TITLE
Recommendation to request City Attorney to prepare ordinances to designate the properties located at 645 West 11th Street, 953 Chestnut Avenue, 338 Junipero Avenue, 1400 East Hellman Street, 830 Santiago Avenue, 151 St. Joseph Avenue, 622-628 East Anaheim Street, as Long Beach Historical Landmarks;
Authorize City Manager, to execute Mills Act historic property contracts, with owners of 22 historic properties; and
Adopt minor revisions to the Mills Act Guidelines, effective January 1, 2019. (Districts 1,2,3,4,6,7)
DISCUSSION
The Mills Act, enacted by State law in 1972, allows local governments to enter into tax abatement contracts with property owners of historic structures. Property owners agree to restore, maintain, and preserve the property in accordance with specific historic preservation standards and conditions identified in the contract. Entering into a Mills Act contract results in a property tax reassessment by the County Assessor, using the income-capitalization method, which may result in a 30 to 50 percent reduction in property tax.
The City Council established a local Mills Act program in 1993. Between 1993 and 2006, the City awarded 31 contracts. With each contract, the Development Services Department, conducts an inspection of the property prior to contract execution and again every five years thereafter, to ensure proper maintenance of the property. The contracts are between the City and the property owner, and the initial term is ten years, with an annual automatic ten-year renewal, unless a request for non-renewal is made by either party. The City maintains various mechanisms to bring a property into compliance or terminate the contract and recover significant damages if the property owner breaches any of the contract terms.
On February 4, 2014, the City Council directed staff to resume the acceptance of new Mills Act applications. On January 6, 2015, the City Council approved guidelines and funding for the program. The program has been improved and eligibility requirements modified with each continuing application cycle. In 2015, only properties that were designated historic landmarks at the time of application, were eligible. In 2016, the eligibility requirements were expanded to include properties that were eligible to be designated as historic properties. In 2017, no changes were recommended. This year’s application cycle also gave priority considerations to applicants from 2006, when the Mills Act program was suspended, and to applicants that were not awarded in the 2017 cycle.
The Mills Act application guide was released to the public on February 14, 2018, and applications were due on March 30, 2018. A total of 24 applications were received prior to the deadline. At its meeting on August 13, 2018, the Cultural Heritage Commission, made recommendations for landmark designation of seven properties and recommended 22 Mills Act contracts (Attachment A - CHC August 13, 2018).
Recommended historic property applications from the 2017 Mills Act application cycle:
1. 3301-3305 East 4th Street (District 2) - This one-story vernacular cottage includes treatment, and abatement of termite damage, replacement of non-period back porch with period-appropriate materials and code-compliant stairs, rehabilitation of windows throughout the house including repair of counter weights, diamond pane detailing repair, sanding, repainting, bolting of foundation fastening with tie plate, and reinforcement of posts and piers, and replacement of front porch landing with redwood lumber.
2. 789 Coronado Avenue (District 2) - This one-story side gable Craftsman house features a full-width porch, brick porch piers and columns, and a decorative dormer gable. The workplan includes dormer gable repair, rehabilitation of non-operable windows, electrical panel upgrade, floor joists and foundation repair, repair dry rot, replace missing concrete piers, termite repair in garage, repair and/or replace sewer connection. Reversible alterations include replacing the exterior stucco cladding, and restoring wood siding to Craftsman building.
3. 3053 East 1st Street (District 3) - A one-story Craftsman bungalow located in the Bluff Park historic district. The building exhibits influences of prominent Long Beach contractor Miner Smith, whose work was distinguished by his architectural and artistic detailing. The porch has been modified, and the workplan includes reversal of those alterations including restoration of original stonework, restoration of original tapered columns. Other work includes roof replacement, rehabilitation of windows throughout the house, and removal of knob and tube electrical system.
Recommended applications from the 2018 Mills Act application cycle:
4. 645 West 11th Street (District 1) - This Craftsman style single-family building was constructed in 1911 and is a unique example of the style. The two-story building house conveys a commanding presence as a corner property. The building has a combination of wood siding and shingles, with upper leaded glass. The half-width porch wraps in a semi-circle shape with upper porch. The building retains several character-defining features. The workplan includes electrical system repairs and upgrades, repair of water damage and leaks, and foundation repair. This building is also recommended for Landmark designation approval.
5. 953 Chestnut Avenue (District 1) - Originally constructed in 1905, the building is one of the earliest examples of Queen Architecture in the Drake Park Willmore City historic district. Although remarkably intact, the building requires termite treatment and repairs, repair of water damage, work to preserve the porch, structural work at areas of settled foundation, and recreation of original features based on historic documentation. This building is also recommended for Landmark designation based on its architectural style and early association with contractor and developer Robert J. Craig.
6. 824 Maine Avenue (District 1) - A two-story Spanish Colonial style apartment building that features a symmetrical front façade with arched courtyard entry. The work includes replacement of the first-floor front façade windows with period-appropriate windows and the openings will be restored to their original sizes, replacement of aluminum windows and reversing alterations throughout the building. Garage doors will also be replaced with new period-appropriate doors.
