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Apartment license status up in the air

A rare meeting of the city of Brainerd rental dwelling license board of appeals Tuesday night did not result in a recommendation from the board. The city has notified DBM Two Partnership LLC, the owner and license holder for 12 apartment units at...

Julian Jayasuriya (left) consults with his attorney Loren Gross during a meeting of the city of Brainerd rental dwelling license board of appeals Tuesday. Jayasuriya, owner of the building at 721 South Seventh St., is appealing the city’s suspension or revocation of his rental license. Spenser Bickett/Brainerd Dispatch
Julian Jayasuriya (left) consults with his attorney Loren Gross during a meeting of the city of Brainerd rental dwelling license board of appeals Tuesday. Jayasuriya, owner of the building at 721 South Seventh St., is appealing the city’s suspension or revocation of his rental license. Spenser Bickett/Brainerd Dispatch

A rare meeting of the city of Brainerd rental dwelling license board of appeals Tuesday night did not result in a recommendation from the board.

The city has notified DBM Two Partnership LLC, the owner and license holder for 12 apartment units at 217 South Seventh St., of its intent to suspend or revoke the dwelling license. The license is for the period of June 23, 2016, through May 31, 2017.

Julian Jayasuriya, the owner of DBM Two Partnership, appealed the proposed suspension or revocation, which triggered the board meeting. City Administrator Jim Thoreen noted Tuesday night the board has not met for several years.

After three hours of testimony during a public hearing, the board recessed until 5 p.m. May 17, when the board will decide on a recommendation. The recommendation will then be presented to the Brainerd City Council for final action.

Public hearing

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City attorney Joe Langel Tuesday presented the city's evidence to suspend or revoke Jayasuriya's license. Jayasuriya was joined by his attorney Loren Gross.

Langel opened the hearing by calling Brainerd Police Chief Corky McQuiston to testify. He was the only witness Langel called. During McQuiston's testimony, Langel presented 17 exhibits of evidence. Those 17 documents included correspondence between McQuiston, Jayasuriya and property manager Nancy Osterman. McQuiston also provided incident reports and a list of police calls made to the building during a two-year period.

The city's argument for revoking or suspending the rental license follows section 425.2020 of the city code, titled Conduct on Licensed Premises. The code outlines different types of disorderly activities prohibited in licensed dwellings, including possession of stolen property, unlawful sale of alcohol, unlawful sale of controlled substances, disorderly conduct and noise-related issues, among others.

If two instances of disorderly use occur within 12 months, the license holder is required to submit a written management plan to the Brainerd Police Department. The plan should detail all the actions the license holder took in response to the instances and to prevent further instances. Then, if a third instance of disorderly use occurs within 12 months, the department may initiate a process to deny, revoke, suspend or not renew the rental license.

Tuesday, McQuiston described the three incidents which led to the police department pursuing action against the rental license. The first instance, on Feb. 20, 2016, involved a report of a disturbance and resulted in a resident being arrested for disorderly conduct and a probation violation. The second instance, on March 6, 2016, involved a noise complaint.

The second instance caused the police department to notify Jayasuriya and Osterman of the violations and request a written management plan. Osterman submitted a plan, which included actions she took to evict two tenants and the assurance that background checks would be performed on tenants in the future.

Then on Aug. 11, 2016, a resident was arrested for second-degree assault and terroristic threats made with a firearm. A notice was then sent to Jayasuriya requesting a response within 10 days, which was not returned. The department was able to contact Jayasuriya and Osterman after the 10-day deadline had expired.

The city notified Jayasuriya of its intent to revoke or suspend his rental license on Feb. 28. He submitted his appeal of the decision on March 12.

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McQuiston cited data from police call history showing from October 2014 to September 2016, the 217 S. Seventh St. property generated 112 police calls. Of those 112 calls, 36 involved disturbances, noise complaints, fights, intoxicated persons and assaults. In comparison, the more than 48 apartment units in six buildings within a one-block radius generated 60 calls during the same time period.

Appeal

Jayasuriya's defense involved Gross calling Osterman, Jayasuriya and four building residents to testify. He also presented four exhibits into evidence, which included a resume from Osterman, a lease addendum, a written statement from Jayasuriya and another management plan.

Jayasuriya bought the building in 2004, he said, and hired Progressive Property Management to manage the building. That agreement ended in 2006-07, he said, and he took over management in 2010-11. He hired Osterman to manage the building in November 2015.

During the two years in question, Jayasuriya claimed he had an agreement with Lutheran Social Services to provide housing for individuals with mental health issues, disabilities, or both. After a certain point, the entire building was filled with tenants like this, he said, which generated the police calls.

"I do give these people a break," Jayasuriya said. "I know the feeling of finding housing more than anyone else does."

The tenants who were the subject of conduct on premises calls were either provided notices of eviction or were warned and have been good tenants since, Jayasuriya said. The building's proximity to bars generates disturbances, he said.

Osterman has always screened prospective tenants, she said, and doesn't deny an application because of the existence of a criminal history. Since she took over managing the building a year and a half ago, 10 of those initial 12 tenants have moved out, she said.

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Some of the 112 police calls presented by the police department include calls related to street cleaning or parking complaints, Osterman said. Some of the noise complaints can also be traced to the Iron Rail Saloon, located next to the building, she said.

The lease addendum presented by Gross outlines a zero-tolerance policy for drugs and crime in the building. Osterman said she would attach the addendum to future leases and work to persuade current tenants to add the addendum to current leases.

After both sides had presented their cases, it was decided the meeting would recess until 5 p.m. May 17. In the meantime, both Langel and Gross will prepare findings of fact and written arguments, with a deadline to submit them by May 15. The board will then review the documents and come to a recommendation on May 17.

Board member Rick Fargo recused himself from the hearing due to a potential conflict of interest.

DBM Two Partnership also owns the vacant motel property at 507 S. Sixth St. The council on April 17 adopted a resolution declaring the building hazardous and ordering its removal.

The city of Brainerd has notified Julian Jayasuriya, owner of an apartment building at 217 South Seventh St., of its intent to revoke or suspend his license. He has appealed and the hearing took place Tuesday. Kelly Humphrey/Brainerd Dispatch
The city of Brainerd has notified Julian Jayasuriya, owner of an apartment building at 217 South Seventh St., of its intent to revoke or suspend his license. He has appealed and the hearing took place Tuesday. Kelly Humphrey/Brainerd Dispatch

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