Indiana Dunes developer warns state may owe him millions

CHESTERTON, Ind. (AP) - A politically connected developer is warning that Indiana could owe him millions of dollars if setbacks scuttle his contract to bring fine dining, a banquet hall and bar to a lakefront state park surrounded by the state's towering dunes.

In his first expansive public remarks since controversy enveloped the project, developer Chuck Williams told The Associated Press that he is appealing a state agency's decision to deny him a liquor license. He views the license as key to moving forward with his planned rehabilitation and expansion of a dilapidated beachfront pavilion at Indiana Dunes State Park.

"At the end of the day, if I can't move forward, they got an empty building and a liability of a couple million dollars," Williams told the AP, referring to his state contract.

The contract states Williams has the "right to offer" alcohol and provides ways for him to recoup expenses if the deal falls through.

Now the project, nestled among dunes molded over thousands of years at the southern tip of Lake Michigan, is on hold pending the outcome of the appeal filed Tuesday.

For five years, Williams worked behind the scenes with state Department of Natural Resources officials, securing a decades-long privatization deal. But once the project was formally announced last March, it was engulfed in controversy amid accusations from environmentalists and others that Williams used political clout to get a sweetheart deal that was negotiated without the public's input.

Acknowledging the state could owe Williams money if the contract is broken, Jim Sweeney, of the conservationist group The Izaak Walton League of America, says he is fine with taxpayer money going to reimburse Williams if it will avoid turning the pavilion into a "three-floor saloon."

"He deserves to be paid for what he's done already, whether we like it or not," Sweeney said.

The DNR did not directly respond to questions about whether Williams would be owed money if he can't get a liquor license. In a statement the agency said the contract does "contain provisions that address each party's responsibilities, including financial, should the contract be terminated."

Williams, a state Republican Party official who has donated handsomely to GOP causes, denies his political connections played any role in getting the contract, calling those suggestions "absolutely false." However, he acknowledged to the AP that he frequently interacted with then-Gov. Mitch Daniels and managed to tap into a network of acquaintances that led him to officials who shepherded the deal.

Still, Williams counters that he had "a vision and a passion" to rehabilitate a building that the state has neglected since he was a child. He says he poured money into a project that the state had refused to fund. That's despite the state sitting on a $2 billion budget surplus and recently budgeting $24 million to develop new accommodations at Potato Creek State Park.

"A building, if it's empty, rots. And this building has been underutilized my entire life," Williams said of the pavilion near the dunes. He also accused his opponents of behaving like a "lynch mob" while using the threat of boycott to silence his supporters.

"They are attacking businesses that don't see things their way, they are bullying people and they've been effective," Williams said.

However, Desi Robertson, of the Group Dunes Action!, says murky proceedings that surround the deal raises a red flag.

"They had five years to think this thing through," she said. "If they had done it the proper way they wouldn't' be in this boat."