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Dispute over Phoenix fees ends

PHOENIX — A local restaurant owner who for three years fought the city's assessment of system development charges for his project has paid a $33,000 bill to avoid further legal costs.

Jack In The Box owner Vin Mehta said Wednesday he paid the fee earlier this month to avoid a lien being placed on his property. Mehta and his attorney had argued that during construction of the project he was permitted to pay "the going rate" in Medford, which at the time was $44,000.

Mehta was also instructed, he said, to implement area street improvements that would be credited to his bill.

While constructing the shopping center portion of his project in 2005, Mehta said he was told SDC rates had not yet been determined and to "just pay $60,000 and wait to find out what the city was going to do."

The restaurateur eventually received a bill for $140,000 — just for the restaurant portion of the project — after the city raised its SDC rates last year. Public outcry from local business owners, including Si Casa Flores owner Gregorio Rodriguez, prompted a second look and, ultimately, reduced rates.

City Manager Joe Wrabek said last week that City Council members and City Attorney Kurt Knudsen had determined Mehta owed additional fees for his project.

Had Mehta opted not to pay the city by early December, a lien could have been placed on his property.

City Recorder Betty Smith reported this month that Mehta's final SDC bill for both restaurant and shopping center totaled $129,437. Considering payments made, and based on older SDC rates applied as a courtesy, Mehta owed an additional $26,000 plus interest, she said.

Of Mehta's recent payment, Wrabek said, "They gave us our money so we're going to agree that's all the money we'll ask for. The original deal was they had appealed the street SDCs, claiming they were too high, and the deal the city offered was, 'OK, you pay the bill in full and we'll apply the lower rates to you.'"

Mehta said he had no plans to bring new businesses to the city.

"With this city, there are a lot of people who have come and gone so nobody knew whatever they promised me, so overall you cannot trust the city because of the way things are being run in Phoenix," he said.

Mehta noted that he recently built a restaurant in Klamath Falls, which did not assess development charges, and planned to develop a hotel there.

"I'm building businesses in places that appreciate new business," he said. "Phoenix has to change their attitude. They have the worst SDC fees and the worst customer service. I don't see anyone wanting to bring new business to Phoenix."

Buffy Pollock is a freelance writer living in Medford. E-mail her at buffypollock@juno.com.