Orange Beach Needs Standards in Dealing with Developers

GARRY MITCHELL.
Associated Press

MOBILE, Ala. - A Baldwin County grand jury that indicted Orange Beach's mayor and three others on corruption charges recommended that the Alabama Legislature set standards for cities to deal with developers, particularly on the Gulf Coast.
The grand jury in November heard testimony about Orange Beach's policy on "certain fees, charges and special considerations" required for developers to obtain variances for buildings.
A builder, for example, may offer to build a ball park, give up some parking spaces, or donate land for public use in exchange for permission to build a taller building or add more condominiums to a project.
The grand jury found that the fees and other charges required by Orange Beach officials are "inconsistent, based upon no standards and without legislative guidance or oversight."
In its report, the grand jury said the Orange Beach system encourages "discrimination, fraud and improper inducements."
High-rise condos and hotels have been rising along the Alabama coast, squeezing out smaller dwellings and altering the looks of laid-back beach retreats.
Former Orange Beach City Councilman Mike Schiehl said the corruption charges reflect on city operations.
"It's a shame," Schiehl said Saturday, recalling debates over condo construction have gone on since the first 14-story building went up after Hurricane Frederic hit in 1979.
In its report, the grand jury said developers should bear the cost of certain infrastructure improvements which are necessary due to development not only in Orange Beach but anywhere in the state.
The grand jury urged the Legislature to change the law to give cities guidance on how fees could be assessed with appropriate standards. Those impact fees could go for drainage, roads or other public projects.
Even small decisions by the Orange Beach City Council and city planners could bring millions of dollars in additional profits to a developer, Baldwin County District Attorney David Whetstone said Friday.
Whetstone said in one case, the city considered an offer of some condominiums for use by city employees at reduced rental rates. Whetstone said that could be viewed as using a public office for personal gain.
Other cities offer incentives to attract developers, but Whetstone said Orange Beach officials ask developers: What can you do for us?
In the past three years, Orange Beach has secured pledges from developers totaling over $100 million in value for parks, beach accesses and case for infrastructure improvements, the Mobile Register reported in a story Saturday.
With a population of about 5,500, Orange Beach and its neighbor, Gulf Shores, are both in the spotlight in dealing with developers.
Whetstone said Orange Beach is not just a city, but a "diamond" in the state because of its beaches and tourism economy. Its population can grow to 50,000 in tourist season.
Local government decisions on beach construction affect the rest of the state, Whetstone said.
Orange Beach Mayor Stephen Russo is accused of misspending campaign funds and using his office to obtain use of a New Orleans condominium purchased by developer Larry Wireman, who was not charged.
Wireman, who is planning condo towers on the coast, had applied for a zoning variance for an Orange Beach project.
Former Orange Beach City Council member Joseph McCarron is charged with ethics law violations for voting for projects in which he had a business interest or gained business from the vote.
Also indicted were Orange Beach city attorney Laurence Sutley and developer James Brown.
Russo is accused of failing to disclose a partnership with Brown and Sutley in a firm called American Hot LLC. Russo voted on May 3, 2005 to approve a Terry Cove development involving Brown and another at Romar Villas.