The following articles, published in various issues of the Maryland Independent over a number
of years, provide some insight and background into the creation and development of Swan
Point since its inception in 1969.
Maryland Independent
Thursday, December 18, 1969, Pg. 1
By Del Malkie
U.S. Steel Buys Swan Point Site
No Steel Plant, Say Spokesmen
A 950-acre tract on Swan Point on the Potomac River in Charles County has been purchased
by the United States Steel Company from Mr. and Mrs. Bennett Crain for a reported price of $1.8
million.
A U.S. Steel spokesman said late Tuesday afternoon that while the ―investment property‖
might be used for housing development, ―we know we are not going to build a steel mill there.‖
The property, which has six miles of shoreline on the Potomac and Cuckold Creek, lies about
five miles downstream from the Potomac River Bridge and about the same distance north of Cobb
Island.
With respect to citizen fears that the proximity to the new PEPCO Power Plant at Morgantown
could lead to an industrial plant at Swan Point, the spokesman said ―there is absolutely no
significance in the location at all.‖
Company representative David Ferguson pointed out that which plans for use of the point
―have not been formulated‖ the site definitely ―would not be developed for normal industrial purposes.‖
Another spokesman defined the ―normal industrial purpose‖ of U.S. Steel to manufacture steel.
The U.S. Steel officials did report they were considering development of a ―second home‖ type
of community, for retired and vacationing city dwellers.
County Commission President Reed McDonagh confirmed that the firm ―did have some
preliminary conversations‖ with him and was informed that so far as the Courthouse was concerned,
the minimum lot size which would be permitted would be in the half-acre and up category.
Both McDonagh and company spokesmen asserted that no applications had been filed for a
more dense, or commercial, use of the property nor had there been any discussions along those
lines.
U.S. Steel officials said ―no firm plans‖ would be made for use of the property until completion
of a land use study by professional consultants. Ferguson said the firm’s realty division had acquired
several similar properties in recent months around the nation, but has no similar holdings in Maryland.
He added ―U.S. Steel has a homebuilding division, but our plans are just not that far along yet.
We just might sell the land from investment point of view.‖
Other company spokesmen indicated, however, that the ―second‖ home or resort plan was
high on the list of considerations, possibly along with marinas, and other apertenances of resort living.
At the present time, the Department of Chesapeake Bay Affairs is deepening the channel into
Cuckold Creek but only to a depth of seven feet, to accommodate pleasure and oyster boats.
While present restrictions would limit development to the half-acre lot type of community,
McDonagh said U.S. Steel had been advised that a new zoning category to be known as RPC—
Residential Planned Community—was being developed and was designed for application in tracts
such as the Swan Point location. This category, however, would not include high-rise apartments,
which need separate application.
The Baltimore Sun reported Tuesday that the property at one time was under consideration as
a state park, financed through federal matching funds. The newspaper said it was unable to
ascertain ―why those reported negotiations failed.‖
Commissioner McDonagh said he had no knowledge of any such proposals.
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Maryland Independent
Thursday, December 17, 1970, Pg. 1
U.S. Steel Seeks Exception To Construct Private Club
United States Steel has applied, through its Realty Development Division, for a special
exception to build a private club on land it owns on Swann (sic) Point. The club, which will be part of
a second home and retirement community, will include a golf course, clubhouse, tennis courts,
swimming pool, and a yacht basin.
The company purchased approximately 900 acres of land from Bennett Crain last year and
has announced plans to develop it into a community of approximately 5,000 part-time residents.
According to attorney Robert Barbour who is representing U.S. Steel in the matter, the
development will be for people interested in water sports primarily. He said the company felt the land,
which is in the Fifth Election District of Charles County and is over 50 miles from Washington, is too
far from D.C. for commuting and would have to be restricted to people who want second homes or to
retired people.
The preliminary plan calls for lots of approximately one-third of an acre. Company officials
said that no cost per lot has yet been decided on. The first section, which will go on sale sometime in
1971, will have 515 lots of which 100 will be on the water, and 45 on the nine-hole golf course.
The granting of the special exception is necessary to the development, Barbour said. The
construction of the club will be geared to the sale of lots and the company could not give a projected
completion date. A second nine holes for the golf course is projected also, but in a later stage of
development. Barbour said that because of the nature of the development, it will produce more tax
revenue than it will cost the county in services. Most services, such as water, sewer system and
roads will be built by U.S. Steel as part of the development of the land, according to Barbour.
Schools, he said, will not be needed in any number because of the second home nature.
The development, when finished, could have as many as 1,900 homes and 5,500 part and full-
time residents.
The club facilities will be limited to members, according to a company official, and th
membership will primarily be residents of the community.
During the one hour hearing no one voiced any objection to the plans and Samuel Bowling, a
resident of the area, said that most people in the Fifth District approved of it. He called the
development ―a natural‖ for the southern end of Charles County.
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Maryland Independent
June 24, 1971, Pg. 1
At Chamber of Commerce Dinner
U.S. Steel Outlines Swan Point Plans
U.S. Steel revealed its plans for Swan Point last week.
At a dinner meeting of the Charles County Chamber of Commerce last Thursday night, Joseph
Denbeck, president of the Realty Development Division of the steel company, said the 900-acre site
would develop into a second home community that would eventually have 5,000 residents.
Because the property has about 25,000 feet of waterfront on the Potomac River and Cuckold
Creek, the development will be oriented toward water sports although tennis courts, and a golf course
will be built. A marina and clubhouse will also be constructed.
The property was purchased in late 1969 from Bennett Crain. The company retained the firm
of Wilbur Smith Associates of Washington as planners and engineers.
Neil R. Greene and Associates of Silber (sic) Spring is the architect and Shannon and Luchs of
Washington is the realtor.
The company plans to develop the property over a five year period. The first state will consist
of 330 acres which will have 515 lots. All will be single family, detached homes. There will be 88
acres set aside for recreational use including the marina, swimming pool, tennis courts, playground
and golf course.
The golf course will be built as soon as 150 people have applied for membership, Denbeck
said. There will be both resident and non-resident membership.
Denbeck said that all natural features will be preserved and residential lots will be about one-
third of an acre in size. The buyer will construct the homes, he said, but plans must be approved by
the company’s architect and builders will come from an approved list.
Lots will sell from $6,500 for a back lot to $20,000 for a prime waterfront lot. Sales will begin in
the fall, he said.
