Road
- Township Cemetery on Peninsula Drive
- Compactor and Recycling Station on Devil’s Dive Road
- Dougherty Mission House and Museum in the Village of Old Mission
- Fire Stations 1, 2 and 3 (Station 1 includes a cell phone tower; income from this tower has been funding the legal fees thus far)
- Two parcels at Haserot Beach
- Lot 102 on Swaney Road, adjacent to Haserot Beach
- Mission Point Lighthouse
- Mission Log Church
- Pelizzari Natural Area and Meeker Addition
- Swaney Road Garage and Overflow Parking
- Peninsula Township Hall
- Peninsula Township Offices
- Underwood Ridge water service utility station
What are your thoughts about these options for covering winery lawsuit damages? Should township properties be sold? Would you move off the Peninsula if forced to pay the wineries via increased taxes? Leave comments below.
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WOMP has sued us as well as every Peninsula Twp resident. We never dreamed such terrible thing would happen to us, and had we known, we’d have never moved here.
Ms Rinck, I still believe you moved to the right place – and I also believe there are enough constructive voices to carry us through to an amicable resolution. Be patient, stay involved and be discerning as to who is “Protecting” us.
In the 40 years our family has been OMP residents, have seen the farmers and their families, and our friends that own and manage much of the landscape in our community, be very creative, resilient and patient. I am not a farmer, but I sincerely admire them. Their tenacity and willingness to take exceptional risks has been to our mutual benefit. In my opinion, The FARMERS have Protected our Peninsula (not PTP) yet now they are presented as the villains…where they should be the Hero’s.
Some people enjoy the fight and the attention such as the Protect the Peninsula (PTP) agenda, but they normally are not your neighbor.
Protecting is one thing – “Taking” should not be condoned. The Judgement rendered summarized the appalling overreach of the Township into the rights of the Farmers and their businesses. Please know, the Townships presumptions have not only been with the farmers but on many of your OMP neighbors and their desires to make lawful constructive changes to their property. Those rights (your rights) should be now clearly protected. Old Mission will be the place you will want to continue to call Home.
Be assured, we have many wonderful and capable (and dedicated) individuals working for us in Peninsula Township. However, overreaching of many (NOTE not ALL) of those in Peninsula Township’s leadership, was not only stifling – but wrong. Some of our Township’s leadership exercised their personal opinions blended with poor judgment, to consider what is allowed to be permitted.
Hopefully, Peninsula Township Leadership, as well as PTP ‘s over protection mindset will be soften. Too much protection can lead to unintended consequences which is what we now have address.
Poor judgement, poor management and personal bias is what very naturally escalated to 212 degrees F. The quieter OPM voices are becoming more pronounced. We will be fine. You will be glad you stayed where you belong, on Old Mission Peninsula.
Kelly – I appreciate how hard you worked to appear to present a conciliatory opinion piece. That is what it is: an opinion, personal bias, and a rationalization. The wineries knew the rules from the beginning, presented their opposition, and nevertheless the people of Old Mission Peninsula voted in free and fair elections for candidates they felt best represented their interests. We have the elected officials we have because we chose them.
A question I have is: who are the investors in the wineries who will benefit from this judgement? Are they also farmers? Heroes?
Thank you both Kelly & Mary.
I hope this helps. I have been encouraged by some of our neighbors to keep an eye on this situation.
We might be missing something very important here, Mary. With due respect, the constitutional and legal rights of the wineries were violated (by an over zealous & ill-informed planning scheme), which, if we had received the proper legal advice when the scheme was under consideration prior to adoption, should not & would not have been adopted as an ordinance.
Had the Township possessed only the modest level of legal sophistication needed for it to consult outside land use legal counsel prior to adopting certain of the rules it would have been told that key restrictions being sought were clearly illegal. The judge said as much when he indicated he had a relatively easy time deciding this case despite the harshness of the outcome.
Our legal problems started the moment we adopted a scheme that was never legal in the first place. The first leadership failure was in our failure to get teh proper legal advice we should have obtained. I suspect there was LOTS of pressure to choke off the wineries from PTP.
As harsh as this outcome seems, I agree with Mr. Miller that the farmers are to be celebrated and need our support because that is the ONLY viable long term strategy to preserve the rural, open space character we all, PTP included, seek to preserve & protect. The Township went too far and then dropped the ball in handling the legal dispute it, not the wineries, precipitated, in my view.
Todd J. Anson
iPhone Sent
Thank you for your message.
question for thought….. Can the township sell the parks and property without a vote ??.and some of the property could have been donated to the township from a estate .,.
Yes. I thought Haserot was deed restricted, for one.
As a recent full time resident of OMP I have been trying to understand the issues at at hand and for the last week have been reading the articles and legal documents associated with the matter. Todd’s summary of the legal position OMP is the same conclusion I have come to.
In addition to what appears to be very poor legal advice and representation while writing and enforcing the zoning ordinances and what appears to be malpractice level representation in this legal dispute, I question what insurance coverage we had in place( liability , Officers and Directors, Etc.)? It seems that if we had reasonable and significant insurance, then the insurance carriers would have presented a much more robust defense from the beginning. For this reason, I suspect it is minimal coverage, but am unclear the amount and nature of our insurance coverage is not public knowledge.
All of that is water in the bridge at this point. It is unclear whether there is even a reasonable path to negotiate with WOMP but if possible of course it is desirable. At this point though we must understand that OMP lost and any of the possible res0lutions will be quite painful and change the quality of life here on OMP.
First, while I applaud the sentiment of Maua Sanders proposal to suspend all non- statutory financial requirements, I think this is more symbolic than any real solution. OMP’s annual budget is about $2.7 million I believe and suspending the services described would not save enough to move the needle on our approximately $53 million debt (legal fees added) and would result in significant damage to all of us as property owners. I also fear that it could open us up to more legal liability from property owners and businesses who would then be impacted by the inability to complete projects and do business normally, etc.
The available options to us are limited at this point. The only real options seem to be:
1. Collect the monies from residents by some form of property tax
2. Sell assets
3. Declare “bankruptcy.”
4. Some combination of the above.
I doubt that any reasonable negotiated settlement would still in a financial obligation that does not change this calculus. In other words, if WOMP agreed to $20 million, could OMP satisfy that without resorting to the same actions? I suspect not.
Unfortunately, I am coming to the conclusion that the Township does not have the revenue basis to support the type of government and services we wish to have (including the kind of legal expertise and insurance protections we need) . Keep in mind, however we solve the WOMP matter, it does nothing to prevent ,or protect us from, future issues like this from arising again.
Please send a questionnaire out to (y)our residents and give all a chance to respond. If possible, also include an indication for a one-time tax assessment to cover the current claim. I personally would rather pay the assessment and get this over with.