How to Demolish History in Ocean City: New Debate on Rules

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Ocean City's Historic District covers an area roughly between Third and Eighth streets, Central and Ocean avenues. When should an owner in Ocean City's Historic District be allowed to demolish an old home and build new? That's the subject of a questionnaire mailed to homeowners in the district, and the survey results will be discussed at a public meeting 10 a.m. Saturday (June 11) at the Recreation Center at Eighth Street and Haven Avenue. Ocean City's first homes and buildings took shape around the prayer meeting area of the Christian resort founded in 1879 — the site now occupied by the Ocean City Tabernacle. The current Historic District surrounds the Tabernacle in an area from Third Street to Eighth Street between Central and Ocean avenues. The district is on both the state and federal Register of Historic Places. It includes a small number of the original Tabernacle Cottages and a larger number of Victorian homes built in the 19th century. But while Ocean City's Historic Preservation Commission has some oversight of both what can be torn down and what can be designed (if visible from any numbered or named street), property owners do retain rights to rebuild under certain circumstances.. The Commission has proposed a couple of changes to help preserve more historic homes in a slowly dwindling inventory. The proposed changes are designed to make sure owners make a good-faith effort to preserve or sell historic structures before demolishing them. City Council must approve any change to the ordinance governing the Historic District, and a Council subcommittee sent the questionnaire to homeowners to gauge opinion before taking any action. The questionnaire even asks if property owners believe they should have the right to "opt in" or "opt out" of district regulations — a suggestion seemingly contrary to the very notion of preserving a Historic District. At a meeting last week, Historic Preservation Commission members said they had no prior knowledge that the questionnaire was going out, and they debated sending a letter to homeowners explaining why they are suggesting changes. CITY COUNCIL QUESTIONNAIRE City Council subcommittee members sent out a questionnaire in May to homeowners in the Historic District. The mailing starts as follows:

"The Historic Preservation Commission ("HPC") is requesting City Council to consider two (2) changes to the district, which pertain to the demolition of structures in the Historic District. The subcommittee formed by City Council to review the proposed changes would like to have input from the homeowners in the Historic District regarding these changes. Please indicate if you are in favor of the change or against. If against, please state the reason for your opposition."

It goes on to list the two changes (followed by the "opt in" question):

The first change proposed by the HPC is to revise Section 25-1800.10.1(c) to change the "Notice" period from 6 months to one year. This would change the amount of time notice of the proposed demolition must be posted on the property and published pursuant to Section 25-1800.10.1(b), as well as the amount of time a property for which a demolition permit has been denied must be marketed for sale from 6 months to one year.
The second change proposed by the HPC is to revise Section 25-1800.10.1(d) to add the following language: "In addition, the owner of said property shall obtain two certified appraisals from a certified licensed appraiser indicating the fair market value of said property, as defined in 'Pansini Custom Design Associates, LLC et al vs. the City of Ocean City, 407 NJ Super 137 (App. Div. 2008),' said appraisals to be filed with the administrative officer either prior to or contemporaneously to the notice period. The fair market value shall be the lower of two appraisals." This language would require a seller to obtain two appraisals to illustrate market value, submit both reports to the city's administrative officer, and list property for sale at a price dictated by the lower of two appraisals, before the property could be sold and torn down.

Councilman Mike Allegretto — a member of the subcommittee with Council President Tony Wilson and Councilman Antwan McClellan — said that the questionnaire is a simple attempt to "vet the ideas to the public" before making any decisions. "It's just a start in the process," he said. But at a public meeting last week, the Historic Preservation Commission discussed three issues with the questionnaire:

The correspondence includes no explanation why the Historic Preservation Commission is seeking the changes.
The correspondence includes wording that could be perceived as misleading.
As a legal impossibility, the "opt in, opt out" question serves no purpose.

PRESERVATION COMMISSION CHANGES The Historic Preservation Commission voted last week not to send a letter to homeowners explaining the suggested changes — partially because it would not reach homeowners in time to influence their input on the survey due June 11. Instead, they will wait for the results of the survey and ask Commission Attorney Mark Stein to address City Council directly with the commission's questions and concerns. Commission Chairman John Ball said last week that the two changes noted in the questionnaire are part of a much larger revision that includes mechanical and fee changes that have been discussed for several years. The commission would like Stein to urge council to pass the bulk of the revisions, even if it wants to continue to discuss the two demolition issues. Ball had drafted a letter to district homeowners explaining the proposed changes. The letter explained that the intent of extending the notice period from six months to one year is to make sure historic properties are advertised through at least through one summer. Any property slated for potential demolition is required only to post a sign on the property to advertise a sale. A six-month notice period could run late fall through early spring, when signs would be less likely to be noticed. Commissioners said last week that they have always been willing to compromise on the length of the notice period as long as one summer cycle is included. If a property does not sell during the notice period, owners are allowed to request demolition and rebuild to conform to existing zoning code. Much of the Historic District is zoned for duplexes. Ball's proposed letter also said that the proposed revisions seek to clarify a vague requirement that people applying to have a historic structure demolished must list the property at "fair market value." He said the language suggested for obtaining two appraisals was derived from the city's attorney and not from the commission, and he said he wants it to be clear that the requirement applies only to owners seeking demolition. The central premise in the lawsuit referenced in the questionnaire ("Pansini vs. Ocean City") is that a property should be valued on the basis of its current use (historic home) as opposed to its "highest and best" use (a newly constructed duplex, for instance). The commission's aim is to prevent owners from placing a property on the market at an artificially high price to prevent it from being sold. Commissioners questioned the inclusion of the "opt-in, opt-out" question on the survey and suggested it will serve only to "inflame" residents who might be led to believe it's a possibility. ("I just put it in there to see how they felt," Allegretto said of the question. "I’m not sure if legally we could even do that.") Inclusion on the state and federal registers would prohibit such a policy. And commissioners compared the idea to allowing property owners to "opt out" of zoning requirements or adhering to other ordinances. Commissioner Jeff Frost said he sympathizes with homeowners faced with Historic District requirements and costs, but he said he doesn't agree with the notion that owners should be allowed to opt out. "It's been decided that these houses are special to the whole community," he said. Commissioner John Loeper said part of living in a Historic District is making some sacrifices in exchange for the pleasure of "walking out your door and looking at a neighborhood that doesn't change from year to year."

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