Hotel tax based rehab fund finds no favor with City officials — clash with HPC, Preservation Maryland

Preservation Maryland’s proposal for a downtown hotel-tax based fund as “mitigation” for the demolition of the Birely Tannery is proving a divisive issue. Historic Preservation Commissioners at their  January 11 meeting spoke enthusiastically of the scheme and voted unanimously to draft a letter in support (see transcript below) The letter will be discussed at the Jan 25 meeting, this Thursday at 6pm.

However other City officials don’t like the proposal.

Tourism Commissioner John Fieseler was quoted in the Frederick News-Post as saying all the hotel tax money is accounted for.  In any case the hotel tax is principally an issue for County government.

“Not really mitigation”

City manager of comprehensive planning Matthew Davis told the historic preservation

Matthew Davis

commissioners the proposed hotel tax-based rehab fund “is not really mitigation for what is being lost.”

That’s damning!

He implied it wouldn’t meet the requirement of the law in dealing with a historically important property like the Birely Tannery, or satisfy the Maryland Historical Trust (MHT) which to legitimize demolition of the tannery has to sign a mitigation memorandum of agreement with developer Plamondon and the City.

Davis said the Preservation Maryland (PM) fund for historic rehab is not included in the first draft of the Plamondon-City-MHT agreement. The fund proposal became known to insiders back in November when it was sent to the state DHCD which is handling the case for compliance with state historic preservation law.

Scott Waxter assistant city attorney objected to the Historic Preservation Commission (HPC) writing to state agencies on City letterhead — apparently on the grounds that its support for the PM Fund could misrepresent the City position.

The HPC in its enthusiasm to tap a potential new source of funds crossed a couple of legal lines. The Open Meetings Act requires public notification of topics for discussion. But the published agenda for the Jan 11 meeting contained no mention of the PM fund suggestion being up for discussion. Also no public comment was solicited

Commissioner Parnes also questioned attorney Waxter about the propriety of the Commission weighing in with the state about a mitigation measure when it is dealing with an active permitting case. Waxter avoided an answer saying he hadn’t had time to consider the matter. Another aspect of the Commission’s failure to place the item on the official agenda!

ACTORS: Preservation Maryland is a private state preservation advocate normally but

Nicholas Redding

has stood aside and maintained silence over the proposal to demolish the Birely Tannery. Maryland Historic Trust is a state government agency for historic preservation. Historic Preservation Commission is the City of Frederick regulator with draconian powers within historic districts. Frederick Preservation Trust is the private county and city advocacy group. Frederick County Landmarks is a private charitable entity that attempts to preserve great ‘landmark’ buildings.

Tourism Council explains (added after initial posting)

Tourism Council’s John Fieseler explained his opposition to the PM fund in an email as follows: “Up to 85% of the hotel tax collected at the DHCC is expected to be committed to debt service on public infrastructure to support the DHCC, for a period of up to 25 years.  The remainder will flow to the Tourism Council with formula driven allocations to various programs and for marketing the destination to potential visitors.

“While we are big fans of preservation, we feel that increased visitor spending in our historic downtown helps drive a healthy downtown economy which in turn spurs building owners to maintain or rehabilitate historic structures.  It is therefore helpful to preservation efforts and important to retain the remainder of the tax revenue for destination marketing.”

TRANSCRIPT of the pertinent sections off the Jan 11 HPC meeting starting at about the 8 minute point in the video:

Commission chairman Dan Lawton:….a potential solution or to help with that is another initiative from Preservation Maryland and as part of the mitigation initiatives for the downtown hotel. They are suggesting that a small portion of the hotel tax be dedicated to a revolving fund so that citizens of the historic district can finance their rehabilitation projects.  If you like that idea whether we should possibly send a letter in support of that. This letter that is in front of you was sent from Preservation Maryland to the Department of Housing & Community Development already, so they know about it. It’s about whether we would like to support them or not.   Any thoughts?

Commissioner Carrie Albee: …I’m currently serving as the president of the board of directors of Frederick Landmarks Foundation. And over the past five to say ten years there’s a widespread decline in the financial donations that have been going from the public to house museums and those types of organization. So it is something that is something that is at the forefront of my thinking. And I do think that there is a strong value to actually being able to earmark bricks and mortar monies to work on historic buildings because it seems to become more and more expensive and harder and harder to get support for. So I am strongly in favor of this and am very pleased that Preservation Maryland has taken it upon themselves to suggest this and put forward this very well written letter.

Commissioner Stephen Parnes: I would concur but I would just ask our attorney whether

Stephen Parnes

would consider this an active case right now we are muddying the waters asking some of the moneys going into them start coming to us.

Assistant city attorney Scott Waxter: I haven’t really had time to look into that aspect of it (hears City staffer Matt Davis)

Davis: I would say that I believe the draft of the letter from DHCD has gone out for the mitigation and I don’t believe they re going to include this particular item in that because it is not really mitigation for what is being lost. So while…  And the other issue is that we have no mechanism to implement this (Preservation Maryland) program at this time. So it is a little more involved than all off a sudden money coming to a certain entity and then how you distribute that and administer that program. That will be something that will take a lot of discussion. I just want to point that out. It is not to say something like this couldn’t exist within the City but this might not be the exact place for it to occur.

Lawton: .Did I hear you say the letter of agreement (MOA) draft has been…

Davis: Yes sir. That is correct.

Lawton: That is interesting since three (Historic) Commission members are part of that initiative know nothing about it.

Davis: well, from the parties that will be the signatories to it (MOA), which the HPC is not. It would just be the City, the developer and MHT.

Lawton: but we are part of the process.

Davis: and you will be. It is being worked right now and it will go out for comment. I will just point that out.  It will go out to everyone before it is signed, of course, for comment.

Lawton: Well I think that is why if we are to be in support of this (Preservation Maryland) idea now is the time to send a letter in support before that letter (MOA?) is signed.

Albee: and I would just like to say that this is in fact a perfect example of creative mitigation. We have already talked about the unusual importance of Tannery site and the legislation that calls for this consultation to consider effects on historic properties absolutely allows for, enables and encourages creative uses of monies that will ultimately go to mitigation and particularly monies that will benefit the public actively.  So with respect I disagree with Mr Davis’s statement.

Lawton: some of the mitigation efforts which may or may not come before us, the typical photographs, archeology, and all kinds of things and those will be useful and helpful for telling the story of the tannery. But this can really help people to afford to rehabilitate their properties. So if you would like us to send a letter in support of this..

Waxter: Mr Chairman just again regardless of what your decision is we certainly can’t put it out in this format on this (City) letterhead the way it is here.

Lawton: This (Preservation Maryland) letter already exists and it is already sent. The question is whether we support this initiative or not.

Albee. … I am strongly in favor of it and I would move that the Commission prepare a letter of support for this (Preservation Maryland) suggestion for consideration as a mitigation option.

Lawton : Is there a second?

Unknown commissioner: Second.

Lawton: any further discussion? I suggest one or more of us will draft something up and we’ll bring it to a vote at the next hearing. With that in mind all those in favor?… That is unanimous. ends transcript

Comes from

Meeting Thursday City Hall, Jan 25 6pm:


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