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County accepts deal to resolve restaurant's debt

Birch Terrace Supper Club in Grand Marais. Photo by Joe Friedrichs
Birch Terrace Supper Club in Grand Marais. Photo by Joe Friedrichs

There was a meeting of the Cook County Board of Commissioners on Tuesday, Feb. 12. The county board moved into a closed session for a period during Tuesday’s meeting. The purpose of moving the meeting into a closed session was to discuss an issue relevant to the county’s revolving loan fund. A loan of $75,000 was made in 2008 to Brian and Dave Larsen for the Birch Terrace Supper Club, a restaurant located in Grand Marais.

The loan was secured, or backed by a piece of local property and residence owned by Brian Larsen. A payment has not been made in more than three years on the loan, which has a balance of more than $56,000. County Attorney Molly Hicken says the county has done everything it is capable of with regard to settling the debt.

At the start of the discussion on this issue, Hicken said the county has three options with regard to the loan made to the Larsen brothers. One option was to do nothing and continue making requests for payment. The second option was to foreclose on the property located in Grand Marais. The third option was to accept raw land valued at approximately $45,000 and that the Larsen brothers must pay $10,000 in cash over the course of the next ten years.

Commissioner Dave Mills said the issue is really about the risk of public funds versus foreclosing on the home of a private residence.

Scott Harrison from the revolving loan fund committee shared a brief history of the local entity. Harrison said the revolving loan fund started through a series of grants and has expanded over the years.

Harrison said foreclosing on the house would be expensive, take an abundance of time and bring negative publicity to the county and revolving loan fund. Harrison said the best option, from the loan fund committee’s perspective, is to accept the third option as described by Hicken.

Commissioners Myron Bursheim and Heidi Doo-Kirk said although the situation is difficult, they did not want to put a local resident out of their home or generate bad publicity for the county.

Commissioner Bobby Deschampe questioned the precedent it would set by allowing the Larsen brothers to not satisfy their debt owed to the county. He also questioned why the Larsen family was not present during Tuesday’s meeting to discuss the situation.

After the closed session and additional discussion on the topic, the county board voted 4-1 to accept option three to settle the debt. Commissioner Deschampe voted against the measure.