February 23-March 1, 2006
cover storyWhat Price Preservation?
The pros and cons and different types of historical designation
"We had to make 5,000-plus terra-cotta roof tiles by hand to satisfy the requirement for historic preservation tax incentives on the Lansdowne," recalls developer James L. Brown IV, speaking of the elegantly restored apartments at 41st Street and Parkside Avenue. Making those tiles included hunting down the proper clay, hauling it back from Delaware in the back of a pickup and then to a brickyard in Norristown to be fired.
Brown, executive director of the family-based Parkside Historic Preservation Corporation, would do it all over again. That federal tax-incentive program helped him fulfill his lifelong desire: to preserve gorgeous old housing in Parkside, where his family has lived for years, and, in turn, save a neighborhood on the brink.
Photo By: Michael T. Regan
"We wanted to get the cost down to be able to reach the people. We have a nice mix, some Section 8 vouchers, others middle-income. If we didn't have those [tax] credits, we couldn't have made [the rents] affordable."
Brown's Parkside story is the upside of a two-sided debate over the merits of historic designation. It can help save a crumbling neighborhood; It can also be used as a form of economic cleansing a way to "improve" a neighborhood by attrition, forcing the less affluent to sell out to those who can keep up with the expense and paperwork.
Brown explains the incentives thusly: If you are approved for federal historic tax incentives, there is a 20 percent tax credit available to investors. This credit is available only for rental properties. Say the total development cost is $100,000. An investment of $20,000 for a tax credit of the same amount can lure funding from people who would not otherwise dream of an edgy neighborhood like Parkside (west of the zoo, east of Belmont), and make a significant dent in mortgages for those, like Brown, with equal passions for history and community.
Brown and other community movers, including reps from the Philadelphia Zoo, are conspiring to expand this vision, have formed a Centennial District (referring to the Centennial celebration held nearby in 1876), honoring the history that lies across the street in Fairmount Park. "The railbed is still there!" enthuses Brown, dreaming of a new zoo rail stop for which he is helping to raise funds, one that would unite the Please Touch Museum, soon to be in Memorial Hall, and the Mann Center. Brown loves Parkside and wants to make it clean and inviting. He feels protecting the aesthetics "will help to move the market forward."
All this has been made possible with the aid of National Register Historic District designation and its accompanying tax credits. But now Brown is looking forward to having Parkside become a city-designated historic district, "because the city stipulations are much stricter," stricter even than those handcrafted roof tiles. Brown favors the city designation because he wants to see his hard work preserved. He admits, though: "I can't always say it's a good thing for limited-income people."
A federal historic designation is a good thing for developers, worth all the filing of papers and the requests for approval necessary to qualify for the tax incentives. And, if you're not looking for the tax breaks, you're simply not required to play ball. Local historic designation is another bird altogether. Buy into a district like Old City or Society Hill, Spring Garden or Rittenhouse-Fitler and you'll be required to follow stricter restoration standards, without the benefit of a tax break. All the paperwork and none of the financial breaks. Thus the famous fight when the Spruce Hill section of University City was up for historic designation.
Al Krigman of developer KRF Corp is, like Brown, a provider of mid-price apartments. The Spruce Hill Historic District (SHHD) seems to be on the back burner for now, but when it was simmering Krigman was one of its most vociferous critics, arguing that longtime blue-collar residents would be forced to sell and move from a community they'd kept stable.
Krigman recalls a public debate over the SHHD where someone from the back of the room hollered that Krigman was opposed to the district because he was notoriously cheap. "I responded that I don't take that as an insult. [Being cheap] lets me pass the savings on to the people that I rent to," he remembers. "There is a strong need here for places that are middle-market, and the increased costs [spurred by the SHHD] would raise my rents."
Where the federal designation helps housing providers like Brown to restore faded elegance to affordable housing, Krigman worries that a city historic district in Spruce Hill is a thinly veiled attempt at what he terms "social engineering" or pricing out so-called undesirables.
Krigman recalls with incredulity that people who raised the issue of added cost for authentic restorations in the proposed Spruce Hill District were advised that since their homes had shot up in value they should just take out loans to cover increased taxes and restoration expenses. Krigman urges those thinking of buying into any historic district to attend a Historical Commission meeting, which is where renovations proposals are vetted. "You'll see people have to submit elaborate plans, and then the committee nitpicks! If you are thinking of buying into an HD you have to ask how much is it worth to you to have this assurance of visual goodness." According to the Philadelphia Historical Commission Web site, virtue is its own reward:
"The ownership of a recognized cultural resource brings with it a satisfying sense of trusteeship of the past for the future."
In other words, you'd better have deep pockets when it comes time to replace that lovely-but-worn slate roof with original materials.
Though there is a new program in place to help low- and moderate-income home owners who live in local or federal historic districts. According to Randy Cotton, associate director of the Preservation Alliance of Greater Philadelphia, the newly available Historic Properties Repair Program is now taking applications. Funded by $1.1 million from Neighborhood Transormation Initiative funds and other sources, the program will provide grants to bridge the gap between ordinary and historically accurate remodelling. (Applications can be requested by calling 215-546-1146 or e-mailing Cotton at firstname.lastname@example.org.)
Though admittedly cheap, Krigman says he is as much a fan of "visual goodness" as the next guy. As such, he is now cheering on the prospect of Neighborhood Conservation Districts (NCDs). The concept is relatively new to Philly Queen Village is in the process of becoming the city's first but it has worked in other parts of the commonwealth for 50 years. The theory is that rather than having an appointed body decide what works for the neighborhood, an NCD is created by neighborhood vote. The same stakeholders decide what they want to preserve and what can be altered. NCDs work the the city's Planning Commission rather than its Historical Commission. Krigman relishes the idea that the two cents of the experts at the Planning Commission is not binding.
"Under the Conservation District, the [Planning Commission] acts as a consultant, but not final arbiter," says Krigman. "You can ask their advice, but you don't have to take it!"