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Judge Doyle Square construction

The city of Madison and its partner, Beitler Real Estate Services, are in a legal dispute over whether the city can build a portion of the private development.

The Madison City Council on Tuesday fell one vote short of approving a $600,000 payment to the developer of the Judge Doyle Square project that was meant to resolve a legal dispute on the massive Downtown redevelopment.

City Council members voted 10-8 in favor of amending a development agreement with Beitler Real Estate Services, of Chicago, that would have paid Beitler $600,000 in exchange for the city being explicitly granted the right to build and own a private portion of the $186 million project.

The measure needed 11 votes to pass.

“It seems to me it’s all taking by Beitler and giving by the city,” said Ald. Rebecca Kemble. “We have power to direct our negotiating team to go back and negotiate a better deal for the taxpayers of this city.”

The Judge Doyle Square project is slated to bring a hotel, apartments, retail and commercial space, and more than 1,000 parking spaces to the blocks that hold the Madison Municipal Building and Government East parking garage.

The amended agreement and $600,000 would give the city the right to develop and own first-floor retail, two levels of private parking and a structural slab — collectively called the “podium” — on top of an under-construction $50 million, 560-stall underground public parking garage behind the Madison Municipal Building.

In June, Beitler sued the city in federal court after the council had appropriated $11 million to construct the podium, claiming the city “unilaterally seized, for its own financial gain, the development” of the podium. City officials maintained Beitler asked them to consider financing that portion of the project due to rising construction costs on the project.

Beitler, however, voluntarily withdrew its lawsuit in August, and the two sides have since been working to resolve the dispute.

Prior to Tuesday’s vote, Ald. Mike Verveer, whose 4th District includes the project site, warned colleagues that Beitler could refile their lawsuit if the motion was denied.

City Attorney Michael May declined to comment whether he thinks the lawsuit would be refiled.

As part of the Judge Doyle Square project, Beitler is planning to build a hotel to serve Monona Terrace and more apartments on the block with the aging Government East parking garage. The developer hopes to build nine floors of apartments above the podium.

The $600,000 figure is what Beitler estimates it would cost them to delay construction of the hotel on the Government East block while the city would build the podium portion.

“I would say we’re paying them $600,000 in a dispute resolution to resolve a dispute about how to interpret the development agreement that exists,” said Natalie Erdman, the city’s director of planning, community and economic development.

Alds. Shiva Bidar-Sielaff and Steve King could call for the decision to be reconsidered as they were absent for Tuesday’s vote.

  • In other action, the council adopted a parental leave policy that will give permanent full-time and part-time city employees six weeks of leave for the birth or adoption of a child.

The city currently doesn’t have a paid parental leave policy, so employees have to use other paid time off or wage insurance. The policy is estimated to cost about $500,000 annually. It will be in effect Jan. 1 and will cover any births or adoptions that happened on or after Sept. 1.

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Logan Wroge has been a general assignment reporter for the Wisconsin State Journal since 2015.