Galveston city attorneys have entered mediation talks with a bankruptcy trustee who threatened to sue the city over ownership of several rights of way near the seawall.
The city will hold two public hearings on the potential abandonment of the rights of way, which are in and around Porretto Beach, between Sixth and 10th streets. The beach is known to be the last property left in the bankruptcy estate of Sonya Porretto, and the estate trustee has said he has a buyer ready to take the property as long as the rights of way are included in the sale.
Trustee Randy Williams declined to comment because mediations are confidential, he said.
The council will have public hearings on Nov. 9 and Dec. 14 and will take a vote on the abandonment Dec. 14, according to the mediation agreement.
“Under this mediation agreement, no particular course of action or vote is guaranteed by city council,” City Attorney Don Glywasky said. “It is just a process to allow us to try to resolve this.”
Williams and others working to sell the property have claimed the rights of way belonged to the Porrettos since 1978, when the Galveston City Council voted to abandon them to the family.
Proof of the transaction is largely nonexistent, however, as the city has not found official records showing the required legal documents were ever filed to turn over the properties.
The city’s vote in December would either recognize or deny that the abandonment took place.
Williams filed a letter with the city in April, threatening to sue over the matter.
“I am at an end of the chicanery and mischief of Galveston,” Williams said in the letter.
“My goals are to sell the property of the Porretto estate and pay creditors,” the letter states. “My goal is not to engage in litigation. That said, I will if there is no alternative.”
The mediation agreement specifies that the rights of way would only be abandoned if the trustee deeds the city 100 percent of Porretto Beach West, a few blocks from Porretto Beach. That land is valued at somewhere around $160,000, Glywasky said.
Plans to develop on the Porretto land have been controversial. Developer Galveston LLC has made the $6 million offer and plans to build a mixed-use development on the land.
Elizabeth Beeton, a former city councilwoman, said she doesn’t believe the city should give away public property because of a claim that hasn’t been proven true.
“City council should consult an independent legal expert to advise the council regarding the merits of this claim, because it’s a bogus claim,” Beeton said.
The existence of a buyer has “really not that much import” to the city in signing a mediation agreement, Glywasky said.
“The buyer, I think, provides the impetus for the trustee to want to resolve this quickly,” he said.