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How Dave Sundberg’s House at 1812 25th Avenue North in Minneapolis was Taken by the Minneapolis Community Development Agency through Condemnation by Eminent Domain 

David Sundberg has spent much of his professional life conducting seminars for business executives. He became involved with Minneapolis real estate through a seminar at the University of Minnesota which urged participants to become involved in socially useful projects. He bought a five-bedroom house at 1812 25th Avenue North in Minneapolis in 1989. This house had originally had three bedrooms and a full basement. In 1960, two more bedrooms were added. A partial basement was built under this addition.

In early January 1992, Sundberg took an application from a woman who was living with her husband and seven children. She said she was forced to move because her previous residence had been condemned. Sundberg thought this was the type of person who ought to be helped.

Within a week, Sundberg noticed that others besides the accepted tenants were staying at the building. An older woman in a wheelchair, who was the tenant’s mother, soon moved in. The tenant’s sister and her four children, and another sister with three children, were also there, as was an unrelated 15-year-old female who helped with the children. Sundberg estimates that between 18 and 23 people were living in his building.

In April 1992, Minneapolis police conducted a drug raid on Sundberg’s building, kicking in the front door. The police searched the entire building but found no drugs. They did find five weapons: small stuff - a pellet gun and 22-caliber gun. No ammunition was found.

A short time later, Sundberg received a letter from the local SAFE officer noting that the police had found five weapons in the building. When the owner of these weapons was asked about them, he said that the guns belonged to the Vice Lords, a notorious gang. Because of the danger, the letter advised Sundberg not to go near the building unless he had a police escort.

Sundberg, who had been visiting this property three to four times a week, stayed away for about ten days. Then he called SAFE for a police escort. SAFE told Sundberg that they were too busy. So Sundberg visited the house himself. He found two women arguing on the front lawn. One woman threw a glass bottle at the other. It missed the target, landed on the street, and broke into many pieces. Looking around, Sundberg found that this street was littered with broken glass.

Sundberg was concerned about the broken lock on the front door. It had not been fixed since the police raid. The tenants seemed to be living with the doors continually open.

A short time later, a city housing inspector named Kelly Jo was in the neighborhood looking for buildings that needed a rental license inspection. She picked Sundberg’s building. The tenants let her in. They directed Kelly Jo to an upstairs bathroom where the trap beneath the sink had been removed. A bucket placed there was catching the waste water. This problem could have been fixed by buying a U-shaped pipe for $3.50 and reconnecting the pieces.

Kelly Jo wrote a citation that referred to hazardous plumbing and lack of maintenance. When Sundberg received the work orders by mail, the date by which the work needed to be finished was two days before the date when Sundberg received the letter. Sundberg thought this totally unreasonable and ignored the citation.

A month later, Sundberg learned that city inspectors had posted a placard of condemnation on the front door of his building. The building was declared to be unfit for human habitation. The tenants had 30 days to vacate the premises. At the time, Sundberg rather welcomed this event because he thought that condemning the building would be a good way for him to get rid of the troublesome tenants.

City inspectors checked Sundberg’s building and found mostly minor code violations. Ominously, however, the building inspector noted that Sundberg’s building lacked a full basement. There had been a full basement under the building before the two extra bedrooms had been added in 1960. The city had approved plans for a partial basement when the builder took out a permit. City code in 1960 did not require that a full basement be installed beneath such additions. Sundberg reasonably expected that his building would be protected by a “grandfather clause”.

The city’s supervisor of boarded buildings gave Sundberg some friendly advice. To beat the system, he said, just install a new door between the main house and the additions. Then tear out the plumbing fixtures in the addition. Once the plumbing was removed, Sundberg could call the two rooms a “porch”. Porches did not require full basements. Later, after the controversy subsided, Sundberg could apply for a permit to add back the plumbing and the city would probably approve his request. Sundberg thought this approach a bit too cynical and ignored the suggestion.

Instead, he decided to seek a waiver to the basement requirement. The procedure is that the building owner must first pay a $25.00 fee and hire a competent structural engineer who would inspect the building and state that it did not require a full basement. The engineer’s report would then go to the city’s housing planning and building permit departments for approval. If they approved, the request for a waiver would go before the city’s building committee. That committee had the power to grant the waiver or reject it.

