Bainbridge Taxpayers Unite and others have filed a complaint in Kitsap County Superior Court against the city of Bainbridge Island and others regarding alleged violations of the Racketeer Influenced and Corrupt Organizations Act.
The complaint concerns the BI police station and court facility at 8804 Madison Ave. Ironically, Friday the city planned a ground-breaking event at the former Harrison Medical Center property.
The complaint alleges that former mayor Kol Medina and ex-city manager Morgan Smith lobbied for the purchase of the HMC property and concealed conflicts of interests and misrepresented alternatives for the police-court facility.
The complaint says:
The city hired Coates Design Inc. to evaluate sites for the police-court facility, even though it had no experience with city buildings. In 2013, HMC purchased the building for $1.75 million. But it lost money every year and wanted to sell. HMC talked with Medina, an attorney who specialized in work with nonprofits, such as hospitals. He thus had a financial relationship with HMC, which was not disclosed.
HMC approached the city about selling the property for the police-court facility in 2017. In 2018, the City Council discussed purchase of the site. Medina reportedly pressured the council to consider only the HMC site, rather than a competing site at Yaquina Avenue, owned by complaint plaintiffs Lee Rosenbaum and Janice Pyke.
Medina, Smith and staff said Yaquina would cost $34 million, while HMC would cost $15.3 million. But they knew that information was false. Medina was outvoted in selecting HMC at that time. However, in 2018-19 Medina was president and CEO of Kitsap Community Foundation. In that role, he developed donor relationships. CHI Franciscan Health was a substantial donor.
The complaint continues:
In 2019, the council again looked at the HMC and Yaquina sites. The costs now were set at $20 million for the first and $28 million for the latter. Again, they allegedly knew the information was false. HMC was appraised as a medical building, not a police-court facility. The site really was worth $3 million, meaning the city overpaid by $6 million. The Yaquina site reportedly would have only cost $13.2 million. Also withheld was information that the Yaquina site would have allowed for a facility with 10,000 more square feet. The council at that time, Jan. 29, 2019, voted 4-3 in favor of the HMC facility.
The complaint alleges that as an attorney Medina knew his actions violated city code, along with state criminal and civil statutes. “Medina and Smith’s willingness to pay top dollar for the HMC site is particularly perplexing given an earlier offer by Smith to purchase Yaquina from Rosenbaum and Pyke for $600,000, half of its $1,200,000 value,” the complaint says.
The city compounded the fiasco by issuing $8.645 million in municipal bonds, of which interest alone would cost $3 million. “This misconduct has thus damaged the city and its citizens by at least $9.8 million,” the complaint says.
Another plaintiff in the Superior Court complaint, City Councilmember Michael Pollock, incurred $8,000 in attorneys’ fees when he raised the issue earlier in a complaint to the city’s Ethics Board. The city admitted Medina violated ethics code, but decided not to pursue any other investigation.
As to alleged racketeering, the complaint says:
Defendants Medina and Smith had authority within Medina Enterprises, whose primary purpose was to preserve power over the City Council regarding HMC. It says Medina compensated Smith for assistance in promoting the HMC proposal. Even though Medina had an interest in the HMC proposal, he failed to disclose it, as it would have failed to pass otherwise. Those and other actions “constitute bribery and/or extortion and constitute a pattern of racketeering.”
Among the requests for relief, the complaint asks for actual and punitive damages, a judgment declaring the contract void, an injunction barring the city from more HMC contracts and other expenses.