Terance Frazier, the Fresno developer who has had a long-running disagreement with the city over Granite Park, filed a federal lawsuit Friday night.
In the suit, Frazier claims the city of Fresno — which owns the facility — failed to live up to its obligations when he leased the Granite Park property to operate it as a recreational sports venue. When he complained and asked for a doubling of a subsidy included in the lease terms, the city retaliated with a damaging audit, the suit alleges.
According to the 65-page complaint, the city’s audit was faulty, as well as “defamatory” and “discriminatory” and should have never been publicly released.
While the lawsuit does not make a claim for a specific dollar amount, the body of the complaint alleges more than $11 million in damages.
“This is an unfortunate incident that falls under the category of no good deed goes unpunished,” attorney Kevin Little said, speaking on Frazier’s behalf. “The city, on the other hand, at every turn tried to undermine Mr. Frazier’s efforts.”
When reached by GV Wire℠, the city said it had not yet received a copy of the suit.
“As a policy, we don’t discuss pending litigation or lawsuits we haven’t seen,” city spokesman Mark Standriff said.
Allegations of Racism
The suit claims the city violated Frazier’s civil rights because of his race. Frazier is Black.
“(Frazier) has never been given the same treatment that other white owned developing companies had been given,” Little told GV Wire℠.
Little cites the treatment Frazier faced as opposed to how white-owned businesses were treated.
“There also has not been an audit of a project managed by a similarly situated Caucasian or majority owned business that in reality was an effort to document law or ethics violations. Nor has any similarly situated Caucasian or majority owned business had an incomplete, substandard draft audit published that was likewise damaging in nature,” the suit says.
The attorney believes he will uncover evidence of racism during the discovery process.
“Racism is never admitted. It’s usually proven by circumstantial evidence and by reference to how (comparable companies) are treated. And we feel strongly that this was an act of racism by the city,” Little said.
A Deal Gone Bad
For many years, the Granite Park complex, located on Cedar Avenue between Ashlan and Dakota avenues, lay vacant. A victim of the Great Recession — the sports facility included baseball/softball diamonds and soccer fields — it was filled with more weeds than players.
The city and Frazier’s non-profit, the Central Valley Community Sports Foundation, agreed to a 25-year lease in 2015. As part of the agreement, the city would pay Frazier $150,000 annually, in the form of a subsidy among other benefits and credits, to operate the park.
In return, CVCSF would rehabilitate the facility and offer recreational sports programming and handle the park’s day-to-day operations.
Frazier expected the city to provide the site with recycled water, known as purple water, which never came, according to the suit. This led to a $200,000 expense to keep the fields irrigated, the filing said.
“CVCSF complied with its maintenance and security obligations, again without any cooperation and despite the City of Fresno’s failure to make any effort to provide cost-saving purple water. The City of Fresno also failed to cooperate in granting permits for proposed billboards and signage on the site, which further decreased anticipated revenue,” the suit says.
Suit: A Request for More Help Leads to Retaliation
Faced with mounting expenses, in the summer of 2018, Frazier asked the city to double its subsidy to $300,000. The two sides agreed to an audit, which Frazier expected would show the facility was operating at a loss.
“When Mr. Frazier had the temerity in (the city’s) estimation to come back and ask for a greater contribution because of those failings, the city retaliated and audited him,” Little said.
The suit claims that there were ulterior motives for the audit.
“(City leaders) insisted that the audit have the objective of uncovering proof of unlawful or unethical conduct by Mr. Frazier, rather than assessing the Granite Park project,” the suit says.
The suit says the audit failed standard practices by not using random sampling of records, but rather a “subjective sampling that has the obvious potential for capaciousness.”
The audit found questionable bookkeeping practices, and loan repayments to Frazier and business partner TJ Cox — now a U.S. congressman — that were made from different accounts.
Cox has since divested himself from the project.
The suit says the turning over of the non-profit’s records was rushed and had “not been fully reviewed or finalized by its accountant or attorneys” admitting that such records “were not perfect” but did show the financial shortfalls of Granite Park.
Because of the imperfect records, Frazier withdrew his request for the subsidy increase on Nov. 26, 2018. The city, according to the suit, would place the audit on hold for six months.
Despite the negative findings, CVCSF remained in “good standing” to operate Granite Park, City Attorney Doug Sloan told the city council during an April 2019 meeting.
Public Release of Audit
Around the same time as he made the subsidy request, Frazier sued a former business partner, Sammy Franco, over a loan related to a failed restaurant venture.
In January 2019, Franco made a Public Records Act request for the Granite Park audit and the city complied. Franco shared audit documents with local media, including GV Wire℠.
Frazier’s suit says the audit was in draft form, and thus not subject to public release under a PRA request. The state’s public record laws exempt documents that are not in final form.
The lawsuit says that Mayor Lee Brand and his leadership team “insisted that the draft audit be deemed final, even though the process was ongoing and had actually been suspended by the City of Fresno.”
It says the city “altered” the audit before its release, over the objections of assistant controller Mavet Mora.
The motive, the lawsuit says, was to damage the reputations of Frazier and CVCSF. As a result, the suit alleges, Frazier was denied loans for other projects based on the negative media coverage.
Additionally, Brand and his staff referred the matter to the district attorney’s office for investigation, the suit says, never revealing the fact that the audit was in draft form.
The DA’s office at the time told GV Wire℠ they did receive the complaint. As of now, no charges have been filed.
Another allegation in the suit says the city wanted to break its lease with Frazier and offer the land as a practice facility for the Fresno Football Club. The team, known as the Foxes, folded last year after two seasons playing at Chukchansi Park.
Filed in Federal Court
The suit alleges five causes of action, in violation of federal and state law: defamation for releasing the audit, retaliation, discrimination, breach of contract, and breaching good faith and fair dealings.
In addition to the city as a defendant, Brand and three of his top staff — city manager Wilma Quan, assistant city manager James Schaad, and chief of staff Tim Orman — are also named.
Frazier and CVCSF are the plaintiffs.
Little said he filed in federal court, as opposed to state court, because he feels Frazier would be treated more fairly. Potential jurors at the federal level could be found from Sacramento to Bakersfield. In a state court action, the jury pool would come only from Fresno County.
Additionally, the suit claims violations of federal civil rights statutes. Little anticipated the city would request the move anyway.
“We would prefer not to delay matters two or three or more months worrying about where whether this case stays in one court or another,” Little said.
Little expects the case to last two years or longer.
Read Copy of Complaint