Developers sue Harrisburg over installation of utilities

Arkansas Business, Nov 19, 2007 by Mark Friedman

Two developers said they are out nearly $1 million after they built homes at the city of Harrisburg's request, but the city hasn't installed the water and sewer lines.

Tom Ford and Charles Dunham, who own Ford/Dunham Subdivision, are suing the city of Harrisburg, the mayor and the city council alleging breach of contract, fraud and intentional infliction of emotional distress. The developers are seeking nearly $8 million in damages in Poinsett County Circuit Court.

In 2006, city of Harrisburg officials asked Ford to build moderately priced homes in a section of Harrisburg, according to the lawsuit. In exchange, the city would install water and sewer lines to the homes.

After four homes were built, at a cost of $258,000, the city then backed out of supplying the utilities, the lawsuit said.

"The refusal of the Defendants to honor the agreement has made the constructed residence virtually unsellable and uninhabitable," the lawsuit said.

And Ford and Dunham also said the city has built a high-powered natural gas line through part of the 40-acre site, making 14 lots uninhabitable. The developers said the land used for the pipe is worth $210,000, and they want the money for that.

Harrisburg's city attorney, Ron Hunter, couldn't be reached for comment.