PORTSMOUTH
Two companies created by Louise Lucas to build a conference center project filed a $97.7 million lawsuit this week against the city, several City Council members and owners of the Renaissance Portsmouth Hotel and Waterfront Conference Center, claiming Portsmouth denied the state senator access to millions in lower-cost financing in an attempt to hold onto a monopoly.
The federal lawsuit argues that in July, the council barred Lucas from access to taxable and non taxable bonds for the project because it is led and funded mostly by African Americans. It also states that the city is trying to control all of Portsmouth's hotel and conference center business.
Filed late Wednesday, the suit comes less than a month before the council is scheduled to vote again on whether Lucas can use federal and state bonds to build a hotel and conference center in Victory Village business park. They would enable her to access lower-cost financing.
It asks for $36 million in damages for a violation of federal anti-trust laws, $12 million each from Councilman Doug Smith and City Attorney Tim Oksman, and additional money from the three council members who voted against the project and the Renaissance's ownership.
"I'd like to think a state senator is working for us, not against us," Councilman Bill Moody Jr. said. "I'm just saddened she feels she needs to sue the city she represents."
"This is kind of a strange way to begin the lobbying effort."
Lucas said the suit should not affect her current council request. "This has nothing to do with what we're doing now," she said. "It's based on the prior action, not this one."
In order to build the $67 million project on 7 acres at Victory Village business park, Lucas created two entities - Victory Conference Center LLC and Victory Conference Center Hotel LLC. The hotel is led solely by Lucas; the conference center has several hundred investors, mostly local African American residents, who currently have invested about $700,000.
After being rejected by a 3-2 council vote in July, Lucas downsized plans for the hotel and repetitioned the city for access to up to $38 million in low-cost financing offered through the state and the federal Empowerment Zone program.
On Tuesday, she received approval from Portsmouth's Economic Development Authority to push forward with the request. If the council now approves the bonds, then the Norfolk City Council would also have to endorse them.
The lawsuit names the city, the council members who voted against the initial bonds - Moody, Elizabeth Psimas and Smith - Oksman, the Barcelo Crestline Corp. and its president, and the JE Robert Company Inc. Both companies own leasehold interests in the Renaissance hotel downtown.
The lawsuit accuses the council of violating federal anti-trust laws by trying to protect a monopoly on conference centers. In 2001, the city opened the Renaissance hotel and conference center, a hotel built through a public-private partnership.
It states that several council members and the Renaissance's manager voiced concerns that Lucas' project could take away business from the city's multi million-dollar investment. The city "conspired... to restrict others from entering the market," it says.
It also alleges that Oksman told Council members Charles B. Whitehurst Sr. and Marlene Randall that they could not vote on the bonds because they had conflicts of interest.
Whitehurst initially invested $2,500 in the project. He has since received a refund. Randall's husband invested $2,000.
In addition, the suit states that the council demanded more from Lucas than its asks of other developers. Some council members said they weren't comfortable voting for the bonds unless Lucas' partnerships pledged to not ask for city funding, it says.
"Holy cow," Psimas said when The Pilot informed her of the lawsuit. "Wow."
In an e-mail to council members sent Wednesday, Oksman wrote: "For the moment, my advice is simply to refrain from any public comment about this notice of claim, the upcoming vote, or the Lucas project in general."
Councilman Steve Heretick said the council members who voted no acted within their means. "I certainly did not see the kind of conduct that's described in the claim," hesaid.
"Although I didn't agree with them, their decisions were made properly."
Meghan Hoyer, (757) 446-2293, meghan.hoyer@pilotonline.com
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BUT IS IT GOOD FOR THE CITY? (LAST)
Many respondents have noted that one deadly sin is involved in all of this: greed. I would argue that whether it began that way or not, the lawsuit is all about two of the other deadly sins: pride and wrath. Sen Lucas depended heavily on personal friends, sorority sisters, and others to try to make this dream come true. The VCC and VCCH were her opportunity to grow beyond her current business ventures into something much flashier. One look at her obscenely large Hummer in any of the parades down High St will tell you that vanity is not something she lacks. This has, in my opinion, never been about what is good for the citizens of Portsmouth. It was and is about Sen Lucas' legacy. Now I fear, whatever her legacy was about before, it is now about wrath: both hers against those that she feels have wronged her and those of many of her constituents at what appears to be a case of standing on the City's head to keep your own above water.
BUT IS IT GOOD FOR THE CITY? (4)
5. Much has been made of the $1.8 mil that was raised for the Victory Conference Center with around 600 investors. But the majority of that investment came from Sen Lucas' household and her companies and not from other investors. Additionally, the portion of the project that was arguably less financially risky, the Victory Conference Center Hotel, was not funded by investors but Sen Lucas herself. According to VCC's website, previously available but now "under construction", that $1.8 mil had been on the books for some time. One has to ask how the recent fundraising was going, particularly in light of the project's previous issue with the SEC.
But Is it good for the City (3)
4. In a previous article in the V-P [http://hamptonroads.com/2008/09/portsmouth-sen-lucas-revive-conference-center-plans] , Michael Glenn of Luna Development was described thusly:
"Development consultant Michael Glenn said the Victory Village area is a great location for the hotel and conference center and will become a destination spot.
He said it is close to Interstate 264, a Tidewater Community College campus under construction and the planned 1,500-home New Port residential development.
'If you look at all the town centers throughout Hampton Roads, they're all very successful,' Glenn said."
Given what we know about the finances at Virginia Beach's Town Center and those of similar projects in Hampton and Newport News, I would have to say that Mr Glenn's statements are no longer valid.
