Correction: An earlier version of this story erroneously reported the Baldwin House was going to be demolished. Based on a lawsuit settlement, the home will be restored. MILFORD \u2014 The city and a developer have agreed to settle a lawsuit over the fate of the nearly 200-year-old Baldwin House at 67 Prospect St. The agreement will preserve and restore the house, while clearing the way for 36 apartments to the rear of the .98-acre property. If the Planning and Zoning Board approves the application at its Jan. 19 meeting, the house would be used for office space and a fitness center for the apartment dwellers. Patrick Rose, of Rose Tiso and Company, is applying for a coastal area site plan review for the project on behalf of the owner, 67 Prospect Street LLC. The three-story apartment building will have grade level parking underneath and includes 36 single-bedroom apartments on the next two floors. This is a reduction from the 44 units proposed in 2017. The property would have 58 parking spaces, of which 32 spaces would be under the building. The lawsuit was triggered in April 2018 when the Milford Historic Preservation Commission denied a certificate of appropriateness that the owners sought to allow demolition of the house. The city and the applicant agreed to settle the lawsuit with the commission voting in favor of the settlement at its Sept. 21, 2020 meeting. The owners, in turn, agreed to withdraw two parts of their lawsuit, one challenging the legality of the city\u2019s historic preservation ordinance and the other asking the court to order the certificate of appropriateness to allow the demolition to take place. The city agreed that the terms of site plan approval would be to issue a certificate of appropriateness upon completion of several conditions by the applicant. First, the owners paid for a ground-penetrating radar investigation on Aug. 20, 2020, which concluded that there were no \u201canomalous radar reflection patterns consistent with unmarked graves.\u201d Second, the owners agreed to recreate and restore a bronze plaque and stone, previously located next to the Baldwin House driveway, at or near its former location. Finally, they agreed to restore the exterior building systems on the Baldwin House to wood or replaced with wood before any certificate of occupancy is granted for any portion of the apartment building or site. Attorney Thomas Lynch, who is representing the LLC, said his clients agreed to a reduced building size and to bear the cost of renovations, which he said will be expensive. David L. Baldwin built the house in 1835. Baldwin served as Milford town clerk for 27 years and clerk of probate for 12 years. The property was once part of the home lot of the Rev. Peter Prudden (1601-1656), leader of the Hertfordshire Group that founded Milford in 1639, and first pastor of the First United Church of Christ. Local historians had thought the city\u2019s first burying ground was in Prudden\u2019s backyard, meaning that a number of Milford\u2019s founders could be buried on the property. However, the radar survey settled that question. Zoning regulations require 1,000 square feet of land for each one bedroom or efficiency unit, which means a project of this density is permitted in the zone. In February 2018, the applicants presented a structural report by Atlantic Consulting & Engineering of Bridgeport, which concluded that the house from 1835 is unsafe and should be demolished. When the Inland Wetlands Agency approved the wetlands portion of the project at its Dec. 20, 2017, seven residents spoke in opposition, based on their concerns that project could affect neighboring properties with regard to stormwater flow. The project needed wetlands approval because the property is located within 150 feet of wetlands or watercourses within the Wepawaug River watershed. In coming before Planning and Zoning, the project requires a coastal area site plan review. No public hearing is required, but residents are expected to request one.