Sundberg applied for the waiver on February 7, 1997. He paid the fee and submitted the structural engineer’s favorable report. He learned that the housing planner and building permit staff person had approved his request on February 10th. The remaining hurdle was the housing committee.

Sundberg called city officers to inquire when the housing committee would be meeting. The clerk of court did not know. For several months, Sundberg made periodic calls to the city to try to learn the date of the committee’s meeting. Finally, on the 25th call or so, some time in June, the clerk told Sundberg that - even though she was not supposed to give out this information - the problem was not with the committee but with the City Council member in the ward where the building was located. Before the committee could consider his request, this Council member needed to fill out a simple form to put the request for a waiver on its agenda. The Council member, Joe Biernat, still had not taken any action.

Sundberg began calling Biernat’s office to ask what the problem was. At first, he had friendly conversations with Biernat’s staff. Once he gave his name, however, these people clammed up and he was given no further information.

Sundberg later learned that Biernat had, in effect, pocket-vetoed his request for a waiver. He simply declined to take any action. He did not inform anyone that he was rejecting Sundberg’s request but simply let the form sit on his desk. Sundberg called Biernat’s office eight to ten times and left messages. No one returned the calls.

Some time later, Sundberg received a letter from Joe Biernat. The letter stated that he, Biernat, had previously approved a waiver on another building that Sundberg had owned and he was criticized for it by his constituents. Never again will I approve a request for a waiver from you, Biernat informed Sundberg.

Sundberg suspected that the problem lay with neighbors who had put pressure on Biernat. Since Sundberg himself did not live in Biernat’s ward, Biernat did not consider him a constituent and saw no reason to be helpful. On the other hand, the block clubs in the neighborhood might have wanted Sundberg's building torn down. They may have been the same people who called the police doing the drug raid. They might have called inspector Kelly Jo. Sundberg learned from conversations with a neighborhood resident with whom he was on friendly terms that the Jordan block club was the source of his troubles.

Sundberg approached the leader of this block club. This was a 26-year-old single woman who was not herself a resident of the neighborhood but a paid professional. Her job was to organize the neighborhood block club. When Sundberg asked her about the block club’s role in blocking his request for a waiver, she feigned ignorance. Her job was simply to recruit people for the block club meetings, she said. Sundberg asked what was her own opinion about his property. “I have no opinion,” this woman replied.

Through his neighborhood informant, Sundberg learned that this woman had told others, in effect: Sundberg thinks I’m either crazy or dumb. He doesn’t realize the pressure I’m under and why I have to do things this way. But Sundberg was welcome to attend the block club’s next meeting in October to present his case.

Sundberg’s house had sat empty since February. The doors were not secure. Vandals were becoming a problem. Because this was one of the finer houses in the neighborhood, Sundberg wanted to save it. A woman across the alley offered him $45,000 for the building. Sundberg was not averse to that idea but he first needed the city to lift its condemnation order.

The October neighborhood block club meeting began at 7 p.m. Sundberg listened politely for the first half hour of business. When “open session” arrived, he began to make his case. Someone cut him off after several minutes, saying that he should not be at this meeting but at a meeting of the housing planning committee which would meet on November 5th.

Sundberg wanted to have his case put on the agenda for the November meeting. He proposed to show a video of his building and its interior so that the committee members could decide whether or not it was worth saving. On November 4th, Sundberg learned that the November meeting had been canceled. The committee’s next meeting was December 6th. A committee member told Sundberg that they would give him 20 minutes before the December meeting began to make his presentation.

That meeting was scheduled to begin at 6 p.m. Normally, the committee met in a room on the third floor of St. Mark’s church. At 4:45 p.m., Sundberg learned that the committee had decided to meet with him at his building instead. Sundberg went over there to open the doors and turn on the lights. Unfortunately, he also went across the street to talk with the friendly neighbor, whose wife fixed a hamburger for him. He returned to the condemned house and waited.

He waited for half an hour but no one appeared. Finally, Sundberg went to the third-floor room in St. Mark’s church where the neighborhood group was in session. There he learned that several members had visited his house while he was across the street. Since it was cold, they left after a few minutes. A woman on the committee remarked that it was useless for Sundberg to seek a meeting with this group since the fate of his building had already been decided.

