Contractor to vacate Blossom Heath by end of year

By: Kristyne E. Demske | St. Clair Shores Sentinel | Published July 30, 2021

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ST. CLAIR SHORES — More than a year of restrictions and shutdowns are leading to the early termination of a 10-year contract between the city of St. Clair Shores and the operator of Blossom Heath Inn.

Kosch Catering, of Rochester, took over management of Blossom Heath Inn from Oak Management on Jan. 1, 2015. The 10-year contract called for the company to undergo renovations of $150,000 at the historic facility, to pay utility costs, and to pay annual rent beginning at $36,000 in 2016, which would climb each year until reaching $84,000 in 2024, for an average payment of $60,000 per year.

Gordie Kosch, of Kosch Catering, told City Council July 19 that the pandemic has affected all industries, but especially his own. Revenue is down 80% in 2020 and 2021 compared to pre-pandemic levels, he said.

“Some businesses have been hardly affected, some have prospered and some have been devastated,” he said. “The event-catering wedding industry has been hit the worst.”

He was speaking before City Council because he had a disagreement with City Manager Matthew Coppler and City Attorney Robert Ihrie over language in the contract as it relates to payment of rent.

“We believe the contract clearly abates any rent and utilities obligation of Blossom Heath hospitality during the state mandate shutdown of banquet event facilities,” Kosch said.

City Council authorized Coppler to negotiate with contractors who provide services in city facilities, including Kosch Catering, in April 2020, to place a pause on rent during the state shutdown.

“Council wanted to provide them some relief because they viewed these vendors as our partners in providing the service,” Coppler said July 21.

Kosch Catering was given six months of relief in 2020 during which to deduct rent from the annual contract, but Coppler said, “it was provided to us, pretty quickly after that offer was made to Mr. Kosch, that that wasn’t going to be enough. That he couldn’t make any payments.”

After the end of the six-month time frame, when some restrictions had been loosened by the state, the city still was not receiving rent from the company and reached out to Kosch. Coppler said when Ihrie spoke with Kosch about the state of the rent payments, Kosch told Ihrie he wanted to get out of the contract.

“What I was being told was, the terms of the contract signed back in 2015 were not going to be lived up to,” Coppler said. “We had to do something. We’re not going to let you stay there for free.”

Municipalities aren’t allowed to do that because it would be akin to giving a gift to a company, which is not allowed, he said.

Kosch told City Council the company wanted to be able to finish out their contract for 2021 to cater 24 events still on the schedule.

“The Blossom Heath cash position, if allowed to finish out 2021, can perform each of the 24 remaining booked events and have enough money left over to return money for all of the booked events for 2022,” he said. “We have been approved for federal aid. If deposited, I would gladly pay all prior rents.”

He said he believed finishing out the year would be in the best interest of the facility’s reputation.

“We would be able to uphold the historical legacy of Blossom Heath for the community instead of closing abruptly and angering those associated with those events,” he said.

As of July 21, Coppler said the city had agreed to terminate the contract at the end of the calendar year.

“The city’s position is he is in material breach of the agreement. There are provisions in there that would advance when you’d have to leave, but we did” allow Kosch to remain until Dec. 31, he said. “Things keep changing. It wasn’t us saying you have to be out by this date, it was us saying, what date do you need to be wrapped up?”

Kosch said they have compassion for the individuals who have had their celebrations rescheduled multiple times during the course of the pandemic.

“My wife and I, and my sister-in-law ... have thoroughly enjoyed being a part of this community in Blossom Heath, and we ask that you let us wrap up the 2021 events,” he said.