City Council finds Preservation Commission denied Mercantile permit in error


By Martin Kidston

After six weeks of hearings and deliberation, the Missoula City Council’s Land Use and Planning Committee on Wednesday found that the Historic Preservation Commission erred in denying a Montana developer a demolition permit for the Mercantile.

It then called upon HomeBase, the developer, to return next week to begin working with the city on a project that meets the community’s desire to see portions of the historic structure preserved.

On a voice vote, a majority of the committee found that the HPC had reached many of its findings in error. The HPC also violated the developers’ due process rights by failing to fairly and objectively consider the demolition permit, the committee found.

“The concern revolves around error by several commission members to let their predisposition for historic preservation trump their role as a commissioner,” Ward 4 council member John DiBari said. “There is sufficient evidence in the record to illustrate error on the part of several HPC members regarding the need to maintain fairness and demonstrate a lack of prejudice.”

The HPC reached its decision to deny HomeBase a demolition permit in June. It based its decision on more than 45 findings of fact, most of which found that HomeBase and Octagon Capital Partners had failed to meet the standards needed to receive a permit to deconstruct the Merc, which dates back to the 1880s.

The developers appealed the decision to the City Council, which went through the HPC’s findings one by one on Wednesday before reaching its decision. While finding error with the HPC’s conclusion, members of the council praised the volunteer board for its time and called upon HomeBase to work with the city on a compromise regarding their project’s design.

“There was a preponderance of evidence that HPC erred,” said Ward 3 council member Emily Bentley. “But that is not the end of this discussion. I’m hoping with this vote, that when we start doing this process, that we’ll strike a compromise.”

While the HPC found that denying the application would not prevent all reasonable economic use of the property, the council found it was a decision rendered in error.

The preservation commission also found that the developers had failed to make a good-faith effort to find an alternative project or buyer willing to preserve the structure.

The council disagreed on that point as well, saying the developers had made a good-faith effort by seeking other buyers and considering other projects over the past several years.

“The applicant, who is the owner, spent a lot of his own time trying to identify a use for this,” DiBari said. “People are upset perhaps because the market hasn’t generated the interest that they feel the building deserves, and I can understand that. But there was opportunity for people who had a vision for that to step forward and proffer and alternative use. It’s not the applicants’ fault other people haven’t come forward.”

Ward 1 council member Heidi West voted to support the HPC’s findings. She said the errors found in the commission’s decision to deny the permit didn’t result in a preponderance of evidence – the legal standard guiding the council’s conclusion.

“With that said, I hope there can be some sort of a compromise that more accurately reflects the values of our community,” West said. “We have to look at the public benefit versus the private loss. I think there’s a lot of public benefit to our history and the feel of downtown and how that fits into why people chose to make this place home.”

HomeBase has proposed a $30 million branded hotel for the historic corner, which fronts Higgins Avenue and Front Street. Plans currently call for a five-story Marriott with 154 rooms and 24,000 square feet of ground-floor retail and restaurant space.mercantile hotel

Bentley called Andy Hollaran of HomeBase forward and asked him to return next week to begin working with the city on a “classic design” that preserves the property’s historic character. Hollaran agreed to present additional concepts that portray a more “conservative and traditional” look.

“We’ll be committed to work with you all,” he said. “If the point comes, we’re committed to working on the design of the project and incorporating anything we can to pay homage to the building – to incorporate materials in the building. We stand by that commitment.”

The council took the opportunity to brainstorm its wish-list for the HomeBase project. Some asked the developers to preserve the Mercantile’s brick facade, if not all of it then at least portions of it. Others asked HomeBase to retain the building’s classic arched windows and place the historic copper canopy outside the structure, not inside an internal “mews.”

“I’m not an architect and I’m not going to design your building for you,” said DiBari. “But I want to say that the people I heard speak – and many of my colleagues here – not just want to capture the spirit of that building emotionally, but its physical presence too, and that’s what I’m hoping we can get to with some of these design elements and having a conversation with you and your architects.”

Bentley urged HomeBase to contact the Missoula Redevelopment Agency regarding the potential use of tax increment financing to help with preserving portions of the structure. Such a move was suggested by many preservation advocates over the past few months.

“I would remind you that you are allowed to request funds from our MRA if it will help you preserve more of the building,” she said. “I believe this committee would support you in that.”

Contact reporter Martin Kidston at