by Jack Hoeschler, 2018

In the mid-60’s, the downtown establishment—bankers and business leaders—were of one mind about the old Federal Court House facing Rice Park: Tear the darn thing down for parking.  In the late 1960’s, “new and modern” was the catch phrase, and the new Federal Court House on Kellogg was an ugly example.

But in the early 1970’s, a group of women led by Betty Musser and Georgia DeCoster, rose in opposition to the bulldozer approach to downtown development. Of course, their spouses joined later, but to be clear, it was “The Women” who were responsible for saving the beautiful building we enjoy today as Landmark Center.

Betty was a force of nature and head of the Arts and Science Council, which was the umbrella organization that raised money for the Science Museum, the Minnesota Museum of Art, COMPAS, and others.  

She decided that Landmark Center was too unusual to raze. The Women arranged to have the federal government donate the building to the county for $1. The feds were happy with the arrangement, since they’d be criticized if they tore it down or restored it.  Once the county owned the property, The Women launched a fund-raising campaign.  They knew the undertaking would be a tremendous challenge.

The first floor had been a post office. The Postal Service had installed a glass security ceiling, by then, covered with layers of dust, only the cortile was visible from the second floor.  The front entrance was constructed of white marble, which, enthusiastically, the government had painted green.  The paint now had to be stripped. Other barbarities existed in the court rooms. The GSA (General Services Administration) had installed drop ceilings, which required removal to expose the stained glass above.

The first order of business, however, was to address leaking skylights. The Women first put in translucent fiberglass, but in due course, they recognized their error and replaced it with clear glass.

The exterior of the building was sooty and required cleaning—except the people hired to do so didn’t first protect the windows from acid spray used in the process. As a result, all the windows were pockmarked.  

It was one challenge after another, but The Women persevered. 

The architects were Stahl-Bennett of Boston and Winsor-Faricy of St. Paul. They did a wonderful job restoring Landmark Center to its original grandeur. In one of the court rooms, there had hung a distinctive chandelier. It had long before disappeared, but a photo of it existed, and thus, a replica could be created, albeit at a substantial cost.

In 1973, I was called by Joe Micallef, Honorary Counsel of Malta, who ran the Weyerhaeuser family office and was an active supporter of the arts.  We’d both worked on the Science Museum expansion. 

He asked if I would meet with him, along with Betty Musser and The Women because they needed help in pulling things together financially.  I enlisted Dick Magnusson, a finance professional, in an effort to examine the project finances. In the absence of reliable bookkeeping, this was a challenge.

A second problem was a pledge they had gotten from a wealthy, prominent St. Paulite for $900,000 but written on a cocktail napkin!  The question was, would it stand up in court if the pledgor died before paying?  My opinion was, “maybe,” but better yet, we could use that napkin and turn it into something real.  The pledgor could be unpredictable, and they feared he might change his mind.  We needed to have an excuse to convert the cocktail napkin into a better form before we approached him to confirm his commitment.

First, however, we had to figure out the actual financial condition of the project; turns out it was already underwater by $2 million. Commitments had been made to various contractors based on pledges that might or might not be paid out over time. They had a treasurer, but he now lived in California, and the era preceded the advent of email.   

Physically, the place was a mess.  The architects advised that a clear skylight was needed and the damaged windows had to be replaced.  Furthermore, the design contemplated a theater underneath the cortile, requiring the floor to be removed and rebuilt.

I had the feeling a train wreck was about to happen. But The Women were undaunted.

I recommended issuing tax-exempt bonds to fund the project, but such an effort couldn’t be underwritten upon a potential train wreck. What we did have, however, was a list of donors and pledges from the good and worthy of St. Paul—though bonds can’t very well be sold around the country on the promises of the “good and worthy of St. Paul.”  We needed an angel, a guarantor who had good credit.

The plan was to approach Carl Drake, CEO of the St. Paul Fire and Marine Insurance Company (later renamed The St. Paul Companies), across the street. The pitch would be, “This is an important improvement on your front step. You are a donor. We can borrow $3 million against pledges, but only if the St Paul Companies, with its AAA credit rating, will guarantee collection of these pledges.  It won’t cost you anything but it will really help us.”  Carl agreed. 

(That was an example of how important it is to have CEOs living in your hometown.  I point this out because we have Travelers, as successor to the St. Paul Companies, working busily to get out of town.  In general, however, the Minneapolis-St. Paul metro has managed to keep its CEOs better than a lot of cities.)

This made our bond issue one of the most successful in the state, because in those days, we could arbitrage the earnings on our bonds.  We sold bonds at 7.5%, and shortly thereafter (1981) the prime rate rose to 20% and borrowing rates shot up to 22%. 

We had $3 million in the bank and it was earning for us, 14, 16, 18%.  The Women were eager to spend, but Dick Magnusson and I counseled a slow pace to spending so as to increase our interest earnings.  At the time, arbitrage was legal, though soon after, the feds disallowed it. For Landmark Center, arbitrage was a great thing.

The entire project was a success, first because of The (Indefatigable) Women; second, the willingness of The St Paul Companies to provide the cloak of its credit; third, the actual economics of the time, and finally, but hardly least, the great bones of the building.

To save a venerable, historic building, you must first identify a viable, present use.  Landmark Center today has offices, space for non-profits, and room for performing arts.  The key to the Center’s viability is that Ramsey County has since 1975, paid the operating costs—a heavy load for which the county is rarely recognized.

It’s hard to imagine St. Paul without Landmark Center. It anchors the entire Rice Park square, giving the city a sense of place, and serves as a focal point of civic pride.