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My name is Marti Murphy. I put this web site up to inform the public of what James Palenick did to Bay City. I was mad that no one from the City of Dowagiac Michigan told Bay City Michigan about Mr. Palenick's financial dealings and vision while their City Manager. So , I strongly feel the need to inform the public about Mr. Palenic"s vision in Bay City. I feel strongly enough about Mr. Palenick Vision that I would have regrets if I did not inform the public and they suffered from it, as Bay City did.

The first time I got involved with my city politics was when our City Manager, Mr. Palenick, and his director of Development Services Department, Rob Anderson, tried to take my neighborhood's property rights away. A group from the neighborhood prevented them from taking our property rights. Since that first encounter with Mr. Palenick and Mr. Anderson , I have exercised my constitutional right as a citizen to be part of the solution to benefit our community.

I'd like to provide examples of our city's cost from Mr. Palenick's tenure:

  2. Heritage neighborhood (Failed)
  5. Heather Ridge (Failed/Lawsuit)
  7. New public works complex (Never happened)
  8. New Police Station (Never Happened)

There are more, but with a limited amount of time, I felt these would aptly illustrate the situation in Bay City. I will explain some of the projects shortly.

To fulfill Mr. Palenick's vision, projects were creatively financed, and now we have to pay. So, how is Bay City doing financially today!

Not very good at this year's budget, the City of approximately 40,000 planned to lay off 16 fire and police officers. During and after Mr. Palenick's tenure There were and are lawsuits against the city (I can name at least half a dozen) Our water rates have dramatically increased, our sewer rates have increased, our city owned electric company has increased our rates, the trash rates have increased. Before Mr. Palenick, Bay City was hailed as one of the most affordable cities to live in now it is far from that. Bay City now has one of the highest tax rates in the state of Michigan. Mr. Palenick's vision drained most of our City's financial reserves. His previous employer, Dowagiac, also suffered from Mr. Palenick's vision.

Now for the failed projects:

  1. Hotel Conference center (Failure)
    • Cannot may interest payments on loan to the City
    • Was built right next to a Holiday Inn, causing that hotel to file for bankruptcy
    • Prior feasibility studies states that a Hotel/Conference Center was not feasible. Mr. Palenick asked for a third study on 8/22/2000 (BCTimes: Bay County Board Chairman, Ed Rivet said he thinks it's a real good possibility that HVS Capital will cook the numbers for Garfield (referring to the feasibly study for the Center ) I ask: Did the number numbers get cooked, sure looks like it to me.
    • Selling of the bonds fir the Center Mr. Palenick used the same firm to invest the Police and Fireman's Retirement Fund. Mr. Palenick and the Bay City are currently being sued for an illegal investment and a $3M loss from the fund. And there is also a criminal investigation involving Mr. Palenick, Michigan State Police complaint # 031-505-04
    • State Equalized Value (SEV) Half of what a property can be sold for) of $4M for the hotel/Conf Center, and the City paid $16M for it. Now you can why several people liked this lots of money flowed!
    • Mr. Palenick sold Bay City the air rights over a proposed 3-Story parking structure for $800K he only built a 1 ½ story structure.
    • Mr. Palenick exclusively negotiated with Garfield to reach a master development pact. Garfield's development fee would be $1.5M plus out-of-pocket expense capped at $200K.  I feel the right way to negotiate a contract, is before you sign the deal.
  2. Heritage neighborhood (Failure)
    • Mr. Palenick had the city buy a large parcel of land
    • Now it is an empty lot, 3 years after he left Bay City
    • It is currently off the tax rolls without any income to pay for maintenance.
  3. Breakers Cove (Failure)
    • Mr. Palenick built a housing subdivision
    • No convenience store built as planned
    • Mr. Palenick added 2 boat docks to help the subdivision
    • Built a park at the entrance of the subdivision
    • Still, currently only ½ of the duplexes are built, not all are sold
  4. Uptown at Rivers Edge (Failure)
    • Mr. Palenick: purchased for $17M + 25% of future sale price to orig owner, when city sells.
    • Bay City would have to invest $33M to get the value of property to $16M
  5. Heather Ridge (Failure/Lawsuit)
  6. Fourth Street construction (City overcharged)
    • 8/23/99 Mr. Palenick and Jon Kollesar when to city commission with an agreement for the construction of 1 block of 4 th street without cost to the city.
    • Improvements were in excess of $220K at the developers' expense
    • Contract stated, main street shall provide at its sole and exclusive
    • 2/4/02 City was billed $250, 669.79 for the construction.
    • City paid.
  7. New public works complex (Never happened)
  8. New Police Station (Never Happened)
  9. Hereford and Hops (Bankrupt/Failure)
    • Mr. Palenick loaned the developer $700K
    • Mr. Palenick gave them a tax break
    • Foreclosed and went bankrupt. City still trying to recoup money

 

 

James Palenick's vision of Bay City.

 

Joe@agjoe.com