Pensacola businessmen Ray Russenberger and Collier Merrill will meet with city officials Monday afternoon, on allegations they owe past-due sales royalties and interest on revenues from the Fish House and Atlas Oyster Bar restaurants in downtown Pensacola.
At issue is the ownership of the building, not of the restaurants themselves, on a tract of city land called “Pitt Slip Marina.” Ray Russenberger leased the property in 1987, then granted a sub-lease in 2000 to Collier Merrill and his partners – who formed Great Southern Restaurants.
The city claims that more than five million dollars is due – based on a percentage of sales plus interest over the past 13 years. That’s calculated to be roughly one year’s worth of revenues for the two eateries.
The way the lease is structured, according to Merrill’s attorney Bruce Partington, is that payments to the city are tied to revenues received by the person holding the lease with the city – in this case Ray Russenberger and his firm Seville Harbor. Partington says Seville Harbor has no affiliation with the restaurants, and receives no revenue from them to go with existing revenue streams.
Collier Merrill has paid Russenberger — who then has paid the City of Pensacola -- about $40,000 a year in ground lease fees. City officials, however, claim they are entitled to more. Merrill calls that an attempted “money grab” using “baseless” claims.
One recent report said that the city had threatened to evict Atlas and the Fish House if a resolution is not reached. Merrill dismisses that out of hand, citing their lease when runs until the year 2045. Merrill contends that the dispute has injured his business, and has sent a letter saying the city of Pensacola would be liable for such damages.
Through a spokeswoman, Pensacola Mayor Ashton Hayward, City Attorney Jim Messer and City Administrator Colleen Castille declined to be interviewed for this story. Monday afternoon’s meeting kicks off at 3:30 at City Hall.