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City high bidder on 15 of Kallembach properties

POSTED January 22, 2013 12:06 p.m.

PLATTEVILLE — The City of Platteville was the high bidder on 15 of Darrel L. Kallembach’s 19 city properties at the sheriff’s sale Jan. 15.

The city bid on the properties using the $366,765.38 in fines and interest accumulated on the more than 100 citations Kallembach was issued for violations of city ordinances between 2008 and 2010.

The city was outbid on four properties — at 605 and 605½ Southwest Road, 390 W. Pine St., 540 Mineral St., and 465 Division St. The city was outbid on the Mineral Street and Division Street properties by $1 each.

But neither the city nor the bidders who outbid the city are the owners of those properties yet. Community Planning and Development Director Joe Carroll said a judge must approve the sales, and under state law Kallembach has 15 months to match the offers on the properties and retain ownership.

The city was the high bidder on 15 of Kallembach’s properties — 420 and 440 Southwest Road, 222 and 230 N. Elm St., 310 W. Gridley Ave., 160 E. Mineral St., 565 Cedar St., 235 Third St., 185 Center St., 260 and 430 Chestnut St., 85 Water St., 375 Irene St., 255 and 335 Division St., and 1536 County B.

The city ended up using $288,341.96 of the $366,765.38 in interest and penalties in successfully bidding upon the 15 properties. The city’s successful bids ranged from $12,927.25 on the Center Street property to $30,000 for the County B property.

The 19 properties have combined assessed valuation of $1,412,900, ranging from $49,800 on the Center Street to $116,500 on the County B property.

As for what the city plans to do with those properties should it end up with ownership, Carroll said, “That’s yet to be decided. There might be individual parcels the city might look at depending on their location. Obviously the goal is to get them usable, fixed up and back on the market.”

The 540 Mineral St. property was sold for $14,226.17. The 465 Division St. property went for $16,001. The 605 and 605½ Southwest Road property went for $23,500. The West Pine Street property was sold for $23,750.

The city originally planned to bid on seven properties — 222 N. Elm St., 605 Southwest Road, West Pine Street, 160 E. Mineral St., 420 and 440 Southwest Road, and West Gridley Avenue — when the sheriff’s sale was first scheduled Sept. 25. Kallembach stopped the sale, however, by declaring Chapter 13 bankruptcy. However, the bankruptcy proceeding was canceled when Kallembach failed to file a payment schedule or make the first payment to creditors.

Kallembach’s first citations from the City of Platteville came in January 2008, when he pleaded no contest to five citations for failing to remove furniture from the exterior of a building. From then until July 30, 2010, Kallembach was issued more than 100 citations for allowing occupancy without a valid rental license, allowing occupancy of more than four unrelated persons, and second- and third-offense citations for allowing occupancy without a valid rental license.

The city won a judgment against Kallembach for a total of $309,804.84 in March 2011.  On Oct. 31, Dane County Circuit Judge David Flanagan issued an order prohibiting Kallembach from leasing or renting any of his 21 properties until he obtained a city rental license. Flanagan also ordered Kallembach to provide a copy of all of his existing leases to the city and to have his properties inspected. Kallembach also was ordered to provide notice of violations within 10 days of a citation’s being issued.

An arrest warrant for contempt of court was issued for violating the court order. Kallembach was taken into custody by Platteville police at 440 Southwest Road June 27. He was jailed until Nov. 4.

Kallembach claimed in a letter to The Platteville Journal in February that the city had no authority to cite him “unless my refusal to permit inspections and obtain rental licenses resulted in substantial interference with the comfortable enjoyment of life, health, or safety of others.” Kallembach’s claim was based on a 1981 state Supreme Court decision that defined a public nuisance as “an unreasonable activity or use of property that interferes substantially with the comfortable enjoyment of life, health, or safety of others.”

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