Looks like today will be the second full day of testimony in the case of Satterlee House/Beach Drive “Painted Lady” owner William Conner vs. the city Landmarks Board — it originally was set for a half-day but as we mentioned in our previous reports, the case has been taking so long, the city Hearing Examiner had to add extra time to the calendar. Backstory: Conner has owned the house since 2000. After a previous development proposal went nowhere in the early ’00s, nothing happened for a while, till he filed to subdivide the house’s huge front lawn into three separate lots. That was granted; but before anyone could build on those three lots, the city Landmarks Board had to grant a Certificate of Approval, since the house and site comprise an official city landmark. Conner took a proposal for three homes, about 3,000 square feet each, to the board, and it said no. His appeal of that decision is what is being argued now, courtroom-style, before the city Hearing Examiner, in her hearing room on the 40th floor of the Municipal Tower downtown. This morning’s testimony included revelations about how much Conner has spent so far — in legal fees as well as on the property — among other things:

Today’s proceedings — which followed a full day of testimony Monday (writeup here), preceded by an afternoon of testimony a week earlier from the house’s namesake and previous owner, David Satterlee (coverage here) — began with the continuation of an expert economic witness, William Partin, hired by the city. The question at the heart of the case is whether the board’s denial is preventing Conner from having “reasonable economic use” of the property. Part of the questioning this morning, especially when Conner’s lawyer Richard Hill followed up with the witness, focused on the question of “reasonable economic use” representing what could have been done with the property, or what Conner actually did with the property.

Toward the latter point, it was revealed that according to documents filed in the appeal case, so far Conner’s costs have totaled $1,792,477 for the property he currently has listed for $2.2 million (which city-hired witnesses say is more than it’s worth, whether as the house and lawn as one parcel, or as the house and the three lots as separate parcels).

The paperwork says that in addition to the $900,000 Conner paid for the house and site in 2000 — almost 20 years after it was designated a landmark, which came with restrictions on the site’s potential development including the requirement for Landmarks Board approval of changes — he has spent (rounded-off sums) $80K on taxes, $504K on financing, $118K on legal expenses, $134K on architecture costs, $30K on permit costs, and $18K on engineering, while he has received $68,000 in rent – less than a third of what Partin suggested could have been received if the property had been rented continuously during the time that Conner has owned it. “I don’t think the statute involves a specific person’s specific costs – all kinds of people can spend all kinds of money and make poor decisions and rack up all kinds of costs,” Partin testified. “A reasonable return assumes a reasonable investor.”

Partin reiterated that he and another city-hired expert witness estimate the current fair market value of the site would be $1.4 million as one parcel — the home and all the land — or $1.9 million to $2,050,000 if the home was sold separately as were the three development lots. They also contend that if he had followed a typical course of action, Conner could be making a 6% profit on the site under a variety of scenarios; Conner and his lawyer contend that with the costs he has paid out as spelled out above, he is losing money without the larger development plan.

After Partin, the city called Thomas Veith, who has been on the Landmarks Board for five years and was part of the hearings that led to the “no” vote on Conner’s proposal late last year — including the preceding meetings involving the board’s Architecture Review Committee, which is where owners/developers and board members usually work out the details of proposals before they get to a full board vote.

Veith testified that, as had been noted earlier in the proceedings, that Conner did not take board members’ suggestions into account as he brought his proposal back before the committee several times prior to the full board vote. He testified, “Our job is to preserve the integrity of the landmark. My judgment is whether the current proposal does a good job of doing that … The three structures were very large and impaired your understanding of the landmark, which includes the Satterlee House and site … the perception of the landmark was hindered. I was fairly sure there was an alternative that would work better — I had given advice at the Architecture Review Committee of what might work better — move the houses as far north on the site as possible, the houses should be smaller, modify the exterior envelope of the buildings so they would appear smaller.”

But, he said, none of those recommendations were honored. “They came back with revisions of the original scheme that didn’t reduce the bulk or scale or size, square footage remained the same.”

Previous city witnesses suggested that Conner could still make a profit if homes around 2,000 square feet in size were built on the lots that the front lawn’s been split into; that’s about a third smaller than his current proposals. It’s not only the size, but also the design, Veith noted — “It could be made to work if the new buildings appear to be part of the main estate.”

Earlier testimony had noted that the proposal that the Landmarks Board rejected involved homes that would have been modern in design, with lots of glass and stucco, rather than Craftsman-style homes that one witness suggested could have been built from easily available, non-custom plans, fitting in more with the neighborhood as well as the property.

When lunch break ends in a few minutes, Veith will be questioned by Conner’s lawyer, and will be followed by another city witness, Marie Strong, also from the Landmarks Preservation Board. She’s the city’s last scheduled witness; after that, Conner’s case will be presented.

Earlier today, hearing examiner Sue Tanner said that no decision on this is likely to be forthcoming any sooner than April 11, because of other cases and vacation time. Once a decision is in, it’s the city’s final word, and any further challenges would have to happen in the form of a lawsuit.

A couple notes of courtroom color – the players at the table before Tanner’s bench are the same, two city lawyers, Judy Barbour and Eleanore Baxendale, plus Hill and Conner; the spectator gallery is starting to fill up a little bit more, with onlookers including at least one historic-preservation advocate from another part of the city — since as we wrote before this case is something of a precedent, involving the only rejection that the Landmarks Board voted all of last year, and one of just a handful of cases that has gone this far in the past 20 years, it’s being closely watched.