But Is It Good For the City (2)
2. The filing also states that there are no facilities of this scale currently available in the geographic area. But for the purposes of the brief, they have defined the "Market Geographic Component" as the boundaries of the City of Portsmouth. The Renaissance has certainly gotten competition from Norfolk, Greenbrier, and North Suffolk. Why would a development in Victory Village not have the same competitors?
3. The filing goes on to assert that the 2007 Master Plan for Victory Village called for two hotels. Later in the filing it is noted a luxury hotel at that location was part of the City's vision for that area. And yet, I see none of that in the year-end economic development report for 2007 [http://www.portsmouthva.gov/news/2007/ayearendreport/08%20Economic%20Development3.pdf].
But is it good for the city?
My overarching concern is: Is it good for the City of Portsmouth?
Just some things to consider:
1. Sen Lucas' attorneys note in their filing that neither Ocean Marine nor Old Towne Hospitality (developing the Holiday Inn replacement) were asked to pledge not to seek City funds to finish their projects. But are the $8 mil for Ocean Marine and $12 mil for Old Towne Hospitality comparable to the $32 mil that Sen Lucas is now requesting? Is the economy anything like what it was when Ocean Marine and Old Towne Hospitality made their proposals?
Is she from Chicago?
Just business as usual... she thinks.
Face it people... she's the same kind of crook we just voted OUT!!!
Until we ALL grow a pair and challenge her, despite her 2 most effective weapons (race & gender), nothing will change. She's trying to rip off EVERYONE & ANYONE... black & white, men & women!
This is a conflict of interest, at best, and really... it's just bald-faced racketeering, to anyone who will look at it with clear eyes.
I'd hoped we were past all of this kind of crap, by now... but we must ALL be vigilant and hold these crooks feet to the fire, wherever we see it.
nothing new
Talk to those who worked with her in the Norfolk Naval Shipyard. She played the race and woman card until she got what she wanted. Seems like she has refined her act. Sueing the City of Portsmouth is basically taking money from the people of ALL races that she represents. Problem is that some voters only see race when voting. I e-mailed the Govenor when she first started this mess and he basically said she had not broken any laws. No one in Richmond will go up against her and be called a racist. They would lose too many votes.
louise lucas sues city
THIS WOMAN HAS TO GO!!!!!
How this woman keeps getting
How this woman keeps getting re-elected just boggles the mind.
TAKE SOME ACTIONEMAIL THEM
Stop Blogging and Start Emailing!!!!!
Seantor lucas: Senlucas@aol.com
Attorney General: http://www.vaag.com/ContactUsForm/ContactForm.aspx
Govenor: http://www.governor.virginia.gov/AboutTheGovernor/contactGovernor.cfm
louise has more power than you think
Just watched all 3 local news channels and not a peep about the biggest story in Portmouth in a year. I guess she paid off the tv stations. How sad that she has the local tv staions in her hip pocket.
The counties and cities that Lucas reprsents
18th District
Brunswick County (Part); Chesapeake City (Part); Emporia City (All); Franklin City (Part); Greensville County (All); Isle of Wight County (Part); Lunenburg County (Part); Nottoway County (All); Portsmouth City (Part); Southampton County (Part); Suffolk City (Part); Sussex County (All)
It is just starting with Portsmouth, but if you notice above....Ms. Lucas represents folks in other local cities and nearby regions. If she achieves her goal here, which of these other fine localities will be targeted next? Please people stop electing folks that think holding public office is a stepping stone to violating the public trust and robbing the government purse into which we all pay.
The Magnitude Of This Boggles The Mind !
What a self absorbed and arrogant individual we have on display here.
This is someone who is supposed to be a representing the people but is clearly only interested in representing herself and a few of her cronies.
This is so over the top that when you consider other acts of politicians indescretions such as tossing a ham at someone or falling behind on some taxes they are pale by comparison to this attempt to use position and influence for enormous personal financial gain.
If she can't be recalled then vote her out at your first opportunity!
To the Pilot
Plase quit showing this funky picture of someone who is interested in HERSELF and her pocketbook. I'm sick of looking at her picture. She is a poor excuse for an elected offical.
be careful....
what you say. she just might sue you, too.
she's sueing because she
she's sueing because she can't have a monopoly? ? Just another crooked politician trying to suck us all dry. Who cares of she or her investors are mostly black? This has nothing to do with color, unless you are one apparently. Just another way to rip us off and line a dirty politicians pockets.
Nothing you say here matters
Nothing you say here matters unless actually pick up the phone.
Bill O'Reilly
I just sent the link to this story to Bill O'Reilly.....maybe he will help to expose this embarrassment to VA.
Hey IVY22!!
I remember that article on her clothes, shoes....and how about all that PACKING and the entourage she had to do it and cart it everywhere. No class is right. Add arrogant to it. Gee -- who's worse....Louise Lucas or Jesse Jackson? Right now I'm thinking Lucas. I'll bet she thinks she's untouchable. I know for a fact she's used her 'status' to blow off speeding tickets in the past and was none the lady doing it either.
Letter to Governor Kaine
stevenm posted the Governor's email addy, as follows...
http://www.governor.virginia.gov/AboutTheGovernor/contactGovernor.cfm
Thanks, Steve. I used that address to post the following letter to Governor Kaine...
"Dear Governor Kaine,
What Louise Lucas is doing in Portsmouth is shocking and appalling, and brings disrepute to the Virginia State Senate. She is abusing her elected position to enrich herself, at the taxpayers’ expense. Please investigate her activities. She is making Portsmouth the laughing stock of our State.
Respectfully submitted,
(Me)”