New Neighborhood Voice

December 9, 2003

Santa Clara County Staff's Responses to
Questions on Proposed Historical Preservation Ordinance

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NNV Note: Received 12/8/03 from Dana A. Peak, Historical Heritage Coordinator, Santa Clara County Planning Office, 70 West Hedding Street, East Wing - 7th floor, San Jose, CA 95110, Voice: (408) 299-5798, Fax: (408) 288-9198, E-mail: dana.peak@pln.co.scl.ca.us, Website: www.sccplanning.org 

Thank you for your thoughtful questions regarding the draft Historic Preservation Ordinance. We appreciate your concern and hope that we can address your questions in a helpful manner.

1. Why do we (the property owners, residents, taxpayers and voters) need an ordinance like this? What are the benefits for us?

Benefits of a Historic Preservation Ordinance
As previously discussed, the draft historic preservation ordinance is a beneficial tool for community members in unincorporated Santa Clara County to achieve their interests in preserving important historic resources by ensuring that they are not damaged or lost. Community concern for Santa Clara County's historic and cultural heritage resulted in the inclusion of historic preservation as an element in Santa Clara County's General Plan. The General Plan recognizes that heritage resources are important for a variety of reasons and are irreplaceable. To prevent unnecessary losses to heritage resources, the General Plan calls for the development of adequate ordinances, regulations and standard review procedures.

Historic preservation ordinances have been successfully used by communities across the country for many years and have become a standard planning tool. Studies demonstrate that designated properties and areas appreciate in value more than undesignated properties and areas that do not maintain their historic integrity. The proposed ordinance provides for a designation and review process to maintain historic integrity for designated properties. It also allows the owners of designated properties to make use of the State Historical Building Code (SHBC). The SHBC provides relief from or relaxation of certain requirements of the standard building code, which may result in cost-savings. In addition, the proposed ordinance allows the owners of designated properties to be eligible for a Mills Act contract, which provides a reduction in property taxes to facilitate the preservation of the property.

Effects of Historic Preservation Ordinances on property values
A World Wide Web search using the words "historic preservation" and "property values" results in over 8,500 related sites. All reports included in the first 20 sites indicate that the vast majority of properties and/or areas studied increased in value as a result of historic designation.

The Economic Impacts of Preservation in Florida, published in 2002 by the Florida Department of State, with research assistance from Rutgers University and the University of Florida Levin College of Law. The study includes a chapter on historic designation and property values that reports - in 15 of 18 case studies, property in historic districts increased more than in comparative neighborhoods. No instance was found in which historic designation depressed property values. This study is typical of a number of studies sponsored by state governments wishing to report on the economic impacts of state and local preservation programs. (http://www.law.ufl.edu/cgr/pdf/historic_report.pdf

A 1995 economic study of house prices findings: homes located in two nationally and locally designated historic districts increased in price at a rate almost 25 percent faster than did homes in the community at large. John A. Kilpatrick, a lecturer with the Center for Real Estate and Urban Economic studies at the University of South Carolina College of Business, coordinated the project in cooperation with Susan McGahee and the late Nancy Meriwether of the Historical Services Division, South Carolina Department of Archives and History. (http://www.anaheimcolony.com/propval2.htm)

The Economic Benefits of Historic Preservation (2002) found that residential property values in historically designated areas increased or stayed the same as those values in nearby, undesignated areas. None of the case study areas showed any decrease in property values after historic designation. Other economic effects and benefits of preservation were also studied. Study partners included Clarion Associates of Colorado, a land-use and real estate consulting firm, BBC Research & Consulting and Place Economics of Washington, D.C. (http://www.coloradohistory-oahp.org/programareas/shf/support/2002/june.htm)

A Mundy Associates LLC study of valuation issues in historic preservation found that residences in designated historic districts sell for 21% to 27% more than similar residences outside the district and residences in those districts increase in price faster than homes in the surrounding market. Furthermore, this increase lasts a long time, benefiting not only the owners at the time of the creation of a historic preservation ordinance, but also subsequent owners. (http://www.mundyassoc.com/publications/pocketbook.pdf)

