The City of Annapolis cannot pass legislation to immediately occupy the Market House at City Dock, city officials said in response to a petition being circulated by the Annapolis Business Association requesting that the city allow tenants to move into the waterfront property by the start of spring.
In its statement, the city outlines why it's not legally up to city officials to allow tenants to move in.
"The city would love to resolve this matter and return the Market House to its rightful position as a jewel of our downtown and harbor area," the statement reads. "However, earlier good-faith efforts on the part of the city to resolve this matter in its entirety were unsuccessful due to the unreasonable demands on the part of others involved in the process."
According to the city, Market House is in its third year of a 10-year lease with Market House Ventures, a subsidiary of Site Realty, the private company that has been managing Market House since 2005. Market House Ventures controls who occupies the property.
Market House Ventures has also sued the city for about $11 million, stemming from an air-conditioning dispute from 2006. The case is scheduled to go to trial June 9.
"The city can end this litigation only by negotiated settlement or a verdict from the court after a trial. ... We are working vigorously and aggressively to protect the city's interest and checkbook," according to the city's statement.
Annapolis Mayor Ellen O. Moyer could not comment because of the pending lawsuit, city spokeswoman Rhonda Wardlaw said. Neil Hyman, attorney for Market House Ventures, said the matter was "really an issue between the Annapolis Business Association and the City Council and the mayor."
Jessica Jordan, Annapolis Business Association president, said: "We understand that this is not a legislation issue.
"Our goal is to put pressure on the city to do what needs to be done, and they need to negotiate based on the merits of this case," Jordan said. "We all realize that $11 million is a lot of money, but I think it's a bit inflammatory ... because we all know that's not the amount that's going to be paid out. We all know it's not reasonable."
Jordan said much of the community is behind the petition.
"It seems like so often it comes across as a fight about who's right, not about what's right for the community, and that's where we have an issue," she said.