City Administrator & Council Members Comments on the HUTCHINGS’ Mills Act Contract Agenda Item: 8 August 2006 City Council Meeting
Verbal Exchange between City Administrator GUILLEN and Mills Act Contract Applicant DAVID HUTCHINGS:
City Administrator GUILLEN: “…I did place a cover memo on top of this particular report and there’s basically 4 bullets that I have listed that I think the Council needs to consider as part of their action tonight. We had talked about a workshop, I think the Council still needs to schedule that and maybe have more in-depth discussion at the Council level so that you are more familiar with the Act as well as the public…”
Mills Act Contract Applicant DAVID HUTCHINGS: “...You say here workshop for the benefit of the public. Actually at the City Council meeting, when you review the tapes, and again we talked about this…the workshop was for the City Council, period. That’s how it was presented."
City Administrator Rich Guillen: “Yeah. That’s fine. I don’t disagree.”
But later, City Administrator Rich Guillen: “...educate the public, but from my standpoint it was really more education of the public, than it was the council, because I think you generally understand the criteria, but I don’t know if the public really knows the criteria means...”
REBUTTAL: So, Guillen, which one of your stories reflects reality? At the December City Council meeting, you stated the Mills Act Workshop would be for the benefit of the City Council. Early on during the 8 August 2006 City Council meeting, you stated that the Workshop would be for the Council and the public. Then later on during the meeting, you stated that the Workshop was exclusively for the public because you believed the Council “generally understand the criteria.” For the benefit of the City Council OR the Council and the public OR the public? So many versions, so much incoherence, so much doublespeak!
City Administrator Rich Guillen: “Let me comment on that. Because the staff’s understanding and maybe I need to take the responsibility more than anybody else at this dais. But the staff’s understanding at that time is that you do not want to have that Mills Act Workshop until you really understood what the revised or amended Historic Context Statement said cause you had talked about having the best of the best houses considered historic. And we cannot do that until we revise the Historic Context Statement. We went to the prior person who drafted the Historic Context Statement and that person was not available. I’m getting off line here. But it’s not like we haven’t tried. I mean, literally, it’s not like we haven’t tried. And then secondly, you know, while I was trying to give the Council an out here in my cover memo. Just continue it. Because we still really have at least 3 more months, maybe 4 more months before this Act applies again. And within that timeframe I think you can accomplish these points that I listed in my memo.”
RETORT: “And we cannot do that until we revise the Historic Context Statement.” WHERE HAVE YOU BEEN! The City’s Inventory of Historic Resources, as originally submitted in 2004 to the California Coastal Commission, was supposed to represent the “best of the best” already. Apparently, none of the Council Members, nor the City Administrator, bothered to read and comprehend the contents of the Local Coastal Program with regard to historic resources prior to the City’s submission of the LCP to the California Coastal Commission. Gross incompetence doesn’t even begin to explain this mockery of city government!
City Administrator GUILLEN: “Finally, the most important one, we don’t really, totally, completely know what the financial impact will be to our property tax revenues, which is our second highest revenue source in this city. And even though there might only be one house put in the Mills Act, that obviously would not have any major implication. But we have 3 historic resources, 300 historic resources, or a little less than that and out of those even if a third were placed into the Mills Act requirements, I think we could have some substantial financial impacts to our revenue sources.”
RETORT: The Mills Act is an integral part of the Historic Preservation element of the City’s Local Coastal Program; as such, all of the ramifications, including the number of historic resources on the City’s Inventory of Historic Resources and the financial calculations and implications, should have been considered prior to the original submittal to the California Coastal Commission.
Moreover, as David Hutchings articulated on the financial impacts, “the differences between fair market value versus rental value and capitalizes it. And the range is somewhere between 40-60% tax savings to the individual applicant to help him use that funds to help with the maintenance program of his house.”
City Administrator GUILLEN: “…the crystal ball’s kind of foggy and it was really foggy in December and it’s a little clearer now, but it’s still foggy, and I think 3 more months it would be a little less foggy, if we do have the workshop and do some other things and it would make your decision a lot easier…”
RETORT: The only valid foggy “crystal ball” analogy is to Rich Guillen’s mental processes. As the city’s Administrator, Guillen should have initiated, scheduled and conducted a Mills Act Workshop soon after December 2005. Instead, his lack of initiative and incompetence has created this foggy crystal ball fiasco and denied the Hutchings a timely Mills Act Contract decision. (Note: The Hutchings’ applied for the Mills Act Contract in June 2005.)
