City, developer work out permit fee refund deal

When Mel Fingarson, principal of Fingarson & Associates, LLC, died in 2008 in the process of building about 20 homes in the plat of Blackjack Creek, a significant amount of the project’s paperwork hadn’t been completed.

The result was confusion for both the city of Port Orchard and SDC Homes, which bought the lots from Fingarson’s widow.

For example, Fingarson planned to tie the lots in with Port Orchard’s water and sewer plan, although the lots haven’t yet been annexed into the city.

SDC Homes sold several of the houses before the city of Port Orchard pushed for the area to sign onto a “no-protest agreement for future annexation” into the city.

In order for the city to continue providing water and sewer to the area, SDC Homes, the homeowners and Fingarson & Associates each had to sign the agreement.

When Fingarson died, “There were a couple of things that kind of got screwy,” said Michael Dattilo, chief operating officer for SDC Homes.

“We were under contract to buy all of the lots,” he said, “but because of the way (Fingarson) had developed his lots, we had a lot of extra costs that weren’t anticipated. I think (Fingarson) hired a contractor to do that, and it’s my opinion that maybe they took advantage of him a little bit.”

SDC Homes built about 12 of the houses, and the city of Port Orchard overcharged the company by about $60,000 in fees, Dattilo said.

“What shocked me is that, when everyone discovered this, the city didn’t have a mechanism to refund our money,” he said.

Legal advisors for SDC Homes, the city of Port Orchard and Fingarson & Associates met and wrote an agreement, which would refund $42,488, to SDC Homes, if they choose to build on the remaining 10 lots.
If SDC Homes chooses not to build on the remaining lots, they won’t see the refund.

SDC Homes’ lawyer signed off on the agreement.

The Port Orchard City Council voted in favor of it on Feb. 22.

Mark Dorsey, the Port Orchard’s public works director, said the city went “above and beyond” its obligations try to help the builders.

“The city charged a fee in lieu of assessment, which is what we do when there isn’t a bill of sale and isn’t a developer’s agreement,” he said. “We’ve been working with all parties involved to reimburse some of that.”

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