Shirato cites FDIC in project violations

Faced with a lawsuit alleging violations of Missouri’s Clean Water Law, the developer of a troubled Branson West resort is determined, but struggling to be optimistic.

Jim Shirato, Springfield developer and owner of Indian Ridge Resort Inc., and Donald Snider, managing member of North Shore Investments LLC, broke ground in 2005 for the planned $1.6 billion, 850-acre Stone County development. But construction stopped in August 2008 following the Federal Deposit Insurance Corp.’s takeover of Topeka, Kan.-based Columbian Bank, which held Indian Ridge Resort’s commercial loan.

“I don’t walk from anything,” Shirato said last week. “Indian Ridge will be built.”

The latest hurdle is Missouri Attorney General Chris Koster’s Dec. 7 lawsuit against the Indian Ridge developers, alleging violations of Missouri’s Clean Water Law.

Koster alleges that rainfall has caused sediment to wash from cleared areas into erosion channels, eventually winding up in Table Rock Lake. Shirato said the lawsuit was filed just a few days into his $58,000 remediation plan, which must be completed before FDIC would release the commercial note for Indian Ridge.

Shirato claims because the FDIC holds the commercial note on the property, he can’t proceed with construction or remediation, leaving him in a stranglehold.

Shirato said the FDIC approved of his remediation plan that was crafted with the help of the Missouri Department of Natural Resources and the Environmental Protection Agency.

FDIC spokeswoman LaJuan Williams-Young declined to comment on the loan situation.

Koster spokeswoman Nanci Gonder said the attorney general’s office is unaware of FDIC provisions that prevent a property owner from performing remediation to comply with the Clean Water Law.

“Water violations have been a priority,” Gonder said. “Our division of agriculture and environment has really focused efforts on clean water violations and moving as quickly as possible.”

In the Indian Ridge case, Koster is seeking a court order requiring the defendants to comply with the Clean Water Law, to incur a civil penalty not to exceed $10,000 per day for each violation of the law, to pay for the damage to Table Rock Lake and to pay the costs associated with the case. Koster’s office said a trial date has not been set.

Shirato said he’ll continue to work with FDIC, MDNR and EPA officials until remediation work can resume.

“We don’t fight lawsuits,” Shirato said. “We let the facts develop. We’re confident that the facts, when developed, will speak volumes to our good intent to comply with state and federal laws. We absolutely concur with the Clean Water Act.”

Indian Ridge was to be built in four phases encompassing 2,440 homes for up to 7,800 residents, an eight-story resort hotel with an adjoining $35 million indoor water park and an 18-hole golf course with five manmade lakes.

Infrastructure for the first phase was completed in September 2007, and at that time Shirato said $138 million of construction on condominiums, town homes, log homes and single-family homes would begin in late 2007.

There were 45 log homes presold, and Shirato said in 2007 that 140 town home units were sold at $498,000 apiece to buyers from California, Nevada, Texas and New Mexico.

Shirato said phone inquiries are taken daily from parties interested in buying Indian Ridge property. Once the issues with the FDIC and the resort’s commercial loan are resolved, Shirato said remediation work will resume on the project. He hopes to restart construction on the project in about three years.

“We’re not going to fault the FDIC,” Shirato said. “I’m in the business of solving problems, not creating them. We’re going to continue working with the FDIC and pray daily that our resolution is forthcoming in the near future.”[[In-content Ad]]