City Councilman ROSE: “...I don’t see how the applicant is prejudiced if we postpone the decision until after our workshop. What I want to assure is that all property owners who are situated similarly to the applicant are treated equally and fairly…but I don’t think he should either get an advantage or a disadvantage because of it. As long as we hear his application by the end of the year…I think it’s better public policy to take a step back and make sure we have our ducks in order before we sign a contract.”
Verbal Exchange between ROSE and Mills Act Contract Applicant HUTCHINGS:
City Councilman ROSE: “We need to hold one.” (a workshop)
DAVID HUTCHINGS: “What assurances do I have from the City Council that it will be done this time. The last time I was here in December that this was continued…and the City Council at that time would not give a date certain…What assurance do I have?”
“There are things that I would be prejudiced by, as you know property taxes. The assessment to be done by January 1, with the county. However, there are tax planning issues involved individually. Now, I’ve waiting since June 2005…It cost me because of the result of the continuance, $25,000. If this goes past January 1, it’s going to cost me an another $25,000, $50,000. So I think I have been prejudiced by this.”
Later on during the hearing, City Councilman ROSE: “...You don’t make people wait a year for something like this. It’s our fault, not his fault, that we didn’t have a workshop. It’s our fault, not his, that we haven’t given him an answer. It’s our fault, not his, that we haven’t come up with standards.”
RETORT: While Rose voted to grant the Hutchings’ Mills Act Contract, to his credit, his contradictory comments regarding whether to hold a Mills Act Workshop prior to a vote on Hutchings’ Mills Act Contract or go ahead and vote on the Hutchings’ Contract prior to a Mills Act Workshop indicated a confused and disconnected stance on the matter.
Carmelite MONTE MILLER: “I agree totally with the applicant and I think it’s absolutely ridiculous that after, this was in December of last year. Monterey’s had this Act for years. And it would have been very simple for Carmel to go over and find out from Monterey how they are administering it. And it’s a very simple economic analysis to know whatever the percentage reduction is, you were pushing the benefits of historical for the last couple of years. You hired Kent Seavy to tell which ones were historical. So I think you have the responsibility to allow these people to get the benefits of a historical house. And this business of, last December you should have had a workshop scheduled of whoever doesn’t know enough about this Act, to do an economic analysis on the impacts. But I think this guy’s been treated really badly. And I think it behooves you to make justice to him be approving his application today.”
COMMENT: ABSOLUTELY! Monte Miller was the only member of the public to speak in support of granting the Hutchings’ Mills Act Contract. If any one of the five City Council Members was treated as Mr. Hutchings’ has been treated by the City Council and City Administrator, does anyone really think he/she would not be OUTRAGED by such treatment?
City Councilwoman HAZDOVAC: “We were given 300 structures that were designated historic. I don’t really take that as my responsibility and my fault. And the problem with this application is I don’t see this as an historic structure. So I would be voting no if you made a motion to go ahead and grant this Mills Act application. I don’t see this house as historic...”
RETORT: The day the California Coastal Commission certified the City’s Local Coastal Program submittal is the day YOU became RESPONSIBLE for its contents. Therefore, YOU and your colleagues are ALL AT FAULT! Moreover, once a property is placed on the City’s Inventory of Historic Resources, it is considered “historic,” until and unless substantive evidence is presented to contradict that designation. No such information was been presented to the City Council. Therefore, YOU are acting in an IRRESPONSIBLE manner; you are supposed to apply the historic element of the Local Coastal Program on a case-by-case basis, not base your decision on YOUR UNSUBSTANTIATED PERSONAL OPINION!!!
Mayor MCCLOUD: On the application today...”are the normal maintenance of sanding, painting, scraping, gutter cleaning, cleaning windows. I just don’t think that’s what the Mills Act was talking about. And I have a real problem with granting such a big tax break for things that are landscaping, adding soil, so forth.”
RETORT: While McCloud is rewriting the Mills Act, perhaps she can time travel to the 18th century and rewrite the Constitution of the United States of America. Only delusional arrogance would allow an individual to erroneously interpret the Mills Act, disregard the Historic Resources Board’s 17 October 2005 unanimous decision to recommend to the City Council a Mills Act Contract for the Hutchings’ Elizabeth F. Armstrong House # 2, dismiss the Planning Staff’s recommendation and substitute her own erroneous, irrelevant and extraneous opinion.
Suggested Reading:
U.S. Department of Interior, National Park Service. The Secretary of the Interior’s Standards for the Treatment of Historic Properties. Washington, D.C.: U.S Government Printing Office, 1995.
Mills Act Property Tax Abatement Program
Technical Assistance Bulletin #12
CALIFORNIA OFFICE OF HISTORIC PRESERVATION
Department of Parks & Recreation
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