Denbeck said that because of its distance from the Washington and Baltimore metropolitan
areas, most of the houses will be second homes that will be used on weekends during the summer.
(The article included a diagram of the master plan, showing residential lot layout, initial 9-hole golf
course, community center, and the areas reserved for future residential development).
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Maryland Independent
Wednesday, February 19, 1975, Pg. 1
Swan Point housing faces deadlock
Representatives of U.S. Steel Corp made a desperate plea to the Charles County
Commissioners yesterday to iron out conflicts with the Sanitary District which have stymied a housing
development at Swan Point.
The conflict between U.S. Steel and the county sanitary district originated in October, 1972,
when the county commissioners incorporated the Swan Point property as a part of the county-wide
sanitary district.
The result was that plat sales by U.S. Steel Realty Development (URD) were terminated,
because no agreement could be made with the sanitary district concerning sewer and water facilities
for the subdivision. Now 254 lot owners have no guarantees that water and sewer facilities will be
built.
The 950-acre parcel was purchased by URD in December, 1969, and approval for the phase 1
subdivision plats (284 lots) were made in May, 1972, prior to the incorporation of the development
into the sanitary district.
In the meantime, on Jan. 5, 1972, URD and the Charles County Commissioners agreed on the
sewer and water facilities at the development.
Basically, the county said that URD could build the treatment facilities, and subsequently,
could recover 100 per cent of the construction costs.
Also in the agreement, it was stipulated that Maryland Environmental Services (MES) would
participate as a contract agent for URD to operate the treatment facilities.
According to G.P. Willard, vice president of engineering and development for URD, the
conflicts have arisen due to a ―paradoxical stance‖ taken by the sanitary district.
He remarked, ―The sanitary district is saying that the agreement between URD and the county
commissioners is valid, and they will abide by them, but only if the agreement does not include their
district, which in this case, it does.‖
Reed McDonagh, deputy director of the MES, added, ―It’s a true dilemma for the sanitary
district, because they feel they can’t make an exception to bend with the agreement when it is
contrary to their regulations.‖
The 1969 comprehensive plan for Charles County makes a general statement of policy that a
public utility cannot be privately owned, which contrasts with the agreement between URD and the
former county commissioners.
Willard said that because the sanitary district will not approve plats on the property site, the
entire housing project is jeopardized, and 254 property owners who have already purchased lots are
infuriated.
The sales program was terminated in November, 1973, because the remaining plats were not
legally sanctioned by the sanitary district.
―Despite our agreement for 100 per cent recovery of construction costs,‖ Willard told the
commissioners, ―URD would be willing to recover 75 per cent if the sanitary commission provides the
vehicle whereby we can recover 75 per cent.
―But up to now, the sanitary district has not provided us with the means to recover our capital
investment in the plant construction.‖
J.R. Dembeck, president of URD, submitted a request to the commissioners to exclude Swan
Point from the jurisdiction of the sanitary commission, thereby enabling URD to proceed in
accordance with the existing agreements.
Secondly, he urged the commissioners to support a request for a franchise for the utility
system be provided by the existing agreement.
Such a franchise, he said, would provide the mechanics for collection of use fees only since
the MES will operate the facilities by contract.
Finally, Dembeck requested that the commissioners agree to a water system operation by the
MES comparable to the sewer system at the Swan Point development.
Willard concluded, ―If this situation is impossible, we would like to face up to it now and say the
project was wrong. The worst thing that could happen to us is to get a temporary breath of life, only
to find that the project would fall through later on.‖
Commissioner President Raymond Tilghman said the commissioners would attempt to arrive
at a solution as soon as possible, but he added that he doubted if they could come to any decision by
the requested date of Feb. 28, 1975, when URD officials meet with the Swan Point Property Owners’
Association.
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Maryland Independent
Wednesday, May 14, 1975, Pg. 1
Swan Point to be scrubbed?
The indications are that U.S. Steel Realty Development (URD) will abandon its 950-acre Swan
Point development in the Fifth Election District.
Tuesday morning, U.S. Steel officials met with the Charles County Sanitary Commission in an
attempt to settle the impasse which has stymied the development since 1972.
At the end of the meeting, however, Joe Dembeck, president of URD, dismally announced that
URD, a subsidiary of U.S. Steel Corp., had no alternative but ―to raise the white flag‖ and scrub the
project.
The conflict began in October, 1972, when the county commissioners incorporated the Swan
Point property as part of the newly-formed, county-wide sanitary district.
Plat sales were terminated, because no agreement could be reached with the sanitary district
concerning reimbursement of water and sewer facilities for the subdivision.
At that point, 254 lot owners had no guarantees that sewer and water facilities would be built.
URD originally bought the Swan Point parcel in December, 1969, well before it was incorporated into
the sanitary district.
Before the formation of the sanitary district, the county commissioners had indicated that URD
could recover 100 per cent of the construction costs on the water and sewer facilities.
During the past two-and-a-half years, the conflict has centered on whether or not the sanitary
district would guarantee a 100 per cent recovery.
At the heated meeting Tuesday, Louis H. Cummings, chairman of the commission, noted, ―We
like you guys, we want you here, because your development concept is sound, but we can’t give you
the wealth out of our bank. Any other solution will be just an out-pouring of other people’s money –
the taxpayers of Charles County.‖
URD officials have said in the past they would be willing to recover 75 per cent of the
construction costs if the sanitary district provides the vehicle to recover the 75 per cent.
But it is the contention of URD that the sanitary district has not provided that means, and under
the commission’s terms, the amount they could recover ―would be only 10 per cent.‖
But Cummings adamantly insisted, ―If you all can work out the economics, the project can go
on. We’re giving you the opportunity to recall your money up to 75 per cent over a 10-year period,
and if that is unsatisfactory, you’ll just have to increase the costs of your lots.
―I don’t understand your reluctance to increase your lot prices by $500 to cover the costs of the
water system. You’ll never know if you can until you try it will you?‖
This move would eradicate the county policy in the 1969 comprehensive plan that a public
utility cannot be privately owned, and according to URD officials, it would honor the legal agreement
with the county on Jan. 5, 1972 that URD could make a 100 per cent recovery on the facilities.
Cummings was quick to point out that the district had sent a letter to URD on Oct.15, 1974
outlining its position and ―legally opening its hearts‖ to the developers in an effort to get the project
underway.‖
―Personally, ― he added, ―I thought it was quite an insult that our letter was not answered. I’ve
been in government for a long time, and I’ve never before seen a large corporation such as U.S. Steel
ignore an agency such as the sanitary district.‖
The second alternative that URD wanted was for the county to sell bonds for the water and
sewer project, but only to URD.
