16.05.070 Claims of Economic Hardship.
The Landmarks Commission may approve a Certificate of Appropriateness for Rehabilitation or Demolition of a landmark building or site if the owner has presented substantial evidence demonstrating that unreasonable economic hardship will result from denial of the certificate of appropriateness.
(1) Definition and Determination of Economic Hardship. The determination of economic hardship shall require the applicant to provide evidence sufficient to demonstrate that the application of the standards and regulations of this ordinance deprives the applicant of all reasonable economic use or return on the subject property.
(2) Application for Determination of Economic Hardship. An application for a Determination of Economic Hardship shall be made on a form prepared by the Development Services Director and shall be submitted to the Department. The application shall include photographs, information pertaining to the historic significance of the Landmark Site and all information necessary to make findings regarding the Standards for Determination of Economic Hardship.
(3) Standards for Determination of Economic Hardship. The Landmarks Commission shall apply the following standards and make findings concerning economic hardship:
(a) The applicant’s knowledge of the landmark designation when the property was acquired, or whether the property was designated subsequent to acquisition;
(b) The current level of economic return on the property as considered in relation to the following:
(i) Amount paid for the property, date of purchase, and party from whom purchased, including a description of the relationship, if any, between the owner of record or applicant, and the person from whom the property was purchased;
(ii) Annual gross and net income, if any, from the property for the previous three (3) years; itemized operating and maintenance expenses for the previous three (3) years; and depreciation deduction and annual cash flow before and after debt service, if any, for the previous three (3) years;
(iii) Remaining balance on any mortgage or other financing secured by the property and annual debt service, if any, during the previous three (3) years;
(iv) Real estate taxes for the previous four (4) years and assessed value of the property according to the two (2) most recent assessed valuations by the Utah County Assessor;
(v) All appraisals obtained within the previous two (2) years by the owner or applicant in connection with the purchase, financing or ownership of the property;
(vi) Fair market value of the property immediately prior to its designation as a Landmark Site and the fair market value of the property as a Landmark Site at the time the application is filed;
(vii) Form of ownership or operation of the property, i.e., sole proprietorship, for-profit corporation or not-for-profit corporation, limited partnership, joint venture, etc; and
(viii) Any state or federal income tax returns on or relating to the property for the previous two (2) years.
(c) The marketability of the property for sale or lease, considered in relation to any listing of the property for sale or lease, and price asked and offers received, if any, within the previous two (2) years. Such determination may include testimony and relevant documents regarding:
(i) any real estate broker or firm engaged to sell or lease the property;
(ii) reasonableness of the price or rent sought by the applicant; and
(iii) any advertisements placed for the sale or rent of the property.
(d) The infeasibility of alternative uses that can earn a reasonable economic return for the property as considered in relation to the following:
(i) A report from a licensed engineer or architect with experience in rehabilitation as to the structural soundness of any structures on the property and their suitability for rehabilitation;
(ii) Estimate of the cost of the proposed construction, alteration, demolition, or removal, and an estimate of any additional cost that would be incurred to comply with the decision of the Landmarks Commission concerning the appropriateness of proposed alterations;
(iii) Estimated market value of the property in the current condition after completion of the demolition and proposed new construction; and after renovation of the existing property for continued use; and
(iv) Testimony of an architect, developer, real estate consultant, appraiser, or other professional experienced in rehabilitation as to the economic feasibility of rehabilitation or reuse of the existing structure on the property.
(e) Economic incentives and/or funding available to the applicant through federal, state, City, or private programs.
(4) Procedure for Determination of Economic Hardship. For each application wherein an economic hardship is claimed, the Mayor shall appoint a three (3) person Economic Review Panel pursuant to the requirements of Section 2.20.020, Provo City Code, except as specifically modified by this Section. Panel members shall consist of real estate and redevelopment experts knowledgeable in real estate economics and in particular the economics of renovation, redevelopment, and other aspects of rehabilitation. The Mayor shall request recommendations for Panel members from the Landmarks Commission and the applicant.
(a) Review of Evidence. All of the evidence and documentation presented to the Landmarks Commission shall be made available to and reviewed by the Economic Review Panel. The Economic Review Panel shall convene a meeting complying with the Open Meetings Act to review the evidence of economic hardship in relation to the standards set forth in Section 16.05.070(3), Provo City Code. The Economic Review Panel may, at its discretion, convene a public hearing to receive testimony by any interested party provided that notice for such public hearing shall be in accordance with the notice requirements of Section 16.02.040, Provo City Code.
(b) Report of Economic Review Panel. Within forty-five (45) days after the Economic Review Panel is established, the panel shall complete an evaluation of economic hardship, applying the standards set forth in Section 16.05.070(3), Provo City Code, and shall forward a written report with its findings of fact and conclusions to the Landmarks Commission.
(5) Landmarks Commission Determination of Economic Hardship. At the next regular Landmarks Commission meeting following receipt of the report of the Economic Review Panel, the Landmarks Commission shall reconvene its public hearing to take final action on the application.
(a) Finding of Economic Hardship. If after reviewing all of the evidence, the Landmarks Commission finds that the application of the standards set forth in Section 16.05.070(3), Provo City Code, results in economic hardship, then the Landmarks Commission shall issue a Certificate of Appropriateness for demolition.
(b) Denial of Economic Hardship. If the Landmarks Commission finds that the application of the standards set forth in Section 16.05.070(3), Provo City Code, does not result in economic hardship then the Certificate of Appropriateness for demolition shall be denied.
(c) Consistency with the Economic Review Panel Report. The Landmarks Commission decision shall be consistent with the conclusions reached by the Economic Review Panel unless, based on all of the evidence and documentation presented to the Landmarks Commission, the Landmarks Commission finds by a vote of three-fourths majority of a quorum present that the Economic Review Panel acted in an arbitrary manner, or that its report was based on an erroneous finding of a material fact.