Bandito Barney's owner withdraws parking lot plans in East Dundee

An ongoing dispute over the future of a gravel lot in downtown East Dundee has resulted in a maximum $1,000 fine issued to the property owner.

Big Kahuna Corp., which owns the nearby Bandito Barney's Beach Club and Bordello, purchased the vacant site at 110 N. River St. about three years ago with the intention of transforming it into public parking, President Roger Shelton said.

The company had asked the village to assist in funding the lot's construction, he said, noting it would provide 145 much-needed parking spaces for the entire downtown business district. But East Dundee officials determined the request was too high, and negotiations have since broken down, Village Administrator Jennifer Johnsen said.

With little movement taking place, Johnsen said, the village's next step was to take the issue through an adjudication process.

Big Kahuna was cited for having cars parked on the unpaved lot - a violation of village code - and was issued a $1,000 fine last week by a third-party hearing officer, she said. The corporation has 60 days to bring the property into compliance, at which point the fine could be reduced or dismissed.

"The adjudication hearing process is partly related to fines for not complying," Johnsen said, "but mostly it's a tool we use to try to gain cooperation to re-initiate discussions and bring awareness to the severity of a situation, which we feel isn't being addressed in an amicable way."

Shelton said in an email that Big Kahuna will cover the property with grass to adhere to village code but no longer plans to develop it.

The corporation was proposing a $1.85 million project to demolish structures on two adjacent sites and create 145 parking spaces, curbs, stormwater retention, landscaping and retaining walls, Shelton said, noting the cost also includes projected property taxes. He was asking the village to cover $700,000 of those expenses, paid out over seven years.

Big Kahuna provided a concept drawing of the blacktop surfaced parking lot, which Shelton said was being discussed with the village until the corporation was mailed an East Dundee ordinance violation.

Johnsen said negotiations stalled after she realized in April that the two parties were "too far apart" in terms of the project's cost.

"We just have not been able to get anywhere," she said, adding that Big Kahuna was informed ahead of time that the next step would be administrative adjudication.

East Dundee officials have been discussing for years how to remedy a lack of parking in the downtown, which has been cited as a common complaint among business owners and visitors. The village recently funded the construction of a public parking lot behind the 311 Barrington Ave. development.

With an occupancy of 900 patrons, Bandito Barney's significantly contributes to the parking demand, primarily at night, Johnsen said. The village hoped the adjudication process would renew discussions, she said, and that Shelton would move forward with his original plans. But Shelton said Big Kahuna has withdrawn its offer to the village to create more parking.

"The ($1.5 million) of private investment that the Village has lost in support of downtown parking is a much larger issue" than his possible $1,000 fine, he said in an email.

East Dundee agreed years ago to reimburse Bandito Barney's for $300,000 of a more than $1 million project to expand its beer garden. Johnsen, who was hired after the deal was in place, said the village fulfilled its obligation and never promised anything more. Shelton claims the village fell short in its contribution and says he plans to "aggressively pursue the money owed."