The front footage from the lots at Swan Point would pay off the bond issues and go directly to
URD. According to the sanitary district, such a move would be unethical and would raise certain legal
questions.
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Maryland Independent
Wednesday, May 21, 1975, Pg. 1
Swan Point agreement sought
Negotiations are currently underway between U.S. Steel Realty officials and the Charles
County Sanitary Commission which could make or break the ill-fated Swan Point development in the
Fifth Election District.
After the sanitary commission stubbornly refused to yield last week to the requests by Joe
Dembeck, President of U.S. Steel Realty Development (URD), it appeared that the project would
have to be abandoned after a two-year dispute.
But yesterday, Dembeck presented the commission with a proposal involving URD, the
commission and the county commissioners which could iron out the difficulties regarding the yet
unconstructed central sewer and water facilities at Swan Point.
Basically, URD officials have criticized the commission for not providing them the means to
recover the construction costs of the sewer and water facilities.
The commission has stipulated, according to its standard agreement with any developer, that
URD can absorb the costs only through tap-in fees for water and sewer lines.
Those fees amount to $300, which URD officials claim will not even recover the costs of
hooking up the water and sewer lines, much less construction costs for the plants.
URD has been striving for the plant to become a private utility, which is contrary to the local
laws which stipulate that a public, private utility is not allowed in the county-wide sanitary district.
The last tenure of the county commissioners had given URD permission to operate as a
private utility and to recover 100 per cent of the construction costs. Shortly thereafter, the Swan Point
property was incorporated into the sanitary district and became subject to its regulations.
The proposal offered by Dembeck yesterday says that URD will enter into the standard
agreement desired by the sanitary commission, and if it is signed by the commission and the county
commissioners, the project will begin immediately.
The proposal further reads, ―It is understood that U.S. Steel will submit to an appropriate legal
forum the existing agreements with the Charles County Commissioners and Maryland Environmental
Service for a determination of its rights under the agreements. In the event that it is judicially
determined that the existing agreements are valid and binding obligations, the standard form of
agreement will thereupon be void and have no effect, and the parties will be bound by the existing
agreements.‖
However, if the courts rule in favor of the district, U.S. Steel will honor the standard agreement,
but only under the following assurances from the sanitary commission and the county commissioners:
That any plats which are presently pending and awaiting approval will be approved promptly so
as to enable U.S. Steel to record those plats and to commence sales of lots.
That any future plats filed by U.S. Steel will be given prompt consideration.
That the sanitary commission will cooperate and not unreasonably delay the installation and
certification for operation of the sewer and water systems as already designed for Swan Point,
so as to permit its operation as soon as possible.
At the meeting yesterday, Dembeck assured the commission that URD would not walk away
from the sewer and water plants in the future and create a financial burden upon the taxpayers of
Charles County.
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Maryland Independent
Wednesday, May 28, 1975, Pg. 1
U.S. Steel plans suit to save Swan Point
U.S. Steel officials revealed before the Charles County Commissioners that they are going to
take civil action against the Sanitary Commission to save the Swan Point development.
The meeting last week was the latest in a series in which Joe Dembeck, President of U.S.
Steel Realty Development, has unsuccessfully attempted to begin the housing project.
Currently, there are 250 disgruntled lot owners who have been waiting for two years for the
controversial issue between USS and the commission to be resolved.
The central issue hinges around the amount of money and the method by which USS can
recoup construction costs for the planned water and sewer facilities.
It is the contention of USS that the sanitary commission will not provide the means of fairly
recovering the construction costs.
The commission has stipulated, in accordance with its standard agreement, that USS can
absorb the costs only through the tap-in fees for water and sewer lines.
Those fees amount to $300 per lot and USS officials claim $300 will not recover the costs of
hooking up the water and sewer lines, much less construction costs for the plants.
USS desires that the plants be classified as a public, private facility operated by the Maryland
Environmental Service (MES), and construction costs will be recovered by rates established by the
sanitary district.
But the drawback in the USS request is that the local laws do not permit a private utility in the
county-wide jurisdiction of the sanitary district.
Presumably, this will be a key issue in the impending court battle, if it comes to that, because
prior to the legal incorporation of Swan Point into the sanitary district, the former county
commissioners had given USS permission to recover 100 per cent of the construction costs.
Last week, in an attempt to resolve the issue before meeting with the 250 property owners,
Dembeck informed the county commissioners that the sanitary commission had rejected the latest
proposal of USS.
That proposal had outlined that USS would enter into the standard agreement desired by the
sanitary commission, and if it had been signed by the commission and the county commissioners, the
project would have begun immediately.
In the meantime, the issues would be decided in the courts, and both parties would honor the
rendered judgment.
Apparently, the sanitary commission rejected the proposal fearing a judgment in favor of USS
and hoping that USS would come to terms without a confrontation in court.
At the meeting last week, Louis Cummings, chairman of the sanitary commission, added a
spark of hope by saying, ―I’m intrigued personally by the possibilities of USS having a contract directly
with the sanitary commission to operate the facilities and to keep it under our jurisdiction.
―I don’t know how the other sanitary commissioners feel, but this would remove MES and other
indirect agencies from the project. The problem is how legally and satisfactorily USS would recoup its
investment. Under this arrangement, this would be a franchise with the sanitary commission the
operating contractor.‖
The state Public Utilities Commission would have to be questioned, he added, as to what type
of return USS could expect on the investment.
He further suggested that the sanitary commission could establish a cut-off time for the return
of the investment, perhaps 75 per cent, within a 10 or 20 year time frame.
Dembeck added an optimistic note that this proposal by Cummings would be advantageous,
because it would eliminate the third party – MES.
Additionally, he indicated that USS would be more agreeable to a return on their investment
under a 20-year period to recoup its investment.
Joe Brewer, administrator for the sanitary district, observed that the proposal would be good
from the standpoint of the sanitary district running the water and sewer facilities at Swan Point.
Dembeck declared, ―The Swan Point property owners have said that if they can’t build by this
summer, they want out, and at the meeting tonight we’ll have to tell them that the sanitary
commission has turned down our latest proposal. We will have to tell them that we will have to
pursue the matter in the courts if we run out of gas on all prior agreements.