7. 2347 East 3rd Street (District 2) - A one-story Craftsman bungalow that features a dual-front gable roof with partial width porch. The building is intact and the workplan includes structural stabilization, termite repair, porch foundation work, floor joist repair, and preventative work to protect original historic garage and house from water damage.
8. 2851-2853 East 5th Street (District 2) - A Spanish Colonial style one-story building in front and a rear two-story Spanish Colonial building. Workplan items include removal of heavy textured non-period stucco and replacement with period-appropriate finish, foundation retrofit of front building, replacement of roof, window repair work, and removal non-period window alterations. This property also received priority consideration because an application was filed in 2006, when the Mills Act program was suspended.
9. 2907 East 5th Street (District 2) - A one-story side gable Craftsman building with centered shed roof dormer. The workplan includes repair/replacement of columns/pillars to period-appropriate style. Repair damaged clapboards due to exposure to elements and replace in-kind, where necessary. Repair, rehabilitate and install original double-hung windows in storage and replace non-period windows. Install new roof with corrective drainage, replace front door with 4-light pattern door, rehabilitate three 12-light windows at attic, replace French doors with 4-light pattern doors.
10. 1502 East 8th Street (District 2) - A classic example of a Craftsman Bungalow with substantial but reversible alterations. Work includes roof replacement with new asphalt shingles. Removal of galvanized pipes and replace with cooper plumbing throughout. Replacement of five aluminum windows with wood casement windows and repair of existing original wood casement windows, porch repairs, stucco removal and restoration of original siding underneath, and addition of new matching siding at rear addition, currently stucco.
11. Alboni Place (District 2) - The Ambassador Apartments building, was designed by W. Horace Austin, and constructed in 1925. The building is L-shaped with portions of building height at 4-stories and 5-stories. It was designated as a historic Landmark building in 1992.
Workplan items include repair, rehabilitate and/or replacement of original windows with new period windows, painting of the building, replacement of non-period courtyard tiles, roof replacement, repair leaks, and rehabilitation and restoration of original character defining features.
12. 520 Junipero Avenue (District 2) - This Craftsman Bungalow with half-width porch was constructed in 1917. The structure retains several character-defining features. The workplan includes replacement of concrete in piers in foundation and flooring systems, reinforce gas line under the house, rehabilitate original wood windows, repair of brick porch façade, replacement of original barn-style garage door, and repair and/or replacement of original furnace.
13. 338 Junipero Avenue (District 2) - This Craftsman located in the Carroll Park historic district. Restoration work includes restoration of door finishes, repair and replacement of damaged wood eaves and siding, restoration of original ribbon driveway, replacement of roofing material, repaint the house and garage, and replacement of all vinyl windows with new period-appropriate windows. The workplan also includes removal of inappropriate building alterations. The building is also recommended for Landmark designation.
14. 1400 Hellman Street (District 2) - A unique Craftsman-style building that features classical character defining features such as a full-width porch, a wide overhanging roof and several notched beams, and is clad in wood siding. The workplan includes termite abatement, repair of several decorative wood features due to dry rot and termite damage, the addition of bolting supports to foundation, repair and replace damaged wood siding, knee braces and fascia as needed, repaint house, replace front yard fencing with period-appropriate wood fencing style, replace glass block window at rear. This building is also recommended for Landmark designation.
15. 789 Walnut Avenue (District 2) - This traditional one-story Craftsman Bungalow constructed in 1920 represents classic Bungalow features and materials including a half-width porch, tapered columns, brick piers, dual front-facing gables, and wood siding cladding. The workplan includes rehabilitation of several windows, foundation retrofit, replacement of original plumbing, removal of original knob and tube electrical wiring, porch cross beam repair, porch brick and pier repairs, and repair of concrete ribbon driveway.
16. 238 Coronado Avenue (District 3) - This two-story Mediterranean style building located in the Bluff Heights historic district retains several character-defining features. The duplex building is well-preserved and a strong workplan is included to continue its preservation. The workplan includes repair and replacement of missing clay roof tiles, repair roof leaks, termite abatement and repair, rehabilitation of historic wood windows, replacement of plumbing and water damage repair, and replacement of remaining knob and tube electrical systems.
17. 830 Santiago Avenue (District 3) - This Kenneth S. Wing designed house was constructed in 1937. The building represents the simple sophistication of residential buildings designed by Kenneth S. Wing. The building is remarkably intact and well-preserved, but work is still needed. The workplan includes rehabilitation of several original windows throughout the building, electrical panel replacement, replacement of unsafe gravity furnace, and roof replacement. This building is not located in a historic district, but is recommended for Landmark designation.
18. 151 St. Joseph Avenue (District 3) - This two-story Spanish Eclectic-style building is unique and provides a robust workplan including complete plumbing system upgrade, complete electrical system upgrade, earthquake foundation retrofit, structural repair work to address cracks and floor framing issues, and windows rehabilitated to original conditions. This property is not located in a historic district, but is recommended for Landmark designation.
19. 3815 Wilton Street (District 4) - The property is a one-story Spanish Colonial-style building with a tile-covered porch. Proposed building work includes replacement of vinyl windows with period-appropriate wood windows, remove existing heavy lace stucco and replace with smooth stucco finish, structural improvements to foundation, replace garage roof, and repair garage door.
