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Duluth City Council holds off on demolition of Kozy

Legal maneuvers continue to shield buildings from the wrecking ball

File: 011420.N.DNT.Kozy
The Pastoret Terrace, former home of the Kozy Bar, pictured in 2017. (File / News Tribune)

Following the advice of City Attorney Gunnar Johnson, the Duluth City Council continued to table any action Monday night on a resolution that could lead to the demolition of the Paul Robeson Ballroom and Pastoret Terrace buildings, formerly home to the Kozy Bar.

The council's inaction continues to frustrate some, including David Ross, president and CEO of the Duluth Area Chamber of Commerce, an organization with offices just a block away from the dilapidated buildings. He said visitors often ask hard questions about the Kozy property.

"They ask questions like: How can that blight occur in our downtown? Are there no fire codes? Are there no safety codes? Are there no building codes that would keep this place from continuing in its current state?" Ross told the council Monday night.

"The Pastoret Terrace is to our downtown the Ghost of Christmas Past. It is haunting the neighborhood and is scaring away any new investment from that precious block of our primary downtown. It is time we remove this building, and by doing so, you will clear the land and clear the way for the revitalization of this precious downtown block," Ross said.

But the case continues to wend its way through the legal system, with a Monday afternoon hearing to discuss what should become of a $50,000 injunction bond posted by the properties' former owner, Dr. Eric Ringsred, and a group of like-minded preservationists who go by the name Respect Starts Here.

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The city's legal team, led by Elizabeth Sellers, argued the bond should be handed over to cover legal costs Duluth incurred in defense of the Duluth Economic Development Authority's plan to tear down the buildings, located at the corner of First Street and Second Avenue East.

Judge Eric Hylden ruled in DEDA's favor back in October, asserting that city officials should be allowed to proceed with the planned demolition of the fire-damaged building. Yet the work has remained on hold for months, as Ringsred and Respect Starts Here continue to pursue other legal means of saving the buildings.

On Dec. 18, Ringsred and his team filed an appeal of Hylden's order, alleging "bias or disregard of evidence by the trial court, which gave 0% credibility to their (the plaintiffs') well-qualified witnesses and 100% credibility to the respondent's (the city's) witnesses."

At the Monday afternoon court hearing, Sellers contended the bond funds should go to the city not only to cover its legal expenses but also in recognition of the extended burden the blighted buildings have placed on the community. "Some of the damages are hard to quantify, such as the depressive effect it has had on the neighborhood," she said.

William Paul, an attorney representing Ringsred, argued the bond funds should be returned to his client, as the city had suffered no financial harm from having the demolition of the Kozy delayed. City officials had predicted the cost of the work would go up if it was delayed, but the latest low bid for the job — $148,683 by Rachel Contracting LLC — is more than $100,000 lower than a bid DEDA received a year ago.

Instead of driving costs higher, Paul said the delay appears to have yielded savings for the city and suggested: "A 'thank you' might be in order."

Miles Ringsred, an attorney and son of Dr. Ringsred, accused city officials of seeking the forfeiture of the bond as a form of financial reprisal. He noted that the suit his father and fellow members of Respect Starts Here initiated was brought forward under the auspices of the Minnesota Environmental Rights Act, which entrusts citizens to protect historic resources. He warned the court that if the city is successful in its attempt to claim the bond funds, "It will have a chilling effect on future litigation."

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