Riverfront Double Play

Developer and Sports Facilities Commissioner Peggy Lucas pursues both a new ballpark and upscale condos

According to an old saw, every city has its conflicts of interest, but only in Minneapolis do they call them civic responsibility. A case in point: When Peggy Lucas was recently reconfirmed for a second term on the Metropolitan Sports Facilities Commission, no one asked about the fact that she's also a partner in a potential real estate development on the Minneapolis riverfront, near where the MSFC hopes to operate a new Twins stadium.

One of the two locations where Minneapolis officials would like to see a new stadium is the stretch of largely undeveloped riverfront between the Whitney Hotel and Interstate 35W. Lucas is a one-third partner in Brighton Development Corp., which has an option on the North Star Woolen Mill, next door to the Whitney, and is negotiating with the city to get development rights to another nearby parcel. Brighton hopes to renovate the historic structures for use as luxury condos.

The subject wasn't discussed six weeks ago when the Minneapolis City Council reappointed Lucas for another four-year term on the commission, an all-volunteer panel that oversees the state's publicly owned sports facilities. The governor appoints the MSFC's chair, and the council picks the other six commissioners. Alice Rainville, head of the council panel that handles the city's MSFC appointments, says she didn't know Brighton had development options near the stadium parcel.

"[Lucas's] business dealings didn't come up," says Rainville. "I'm sure you've brought that to her attention and she's an honest and conscientious person." Rainville and other officials say they aren't concerned about the issue because the MSFC hasn't yet been involved in site selection. "One can always recuse one's self for a specific issue," Rainville adds. (It's true that the MSFC hasn't taken a position on where downtown a new stadium should be built, but the seven-member panel has formally asked the Legislature to build a new ballpark in Minneapolis.)

Lucas herself is stunned that anyone would perceive her dual roles a potential problem. "You're not really going to write a story about this," she said when contacted last week. "I mean, I can't believe anyone would consider it a conflict." Lucas says she first applied for the MSFC post because she has a history with amateur athletics and a personal interest in women and sports. Reporters from other newspapers have known about her dual roles for some time, she adds, and never thought it noteworthy.

Brighton has a long history of helping city officials fulfill their vision for Minneapolis's downtown and the neighborhoods that ring it. And if the trajectory of that relationship is any indication, one reason no one has perceived a conflict is that in the eyes of many city officials, having a "good" developer participate in downtown planning equals good planning.

Brighton got into the housing business as the owner of low- and moderate-income rental properties. In 1988, it and several other development companies bought the troubled Riverside Plaza apartment complex from the U.S. Department of Housing and Urban Development. One of Lucas's partners in Brighton is Dick Brustad, who up until 1980 headed the Minneapolis Housing and Redevelopment Authority, forerunner to the Minneapolis Community Development Agency.

At the time, city officials persuaded HUD to sell Riverside Plaza to the city at a hefty discount, even though other bidders reportedly offered more. The MCDA then sold the complex to an investment consortium that included Brighton, which continued to receive public subsidies for renting apartments to low-income families.

About two years later, Brustad was appointed president of the Minneapolis Public Housing Authority, putting him in the unique position of overseeing the subsidies paid on the hundreds of Section 8 units in Brighton's low-income housing projects, many located in downtown Minneapolis's Elliot Park neighborhood. He no longer heads the agency, but serves on its board.

Brighton went on to develop market-rate housing, including two posh projects--Lourdes Square and the Marquette Townhouses--near St. Anthony Main. In contrast to Riverside Plaza, the condos reportedly sell for up to three-quarters of a million dollars. Lucas herself lives in one.

Brighton is often described as having an inside track with the city. Many of its projects have received tax subsidies, and last year the city granted it a controversial waiver from a Northeast Minneapolis development moratorium to renovate a block of East Hennepin Avenue. Currently, the MCDA is seeking legislation that would allow taxes to subsidize the planned riverside condos.

Last December, Mayor Sharon Sayles Belton drew fire for circumventing the City Council when she proposed spending $500,000 for a Mill Ruins Park near the proposed locations of both Brighton's townhouses and a new stadium. (The council later approved the funding.) Critics hinted that the mayor's support for the park was tied to her relationship with Brighton's owners, who have been her financial and political supporters.

Indeed, Sayles Belton has made no secret of her "dream" of transforming the no man's land between the Milwaukee Depot and 35W into a pedestrian-friendly mix of entertainment and upscale housing. That vision for the riverfront is most fully articulated in "Downtown 2010," a recent joint-planning effort of the business-sponsored Downtown Council and the city. Lucas served on the housing subcommittee of the task force that put together the 15-year growth plan.

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