―Secondly, if they want their money refunded, they can have it back. We can’t in good
conscience ask them to stay on any longer. We feel that with the former agreements, we have some
status.‖
Commissioner President Raymond Tilghman said that the only thing he could see regarding
the matter is ―for both parties to take this issue back to the drawing boards.‖
Cummings noted, ―It’s intriguing to me, but it could be that my proposal does not conform to
state standards. On this point, we will have to be reassured by our attorney.‖
Dembeck added, ―Let’s be brutally honest about this. We really haven’t left home plate yet.‖
And Cummings countered, ―This is the first new thing I’ve learned here today – that USS is
going to sue us regardless of what we do.‖
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Maryland Independent
Wednesday, July 9, 1975, Pg. 1
New Swan Point group intervenes in dispute
The Charles County Sanitary Commission reached another impasse Tuesday concerning the
construction of water and sewer facilities at the 950-acre Swan Point development.
However, Commission Chairman Louis H. Cummings was confronted by representatives of the
Swan Point Advisory Board (SPAB) rather than Joe Dembeck, president of U.S. Steel Reality
Development.
In the past, Dembeck and Cummings have been unable to resolve the issues concerning the
construction and remuneration of the water and sewer facilities.
At a meeting earlier this spring, Dembeck noted formally that because the resolvement of
differences has continued unabated for several years, U.S. Steel would have to resort to court action
against the Sanitary District.
In an attempt to reconcile the problem, the 260 lot owners of Swan Point, at a meeting on May
21, elected Clifford A. Falkenau and Lucian Warren as chairman and vice chairman of the SPAB.
Before the meeting Tuesday, Falkenau explained, ―We arranged this talk with the sanitary
commission in order to learn their point of view I this matter. We know U.S. Steel’s position, and
perhaps we can help in reaching a suitable agreement between the two parties.‖
Warren told Cummings and Commissioners Frank Bowling and Samuel Linton that the
impasse stems from the lack of an adjudicator who can resolve the legal and economic problems.
He stressed that the SPAB doesn’t want to see the matter go to the courts, a process which
would involve much time and money.
―It’s frustrating to an advisory board,‖ he continued, ―to see that the conflicting parties never
seem to reach an agreement. We would suggest that the American Arbitration Association, with its
self-appointed lawyers, enter this matter to try to reach an agreement.‖
Cummings said the commission would take the suggestion under advisement and added that
Dembeck had orally proposed recently to begin afresh new negotiations.
―Mr. Dembeck promised me the proposal in writing,‖ he remarked. ―We’re not trying to be
loggerheads, we’re just waiting for the letter he indicated he would send us.
―We want a safe, conservative, viable course of action taken in this matter to insure that the
citizens of Charles County are protected.‖
Falkenau and Warren asked Raymond Tilghman, Charles County Commissioner President, his
position regarding the Swan Point development.
He replied that Dembeck had promised the commissioners some sort of proposal which would
be reviewed by the sanitary commission’s attorney and then forwarded to the county commissioners.
Tilghman optimistically commented he hopes a settlement will be realized after the proposal is
reviewed. He explained that the commissioners have no jurisdiction over the sanitary commission.
Cummings reiterated the sanitary commission’s position. ―U.S. Steel has told us many times
that they want a vehicle to amortize 100 per cent this investment in the water and sewer facilities. But
we don’t have that vehicle, and that’s where we stand.
―We’re open minded about this situation, but we don’t have the money and the situation all
boils down to economics. We would appreciate it if you would relate back to the property owners our
equal concern about this matter.‖
Falkenau concluded, ―We’ll be working as a third party to see if we can help resolve these
problems. We stand ready to work with both parties to see what can be done to the mutual
satisfaction of everyone.‖
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Maryland Independent
Wednesday, March 3, 1976, Pg. 1
U.S. Steel sues county
U.S. Steel Corp. of Pittsburgh, owners of the ill-fated Swan Point development, has filed a %5
million equity suit against the Charles County Sanitary District, the County Commissioners and the
Maryland Environmental Services (MES).
Submitted to the Charles County Circuit Court Friday, the bill of complaint alleges that U.S.
Steel was not permitted to develop the 900-acre, residential-recreational project according to original
agreements.
Citing cancellations in excess of $1 million for lot purchases, plus incurred damages in excess
of $5 million, U.S. Steel claims it has suffered ―irreparable damage‖ at the Swan Point project.
Furthermore, the corporation alleges that it was the inaction of the respondents to approve the
water and sewer plans, subdivision plats and other agreements which resulted in the collapse of a
four-year effort to develop Swan Point.
County officials were not surprised with the equity suit, however, because U.S. Steel officials
had given prior warnings that they would take the issue to court if an agreement was not reached.
Commissioner President Ray Tilghman, Sanitary Commission Chairman Lou Cummings and
Sanitary Commission Attorney Edward Digges declined to comment on the impending court battle,
but U.S. Steel contends the following chain of events leading up to the bill of complaint:
On Jan. 5, 1972, U.S. Steel made an agreement with the county commissioners to construct,
operate, finance and maintain sewage treatment and water supply facilities for Swan Point.
An agreement modification was made on March 20, 1972 with the commissioners in which
U.S. Steel would permit MES to construct the sewage facilities and outfall line. U.S. Steel was to
construct the sewage collection lines, the water plant and water distribution lines.
The agreements dictated that U.S. Steel and the Swan Point Water Co. were to pay for the
total cost of the sewage and water systems and grant the right to recover the costs through approved
user rate schedules and assessments.
U.S. Steel had 284 lots on about 136 acres approved and recorded in the Land Records of
Charles County in May, 1972. By July, Steel initiated a sales program and sold 261 lots and
proceeded with construction of initial roadways and recreational amenities including a clubhouse,
tennis courts and a golf putting green.
At the time of the agreements, Swan Point was not included in a sanitary district and therefore
did not fall within the jurisdiction of the Charles County Sanitary District, but rather under jurisdiction
of the county commissioners.
But in October, 1972, Swan Point was incorporated into a sanitary district and under its
jurisdiction, according to actions brought about by the county commissioners. Subsequently, the
former agreements were assigned to the district.
U.S. Steel contends that the district has declined to approve the water and sewer systems for
two final subdivision plats which has prevented the further sale of lots.
The Sanitary district, U.S. Steel believes, has insisted that no approval will be made unless
new agreements are made which do not recognize the former agreements.
