A $350,000 loan from the city’s quality growth fund is now paid in full, but a lawsuit challenging the process of granting the loan continues.The lawsuit was filed after a low-interest, business incentive loan was issued in 2015 for a start-up ambulance service – Priority Medical Transport.
North Platte residents Donna Tryon and Ryan Sellers filed suit shortly after the loan was approved by the city council, which heeded the recommendation of the citizen’s advisory committee.
The city’s Quality Growth Fund is a multi-million dollar account designed for incentives for businesses to move to or grow in North Platte. Preference is given to companies that create good-paying jobs.
Tryon and Sellers claim the citizen review committee for the fund, as well as the city council itself, gave “bare legal notice” of their meetings when the loan was granted, in “the exact opposite of an open and public process.”
Nor did the city give notice that Priority Medical is owned by public employees, which also violates a state law, because public positions cannot be used for private enrichment, the lawsuit claims.
Through their attorney, Tryon and Sellers claimed the loan should be revoked.
However, Priority Medical paid the loan in full on April 26, plus $363.80 interest, which could nullify the claim for relief. Shortly thereafter, City Attorney Doug Stack and Priority Medical’s attorney David Pederson asked the court to rule in the city’s favor.
However, the plaintiff’s attorney, J.L. Spray of Lincoln, is not giving up.
Spray said his law firm did not receive the required advance notice of the defendant's latest motion, but he only discovered it himself shortly before a scheduled telephone conference on May 8. In an affidavit, Spray swore he never received the required letter in the mail. He asked the court for more time to amend the claim.
The court allowed more time. The next hearing is tentatively set for June 12, Tryon said Friday.
According to court records, Spray intends to tack some attorney fees onto the claim, if nothing else.
The city’s attorneys have consistently said the city complied with open meeting laws. They also deny that there is a valid legal claim that the Priority Medical owners should have been prohibited from receiving the loan because they are civil servants.
Priority Medical Transport was established by Assistant North Platte Fire Chief Trent Kleinow and Dr. James Smith, the emergency room director at the hospital who is also the medical director for the North Platte Fire Department, according to the lawsuit.
The lawsuit has already been to the Nebraska Supreme Court once. After the Lincoln County District Court dismissed the plaintiff's claims in 2016, the Supreme Court looked it over and sent it back to district court for further review. Without deciding the claims, the high court said they raise worthy questions that deserve more consideration.
Pederson told the Bulletin that Priority Medical never had any control over the notice of meetings provided by the city.
Pederson also said the company is a "Quality Growth Fund success story," since Priority Medical has grown to 42 employees, and now operates in Kearney and McCook, as well as its headquarters in North Platte.
"Priority is now in a position where they no longer needed that loan, and rather than be tied up in litigation that involves something they can’t control, they decided to pay off the loan and request that the case be dismissed as moot," he said.