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The 8-and-a-half year history of the hole


November 1994--The deadline for proposals to develop the property at 8th and Main streets ends. The only one submitted is by developer Rick Peterson.

May 1997--Capitol City Development Corporation (CCDC) enters into a development and disposition agreement with Rick Peterson's Boise Tower Associates (BTA) for the construction of a mixed-use 22-story building project on CCDC-owned property at 8th and Main streets.

January 1998--BTA and CCDC team up to allocate $150,000 worth of public art to be incorporated into or next to the Boise Tower.

August 1998--CCDC authorizes BTA to increase the tower to 23 floors.

November 1998--BTA applies for building permits with the City of Boise, then asks for a delay in issuing those permits.

December 1998--CCDC authorizes BTA to increase the tower to 25 stories. BTA's Winter/Spring newsletter announces new unit configurations for the condos, a seventh floor tower club with indoor/outdoor swimming pool and dining, two floors of retail space on the bottom, one floor of office space and three floors of enclosed parking. It will all be topped by 18 floors of condominiums with prices ranging from $200,000 to $850,000.

March 1999--BTA again fails to begin construction by deadline date. A new deadline is set for July 30.

July 1999--BTA again fails to begin construction and CCDC authorizes open-ended deadline extensions.

December 13, 1999--CCDC is asked by several developers to halt the project and accept new proposals for the site. CCDC appoints a committee to review these requests. Rick Peterson sues one of the developers, Gary Christensen, for slander, defamation and attempting to negate the contract Peterson had with CCDC.

February 2000--CCDC's board votes to allow Peterson to continue with the project and sets new deadlines. He must show proof of financing by November 2000 and break ground by January 31, 2001. The project is listed as costing $51 million in press reports.

November 2000--Deadline to show proof of financing passes, but CCDC staff receives documents from an undisclosed financial group showing interest.

December 2000--CCDC allows Peterson to proceed after he shows that a Los Angeles lender is interested in financing the project.

June 2001--Groundbreaking ceremonies launch the construction phase of the project, two years and three months past the original start date. The estimated completion date in press reports is Summer 2003, and the cost is reported at $62 million.

August 2001--Finance options are being worked out. The proposed lender is through Washington Capital Joint Master Trust Mortgage Investment Fund comprised of union pension plan trusts. The lender requirements include using union workers on all work for the project. The union's Southern Idaho Master Agreement with general contractor M.A. Mortenson stipulates that it cover "all the work Mortenson has in southern Idaho."

September 2001--BTA submits a $29 million loan application to Washington Capital Management, Inc. (WCMI).

October 2001--Rick Peterson submits a $29 million loan commitment to CCDC.

November 2001--CCDC sells the property for the Boise Tower to Rick Peterson for $265,000. CCDC originally bought the property, which then contained the Eastman building, for $528,000 in 1972. A 340-foot crane with a rental cost "in the six figures" is set up on the site to build the 299-foot tall building. BTA says all of the office spaces have been sold as well as 60 of the 100 condominium units.

February 2002--Work is halted on the site as a dispute arises between the union and general contractor. Financing by the union pension fund is stalled as well, because it is tied to using union labor on the project. Peterson says delays in construction are due to problems with excavation for the building and concerns by city officials regarding the foundations of the adjacent Eastman Parking Garage.

March 2002--Conversations and correspondence between Mortenson and the union commence. Debate centers around the union's insistence that Mortenson use union labor in all of their southern Idaho projects. Mortenson wants the agreement to be solely for the Boise Tower Project. The parties reach an apparent impasse.

May 2002--Rick Peterson files a $12 million deed of trust against the Boise Tower Property. On May 23, Mortenson and union officials meet again and Mortenson proposes a compromise agreement.

July 15, 2002--The union rejects Mortenson's compromise proposal. M.A. Mortenson Co. quits the project and Rick Peterson announces that he may have another financial backer. The estimated construction costs in press reports now drops to $61 million. Estimates of a fall 2003 completion date are given.

