A dispute over the ownership of several beach front rights of way came to a boil Thursday when a bankruptcy trustee attempting to sell the overlying property pleaded with Galveston City Council to give up the rights of way and avoid a lawsuit.
Randy Williams, trustee in the Chapter 7 bankruptcy estate of Sonya Porretto, has threatened to sue the city of Galveston over 10 rights of way on Porretto Beach, between Sixth and 10th streets. Williams and others working to sell the property have claimed the rights of way had belonged to the Porrettos since 1978, when the 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, or plats, were ever filed to turn over the rights of way.
The controversy at its core is between a developer wanting to build a mixed-use project on Porretto Beach and islanders opposed to that for various reasons.
The beach is the last property left in Porretto’s bankrupt estate, and Williams has said he has a buyer ready to take it as long as the rights of way are included in the sale. Porretto Beach is one of very few privately owned Gulf beaches in Texas.
The Porretto Beach property is more than familiar with the court system. Another dispute about the ownership of the actual beach slogged through the courts until 2015, when the Texas Supreme Court ruled the Texas General Land Office didn’t own the beach and that it belonged to the Porretto family.
Williams said he would like to avoid that sort of legal fight this time around.
“If that’s what y’all want and you don’t want to settle it, then fine,” Williams said at a public hearing over the issue. “It’ll grind on and on and on.”
Galveston city attorneys have entered mediation talks with Williams. The council on Thursday unanimously deferred a vote that would have officially recognized the process set forth in the mediation agreement.
The mediation agreement sets out steps to settle the issue and specifies that the rights of way would be abandoned only if the trustee deeds the city 100 percent of Porretto Beach West, a few blocks from Porretto Beach. That land is valued at about $160,000, City Attorney Don Glywasky said.
A vote on abandoning the rights of way is set for December, Glywasky said.
Opponents of the transaction came out in full force at the council hearing, which is the first of two to be held. Eight residents urged the council not to ratify that the rights of way were abandoned, or to at least ask an independent entity to take up the issue.
“I expect nobody on this council would hold themselves out as experts on real estate or bankruptcy law, so it seems the wisest course would be to defer this and seek the best outside counsel you can find before deciding how to deal with an irreplaceable public asset,” resident David Collins said.
Alexander Nelson, the son of Sonya Porretto, testified that the rights of way were never officially abandoned in the first place and that his grandfather, Henry Porretto, walked away from the issue after he found he didn’t have full support of surrounding neighbors.
Nelson further contended the city council would only ratify that the abandonment occurred because they were making deals with the trustee and potential buyers of the property.
“If you vote yes to this agenda item today, you’re confirming to all residents and business owners of Galveston that yes, it’s true city council says that planning rules and codes and regulations are for everyone, except those you deem worthy to do backdoor deals with,” Nelson said.
Mayor Jim Yarbrough disputed that the council has been anything but transparent.
“Just when you think you can’t find a crazier one, you find a crazier one here in Galveston,” Yarbrough said. “We’re doing your business in front of you.”
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.
The rights of way hold no real value, because the city isn’t likely to put utilities or roads there on the beach, Williams said.
“There’s no question that in 1978, your predecessors looked at this and said we’re not going to build streets, we’re not going to put utilities in,” Williams said. “We’re 40 years later and now all of a sudden these rights of way supposedly have value? They don’t allow you access, you can’t develop it.”
Resident Rick Smith suggested the city buy the land and preserve the beach, instead of giving away rights of way that he said rightfully belong to Galveston.
“These are our beaches,” Smith said in the public hearing. “I find it hard to believe that they have lost all records of this platting ever taking place.”
Former City Councilwoman Elizabeth Beeton brought forward dozens of documents outlining the original abandonment. The ordinance states that if its terms and conditions, such as platting the property, aren’t met within 90 days, “then this ordinance shall be deemed never to have taken effect or to have ever been in force.”
“In short, this is a flimsy claim,” Beeton said. “There is no evidence at all that the conditions were met. I don’t think the city is legally on solid ground to give away this property without going through the usual process for abandonment.”
Michael Gaertner, a local architect who is working with the potential developers, said it is entirely plausible that the plats got lost.
“All I’m going to say is I have filed plats with the city and the planning department has lost them,” Gaertner said. “It has taken months and months and months to get it resolved.”
The city council will hold a second public hearing on the issue Dec. 14 and is expected to take a vote on the abandonment then. Yarbrough said the city should at least go through the process but that he won’t be intimidated by a potential lawsuit.
“If we don’t want to acknowledge the release of the ‘78 documents, then done deal,” Yarbrough said. “They can sue us.”