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Default STOP WORK ORDER LEADS TO CONDEMNED PROPERTY

OK. Its not a house, its a building on a dock, but I know there are
many of you who can probably sympathisize and many who know a thing or
two about fighting city hall. Please advise - the way things are going
in this country, this could be any one of us next!

I'm trying to help a friend of mine who has a problem with the local
small town city hall and the [State] Marine Resources Commission (lets
call it SMRC). Friend has the deed to an old dock with a (historic)
building on it (and public access off the end of the road) and wants to
fix it up and have a docking, rental and repair business for small
boats.

There are lots of side details in this case, of course, but I think I
can cut to the relevant parts without missing anything important.

It seems there is a neighbor who owns the adjacent waterfront lot (a
lawyer), who, along with his buddies the city attorney, the city
manager, the mayor and probably a few members of the city council, want
my friend out of the way so they can take advantage of the new laws
they just got pushed through the city council, over the protests of
many local residents, which will allow high-density housing to be built
on the waterfront.

The SMRC has jurisdiction because the structures are built in the
water, but they must rely on the local building inspector and city
engineer to determine the soundness of the structure. The
determination from the city is that the structure is unsound and in
need of extensive repairs, which my friend already knew and was ready,
willing and able to do when he bought the thing. The SMRC has given
him 6 months to either make the structure sound, or remove the
structure completely, at which time he would then have no claim at all
because it is now grandfathered in, but would never be permitted to be
built from scratch now under current regulations.

The problem is that the city will not approve any plans, grant any
permits, or allow any progress whatsoever. Some work was done to
prevent/repair storm damage before and after a recent severe storm, and
the city issued a stop work order when they detected even that
activity.

After being stonewalled by the city and with his deadline to fix or
remove the structure running out with the state, an appeal was made
with the local circuit court. The judge ruled against my friend and
with the city.

The local congressional representative for that district was contacted
and my friend was informed that when that particular city manager, city
attorney and judge are working together, nothing can be done.

We've heard a rumor of some sort of a law (maybe from an electrical
codes manual suppliment?) that says government can't stop one from
making improvements and repairs and then condemn a property for lack of
improvements and repairs, but we can't find that anwhere.

There might be some sort of an legal assistance organization that would
take up the cause of property rights... Or some sort of historical
society with pull at higher levels to get things preserved and
restored... But I've not found them.

Any ideas on what he might do next? He doesn't have tens of
thousands of dollars to hire lawyers to fight city hall...