In the meantime, MWS said it would still construct the sewage treatment facilities and would
additionally agree to operate the treatment plant and to build and operate the water plant. U.S. Steel
would still be obligated to pay for the construction costs. But MES added that it could not carry out its
agreements without appropriate support from the county commissioners and the district.
U.S. Steel maintains that the commissioners have acknowledged their obligations under the
agreements to the extent of providing written permission for water and sewer franchises. Otherwise,
the commissioners have said that their obligations have been assigned to the sanitary district.
The district has asserted in public hearings that it is not bound by the former agreements, and
it is unable to comply with the agreements regarding payment for the system, Steel contends.
On Jan. 15, 1976, U.S. Steel wrote the district requesting that it provide the necessary
franchises for the water and sewer systems.
Cummings responded to the letter, ―For the first time the commission has now received a reply
to its letter of Oct. 15, 1974, in which you are now requesting the commission to honor the
agreements existing covering your property known as Swan Point…would you please outline, as
requested, the various steps necessary for implementation of the agreement assigned to this
commission by the county commissioners.‖
Joseph R. Dembeck, President of U.S. Steel, replied, saying that the district must notify MES
its approval of the exercise for the water and sewer franchises. He added that ―these provisions are
outlined in specific detail in our existing agreements that have been reviewed with you a number of
times.‖
Cummings replied on Jan. 27 that the district must have an analyzation detailing the existing
agreement to determine what to do next.
He added, ―We would also expect executed agreement incorporating your consistent
assurances that U.S. Steel Corp. would indemnify Charles County Sanitary Commission and the
county commissioners on behalf of the citizens of Charles County that they will never be obligated for
future operational for financial responsibility for Swan Point.‖
This is in line with Cummings’ statements last year that the District did not want to burden
Charles County taxpayers with operating costs.
In the bill of complaint, U.S. Steel is requesting that it be permitted to proceed with the Swan
Point development, that the water and sewer systems be approved and that U.S. Steel be awarded
damages in the amount of $5 million, plus interest and the costs of the suit.
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Maryland Independent
Wednesday, March 31, 1976, Pg. 1
County asks dismissal of $5 million suit
A preliminary motion raising objection to the $5 million Swan Point equity suit of U.S. Steel
Corp. was filed last week by the Charles County Commissioners.
The commissioners have taken the same action as the sanitary commission, claiming that the
suit should be dismissed due to the doctrine of sovereign or governmental immunity.
In early March, the internationally-known Pittsburgh conglomerate filed the suit against the
commissioners, sanitary commission and the Maryland Environmental Service (MES).
U.S. Steel charged the three parties with failure to honor original agreements permitting the
development of the 900 acre parcel off route 257 into a residential/recreational facility.
Citing cancellations in excess of $1 million for lot purchases, plus incurred damages in excess
of $5 million, U.S. Steel claims that its real estate division has suffered ―irreparable damage‖ at Swan
Point.
Ranked as the 14th largest U.S. company in terms of sales or revenues, U.S. Steel further
alleges it was the inaction of the respondents to approve water and sewer plans which resulted in the
collapse of a four-year effort to develop Swan Point.
It is expected that Circuit Court Judge George Bowling will decide the ―preliminary objection‖
motion this Friday.
County Attorney Thomas C. Hayden, Jr. responded to the U.S. Steel suit by contending,
―Charles County is a body politic clothed with governmental immunity. The doctrine of sovereign
immunity precludes a litigant from asserting an otherwise meritorious cause of action against the sate
or one of its agencies which has inherited its sovereign attributes…‖
While he conceded that the state has the right to waive sovereign immunity, he pointed out
that ―there is no specific and/or implied legislative authority waiving the immunity vested in this
defendant.‖
Although Commissioner President Raymond Tilghman declined to comment on the possible
outcome of the case, he admitted he personally felt all along that the issues would have to be decided
in court.
Swan Point’s controversy, he said, was created by one of the most radical changes in the
sewer concept of the area.
This resulted in the current dispute of what U.S. Steel is required to do at Swan Point and
when it can comply in order to meet the governing standards, he said.
―The man in the black robe is going to have to make the ultimate decision,‖ Tilghman asserted,
―and it’s a shame it has to boil down to this.
―U.S. Steel is looking at how much it is costing them, and the sanitary commission is looking to the
overall good of the county taxpayers. The county commissioners are looking at it basically from an
ecological standpoint.
―But we are also considering the matter as far as long-term cost factors with the citizens of
Charles County. Can we acquire the plant and operate it under the guidelines set down in 1969, or
are these guidelines obsolete according to the state’s present standards?‖
In addition to steel manufacturing, U.S> Steel is involved in fabricating and engineering,
chemical production, transportation subsidiaries, cement production, real estate and other
enterprises.
For 1975, the firm’s sales and revenues amounted to $8.4 billion dollars with a total income of
$559 million.
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Maryland Independent
Wednesday, April 7, 1976, Pg. 1
U.S. Steel drops suit but could re-file
U.S. Steel Corp. of Pittsburgh has filed a motion to dismiss its $5 million equity suit against the
Charles County Commissioners, Sanitary District and Maryland Environmental Service.
All three parties were jointly named in the suit filed in early March by U.S. Steel for failure to
honor original agreements permitting the development of the 900-acre Swan Point
residential/recreational community off route 257.
Motion for dismissal was unexpectedly filed last week by the Pittsburgh conglomerate just
several days after the county commissioners had filed a preliminary motion for dismissal of the suit.
Reasons for the dismissal were basically the same as those filed earlier by the District claiming
the doctrine of sovereign immunity.
County Attorney Thomas C. Hayden, Jr. contended, ―Charles County is a body politic clothed
with governmental immunity. The doctrine of sovereign immunity precludes a litigant from asserting
as an otherwise meritorious cause of action against the state or one of its agencies which has
inherited its sovereign attributes…‖
Hayden said Tuesday that the motion to dismiss presently absolves the county and other
parties without prejudice.
But he cautiously added, ―I’m not interpreting what they’ve done as putting their tails between
their legs and going home. I’ve heard that they intend to re-file the case in federal court. At this
point, I’m not sure whether or not the refilling would bear similar arguments.‖
La Plata attorney Robert I. Barbour, who is the local attorney in behalf of U.S. Steel, revealed
that the other lawyers working for the Pittsburgh firm expect to re-file the case in federal court.
