Legal Action Threatened In Fenwick Over Hotel Project; Property Owners Maintain Fenwick Not Enforcing Code

Legal Action Threatened In Fenwick Over Hotel Project; Property Owners Maintain Fenwick Not Enforcing Code
The new Fenwick Shores hotel property is pictured. The outdoor food and beverage area on the second floor patio is pictured on the left side of the building. Submitted Photo

FENWICK ISLAND – As a resort developer awaits approval for a hotel liquor license that would allow for an outdoor bar, a group of property owners are calling on Fenwick Island officials to enforce the town code.

On May 22, attorney William Rhodunda of the law firm Rhodunda Williams & Kondraschow issued a letter to the Fenwick Island Town Council on behalf of a growing list of property owners concerned about an outdoor bar with the potential for live or recorded music at the new Fenwick Shores hotel on Coastal Highway.

“At this time there are 133 Fenwick residents, representing 89 Fenwick properties, and growing daily, who demand enforcement of the Fenwick Code,” Rhodunda writes. “While my firm does not represent all of these property owners at this time, I do represent numerous Fenwick residents who are ready to commence legal action, if necessary, to enforce the Fenwick Code and maintain the ‘quiet beach town’ of Fenwick Island. My clients hope legal action is not necessary, and the Town changes its position to one that is consistent with the Code.”

In 2018, developer Spiro Buas demolished the aging Sands Motel – which he purchased in 2015 – and began building a new hotel in its place. Fenwick Shores, a Tapestry Collection by Hilton, will be a 65-room boutique hotel.

To allow alcohol service for hotel guests, Buas applied with the state’s Alcoholic Beverage Control Commissioner (ABCC) for a hotel liquor license back in March. The application also seeks a patio permit and a variance to permit live entertainment, external speakers, a paging system and a wet bar on the second-floor patio of his property.

Since that time, however, several property owners have voiced their objections to the developer’s variance request and questioned if the town code allowed for an outdoor bar.

“Your house might not be close to this hotel, but if you let this exception pass, it will only encourage much of the same just like Dewey Beach and Ocean City,” Patricia Westwater, whose family owns property in Fenwick, said in a council meeting late last month. “It’s quite a disappointment to know that instead of protecting the property owners, the town seems to be bending over backwards for this hotel. What’s worse, the council doesn’t seem to be interested in enforcing the town ordinances that already exist.”

Property owner Natalie Magdeburger – daughter of Councilwoman Vicki Carmean – agreed.

“Ordinances are only as effective as the enforcement of them,” she said. “If there’s no enforcement of ordinances on the books, then any commercial establishment can ask for the same treatment or the same variance.”

Officials Say Outdoor

Bar, Speakers Permitted Use

While many property owners believe the code prohibits outdoor bars, town officials have taken the opposite position for the hotel.

According to the town code, “no bar … shall be allowed in any outside service area.” Town officials, however, have pointed out that the town code specifically addresses bars and bar areas under the section heading “restaurants,” not “hotels,” making Buas’ variance request a permitted use.

“As the bar is an amenity of the hotel, the town has no control over where that bar would be located …,” Councilman Bill Weistling said in March. “Everything that has come up on this hotel we have passed it by our town attorney, and as councilmembers we might not agree with the town attorney, but we accept her guidance and interpretation of the town code.”

While the town has no jurisdiction over the issuance of liquor licenses, officials in recent months acknowledged that Buas had agreed to add a restriction to his license and seek permission from the council for any live outdoor entertainment at Fenwick Shores. A letter sent to the ABCC on March 20 even acknowledges the agreed-upon restriction.

“Although the Town has previously confirmed that a hotel is a permitted use of the above-referenced property according to the Town’s Zoning Code and takes no position either in favor of or in opposition to the pending application, the Town finds that it is prudent and necessary to clarify that certain types of outdoor entertainment events requires the advance approval of the Town Council,” Town Manager Terry Tieman wrote.

That letter, however, has now been called into question by property owners opposed to the variance request. Andrew Bellwoar, whose family owns a home in Fenwick, told the council last month he had concerns regarding Tieman’s letter.

“The basic tenet of municipal law is that municipalities act only by a majority of its elected officials …,” he said. “Did the town council approve this letter to the ABC before it was sent? If so, point me to the minutes of a meeting where that occurred. If you can’t identify such a vote, under whose authority was the March 20 letter transmitted?”

In the letter to the council, property owners requested that the town withdraw its letter to the ABCC. In an interview this week, Magdeburger said the hope is withdrawing the letter would demonstrate to the ABCC that the hotel is not in compliance with the town code.

“There’s two levels to this,” she said. “One is the ABC hearing. The other is for the town to say, ‘Yes, having an outside bar would be in violation of our ordinances.’”

When contacted about the letter this week, both Tieman and Mayor Gene Langan declined to comment.

Developer Addresses Concerns

From the outset, Buas said he has tried to address property owners’ concerns. For years, he said, he and his wife have worked hard to develop an upscale hotel that included better amenities. He noted the old Sands Motel housed seven year-round guests and an undercover drug dealer before he purchased the property in 2015.

“When I bought the Sands with my family back in April 2015, it was run year-round and it was a crack house …,” he told property owners in a town council meeting last month. “This is going to be something that everybody in Fenwick can look at and be proud of. I wish everybody would take a breath, relax and give this thing a chance.”

In an interview this week, Buas said he believes many property owners support a new hotel being built, but disagreed with the process the town took.

“I think a lot of them think the hotel is great,” he said. “It’s the process done through the city they are not happy with.”

Buas acknowledged some statutory language in a public notice for his liquor license application had caused some concerns and misconceptions among property owners in recent months. While he is requesting the ABCC grant his application, he noted he had voluntarily placed a restriction on his license for outdoor live entertainment.

“I have voluntarily removed any outdoor live music from being used without the city council’s prior approval,” he said.

Buas also made it clear the hotel’s amenities, including the outdoor bar, would be available only to hotel guests.

“My food and beverage operation is there to support the hotel, period …,” he said. “We will not be advertising those features separate from the hotel. This will not a be a $2 Natty Boh place. That’s not what I want. Even if that is what I wanted, the brand wouldn’t allow it.”

Buas noted that the ABCC has yet to schedule a public hearing on his liquor license application. But he expects construction to conclude on Fenwick Shores in the coming month.

When asked if he could open and operate his hotel without a liquor license, Buas said it was a subject he had yet to discuss with the Tapestry brand.

“I don’t think [the property owners] oppose the liquor license,” he said. “I think the opposition is that there would be the feel of a spring break atmosphere, which doesn’t happen with a five-star hotel …. It’s unfortunate because this is probably the hotel their friends and family would want to stay at while visiting.”

Resident Want Communication

Magdeburger said the group of property owners sought legal representation in an effort to open a line of communication with town officials, but have yet to hear a response from the council in reference to their letter. She noted, however, that their counsel has talked to the town attorney.

“We are trying to create dialogue,” she said. “We are trying to have pathways to success for everyone, but they’ve just decided this is the way it is going to be. It’s just contrary to the plain meaning of the ordinances.”

When asked about the property owners’ next steps, Magdeburger declined to comment.

“I can’t get into the details of that, but we are prepared to move forward,” she said. “We are hoping they take the high road and do what government is supposed to do, which is to have dialogue and transparency in an attempt to listen and work with constituents toward a consensus and a right answer. But we have heard nothing.”

About The Author: Bethany Hooper

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Bethany Hooper has been with The Dispatch since 2016. She currently covers various general stories. Hooper graduated from Stephen Decatur High School in 2012 and the University of Maryland in 2016, where she completed double majors in journalism and economics.