A group of residents voluntarily dismissed a lawsuit that challenged Island County’s award of $1.5 million to a nonprofit organization that plans to convert a Freeland motel into low-income housing.
Freeland Concerned Citizens LLC dismissed its lawsuit against the county, the Low Income Housing Institute, the former owner of the Harbor Inn and the state without prejudice, which means it could be refiled in the future.
Island County Superior Court Judge Carolyn Cliff granted the dismissal but ruled that the defendants can file motions to compel Freeland Concerned Citizens to pay their attorneys’ fees based on a law that allows prevailing parties in frivolous lawsuits to receive expenses.
Attorneys representing the county, the Low Income Housing Institute and the former owners of the Harbor Inn argued in a response to the motion for voluntary dismissal that the action should not preclude the defendants from seeking attorneys fees.
While the judge agreed, it’s unclear whether the defendants will seek expenses. Chief Civil Deputy Prosecutor Pete Smiley said in an email that the office doesn’t wish to comment at this time.
The defendants also argued that the lawsuit should be dismissed with prejudice because the LLC “should not be permitted to reserve the right to re-file a lawsuit beset with incurable legal infirmities.” On this issue, Cliff agreed with the plaintiff.
According to the state Secretary of State corporation and charities filing system, Freeland Concerned Citizens, LLC was registered on July 19. Governors in the LLC are identified as Davide Adams, Gary Wray and Vicki McFarland.
The group sought to undo a 2-1 decision by county commissioners to provide Low Income Housing Institute, commonly known as LIHI, with $1.5 million in record filing fees to purchase Freeland’s Harbor Inn and convert it into a combination of bridge and supportive housing. The recording fees can only be used for housing-related projects.
LIHI also received money from the state Department of Commerce and other sources for the purchase of the motel at $3.4 million.
The county’s 40-year contract with LIHI is structured to ensure that the nonprofit group continues to provide low-income housing for many years. If LIHI abides by the contract for four decades, it doesn’t have to pay the money back.
The project was controversial in the community, with many people voicing objections at public meetings. People complained that housing for low-income people would attract crime and other problems in Freeland, that the loss of a motel would have economic consequences, that the project doesn’t conform to zoning rules and that the public didn’t have enough notice.
On the other hand, citizens and officials pointed out that the lack of workforce housing and temporary shelters is a major problem on the island, affecting children, veterans, victims of domestic violence, those with mental health problems and many others.
