'Wet house' plan relies on eminent domain — [Duluth MN] News Tribune, 11/2/04

DEDA approves a plan to take control of a dilapidated Central Hillside apartment building

By Peter Passi

Nearly two years after the Duluth City Council approved using eminent domain to take control of a dilapidated apartment complex in the Central Hillside neighborhood, the Duluth Economic Development Authority [DEDA] did the same thing.

At the behest of city staff, DEDA members approved taking the old San Marco Apartments, 222-226 W. Third St., with plans to tear them down, making way for a 25-bed home for chronic alcoholics. If all goes according to plan, Center City Housing Corp. will begin construction of the new $2 million facility, called a domiciliary or "wet house," this spring and have it ready for residents before the end of 2005.

Assistant City Attorney Bob Asleson explained that the city's legal authority to seize the property had been questioned, and it was determined that DEDA was in a stronger legal position to take it.

But DEDA commissioners narrowly approved plans to exercise its power of eminent domain, voting 5-4 Monday. Supporting a resolution to condemn and take the property were Greg Gilbert, Donny Ness, Jim Stauber, Russ Stewart and Russ Stover. Opposing the measure were Neill Atkins, Laurie Johnson, Timothy Little and Roger Reinert.

"I don't like seizing property or using eminent domain," DEDA President Atkins said in explaining why he would vote against the resolution.

But the majority of DEDA members were of the opinion that there was a public need for the project, and so far efforts to negotiate a willing sale of the property have been unsuccessful.

Mary Anderson, who owns the building, believes she has not been offered a reasonable price. "It's not fair," she said. "I've been paying taxes on that property for 50 years."

Anderson has been offered $60,000 for the property. Asleson explained that the buildings are unsound and need to be demolished. He said that an appraiser has placed the value of the empty property at $180,000, but it will take about $120,000 to remove the existing structures.

Paul King, Anderson's friend, said the city should rightly pay about 10 times what it is offering for the property.

The apartment complex has been cited for numerous code violations, and the city condemned it for habitation in 1998.

Stewart pointed out that there is a process by which Anderson can make a court appeal in pursuit of more compensation.

Asleson said Center City Housing Corp. would pay taxes on the property after the construction of its domiciliary.

Before DEDA can proceed with plans to take the San Marco Apartments, its action must be approved by the Duluth City Council. Barring any surprises, that should not be a problem, however, because DEDA is composed entirely of Duluth city councilors.

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