Pittsburgh is taking the Penn Plaza developer to court. Here’s why.

It’s the latest in a saga that began with eviction notices and has moved to lawsuits.

The site of a demolished  building at Penn Plaza .

The site of a demolished building at Penn Plaza .

Jasmine Goldband / The Incline
Sarah Anne Hughes

Updated, Thursday 3:30 p.m.

Inside the City-County Building, attorneys for Pittsburgh, including City Solicitor Lourdes Sanchez-Ridge, and those for developer Pennley Park South met in motions court Thursday morning.

The attorneys had been discussing the case in private, and after appearing before Judge John McVay, the judge urged them to keep speaking. Shortly after noon, both parties asked to speak to the judge in his chambers.

The attorneys eventually agreed to continue speaking, refrain from talking to the press and meet again next weekPublicSource reported. McVay also ordered a “standstill” until the next hearing, according to the Post-Gazette.

You can read the city’s complaint here and Pennley Park South’s response here.

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The city of Pittsburgh is taking the developer behind a plan to replace buildings that house low-income tenants in East Liberty with market-rate units and a Whole Foods to court.

It’s the latest in a saga that began with eviction notices and has moved to lawsuits.

On Wednesday, the city filed a complaint against Pennley Park South, a subsidiary of LG Realty Advisors, saying the developer is in breach of a memorandum of understanding it negotiated to provide assistance the tenants. The city plans to present an emergency motion for a preliminary injunction in court Thursday morning.

An attorney for the developer, Jonathan Kamin, told TribLive the company is in compliance with the MOU and has taken its “obligations seriously and will continue to do so.”

Pennley Park South began issuing eviction notices to the tenants of Penn Plaza in summer 2015. Mayor Bill Peduto’s administration got involved shortly thereafter and eventually negotiated an MOU with the developer. (You can read about the whole saga, in detail, here.)

The tension between the city and the developer reached a new peak in January, when the Planning Commission rejected Pennley Park South’s plan for the site. Kamin then filed suit against the city.

On Tuesday, Kevin Acklin, Mayor Bill Peduto’s chief of staff, produced a letter City Solicitor Lourdes Sanchez-Ridge sent to Kamin last week asking the company to affirm that it’s complying with the MOU.

That agreement required Pennley Park South to provide financial assistance to the tenants for relocation costs and allowed some of the residents to remain in a building until the end of March. Only 20 tenants remain, according to the city.

But at a rally outside the City-County Building on Tuesday, some of those residents described deteriorating conditions in the remaining building, including a lack of heat.

“We’re living in conditions that are ridiculous,” said Mabel Duffy, a longtime resident of East Liberty. She said her apartment is covered in dust.

Myrtle Stern, a 76-year-old resident, said, “They are destroying us. … We’re getting sicker and sicker.”

Those allegations, as well as ones about rodents and a lack of security, were included in Sanchez-Ridge’s letter.

Kamin told the Post-Gazette inspectors from the Allegheny County Health Department had visited the building and “found no violations.

A spokeswoman for the Health Department, Melissa Wade, said by email, “A permit for Penn Plaza asbestos removal was applied for and issued correctly. Health Department inspectors have visited the site multiple times and thus far found no violations. We are in the process of inspecting additional complaints.”

Acklin said if Kamin did not respond to the letter by close of business Tuesday, “We’ll go to court tomorrow.”

Kamin didn’t respond, according the mayoral spokeswoman Katie O’Malley.

The tenants

Dozens of tenants have already moved out of Penn Plaza, and the developer has demolished building 5704. Those left in building 5600 must be out by the end of March.

After Acklin spoke to reporters Tuesday, he met with activists and Penn Plaza tenants inside the City-County Building. He thanked them for their work on affordable housing and criticized Pennley Park South for “making up alternative facts about the Planning Commission.”

“We’re here to back you up,” Acklin said. The city “gave this developer every opportunity to do the right thing.”

Randall Taylor, a former Penn Plaza resident and affordable housing activist, asked Acklin to find other units for the tenants still left in the building. On Wednesday, Peduto’s office released a letter the mayor sent to landlords in East Liberty seeking to do just that.

“The litigation brought against the city by the owners of Penn Plaza threatens to put the quality of lives of these remaining residents at risk,” Peduto said. “In response, we are seeking court action against the owners of Penn Plaza to assure that the remaining residents are not evicted in violation of the MOU … We are at a critical stage of this ordeal, and we need your help.”

The letter is addressed to Village Green, Vitmore, Walnut Capital, Mosites, The Community Builders, Inc., McCormack Baron Salazar, KBK, Trek, Action Housing, East Liberty Development, Inc., Bloomfield-Garfield Corporation and S&A Homes.

The lawsuits

The Planning Commission ruled against Pennley Park South on Jan. 10. A week later, the developer filed a lawsuit.

On Jan. 17, Kamin filed an appeal of the Planning Commission’s decision, calling it “illegal, arbitrary and capricious.”

On Wednesday, a number of individuals and community groups including the Friendship Community Group and East Liberty Development, Inc. filed a petition to intervene in the case.

“If permitted to intervene, [each party] will urge the court to issue an order affirming the decision of the Planning Commission and dismissing Pennley Park’s appeal,” the petition reads.

An attorney for those parties, Jon Pushinsky, said his clients are intervening “in order to protect valuable public assets” and to ensure the integrity of the process is followed.

Kamin has also filed a mandamus complaint in Common Pleas court. This type of complaint allows a court to compel a public authority to perform an action it’s required by law to do.

Pennley Park South stated that the Planning Commission did not provide written notification of its decision within the proper timeframe, which means the project has deemed approval.

“I think the case is over. I think we have an approval,” Kamin told the Post-Gazette at the time.

Peduto’s office released a statement, saying, “The Planning Commission explicitly denied Pennley Park’s application and development plan within the legal time period of the official submission. We will fight these legal tricks before the Common Pleas court.”

Even after the Planning Commission’s decision, the developer apparently moved forward with its plan for the site. Sanchez-Ridge sent Pennley Park South a cease and desist letter Feb. 6.

The city then fined the developer $42,000 for cutting down 10 trees “within the city’s right of way adjacent to 5600 Penn Avenue.”

Acklin on Tuesday said Pittsburgh will use its “full power … to defend the right of the city to pursue community-driven development.”