An academic study by Robin M. Leichenko of Rutgers University "suggests that historic preservation generally has a positive impact on property values and that historic designation is associated with average property value increases ranging between 5 percent and 20 percent of the total property value." See page 1984 for conclusions.
(http://geography.rutgers.edu/people/faculty/leichenko/leichenko_coulson_listokin2001.pdf)

At a smart growth seminar Donovan Rypkema, principal of Place Economics, argued that sensible land use policies enhance rather than diminish property values, and that public constraints on private property such as zoning have been central to American political society for three centuries. Comprehensive approaches to smart growth frequently include some form of land use controls. Discussion of land use regulations often generates resistance from proponents of the "property rights" movement. Many argue that restrictions on privately owned land have an adverse impact on property values and are alien to American political tradition. A more complete look at American history and available property value research reaches different conclusions. The talk is available through the Smart Growth Network. (http://www.smartgrowth.org)

2. How will it affect us? How will it be administered? Will it decrease or increase the processing time for permits and inspections? Will it increase or decrease our costs and fees?

Effect on property owners and other community members
The draft Historic Preservation Ordinance will not affect property owners unless the property (resource) is designated a landmark, heritage property or heritage tree, or the owner applies for a discretionary permit for work that will affect a potential historic resource. If such a property is identified (though only a small percentage, likely 1-2% will meet the criteria), it will NOT be designated, but the proposed work will be reviewed through a standard review process. The ordinance will affect community members in Santa Clara County in the sense that the integrity and significance of valued historic resources may be retained.

Administration, permits and inspections
The ordinance will be administered by the Planning Office. The adoption of the ordinance will not affect inspections. In terms of processing time for proposed work, it depends what type of permits (Planning and/or building) are required for the project. For demolition permits, the ordinance may decrease processing time. Currently all historic resources listed in the Inventory that are proposed for demolition must go to the HHC and Board of Supervisors for review. Under the proposed ordinance, proposed demolition will no longer have to be reviewed by the Board of Supervisors. The ordinance eliminates this step in the process, thereby decreasing processing time by a minimum of 4-6 weeks.

In addition, the ordinance provides for a designation process that will distinguish what properties listed in the Inventory are subject to review provisions. Only those properties that meet the designation criteria and are designated by the Board of Supervisors will require review.

Regarding proposed work requiring a discretionary permit, the ordinance should provide for a processing time for alterations that is equal or less than current requirements. The County is required to take the impact of projects on historic resources into consideration under the California Environmental Quality Act (CEQA). By clarifying review requirements for historic resources in the ordinance, the resource is identified and the process determined early in the general review of the project. The goal is to create a more efficient and predictable means of decision making.

If the project only requires a building permit, the processing time may be longer. However, again it depends on the work proposed. Work on heritage properties may not require review if substantial alterations are not proposed. Depending on the scope, work on designated landmarks may only require staff-level review if a minor project and not require review by the HHC.

Costs and fees
Any increase or decrease in fees depends on what type of permits (Planning and/or building) are required for the project. For a discretionary related permit that requires CEQA review, the fees could decrease. For building permits only, the fees could increase.

3. How does this proposed ordinance fit into the County's current budget crisis? Are fees and fines expected to create additional revenue for the County? Will any additional County employees be needed to administer the proposed ordinance? Will it increase the County╣s operating expenses? What is the priority for this ordinance vs. other County budget priorities?

The proposed ordinance is unrelated to the County's budget. Additional revenue is not expected to be created/collected as the result of the adoption of the proposed ordinance. Any fees or fines collected will be insignificant to the overall County and Planning Office budget. No additional County employees will be needed to administer the ordinance.

The adoption of the ordinance will not increase the County's operating expenses. The proposed ordinance is not a budget issue, it is policy development. The Board of Supervisors determines for any budget year which policy decisions to undertake. The preservation of the County's historic resources is a policy decision that is supported by the General Plan and previous action by the Board of Supervisors. Adoption of the proposed ordinance will assist the County in becoming a Certified Local Government and eligible for state grant funding.

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Copyrightę 2003, 2004 by Judy Thompson.  All rights reserved. Updated 1/7/04.