Settlement paves way for purchase of Schilling property in Ocean City

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The Helen Schilling Estate property at 19th Street and the beach. The Helen Schilling Estate property at 19th Street and the beach.

(UPDATED 12 p.m. Aug. 12) OCEAN CITY — After years of controversy over the beachfront property known as the Schilling Estate, the city of Ocean City is now in a position to purchase the three lots at 19th Street.

City Council is scheduled to vote on a resolution and accompanying spending ordinance at its Aug. 14 meeting that will authorize the settlement of litigation and approve the purchase of the Schilling property for $1.75 million.

According to a statement released by the city Monday, Aug. 11, the property will be paid for with $1.25 million from nearby property owners, a $300,000 Green Acres grant and $200,000 from the city’s capital budget.

“If approved, the property would be owned entirely by the city of Ocean City, placed on the city’s Green Acres inventory and protected from development in perpetuity,” the release states.

City administrator Mike Dattilo said the city is settling an appeal it filed, along with neighboring property owners, in 2012 against a New Jersey Department of Environmental Protection decision issuing a development permit for the property.

“We think it’s a good resolution,” he said. “We never thought the property should be developed. We think it is environmentally sensitive and this way, it precludes it from development forever.”

He said that other means to a resolution could have been long and expensive.

Helen Schilling, former owner of Shriver’s Salt Water Taffy and Fudge and many other local businesses, died in 1998, more than 40 years after she and her husband purchased three parcels of oceanfront property at 19th Street.

In 1992, the land, considered un-buildable, was part of an Army Corps of Engineers beach fill. It was raised 10 feet, turning the property, which frequently flooded, into a dune.

After Schilling’s death, the Helen Schilling Estate applied to the state Department of Environmental Protection filed for a Coastal Area Facility Review Act permit to construct a single family home on the property. In 2008, the DEP denied the permit due to what it called “a primary dune system” occupying the property. Then in 2009, the estate filed an inverse condemnation lawsuit against the DEP, in which the estate claimed a DEP permitting denial in 2008 amounted to an illegal seizure of the property by the state.

Meanwhile, in 2010, several neighbors collectively offered the estate $700,000 to purchase the property. That offer was rejected.

In October 2011, the estate settled its lawsuit with the DEP and the DEP sent out a notice of intent to permit. The city and neighbors filed an appeal of this decision.

On Sept. 18, 2012, the Garden State Preservation Trust announced that it had approved more than $123 million in Green Acres open space acquisition and recreational development projects, including a $25,000 loan and $300,000 grant for Ocean City, along with adjacent property owners, to acquire the .36 acre beachfront property to preserve the site as a natural area.

Dattilo said Tuesday, Aug. 12 that the city accepted the $300,000 grant portion of the Green Acres funds and rejected the $25,000 loan portion in order to purchase the property.

Dattilo said that the Schilling property can’t be developed in any way once it becomes part of the city’s Green Acres inventory.

“The reality is it will remain just as it is,” he said.

Dattilo said that the property hasn’t had any sand pumped on to it since the initial fills in the 1990s.

“The Corps hasn’t pumped that far south in many years,” he said.

The settlement calls for the property transfer to be completed in 90 days, but allows for the possibility of an extension if needed. However, Dattilo said he didn’t think it would be.

City Council meets 7 p.m. Aug. 14 at City Hall, Ninth Street and Asbury Avenue.

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