As State College continues planning to replace the aging Pugh Street Parking Garage, the borough intends to use eminent domain to acquire a downtown building that’s home to one of the Centre Region’s longest-running bars, a long-standing music shop, and a popular pizza spot.

On Monday night, the Borough Council approved a resolution authorizing the solicitor to file a declaration of taking — a key step in the eminent domain process — for the building at the corner of East Beaver Avenue and McAllister Alley that houses The Brewery, Music Mart, Canyon Pizza, and Canyon Wings. Council approved a similar resolution to acquire the neighboring rental house at 142 McAllister Street. 

Council member Gopal Balachandran voted no on the measures. It was not clear how council member Divine Lipscomb, who was attending via Zoom, voted. The other five council members voted yes.

The borough plans to construct a new garage on the site of the buildings and the current McAllister Street Deck to replace the 50-year-old Pugh Street garage.

Eminent domain allows a government entity “to take private property for public use in return for just compensation,” according to Pennsylvania law.

The borough’s plan to acquire the building was “shocking” to Jay Horgas, one of the owners of both The Brewery and the building. Horgas only learned of the resolution on Monday afternoon when contacted by a StateCollege.com reporter for comment, about seven hours prior to council’s meeting.

“That’s unbelievable,” Horgas said. “They never said anything to us. There has not been one lick of dialogue about this.”

He also alleged that he attended a borough meeting in 2016 or 2017 and was told “no” when he asked if State College was planning to use eminent domain to acquire his building for a garage.

Speaking at Monday night’s council meeting with fellow owner Ray Rockey, Horgas called the lack of communication “a little bit distasteful or unacceptable.” Rockey noted that The Brewery dates back to the late 1960s, while their tenant Music Mart has been located in the building for 35 years. Another tenant, Canyon Pizza, started down the street in the 2000s and moved to the building in 2016.

“This is our livelihood,” Horgas said. “This is what Rockey and I do. …We’re not big entities. We’re just two local guys hashing it out.”

Solicitor Terry Williams acknowledged the borough did not contact the property owners in advance, but said that is typical in the process.

“When you’re condemning a property, the object is to adopt the resolution authorizing the condemnation, which fixes the timescale which damages are to be calculated,” Williams said. “There now will be a great deal of discussion with the property owners over trying to arrive at the value, trying find a way to accommodate the businesses, find a way to evaluate the damages for the businesses, both for the owners of the building as well as the other tenants. 

“There’s an awful lot of work that gets done after that, but practice is you don’t do that in advance, because council may say ‘Well, we don’t want to condemn it.’ Then it’s a moot point.”

Local landlord Rodney Hendricks, who owns 142 McAllister Street, described the borough’s plan as “surprising.” He claimed his property contains the oldest remaining house in the borough. (StateCollege.com has not been able to verify the claim, though the property is not among State College’s historic sites or listed in the National Register of Historic Places.)

“In a borough that says it’s about historic zones, I find it interesting that they want to tear down this piece of history,” Hendricks wrote in an email.

The property owners were not the only ones who were surprised they were not contacted by the borough prior to the council meeting.

“I am actually in shock as well,” council member Divine Lipscomb said. “This is upsetting to me.”

Council member Peter Marshall urged staff to “get with those folks and bring them up to speed on their options and what’s going to happen next.” Council member Deanna Behring apologized to Horgas and Rockey for how they learned of the plan and said she hoped the compensation process provides “the kinds of things you need to keep your businesses going.”

“I don’t think anyone here wants to see your businesses leave State College,” Behring said.

According to Pennsylvania law, the parties can agree to damages at any time. Either can also petition the Court of Common Pleas to appoint a panel of “viewers” tasked with determining fair value.

For The Brewery, at least, losing the building would seem to be the end of the line. It’s difficult, after all, to imagine the bar anywhere but the alley basement where it’s served up drinks and an eclectic mix of local and touring live music acts over the decades.

“They’re putting The Brewery out of business,” Horgas told StateCollege.com. “We didn’t put it on the market. We’re not interested in selling. Now they’re going to take it from us through eminent domain.”

Rockey said after he originally purchased The Brewery in the 1990s, the ownership group bought the building specifically so that they couldn’t be forced out by a new owner.

“We’ve done everything the American way and now we’re being told because somebody wants to put up a parking deck that everything we’ve done gets thrown out the window, and I don’t think that’s fair,” he said.

State College zoning excludes much of the parking requirements for new commercial construction, and resident Jeff Leo said the borough should have taken steps to push for more parking to be included in the new high rises downtown.

“All these new buildings, instead of retail space maybe we should have looked for parking space,” Leo said. “I just find it a little bit shocking that you’re planning to take over a local institution. It may be a dive bar, but it’s a local institution.”

Horgas added during the council meeting that the ownership group also offered affordable rent for its tenants.

“We refer to the bar as the four-star dive behind the dumpsters. We are a dive bar. We don’t pretend to be anything else,” Horgas said. “But the other part of it is that we’re also landlords to tenants with reasonable rents. If you look at any of these new buildings coming in, what the students are paying for rent is very different than what we charge for the apartment upstairs and for Canyon Wings, Canyon Pizza, and Music Mart. We’re reasonable.”