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City eyes taking 66 acres of Hillmoor



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The city may take a swing at using eminent domain to claim 66 acres of the defunct Hillmoor golf course.

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July 25, 2012 | 09:32 AM
Lake Geneva city staff is considering an eminent domain taking of about 66 acres of the defunct Hillmoor golf course.

At stake is a $90,650 grant for park development.

City Administrator Dennis Jordan said the clock is running out on the grant, and the city could lose the money if it can't find the owner of the property and close a sale.

The 66 acres is a narrow corridor of environmentally-sensitive land along the northern edge of the erstwhile links. The property is mostly marsh and woodland that the city would like to add to the White River Trail area, Jordan said in an interview on Monday.

Included in the city's Tax Incremental Financing project list for the White River Trail is $200,000 for possible land purchases, Jordan said. He said the grant would be a way for the city to get some of that money back after buying the land.

The city already owns more than 30 acres on the south side of the Hillmoor property, where some of the back nine holes are along the White River near Dunn Field and Eastview School.

Jordan said the White River Trail extension might include bike paths, nature trails and a place to put a kayak launch.

Use of the area would be passive and not require a lot of maintenance, he said.

In May 2010, the council approved spending $3,000 in TIF funds to pay for the appraisal so the grant effort could move ahead.

However, efforts to buy the land have run into a dead end. Jordan said the city has unsuccessfully tried to reach the owner of the 220-acre Hillmoor property.

The state stewardship grant's deadline is October 2013. Although the state grant is being folded into a federal Land and Water Conservation Grant through the National Park Service, Jordan said. That may change the deadline, he added.

Ownership of the golf course is obscure at best. It involves at least one limited liability corporation and a nonbank lender. It might also involve a dissolved multinational corporation and a French bank.

Jordan said he hopes that a claim of eminent domain might flush out the real owner or owners.

Jordan said City Attorney Dan Draper is now researching whether the city has the authority to claim the property under eminent domain. At some point, the city council would also have to make a decision to go ahead, Jordan said.

Jordan said he would like to have a strategy in place within the next four months, which would give the city an opportunity to acquire the land before the grant deadline runs out.

Mayor Jim Connors confirmed that eminent domain over the 66 acres has "been bandied about" by city staff.

He said ownership of the Hillmoor property is extremely complicated.

"There appear to be layers there," Connors said in telephone interview on Monday.

Those layers have frustrated other would-be buyers who have approached the city, the mayor said.

Confusion over Hillmoor's ownership began in 2008 when the former owner, George Wight and his Wight Realty Group, went into bankruptcy.

In summer 2009, the Hillmoor property went to sheriff's auction. Kennedy Funding Inc. of New Jersey was the only bidder at $17 million. Wight apparently owed more than $20 million on the property.

According to Jordan, ownership of the property may also be a part of the remains of a giant European insurance, banking and finance corporation called Fortis, which went under in 2008.

BNP Paribas S.A., a French global banking group headquartered in Paris and London, bought a majority of a part of Fortis, called Fortis Bank. In the strange world of global finance, a tiny piece of the Fortis Bank's holdings, now owned by Paribas, may include Hillmoor.

Names that appear on county tax documents are WC Scotti Kunofsky LLC. A listing for WC Scotti Kunofsky LLC taken from the Internet shows an address of 1901 Roselle Road, Suite 100, Schaumburg, Ill., However, that listing is from 2007.

It is also the former home address of the bankrupt Wight Realty Group.

Also on the tax documents is Kennedy Funding.

Jordan said he's been in contact with Kennedy Funding. But the lender insists that it is just managing the Hillmoor property.

Earlier this month, the city saw a ray of hope, when documents in the county recorder of deeds office seemed to indicate that ownership of Hillmoor passed to the county for nonpayment of taxes.

That hope quickly faded, however, when the county treasurer's office reported that WC Scotti Kunofsky LLC paid back taxes and penalties on June 29.

County Treasurer Kathy DuBois said the payment totaled $621,768.10 , covering back taxes, penalties and interest for the tax years 2008, 2009, 2010 and 2011.

In 2006, George Wight brought to the Lake Geneva City Council a proposal for a development that included 278 residential units, a hotel, clubhouse and a renovated golf course.

However, Wight's financial struggles ensued and precise plans were never filed.

The last full season the golf course was open was 2008. Since then, the course has been closed, although the driving range remains open.

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