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Owners of historic properties often either overestimate or underestimate the effect of having their property designated as a landmark of historic significance by a government entity. It does not help that there are at least three levels of governmental regulations involved, between the United States Federal government, the State, and the local municipality. Owners may believe a landmark designation will allow grants and other money to flow to the owner to help in restoration efforts. Or, other owners may fear that landmark designation will make them lose control over what they can and can’t do with their historic properties, causing such designation to be more of a burden than benefit. Let’s take a very high-level look at the structure of historic preservation programs at the three levels of government to better understand the effect of a landmark designation. The general rule of thumb governing this review is that obtaining a landmark designation at the Federal level does not necessarily restrict what an owner can do with their historic property, but obtaining such designation at the local level may impact use. And anytime any level of government may be providing an economic incentive to the historic property owner, those funds do come with strings attached.
FEDERAL LEVEL ISSUES
The Federal government designates historic status under two categories. First, buildings may be listed on the National Register of Historic Places. There are over 90,000 buildings on this list of properties that contribute to the story of the nations’ history on a state or local level. There are multitudes of such properties in Northeast Ohio. To qualify, a building must be at least 50 years old and the National Park Service must agree that the building is of historic or architectural significance by reason of design or association to historic people or events.
Second, a building may be designated as a National Historic Landmark. Nationally, there are only a little over 2,500 buildings on this list, which is reserved for those properties that contribute significantly to the history of the nation as a whole. Properties with this heightened designation in Northeast Ohio would include Thomas Edison’s birthplace in Milan, President Garfield’s home in Mentor, or the Old Arcade in downtown Cleveland.
Either designation by itself is merely honorific, and has no appreciable effect on the owner’s rights with respect to such property. An owner can generally modify, alter, or even demolish any such listed structure as the owner desires unless otherwise prohibited by State or local regulations. Such designation can, however, open up eligibility to sources of funding including Federal or State Historic Preservation Tax Credits, and when such economic incentives are offered the government then has a say in what an owner can do with their historic property, and will generally require that all modifications meet the U. S. Secretary of the Interior’s Standards for Rehabilitation. These standards will also apply if the Federal Government is doing a project itself, or is issuing any kind of license or permit for the project.
STATE LEVEL ISSUES
In Ohio, there is no equivalent State-level designation of historic properties or landmarks. The State’s role is, however, rather significant in offering administrative and technical guidance to both the National Park Service in their review of Federal designations, and to local municipalities in their designations. The Ohio State Historic Preservation Office also certifies local government historic preservation agencies to ensure their conformance with State and Federal requirements, assists federal and local agencies in locating, identifying, and documenting historic structures throughout the state, and assists the Federal government in its historic preservation tax credit program, while administering the State’s own historic preservation tax credit program.
LOCAL MUNICIPALITY DESIGNATION
Often local designation of a property as a historic landmark may carry greater restrictions on what an owner can do with their property than Federal designation, regardless of whether any funding or economic incentives are involved. Local municipalities have the right to set restrictions on what can be done with properties of local historic significance in much the same way as they can control land use and property development through planning and zoning laws – as a permitted exercise of their “home rule” police power to regulate the health, safety, and welfare of the community. This right was upheld as applying to historic preservation controls by the U.S. Supreme Court in their 1978 decision in Penn Central Transportation Company v. New York City, in which the court held that enacting such controls does not amount to a “taking” of the owner’s property rights, as they are a permissible regulation needed to uphold the general welfare of the community. Because of Ohio’s strong “home rule” governmental structure, much of this power is passed down to be wielded at the local level, and this leads to a state-wide patchwork of local historic preservation ordinances. Accordingly, a property owner is well advised to check the local code to determine if there are regulations governing historic properties, and the extent of those regulations. Even if a property is not individually designated as being a historic landmark, if it is within a locally designated “historic district” containing multiple buildings, the preservation restrictions may apply in an identical manner as if the property was individually designated.
A local preservation ordinance requires well-crafted designation criteria and standards, due process hearing procedures, and a sound administrative process to ensure consistent decisions. Such ordinances often address design guidelines, due process for property owners, and require public hearings. The ordinance should be reviewed to determine who can nominate and designate a property as historic. Typically, the designation is made by existing bodies such as a planning or zoning commission or architectural review board, or may be made by a specialized landmarks or historic preservation committee. The ability to nominate a building or district, however, may be limited to such governmental boards, tangential advisory committees that advise such boards, the property owner themselves, or even neighbors or other community members.
Local ordinances typically set a nomination and review framework, then address individual buildings on a case by case basis. Such ordinances often require municipal approval of alterations to properties individually designated or within a historic district, including strict review procedures for requests to demolish a structure. They also may mandate minimum maintenance and design standards, with all changes requiring the governing entity to issue a Certificate of Appropriateness for such changes, similar to issuing a building or zoning permit. Designation and design restrictions are often based on Federal Secretary of the Interior Standards for Rehabilitation criteria. There may be enforcement penalties and an appeals process.
For an example of these municipal regulations, a review of the local landmarks ordinance of the City of Cleveland shows that the regulations for design review apply to exterior changes only, not interior alterations. The landmarks commission may approve or deny alterations, or delay a decision by mutual agreement for two periods of up to six months to allow the parties to explore other possibilities. The ordinance exempts approval for changes to single to three family homes, for routine maintenance (provided there is no exterior changes in design, material, or color), and exempts changes required to ensure compliance with building or fire codes.
The Cleveland ordinance requires owners of designated historic properties to keep their properties in good repair to prevent the deterioration of historic features, and provides a list of minimum maintenance standards. The City can require an owner to post a maintenance bond in an amount up to $15,000 to ensure maintenance compliance. An owner must designate an adult Cuyahoga county resident as authorized point of contact with the City. Violations can subject the owner to fines of $10 to $500 for each violation, and each day of a violation is a separate offence. The City may also seek a court order compelling compliance. Other cities may have less or even more restrictive requirements.
Owners of historic properties should not automatically fear or cheer designation of their property as a historic landmark, but should investigate who will be bestowing such status and what will be the effect. Such owners should be aware that local designations may carry more restrictions than others, and that anytime the owner is seeking economic help with their historic property, the party providing the funds will generally require significant approval rights as to what is to be done to the building to ensure the funding entity’s desired preservation goals.