He added that officially, the parties named in the suit have an opportunity to object to the
motion for dismissal. Shortly, the Circuit Court Judge will handle the final disposition of the motion for
dismissal.
Presently, U.S. Steel appears to be assuming a guarded stance as to why the dismissal was
made, and Hayden declined to speculate on the motivations.
John Weinhold, Project Manager for the Swan Point development, declined comment, and J.R.
Dembeck, President of U.S. Steel Realty Development, could not be reached.
Charges were placed against the county because of U.S. Steel’s allegations that over $1
million in lot purchases were cancelled, plus incurred damages in excess of $5 million and
―irreparable damages‖ to its real estate division.
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Maryland Independent
Wednesday, May 19, 1976, Pg. 1
U.S. Steel re-files $5 million suit
A $5 million equity suit against the Charles County Commissioners, the Maryland
Environmental Service and the Sanitary District has been refilled by U.S. Steel Corp. of Pittsburgh,
Pa.
According to Thomas Hayden, Jr., County attorney, a U.S. Marshal served the suit last
Wednesday – an action expected by all three parties named in the case.
The suit was originally lodged Feb. 22, but in early April, U.S. Steel filed a motion in the
Charles County Circuit Court to dismiss the charges.
Consideration of the suit will be held in the federal District Court in Baltimore, but at this point,
Hayden said a definite trial date has not been scheduled.
He added that the suit is virtually the same as the charges filed in the circuit court, but he
declined to speculate on the probable outcome.
U.S. Steel alleges it was not permitted to develop the 900-acre residential-recreational Swan
Point project off route 257 resulting in the collapse of a four-year development effort.
Citing cancellations in excess of $5 million, U.S. Steel claims it has suffered ―irreparable
damages‖ at Swan Point.
Additionally, the corporation alleges that it was the inaction of the respondents to approve the
water and sewer plans, subdivision plats and other agreements which resulted in the breakdown of
the project.
The Pittsburgh corporation, one of the 10 largest in the United States, is seeking $5 million in
damages plus interest and costs of the impending court battle.
In answer to the previous suit filed locally, the commissioners responded that Charles County
is a body politic clothed with governmental immunity.
Furthermore, the claimed that the doctrine of sovereign immunity precludes a litigant from
asserting a cause of action against the state or one of its agencies which has inherited its sovereign
attributes.
Hayden remarked that the suit is the first one in his experience which blames specific
performance in a contract and also requests damages.
Since he assumed the position of county attorney in 1967, he concluded, the equity suit is the
largest filed against the county.
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Maryland Independent
Wednesday, August 24, 1977, Pg. A-5
(Some text missing due to poor microfilm reproduction)
Swann (sic) Point may be on again
The on again off again Swann Point argument, which has been ensnared…concerning water
and sewer…for over 6 years, may soon be...life.
According to Charles County Commissioner, president Raymond T. Tilghman, the county’s
legal department is considering completion of a series of…negotiations with U.S. Steel Realty
Development to iron out an agreement on who will build, own, and operate the water and sewer
services…development.
…delays of the development,...are attempting to settle, led to a $5 million suit being filed by the
developer against the county last year.
―It’s a very serious matter,‖ Tilghman said, ―but I think we’re working it out. I would expect that
some announcement will be made within the next 30 days.‖
Since Tilghman believes the impasse leading to the suit can be settled out of court, it appears
the ―announcement‖ should involve an agreement between the two on sewer and water facilities for
the proposed development.
The conflict between U.S. Steel and the county started with a decision in Oct. 1972 to
incorporate the Swann Point development as part of a county-wide sanitary district.
The result was that plat sales by U.S. Steel Realty Development were terminated because no
agreement with the sanitary district could be made concerning who would pay for and operate the
services.
In 1975, the commissioners agreed to look into the matter themselves. Tilghman said at that
time the board would attempt to find a solution to the problem as soon as possible, but that he
doubted if they could come to a decision by the requested date.
While that decision took almost a year and a half of legal negotiations to formulate, it appears
an announcement is imminent.
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Maryland Independent
Wednesday, September 21, 1977, Pg. A-1
By John Parker
Swan Pt.’s 1,500—homes taken out of retirement
U.S. Steel drops $5 million suit
―We’ve taken the first step in a long journey,‖ is how public works director, Murray Levy,
described a recent agreement between U.S. Steel and the county that will revitalize plans for the
second home retirement oriented Swan Point Development in southern Charles County.
The agreement, which culminates almost 11 months of arduous negotiations and negates a $5
million suit filed by U.S. Steel last year, allows for the developer to build the water and sewer system
for the multimillion dollar housing development and dedicate it to the county.
It also requires the county to reimburse U.S. Steel up to 75 per cent of the construction costs
for the system through tap fees.
―It won’t cost the county any money, ―Levy said. ―In fact, we could make some money from the
agreement.‖
According to Levy, if tap fees, which are charged homeowners when joining a sewer an water
system, exceed the 75 per cent reimbursement, the county will receive the additional monies.
Reaching an agreement on who would own and operate the water and sewer system has
stalled the recreation oriented development for over four years.
Last year U.S. Steel took legal action against the county because of the delays, charging that
the county had broken a contract requiring it to accept the water and sewer system for Swan Point.
With the final county acceptance in late August and state approval last week, U.S. Steel is now
ready to begin construction of the development.
According to John L. Weinhold, U.S. Steel project manager-residential, because of the long
delays his company will have to review the original concept of development which called for a total of
1,500 lots.
The company will, however, go ahead with Phase I, Section I, as originally planned, he said.
Phase I will involve the construction of the water and sewer system and development of 284 lots.
Many of those lots were sold in 1973 before the water and sewer impasse occurred. The owners of
those lots, Weinhold said, ―haven’t been able to do anything with their property‖ pending the outcome
of the negotiations between U.S. Steel and the county.
Swan Point is envisioned as a retirement and recreation community by its developers.
The original plans, ―which may change,‖ Weinhold said, called for an 18-hole golf course and
clubhouse, swimming pools, tennis courts, and a marina.
Development of Phase I, according to Weinhold, will begin ―as soon as possible.
―We’re interested in getting it started quickly,‖ he added.
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Maryland Independent
Wednesday, October 12, 1977, Pg. A-1
By John Parker
Unique contracts may violate county rules
U.S. Steel to receive $1.5 million rebate
Charles County apparently violated its own Department of Public Works legislations in two
recent water and sewer agreements for southern county housing developments.