August 2002--M.A. Mortenson Co. files a $536,495 lein against the property.

November 2002--Peterson and CCDC agree to a list of 20 stipulations that must be met to restore the building permits. These include proof of financing and requiring Peterson to acquire a $59,000 bond to pay for filling in the pit.

January 2003--Peterson is given a two-week notice to come up with financing or the City of Boise will cancel his permits. If all goes well, estimated completion dates for the Boise Tower are late 2004 or early 2005.

February 2003--CCDC urges the City of Boise to "do all it can" to restore the building permits. Three days later, Boise officials reject Peterson's financial arrangements and officially cancel the building permit due to financial problems and a lack of progress on the buliding. Press reports now label the Boise Tower a $63 million project.

March 2003--BTA files a lawsuit in Idaho State Court against WCMI and the union under the Racketeer Influenced and Corrupt Organizations Act (RICO).

April 2003--M.A. Mortenson Co. files a second $768,890 lein against the property for unpaid construction. CCDC begins to take steps to acquire the property back from Rick Peterson. Peterson threatens to sue the City of Boise. The City Council votes four to one to reinstate the building permits on April 9.

May 2003--Rick Peterson establishes his right to sue the City of Boise by filing a $10 million tort claim against the City of Boise for revoking his building permit. He has one year to file suit. Peterson claims he has spent $11 million of his own money on the project in press reports. According to CCDC board minutes of May 12, Rick Peterson requests that CCDC and BTA enter into an agreement to allow him to fix the defaulting conditions, assign the project to another developer or voluntarily surrender the site to CCDC. CCDC also claims it has become aware of past due property taxes on the site. In the board meeting it is announced that Rick Peterson has 60 days to cure the default.

June 2003--CCDC board finds Rick Peterson in default of his agreement.

July 2003--Rick Peterson files another $10 million tort claim alleging conspiracy between CCDC and the City of Boise over the revocation of his permits.

August 2003--CCDC sends a letter to Rick Peterson demanding he hand over the property. Rick Peterson is granted sole ownership of the deed of trust of the property from Columbia Bank.

September 2003--CCDC files a notice of exercise of right of reentry.

December 2003--BTA voluntarily dismisses its RICO lawsuit.

February 2004--CCDC files a complaint and demand for jury trial against BTA, requesting return of the ownership to CCDC and compensation of damages as a result of BTA's breach of the original development and disposition agreement.

April 2004--Rick Peterson responds to CCDC, claiming the failure of the project was due to CCDC and the City of Boise officials behaving illegally. Peterson requests a jury trial. Price tag on the project now officially listed as $63 million.

AUgust 2004--CCDC Board votes unanimously to authorize a request for qualifications for the Boise Tower site.

November 22, 2005--A hearing before 4th District Court Judge Katheryn Stricklen commences between the Urban Renewal (CCDC) and Boise Tower Associates. The judge hears both plantiff and defendant and adjourns with requests for more briefs. The case goes to a jury trial slated for April 2006. At question is Peterson's personal investment of approximately $12 million and whether or not he should be named as part of the trial.

Did anyone ever think it would take this long?

CCDC Board member and City of Boise City Councilman David Eberly says, "From what I knew then (when he wasn't on the board) and what I know now it's a little bit different. There are a number of steps now we're [CCDC] doing in our agreements with developers that weren't done with the Peterson contract. I think the previous board was very optimistic about the project, but it just kept not starting and not starting. When I looked at it as an outsider prior to being on the [CCDC] board, other developers were going forward with their other projects. So it made you question why this one was unable to go. CCDC transferred the property over at a discounted rate. It should have given him a competitive advantage in the market. I think the new-term strategy is that we're at an impasse and we're going to let the courts decide. As frustrating as it is, with all the delays, let's just get it decided so we can get the property back on the market."

Compiled from CCDC Board meeting minutes, press releases from companies, agencies and organizations involved, legal filings and press reports in the Idaho Business Review, Idaho Statesman and Boise Weekly.