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Duluth's former Kozy Bar building goes to court

An aerial view of the Pastoret Terrace in Duluth. (News Tribune file photo)

Judge Eric Hylden heard opposing arguments Thursday morning about what should become of the the Robeson Ballroom and the Pastoret Terrace Building, formerly home to the Kozy Bar, at 125-129 E. First St.

The former owner of the buildings, Eric Ringsred, and a membership-based organization called Respect Starts Here, made a case for the court to continue to block the Duluth Economic Development Authority's plans to tear down the structures.

Meanwhile, Assistant City Attorney Elizabeth Sellers argued the court should lift a temporary injunction that has kept DEDA from moving forward with the demolition of the blighted buildings. She also called on the court to dismiss the suit brought by Ringsred and RSH against DEDA.

Both sides seek a summary judgment in their favor, and Hylden said he will consider whether to grant either of those motions or allow the case to proceed to trial.

Miles Ringsred, the plaintiff's son and an attorney in the case, said DEDA had a responsibility under the Minnesota Environmental Rights Act to treat the preservation of the historically significant buildings as a "paramount" priority, but he contends the authority shirked that duty.

Sellers disagreed, saying that DEDA "assiduously" sought to redevelop the property in a historically sensitive fashion, but none of the three proposals it received was deemed suitable.

"DEDA evaluated all the alternatives and determined that no option was consistent with protecting the public's safety and welfare," she said.

The buildings have fallen into disrepair and were damaged extensively by a 2010 fire, after which they were condemned for human habitation.

Miles Ringsred lost ownership of the buildings when he fell behind on property taxes, and they were seized as tax-forfeited property in 2015. City officials report that the condemned and abandoned buildings continue to attract squatters and problem behavior.

"We have a dilapidated building that's a crime magnet, and something needs to be done," Sellers said.

Miles Ringsred argued that the proposals to use historic tax credits to rehab the structures did not receive fair consideration, and DEDA did not give enough weight to preserving the Pastoret Terrace, which was built in 1887 and is listed on the National Register of Historic Places as a contributing structure to a historic district.

"The reasons they gave for rejecting the proposals were patently false or disingenuous at best," Miles Ringsred said.

Eric Ringsred pointed to what he viewed as false assertions by DEDA that the redevelopment proposals, which sought to inject $5 to $10 million into the buildings, would not increase the tax base; and that projects that qualified for historic credits would not result in the historic preservation of the structures.

But Sellers said the proposals all suffered from substantial funding gaps and the projects they detailed likely would have required substantial public subsidies. She also questioned whether any of the would-be developers had the financial wherewithal and experience to see their projects through to completion.

Furthermore, Sellers suggested the submitted plans to turn the Pastoret Terrace Building into 40 rental housing units would have yielded cramped quarters unlikely to be well received by the local market.

Miles Ringsred said the city never requested financial models for the proposed projects, but further details could have been provided if desired.

Hylden agreed that the Minnesota Environmental Rights Act sets a high bar in favor of preservation. But he noted that it still does allow for historic structures to be taken down in certain circumstances when renovation no longer appears to be an option, "so the Pastoret Terrace doesn't become Duluth's Roman ruins that are here 2,000 years from now in the same condition."

Eric Ringsred has taken Duluth and DEDA to court on multiple previous occasions in an effort to save old buildings from the wrecking ball. Those suits date back at least two decade to when he tried to block the construction of the Technology Village building at the corner of Lake Avenue and Superior Street.

"There's a lot of history between the parties in this case, and sometimes it seems like both parties are talking right past each other," said Hylden, noting a "lack of trust" between Ringsred and the city and vice-versa.

Hylden took both DEDA's and Ringsred's motions under advisement and said he expects to rule on them soon.

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