Appeal on Stone Arch apartments denied

John Wall and Steve Minn have proposed an apartment building near the east end of the Stone Arch Bridge under the business name Call Your Bluff Development.

That's just what the Minneapolis City Council did on Friday, denying their zoning appeal to build a six-story building of 79 units on an 8-4 vote, despite a threatened lawsuit.

The rejection gives Minn and Wall a choice: Sue or bring back a third proposal to the city, this time for the 56 units presumed by the site's zoning.

Brian Flakne, an attorney for the developers, has drafted a lawsuit that asks a court to grant them the right to build 98 units they originally sought from the city earlier this year and order financial damages. The draft, which was sent to the city, alleges that a backroom deal between two council members helped to block the original proposal.

Flakne said the developers are hoping that Mayor R.T. Rybak will veto the council action because of the difficult legal position it puts the city in. Flakne compared it to a recent court decision over a Loring Hill housing tower proposal that put the city at risk of financial damages because a judge found that bias by Council Member Lisa Goodman denied a developer his rights.

The developers will wait to see if Rybak acts before making their next move, Flakne said. But Council President Barbara Johnson said she's not sure what a veto of a denial would accomplish. Rybak's office didn't respond to a request for comment.

The second phase of Stone Arch Apartments at 600 SE. Main St. has been controversial because of its riverfront location on a triangular parcel that some regional park and neighborhood growth plans envision as parkland. But the developers own the land, and they want to build housing to complement their 221-unit apartment complex across Main Street. The developers say the city has granted higher densities to other housing proposals in the area.

Voting against the developers and for the staff's recommendation of denial were Scott Benson, Betsy Hodges, Cam Gordon, Diane Hofstede, Paul Ostrow, Gary Schiff, Sandra Colvin Roy and Elizabeth Glidden. Ralph Remington, Goodman, Don Samuels and Johnson voted to support the developers' appeal.

A proposal by Johnson to grant the developer 79 units, but delay issuing the building permit for a year to grant park officials time to negotiate a purchase, failed on an 8-4 vote. Remington, Goodman and Samuels supported Johnson.

"I'm heartened that the City Council members understand the importance of them being consistent with the policies and plans they've adopted to protect the riverfront," said Cordelia Pierson, a neighborhood opponent of the proposals.

The developers' draft civil complaint alleges that Hofstede and Colvin Roy made a behind-the-scenes deal in which Colvin Roy agreed to lead motions against the first proposal if Hofstede supported her on 12th Ward issues. The proposed apartment building would be in Hofstede's Third Ward.

The draft complaint alleges that Hofstede repeatedly lobbied other council members against the project in a way that violates the state's Open Meeting Law.