In October 1993, Sundberg received a telephone call from Michael Schmidt, an attorney for Minneapolis Community Development Agency (MCDA), offering to buy his five-bedroom house for $10,000. Sundberg pointed out that the building was assessed at $66,900 on the city’s tax rolls.

The conversation went somewhat like this: The MCDA attorney said, “You’d better sell or we’ll take it by eminent domain; and then you’d wish you had sold because you won’t get $10,000 for the property.” “Can you do this to a law-abiding, taxpaying citizen?”, Sundberg asked. “Watch me,” was the chilling reply.

True to the attorney’s word, the MCDA did decide to condemn Sundberg’s building by eminent domain. A letter arrived from the MCDA about a month later announcing its decision. MCDA would give Sundberg $3,000 for the property which it said represented “fair market value”.

How did a house assessed for $66,900 on the city’s tax rolls have a fair market value of only $3,000? MCDA had hired an appraiser who came up with that figure. To arrive at “fair market value”, this appraiser first took the market value of several comparable buildings in the area, from which he subtracted the cost of depreciation plus the cost of bringing the house up to code.

In this case, he subtracted the cost of putting a full basement under the entire building. If the building was originally worth $66,900, its value was reduced by $49,000 for the cost of code compliance and by $14,000 for depreciation, leaving a net worth of approximately $4,000.

Under the law, Sundberg had the right to hire his own appraiser. He had the right to appeal MCDA’s decision to a three-person panel of commissioners who would decide the amount of the condemnation award. He had the right to cross-examine expert witnesses.

Sundberg represented himself at this hearing which took place in May 1996. His first problem came to light when he asked to cross-examine the appraiser who had come up with the $4,000 figure. Sorry, that would be impossible, he was told: This man had died. However, the MCDA had had a second appraisal done which confirmed the results of the first.

The second appraisal was based on a comparison of the value of Sundberg’s property with the values of seven other properties in Minneapolis. Sundberg asked where MCDA had found these properties. It turned out that these properties were all condemned buildings whose estimated market value reflected that fact.

Writing down the addresses of the houses on MCDA’s list, Sundberg did his own investigation. He contacted the owners of two of the properties. One owner, a woman, told Sundberg that she had just bought the building for $56,500. She sent him a copy of the certificate of real-estate value.

The other owner, a man in Stillwater, had purchased the property along with four others, as foreclosed properties, for $25,000. However, he had also obtained a bank loan using this property as collateral. The bank loaned him $37,000 under an arrangement by which the borrower would receive 70% of the property value. Evidently, then, the bank thought that the value of this property was also in the $50,000 to $60,000 range.

Sundberg’s own appraiser valued the building at $49,900. However, the commissioners picked apart this man’s testimony. In his statement, the man had referred to carpeting in Sundberg’s building. However, a video which Sundberg had made on the day that the commissioners visited the building showed that the floors were bare wood. Sundberg tried to explain that carpeting had been installed at a time between the two visits. But this could not shake the commissioners’ view that Sundberg’s appraiser was either incompetent or lying.

In the end, the three-person commission awarded Sundberg $15,000 for the building plus $500 reimbursement for his appraiser (who later sent Sundberg a bill for $1,250). On the way out, MCDA’s attorney jovially remarked to Sundberg that he had the right to appeal this decision. Sundberg asked how long he had to file the appeal. The attorney thought it was somewhere between 60 and 90 days. Actually, Sundberg had 40 days to file the appeal. When Sundberg finally filed the papers on the 42nd or 43rd day, he learned that his appeal was too late.

So the MCDA, the city’s “community development” agency, acquired Sundberg’s property for $15,000. The building was bulldozed in November 1996. This property used to be an attractive five-bedroom house with 2,080 square feet, fetching $1,020 in monthly rent. Today it is a vacant lot.

David Sundberg, along with his good friend Sam Czaplewski, went on to become a video producer who covered some of the more boisterous activities of Minneapolis Property Rights Action Committee. Council member Joe Biernat, reelected to office in 2001, later resigned and went to federal prison on corruption charges. He found religion while in prison and published an inspirational book about this experience.

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