Ivanhoe neighborhood beats city agency in court

By David Martin in Follow That Story, Martin

Fri., Oct. 31 2008 @ 5:31PM

By DAVID MARTIN

A judge has ruled in favor of the Ivanhoe Neighborhood Council's effort to redevelop the old Horace Mann School on East 39th Street.

Earlier this week, Judge Justine Del Muro dismissed a city agency's petition for eminent domain. The agency, the Planned Industrial Expansion Authority, had condemned the Mann building and awarded the development rights to a company called Prairie Dog.

The Ivanhoe neighborhood had also sought the development rights. Although the PIEA had rejected its proposal, the Ivanhoe council (smartly, it turns out) went ahead and executed an agreement to buy the school from its owner.

Del Muro heard evidence on three days over a seven-week span. She concluded that the PIEA had violated the law by not giving Ivanhoe the first option to redevelop the school. The state law that created the agency gives preference to existing residents and businesses.

Del Muro also found that the PIEA did not make a good-faith offer. The PIEA based its offer on professional appraisals that seemed to go out of their way to degrade the value of the property; if uncontested, the appraisals would have enabled Prairie Dog to buy the building and a separate parcel for just $180,000. Del Muro said the appraisers' testimony "[brought] into question their motive for a low appraisal value..."

The condemnation halted, the Ivanhoe council will be able to redevelop the building as planned. "It's been our intent from the beginning to restore the school and turn into senior apartments," says Margaret May (pictured), the council's executive director.

The suit ended favorably, but the time needed to litigate the case kept Ivanhoe from applying for the historic tax credits necessary to complete the project. Calling the missed deadline "just criminal," May says Ivanhoe plans to apply for the credits in 2009.