$1.5 million fine set for developers

Penalty is largest levied in Maryland for wetlands violation

Case was contentious

Interstate General Co. admits filling in Charles County land

August 27, 1999|By Joel McCord | Joel McCord,SUN STAFF

The developers of a Columbia-style planned community in Charles County pleaded guilty in federal court yesterday to illegally filling in wetlands as they were building one of the neighborhoods and agreed to pay a $1.5 million fine, the largest assessed in such a case in Maryland.

In a parallel civil suit, the developers, Interstate General Co. (IGC) and its subsidiary, St. Charles Associates, also agreed to place 157 acres in a conservation easement and pay a $367,000 fine.

The plea in U.S. District Court in Greenbelt occurred 3 1/2 years after a federal jury convicted ICG's chairman, James J. Wilson, and the two companies of illegally filling 70 acres of wetlands in four tracts around the community -- St. Charles -- on the southern edges of Waldorf between 1983 and 1993. After the sentencing in June 1996, Wilson and other company officials maintained their innocence.

The 4th U.S. Circuit Court of Appeals overturned those convictions and Wilson's 21-month jail sentence in December 1997. Since then, lawyers for the federal government and IGC have been working on an agreement to avoid going to trial again.

Lawyers in the U.S. Attorney's Environmental Crimes Unit, the Environmental Protection Agency and the Army Corps of Engineers negotiated the plea in the contentious case.

The settlement "vindicates the interest of the federal government in protecting Maryland's wetlands," said Lynne A. Battaglia, U.S. attorney for Maryland.

It is especially important "because it requires not only replacement of destroyed wetlands, but a substantial addition to the natural wetlands system in the St. Charles area," she said.

The developers admitted filling in one of the four sites, and prosecutors dropped charges against Wilson and his firms for filling the others.

Wilson, a multimillionaire real estate developer from Middleburg, Va., did not appear in court yesterday. Benjamin Poole, a company vice president who represented the defendants, referred questions to attorney Alfred H. Moses, who declined to comment.

IGC president Mark Augenblick said in a statement the plea would allow IGC to resume development of 80 acres of the project and "avoid the enormous cost and disruption of a retrial. The board and management believe this settlement is in the best interests of shareholders."

IGC began work on St. Charles, 9,100 acres of old tobacco farms near the headwaters of Port Tobacco Creek, in 1972. By 1988, it started construction on a sixth section despite warnings from Charles County officials and EA Associates, IGC's consultants, that federally protected wetlands were in the development area, according to court papers filed yesterday.

The Army Corps of Engineers issued a stop-work order in March 1990 after IGC ignored requirements for permits to fill the wetlands. A year later, Wilson sued the federal government, demanding compensation because of the construction delay.

The criminal investigation began after that, prompting criticism from property-rights activists, who complained of heavy--handed treatment by the federal government.

The acrimony made reaching a settlement difficult, Battaglia said. "When it comes to litigation, when you go to war and then you have to make peace, it takes time."

Pub Date: 8/27/99

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