HOUSE BILL REPORT

ESSB 5639

BYSenate Committee on Commerce & Labor (originally sponsored by Senators Williams and Warnke; by request of Department of Community Development)

Authorizing the acquisition, stabilization, and sale of landmark buildings by the department of community development.

House Committe on State Government

Majority Report:  Do pass with amendments.  (5)

      Signed by Representatives Peery, Vice Chair; Baugher, O'Brien, Sayan and Taylor.

House Staff:Pam Madson (786-7135)

AS REPORTED BY COMMITTEE ON STATE GOVERNMENT APRIL 2, 1987

BACKGROUND:

In recent years, the state of Washington has participated in a matching grant program with the federal government for the preservation of historic buildings.  These matching funds are no longer available.  However, under the federal Tax Reform Act of 1986, investment tax credits are still available for investing in historic property.  This tax incentive could support a program allowing private investors to buy restored or stabilized historic property from the state.

Currently, the state has no ability to acquire property of historic and cultural significance that is in danger of being destroyed or substantially altered in order to protect and stabilize it.

Within the last 10 years, more than 13 states have established state-wide historic preservation funds to protect historic property.

SUMMARY:

BILL AS AMENDED:  An Endangered Landmark Preservation Fund is established into which appropriated funds, donated funds, or the proceeds from sale of donated or purchased property is deposited.  The Department of Community Development (DCD) shall use these funds to purchase, stabilize and rehabilitate historic buildings. These buildings shall be resold and the proceeds returned to the fund for future purchases.

An initial appropriation of $600,000 shall be made by the legislature that must be matched by other public and private donors.  No funds may be disbursed from this fund until at least $100,000 of matching money has been deposited into the fund.  Thereafter, moneys may be disbursed from the fund only as matching funds are deposited until the initial appropriation has been matched.  Thereafter, the fund shall be self- sustaining.

The director of DCD may purchase property that: (1) Is of importance to the state or community in which it is located; (2) is in danger of being altered or destroyed; (3) is suitable and appropriate for re-use within its location and has the potential to return the state's investment; and (4) is accessible to the public.

In reselling the properties, the director shall consider buyers who agree to maintain the historic character of the property, have the ability to achieve the proposed use of the property and can pay cash for the property.  The director is authorized to disregard the criteria for resale if after public hearing no buyer satisfying the criteria can be found.

The DCD is not given the right of eminent domain or condemnation for purposes of acquiring and rehabilitating historic sites.  Property acquired by DCD for resale is excluded from the term "public lands".

AMENDED BILL COMPARED TO ENGROSSED SUBSTITUTE:  The direction to the Department of General Administration to give preference to historic buildings in locations where it is considering facilities for state agency purposes is deleted.  An appropriation of $600,000 is made to the Department of Community Development.

Appropriation:    $600,000 to the Department of Community Development.

Fiscal Note:      Attached.

House Committee ‑ Testified For:    Senator Al Williams, prime sponsor of original bill; Ralph Monroe, Secretary of State and Co-Chair of the Centennial Commission; Jean Gardner, Co-Chair of the Centennial Commission; Jean Ameluxen and David Hansen, Department of Community Development; and Michael Sullivan, Washington Trust for Historic Preservation.

House Committee - Testified Against:      None Presented.

House Committee - Testimony For:    Federal funds for historic preservation are no longer available to the state.  The Endangered Landmarks Preservation Fund is a project that complements the Centennial Commission's efforts to leave a lasting legacy of Washington state history to its citizens.  Thirteen other states have similar successful programs using tax incentives, rather than grants, to support historic preservation.  The proposal offers economic revitalization to central cities.  The project will promote pride in local communities.

House Committee - Testimony Against:      None Presented.