Lien Law Update: Cities, Business, and States Caught Up in Construction Conflicts

• Judge orders Pendleton mill owner to sell:

  A recent conflict in Anderson County, SC has ordered Pendleton Mill owner, as part of a dispute over payments, to sell the property and pay a contractor to clear the derelict site. A mechanics lien was placed on the property by FAB Construction LLC for over $77K and, since payment was not forthcoming, they then moved the property into foreclosure. Mill owners argue that the construction company knew that their operating expenses were to come from the salvaged metal and wood collected from the site.

• City caught up in dispute involving construction companies:

  The city of Joplin, MO is caught in a dispute between a contractor and subcontractor over an $83M expansion at the Heartland Pet Food Manufacturing plant. A lien has been filed against the city when they became the official owner of the pet food plant after agreeing to provide the company a tax break. Local municipalities often own manufacturing real property so that the plant is subject to different taxes than private property. This agreement is governed by a contract between the manufacturing plant and the town. However, this does open the interesting situation where a mechanics lien can be placed against property technically owned by the local government.

• SB 2 would create hardships while attempting to alleviate another:

  In California, Senate Bill 2 is proposing a new, $75 tax on real estate documents filed in the counties. If passed, this tax would generate $250M annually for low-income housing programs. This proposal comes up each legislative season and has yet to gather much support. While it attempt to address a very real problem, the need for more affordable housing in California, it does it by raising the costs of filing real estate documents and not by addressing the underlying causes of the cost of housing.

• A Shadow Cast Over Boston's Building Boom:

  There is a law in Boston that prohibits tall buildings from being constructed that would cast shadows over the Boston Common and Public Gardens. However, as Boston continues to develop all available space, the only direction to build is upwards. Recently, Massachusetts legislators delayed a vote seeking to change the law. This would allow a 775-foot residential tower that would cast shadows on both Boston Common and Public Gardens. This move has the local population concerned, but would allow for more residential and commercial space in the city.

Staying on top of the nuanced changes in construction law, as well as the latest major projects, is part of what makes the team at National Lien & Bond effective. We study the latest cases and make sure we apply the latest findings to every client.