20. 622-628 Anaheim Street (District 6) - This is a two-story building Art Deco-style former hotel building. The workplan consists of removing inappropriate alterations, removing and replacing all damaged exterior finishes, restoring all original windows, removing and replacing non-original storefronts and installing new period-appropriate storefronts, replacing non-period windows and doors with historically accurate period doors, and repairing and replacing the roof. This property is not located in a historic district, but is recommended for Landmark designation.
21. 730 Sunrise Boulevard (District 6) - The Harnett House is a designated historic Landmark. The stately two-story Craftsman-style building was constructed in 1918 and is associated with the Harnett family, who had a long family history of civic engagement. The workplan includes plumbing system replacement, roof replacement of main house, replacement of knob and tube electrical system, correct prior electrical work, replace damaged shingle cladding in-kind, replace non-period doors and windows, repair damaged brick at porch, and additional repair work at garage.
22. 3735 Cerritos Avenue (District 7) - A one-story Spanish Eclectic-style building constructed in 1925. This building feature two front gable roofs with three rectangular arched windows, which form a traditional picture window façade. A strong workplan has been presented, which includes replacing non-period features, replacing electrical system with code-compliant electrical, repair/rehabilitation of original windows, replace garage siding, and termite damage repair.
Proposed updates to the Mills Act Guidelines effective January 2019:
Currently, the Mills Act Guidelines has limitations on the total number of applications awarded in a year, the number of applications awarded based on property type, and limitations on the value of a property. Throughout the year, the City is made aware of unique properties that could potentially benefit from the Mills Act that are sold, but do not meet the eligibility criteria, such as respective property type and/or are located outside of a historic district. One example is the Bixby Ranch House, which is a designated Landmark. To allow for instances when exceptional properties are in need of restoration, staff found, and the Cultural Heritage Commission concurred, that it was beneficial to allow for two additional contracts annually with no property value limitations. Table 1 outlines the current and proposed annual award limitations in an application cycle.
Table 1. Annual Mills Act Award Property Type and Valuation Limits
|
Property Type |
Contracts Allowed Per Year (Adopted Guidelines) |
2017 Valuation Limits* |
|
Single Family Residential (1 dwelling unit) |
12 |
Valuation less than $1,055,700 |
|
Duplex or Triplex Residential (2 or 3 dwelling units) |
3 |
Valuation less than $635,000 per unit |
|
Multi-family Residential or Mixed-Residential/Commercial (4 or more dwelling units) |
4 |
No Valuation Limit |
|
Non-Residential (Commercial, Industrial, or Institutional) |
1 |
Valuation less than $2,731,630 |
|
Exceptional |
2 |
No Valuation Limit |
|
TOTAL |
22 |
N/A |
|
*Values are adjusted annually pursuant to the Consumer Price Index (CPI) |
The purpose of the two new “no cap” contract slots would allow the highest flexibility in restoration of these exceptional properties. Staff anticipates that this situation will continue to arise, and this addition to the guidelines would be a tool to protect unique properties that are not located within a historic district and/or have important cultural significance, architectural significance, or are at risk for demolition.
This matter was reviewed by Deputy City Attorney Linda T. Vu on August 28, 2018 and by Budget Analysis Officer Julissa Jose-Murray on August 24, 2018.
SUSTAINABILITY
Implementation of the Mills Act helps retain and restore local historic landmarks. This work often is completed by reusing or reclaiming existing building materials, reducing construction waste as compared to new construction.
TIMING CONSIDERATIONS
City Council action is requested on September 18, 2018, to allow sufficient time for the City Attorney to draft, the property owners and City Manager to execute, and to record all contracts prior to the December 28, 2018, deadline established by the Los Angeles County Assessor for placement on the tax rolls.
FISCAL IMPACT
Executing Mills Act historic property contracts and the subsequent tax abatements generally result in a 30 to 50 percent property tax reduction for a historic property. The approximate assessed value of the proposed Mills Act historic properties is $20,299.000. Based on this value, the City could experience an annual decrease of property tax revenue to the General Fund (GF) ranging from approximately $12,788 to $21,111. Over the initial ten-year term, the total decrease of property tax to the General Fund could range from approximately $127,880 to $211,110.
The fiscal impact of the recommended revision to the Mills Act Guidelines of adding two additional Mills Act properties without valuation limits annually, cannot be definitively estimated at this time. However, these additional contracts will most likely be for large single-family homes. The current valuation limit for single-family homes is $1,055,700. To provide an order of magnitude impact, it is assumed that the additional contracts will range from $1,500,000 to $2,000,000. Based on this assumption, the fiscal impact to the General Fund (GF) for the two additional properties would range from $1,890 to $4,200 annually, or $18,900 to $42,000 for the initial ten-year contract. There is no local job impact associated with this recommendation.
SUGGESTED ACTION
Approve recommendation.
Respectfully Submitted,
LINDA F. TATUM, FAICP
DIRECTOR OF DEVELOPMENT SERVICES
APPROVED:
PATRICK H. WEST
CITY MANAGER