The agreements are in apparent violation of DPW rules because for the first time in Charles
County a developer has been offered a 75 per cent reimbursement of the costs of constructing ―off-
site‖ water and sewer facilities, an informed source said.
―If either of these agreements were…contested,‖ the source added, ―I think they would be
declared null and void.‖
The agreements in question were signed in August with U.S. Steel: Swan Point and Suburban
Development: Cliffton-on-the-Potomac. The Swan Point agreement resolved a $5 million lawsuit by
U.S. Steel against the county.
It is estimated that the reimbursement offered U.S. Steel could cost the county $1.5 million in
connection fees which would normally go to the county, but will be returned in full to the developer
under the guidelines of the agreement.
That estimate is based on a projected cost of $2 million to build the water and sewer facilities
at Swan Point. Additional connection fee revenues will be lost because of the Cliffton Agreement.
When asked about the validity of the agreements. Murray Levy, director of public works,
strongly denied the county had broken any rules to obtain the contracts with either Steel or Suburban.
According to Levy, the water and sewer facilities that will be built by both developers and then
dedicated to the county constitute ―off-site‖ construction, for which they are entitled to the 75 per cent
reimbursement under current regulations.
―I admit it is something that might be up to interpretation,‖ Levy added, however.
The interpretation the county made, according to Levy, was that the facilities at both
developments will bring water and sewer service to the surrounding areas. And in the county’s
opinion, if facilities are built which help the surrounding area as well as the developer, it’s off-site
construction, Levy said.
But two documents conflict with that interpretation.
In 1974, a study was made by the Charles County Sanitary District, the forerunner of DPW,
which showed tat hooking the southern portion of the county into a central system at Swan Point was
―economically unfeasible.‖
In addition, the fourth paragraph of the Swan Point agreement conflicts with Levy’s
explanation.
―Whereas,‖ the document states, ―the county and Steel mutually agree that the facilities are to
be designed to serve only Swan Point…‖A similar clause is included in the Cliffton agreement.
―The whole on-site, off-site idea was to reimburse a developer for work he did off his own
property which brought water and sewer service to other homes off his property,‖ the source said. ―In
both cases here the developers are being paid for work on their own property for homes they plan to
sell.‖
One potential outgrowth of the two unique agreements is the possibility other developers in the
county, who have not been offered the reimbursement, may approach the county for similar
agreements.
The county has dismissed the idea as nonsense, but one developer who was contacted by the
Maryland Independent expressed interest in studying the agreements, and if after studying the
agreements it appears to give the two developers an unfair advantage over other developers, he said
he would push for a similar agreement.
―I asked for a similar agreement before but I ran up against a brick wall,‖ he added.
According to Raymond T. Tilghman, president of the county commissioners, who feels the
county would have lost its suit against Steel and thus supports its resolution through the water and
sewer agreement, other developers will not have a precedent with which to approach the county for
similar agreements.
The agreements with Suburban and Steel were unique, he said, because negotiations began
in 1969 before the creation of the countywide Sanitary District or the DPW.
The agreements reached in August, according to Tilghman, ―were compromises‖ to earlier
promises made to both developers, which could not be fulfilled by the county.
―We tried to patch the agreement as closely as we could with the existing regulations and the
best interests of the county,‖ Tilghman said. ―Maybe they’re not 100 per cent.‖
John L. Weinhold, of U.S. Steel, declined to comment when asked about the possible violation
of DPW regulations, saying he was ―not familiar with the issue.‖
Weinhold did say that since the document was prepared by the county he believes ―it meets all
county requirements.‖
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Maryland Independent
November 9, 1977, Pg. A-2
By Dick Myers
Charles County said to be a good place for resort hotel
Charles County would be a good location for a resort hotel and conference center. That was
the conclusion of a federally funded market analysis commissioned by the Charles County
Development Commission.
The study looked at Swan Point, Cliffton-on-the-Potomac and Chapel Point and concluded that
either Swan Point or Chapel Point would be suitable but recommend Swan Point first because of the
potential time it would take to develop Chapel Point.
The study is being supplemented with an engineering report by Lorenzi, Dodds and Gunnill.
The preliminary engineering report indicates both Swan Point and Chapel Point sites are suitable for
resort hotels.
According to E.D. C. Director Betsy Cooksey, such a hotel could mean 150 jobs and $5 million
investment.
Cooksey said although the study shows the Swan Point site owned by U.S. Steel is the best of
the three, she will act as an advocate of the Chapel Point site as well as Swan Point.
The report expressed concern about the 806 (?) acre Chapel Point site because it is owned by
the state and is proposed ultimately for a state park. The report said, ―the approval of this type of
private development or public recreation lands would be a departure from past policies but appears to
be the direction the state is moving forward. It thus would take three to five years to get such a
project started,‖ the report concluded.
Cooksey said the governor, at the request of the E.D.C., formed a committee over a year ago
to study the feasibility of such a leased venture on state land, but the committee has yet to make its
report.
She likes the Chapel Point site because of its historic and scenic qualities.
The study was an idea of former E.D.C. Director William Ange (?) to use Chapel Point for a
hotel. A committee of the E.D.C. decided to add Swan Point and Cliffton-on-the-Potomac to provide
several options for the study.
Cooksey said U.S. Steel representatives have been contacted and have expressed interest in
the idea.
Cooksey said she views her role as ―taking the study to potential investors.‖ Whichever site is
chosen first will be the winner,― she said.
The report also recommends such a facility provide space as headquarters for a local cultural
center.
The report will be submitted to the county E.D.C. as well as the federal funding agency for final
approval.
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Maryland Independent
Wednesday, March 8, 1978, Pg. A-9
By Dick Myers
Spray irrigation proposed at Swann (sic) Point
A spray irrigation sewage treatment system has been proposed for the Swann Point
development.
U.S. Steel, developers of the much-delayed second home and retirement community, has
submitted a proposal to the Maryland Department of Health and Mental Hygiene for use of the
proposed golf course as a site to spray treated sewage. The health department is now reviewing
whether the land is suitable for spray irrigation.
The spray irrigation idea is a change from the original development concept of conventional
sewage treatment and a point of discharge into the Potomac River. Such a sewage outfall is included
in the Charles County Water and Sewer Plan, but there is a stipulation attached that the system be
operated by the Maryland Environmental Service, a state agency.
