City Plan Would Offer Incentives to Rehab Historic Buildings

A plan to offer incentives to owners to maintain WeHo properties designated as historically significant got pushback last night from members of the West Hollywood Planning Commission.

While the commission supported the idea of offering incentives, several of its members said the plan didn’t go far enough.

The plan was produced by the city’s Community Development Department, working with Place Economics and Page & Turnbull, outside consultants. West Hollywood currently has 83 properties designated as historic resources and there are eight designated historic districts and groupings in the city. Of the 83, there are 39 historic apartment buildings that also are subject to rent stabilization laws. The plan focused on providing incentives to owners of those properties.

“Property owners have said they do not have the resources to properly maintain their properties because of limited revenue due to a certain percentage of units having rents below market rate,” said a report to the Planning Commission.

The plan presented last night already has been reviewed by the city’s Rent Stabilization Commission and Historic Preservation Commission. The city’s Community Development staff hopes to present it to the City Council in August. Its proposals include:

1) Providing technical assistance to help owners of rent-stabilized and historically significant buildings negotiate complex programs to help with repairs and maintenance. Those programs include the Mills Act, which gives owners of culturally or historically significant properties a reduction in property tax to assist in their rehabilitation. Mills Act applications must be approved by the City Council.

2) Waiving city building and safety fees associated with maintenance work. That would include a 50% reduction in the annual fee of $120 per unit that a landlord must pay to register a rent-stabilized apartment (half of that fee now can be passed along to the tenant).

A report to the Planning Commission from the Community Development staff cited the repair of a pool deck as an example: “The construction cost was valued at $42,000, and the building permit fee charged was $1,882.71. The money spent on building permit could instead be used by the owner to further invest in the property. The waiver of building and safety fees for these properties are estimated at $19,000 annual loss in revenue to the City.” The city already offers historic building owners a waiver of planning fees.

3) Modifying the rent stabilization ordinance’s current requirement that exteriors of buildings be repainted every seven years and interiors repainted every four years. As a practical matter, that requirement now is only enforced only if a tenant complains to the city. However, the study says, requiring repainting whether or not it is needed “can be harmful to historic materials, as the layers build up over time. Rather than spend the money/time on re-painting that may be damaging to historic features, the owner’s energies can focus on more pressing repairs.”

4) Modifying the existing program permitting transfer of development rights. The study proposed pre-certifying 17 properties that have undeveloped rights that they can sell to developers of other properties in commercial zoning districts. ” These properties can become ‘donor’ sites by selling their unused density rights to ‘receiver’ sites to generate a one-time cash infusion to rehabilitate their properties,” according to the report to the Planning Commission. The 17 properties have unused rights to develop a total of 74 apartment units or a total of 88,880 square feet. The modification would require the property owner to reinvest 90% of proceeds from a sale into the historic property.

West Hollywood established a program in 1994 that allowed unused development rights of culturally significant properties to be transferred to another parcel through the sale of the rights. Those transfers were limited to specific properties in the Sunset Boulevard area. Changes in the city’s Sunset Specific Plan have made those transfers largely unnecessary for property owners.

5) Providing assistance with certain major rehabilitation costs, including exterior rehabilitation and improvements to prevent total loss such as seismic retrofit and electrical work. According to the report, the amounts could be up to $150,000 per building and up to $15,000 per unit. Providing this assistance would require the building owner to continue rent- stabilization for at least 20 years.

According to the report, the city needs to provide a variety of incentives because each of the historic rent-subsidized buildings has unique needs. It said a “conditions assessment” “found the properties are generally well cared for and in better-than-expected conditions. However, all the buildings have a range of visible deferred maintenance items reflecting their age, such as window repair/replacement. Outdated infrastructure systems — heating, ventilation and air conditioning (HVAC); electrical; plumbing and structural/seismic reinforcement are the things most in need of upgrades.”

The study also found that repair and rehabilitation for historic buildings generally costs more than it does for more modern buildings. “It requires skilled intensive repair work and sometimes use of materials that aren’t easily available,” it said.

It also found that “rent stabilization is less of a problem than owners claim because of the Costa Hawkins Rental Housing Act, which lets owners move units to market rate when they are vacated.”

The proposals won support from the West Hollywood Preservation Alliance, although it said they were not enough. A specific recommendation by WHPA was to create a full-time position to provide technical support to owners of historic buildings.

“We believe more could be done to bolster the city’s contention that it puts a high priority on historic preservation while ensuring its supply of affordable housing and support of rent-stabilized housing,” the letter said.

“The City of West Hollywood has the financial resources — it’s time it started to truly respect its historic buildings and the owners who provide 593 rent-stabilized units of housing for citizens of West Hollywood, and to allocate more money into maintaining our city’s historic infrastructure.”

Planning Commission members John Altschul, Sue Buckner, Stacy Jones and Sheila Lightfoot spoke out to say that the proposals were not enough. “It is as important to preserve what exists as it is to add new affordable housing,” said Altschul, the commission’s chair.