Title
Approval of a Resolution Granting Special Tax Valuation for the Olympia Heritage Site at 115 State Avenue NE
Recommended Action
Committee Recommendation:
The Heritage Commission recommends approval of the special valuation application for 115 State Avenue NE.
City Manager Recommendation:
Move to approve a Resolution granting special property tax valuation status for the historic property at 115 State Avenue NE.
Report
Issue:
Whether to approve a Resolution granting special property tax valuation status for the historic property at 115 State Avenue NE.
Staff Contact:
Holly Borth, Historic Preservation Officer, Community Planning & Development, 360.688.0419
Presenter(s):
None - Consent Calendar Item.
Background and Analysis:
The City of Olympia participates in the Washington State Special Tax Valuation program. The program provides owners of designated historic buildings with the opportunity to apply for a property tax revaluation following the completion of approved rehabilitation work. The purpose is to incentivize historic preservation by offsetting the costs to maintain and upgrade older buildings. To qualify for special valuation, the qualified rehabilitation expenses must be equal to or greater than 25 percent of the value of the building (not the land value).
As outlined in OMC 3.60 Special Property Tax Valuation the Olympia Heritage Commission (OHC) performs a full review of each application and its related expenses. The OHC then makes a recommendation to City Council for approval or denial.
The application must be reviewed or denied by the City Council before December 31, 2023. If approved, the City enters into a ten-year agreement with the property owner to ensure no additional modifications are made without written consent by the City.
The Thurston County Assessor completes the final processing of the special valuation. Beginning in the following year (2024) the property tax is reassessed (to include the new improvements) and the Total Qualified Expenditures are subtracted from the newly assessed value for a period of ten years.
115 State Avenue NE
On August 23, 2023, the Olympia Heritage Commission passed a unanimous motion to recommend approval of the application for Special Valuation at 115 State Avenue NE. The Heritage Commission recommendation is based on the following:
1. The property is listed in the National Register of Historic Places as a contributing resource to the Olympia Downtown Historic District.
2. The rehabilitation work was completed within the requisite 24 months prior to application.
3. The rehabilitation work and related expenses were reviewed by the Heritage Review Committee on July 10, 2023. The committee recommended approval to the full Heritage Commission.
4. The assessed value of the structure prior to rehabilitation work $851,600.00. Total Qualitied Expenditure would have to meet or exceed a value of $212,900.00 to meet the 25 percent threshold.
5. Staff conducted a review of all receipts and found the Total Qualified Expenditures is $1,279,680.00 and exceeds the 25 percent value threshold.
The attached Certificate of Approval will be submitted to the Thurston County Assessor.
Climate Analysis:
The Advisory Council on Historic Preservation (ACHP) reports:
“…all kinds of historic buildings and neighborhoods, archaeological sites, Tribal sites and resources, and culturally important landscapes (both designed and natural) throughout the country (collectively, “historic properties”), as well as associated intangible cultural heritage, are at risk from a broad range of potential climate impacts, including sea level rise; extreme weather events; increased wildfires; drought; melting permafrost and erosion; and temperature changes. These impacts are both direct and cumulative, and threaten not only historic properties but also the terrestrial and aquatic flora and fauna associated with historically and culturally important places. The loss of or damage to historic properties from such climate impacts can irrevocably change a community’s sense of place and erode people’s sense of personal identity and cultural stability…
…About 39 percent of global carbon emissions come from the construction and operation of buildings. This impact can be reduced by reusing existing buildings, thus avoiding the embodied carbon emissions inherent in new construction, including the carbon associated with the manufacturing and transportation of new materials and the removal and disposal of building materials from demolished buildings. Reuse of existing buildings in urban areas also contributes to climate change mitigation by promoting density, helping to combat urban sprawl and its attendant negative environmental impacts… Since approximately 40 percent of America’s building stock is at least 50 years old, it is critical that reuse and energy retrofit of older and historic buildings (including enhanced electrification and increased energy efficiency standards) be fundamental priorities.”
Promoting and approving applications for Special Valuation encourages the reuse of Olympia’s building stock, thus proactively aiding to the slow the tide of climate change in the City and beyond.
Equity Analysis:
The ACHP also reports:
“…historic properties important to disadvantaged and underserved communities may be disproportionately affected by climate change and that such communities often are ill-equipped to undertake needed interventions.”
The changing demographics of America pose opportunities as well as challenges for Olympia’s historic preservation programming. The diversity of cultures in our city shape and enrich the community experience, and the local government can continue to encourage wider involvement and representation in determining what historic sites are worthy of recognition and preservation; how history and cultural heritage should be valued, interpreted, and preserved; and how we can ensure the American public as a whole can take advantage of the programs and tools created under federal, state, and local laws - in particular, OMC 3.60 and the Special Property Tax Valuation program.
Neighborhood/Community Interests (if known):
The historic site at 115 State Avenue NE is located in the Olympia Downtown area, an area in desperate need of revitalization. The property owner has set an excellent example of how historic preservation can be a worthwhile investment for other downtown property owners and how to utilize the tax incentives available at the federal and local level. Our downtown buildings were built to be used, and using buildings ensures their longevity. Showing the City approve of these investments in our downtown and the positive benefits historic preservation can have on a historic downtown can only help bring more vitality to our struggling business owners.
Financial Impact:
Approving the application will result in no direct financial impact to City budgets. Staff time for processing Special Valuation applications is included in the operating budget.
Options:
1. Approve the resolution granting special valuation for the historic property at 115 State Avenue NE.
2. Do not approve the resolution with findings of inconsistency with program requirements.
3. Take other action.
Attachments:
Resolution
Agreement