The out of court settlement of a $5 million lawsuit last summer, with the signing of an
agreement between the county and U.S. Steel removed MES from the picture, and provides county
ownership and operation after the system is constructed. The agreement called for a rebate to the
developer of up to 75 percent of the construction cost of the system from tap fees for hooking to the
water and sewer system.
The 900-acre site on the Potomac River off Route 257 near Mount Victoria was originally
planned for 1,500 homes. According to John Weinhold, U.S. Steel residential project manager, the
company is evaluating how to proceed after development of the first phase, which contains 284
already platted single family lots.
The first section cannot begin until a decision is reached on the spray irrigation system, and a
final agreement between the county and U.S. Steel on bonding. According to Public Works director,
Murray Levy, the county is requesting a $1.75 million bond to cover roads, water and sewer and
sediment control for up to 400 lots in sections One, Two-A and Two-B.
Both Levy and Commissioner President Raymond Tilghman said they would have no problem
with a spray irrigation system if it were approved by state health and met all county standards.
Tilghman said spray irrigation represents changes in thinking and technology in the sewage treatment
field since the original plan for Swann Point was presented by U.S. Steel in 1969.
―Surface application (of sewage) is much more popular today than would be an outfall into the
Potomac,‖ Weinhold said. U.S. Steel is ready to proceed with te first section, he said, as soon as all
permits are received.
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Maryland Independent
Tuesday, November 21, 1978, Pg. A-11
Swan Pt. sewage disposal considered
The Charles County Commissioners have applied to the state for a $600,000 gallon per day
discharge of treated sewage into a tidal creek off Swan Point for the proposed U.S. Steel
development. Commissioner President Raymond Tilghman said the request is an alternative to the
spray irrigation system espoused by the county and the developer. The state has tentatively rejected
that plan. Tilghman said the county still is in hopes of reversing that decision. He feels the state
requirements for spray irrigation effluent are too strict.
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Maryland Independent
Wednesday, December 26, 1979, Pg. A-1
By Merle K. Turner
Swan Point OKed
A decade after purchasing more than 900 acres for a development at Swan Point, United
States Steel has been granted a permit to discharge treated sewage effluent into Cuckold’s Creek.
The permit was granted last week by the Maryland Water Resources Administration (WRA). It
allows sewage treatment capacity of 600,000 gallons per day.
The permit will extend until October 1984, and dictates what type of effluent discharge will be
allowed. Based upon the specifications, the appropriate sewage treatment plant will be designed.
After state health department officials have reviewed the plans, construction on the plant will begin,
followed by construction of roads, and eventually of houses.
Permits are given for set time periods to allow the state leverage in ―protecting themselves
against changes,‖ according to Murray Levy, head of the Charles County Department of Public
Works. The developer or DPW, which will eventually maintain the sewage treatment operation, may
be periodically required to upgrade the system when applying for renewal of permits, if requirements
change.
U.S. Steel purchased the tract of land in December, 1969, and began planning and
engineering the subdivision in Charles County’s fifth election district the next year. The
developement is seen as a retirement, or second-home community, with no school sites or
commercial sites set aside, according to Levy.
The approval of Phase l, Section l, with 284 lots came in May 1972, from Charles County’s
Planning Commission, and sale of lots in the development began in July of that year. Sales were
terminated 16 months later, when the inventory of lots was sold out, and because of ―an inability to
resolve utility impasse‖ with Charles County’s Sanitary District, according to a statement from U.S.
Steel.
The developer subsequently sued Charles County government and the Sanitary District,
seeking damages in the amount of $5 million, which it alleged the delays were costing. Land
purchasers had been offered refunds, according to the suit, because the impasse in sewage
treatment and discharge had prevented them from building on their lots.
Permission to discharge effluent rested with WRA, which held hearings this fall on the potential
for pollution. Cuckold’s Creek is a protected area for shellfish harvesting.
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Maryland Independent
Wednesday, February 6, 1980, Pg. A-3
By Merle K. Turner
Newburg subdivision to get road improvement
Long confused and deteriorating road conditions in the Matthews Subdivision off Swan Point
Road last week became slightly clearer with the visit of residents and landowners to the Charles
County Commissioners.
Questions of a right of way to Swan Point Road and responsibility for road maintenance were
discussed at length, with a unique solution to road improvement proposed.
A majority of owners of the 22 lots in the subdivision gave the county commissioners their
permission to proceed with condemnation to secure a 50-foot right-of-way to connect their street with
Swan Point Road. The cost of purchasing that right-of-way would be added to the cost of improving
their gravel road to county standards, Murray Levy, public works director, said. Property owners
would pay for the improvement through higher assessments, he explained.
County land records indicate subdivision land owners are guaranteed access to their
neighborhood along a 20-foot right-of-way connect to the county road with the future county road in
the subdivision. The right-of-way dates back to the mid-1950s, when Frances B. and Mary N.
Matthews purchased the land which they later developed.
Most of the homeowners in the subdivision purchased homes from the Matthews, through the
early 1970s. In 1976, developer Joseph Mona purchased nine remaining empty lots from Matthews’
widow.
Condition of the road remained poor, and was sometimes impassable for delivery and
emergency vehicles. Resident Mary Ellen Curry complained to Senator Jim Simpson. Shortly
thereafter, she recalled, the road was noticeably improved.
It was county crews who improved the street, said Levy. He explained it was a common
―holding action‖ because his department ―anticipated the petition (of residents, to pay for upgrading)
was going to be granted.‖ The cost of the material used in the improvement will be assessed against
the property owners along with all the rest of improvement expenses, said Levy.
Mrs. Bill Swann, another Matthews Subdivision resident, last week showed the county
commissioners a letter she had been required to produce in 1978 to secure a Veterans Administration
(VA) mortgage. The carefully worded memo was designed to assure the VA lender that the
purchasers would face no major assessment for further neighborhood improvements in the future.
―The road system in Matthews Manor Subdivision is in the process of being upgraded to
county specifications,‖ explained a memo from county highway engineer Nicholas Scarpa.
―Upgrading will consist of drainage improvement and paving with asphalt concrete. Upon completion
of projected improvements, this road system will be absorbed into the county road maintenance
system,‖ the note advised.
The memo did not mention at whose expense the road improvement was to be made. Two
officials in the department of public works department told the Maryland Independent they had often
issued such letters.
Matthews Subdivision property owners, including Mona, last week gave the county a majority
approval to pursue the unique condemnation action. Curry had noted in her letter to Senator
Simpson that Mona had built two houses in the neighborhood despite a restriction on building