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HISTORIC PRESERVATION

St. Louis is rich in historic buildings and sites. During the golden age of American architecture, St. Louis was a prosperous mercantile center, and that prosperity spurred the construction of a wide array of structures unique to that era of American history. These range from the magnificent commercial buildings in the downtown district to the homes and businesses of the City's residential neighborhoods. The significance of many of these individual buildings and neighborhood districts has already been recognized with listings on the National Register of Historic Places, or designation as city landmarks or city historic districts. With many of these residential and commercial structures still intact, the Cultural Resources Office estimates that over 60 percent of the City's built environment are eligible for the National Register of Historic Places.

St. Louis' large number of historic structures has been both an asset and a liability in its continued growth and redevelopment. Older buildings can be expensive to maintain and update, and in some neighborhoods deferred maintenance or outright abandonment have taken their toll on the housing stock. Further, many historic buildings and districts reflect the needs and lifestyles of a past era. Significant investment is required to maintain the historic features of these properties while making them better suited to present day needs. The restoration and careful maintenance of a number of historic buildings and residential districts in St. Louis, however, demonstrates that such investments can produce spaces that are highly desirable because of their location and unique historic features unavailable in other parts of the region.

CURRENT SERVICES

Cultural Resources Office (CRO) is a division of the St. Louis Planning and Urban Design Agency (PUDA) created by ordinance earlier this year. CRO replaces the Heritage and Urban Design Commission, which formerly dealt with issues related to historic preservation. The mission and scope of CRO is more narrowly focused on preservation than was its predecessor. The Cultural Resources division consists of a nine-member Preservation Board, and a staff of architects and preservation professionals.

The staff of CRO conducts design reviews for proposed new construction or exterior alterations in the City's historic districts or adjacent to the City's landmark sites to ensure that these plans comply with the standards of the historic district. The staff also reviews any demolition requests within these areas. If an owner or a developer is displeased with the staff's decision in the design review process, he or she then has the option of appealing the decision to the Preservation Board. A decision by the Preservation Board may also be appealed to the full Planning Commission for review.

By agreement among the Federal Advisory Council on Historic Preservation, the U.S. Department of Housing and Urban Development (HUD), and the State Office on Historic Preservation, the CRO staff also examines sites where federally funded construction, renovation, or demolition will occur. In accordance with the requirements of Section 106 of the National Historic Preservation Act of 1966 (revised), these reviews determine whether the property may be eligible for listing on the National Register.

If the property is found to be eligible, the staff works with the developer to ensure that plans are carried out in accordance with the Secretary of the Interior's Standards for Rehabilitation. If agreement cannot be reached on a rehabilitation plan that complies with the standards, or if the plans involve demolition of a building that may be eligible for the National Register, then the project must be submitted to State and Federal authorities for further review.

The CRO staff has completed a three-volume Preservation Plan. The Preservation Plan identifies 148 property types that have been prominent over three eras of St. Louis history. The plan also included a three-type classification system for historic neighborhoods based on the length of time the area has been designated a historic district, its stability, and the awareness of historic preservation issues among residents. The plan includes different strategies for promoting preservation in the three different types of neighborhoods. The plan culminated with an in-depth study and specific recommendations for four areas, each of which exemplified one of these neighborhood types.

Landmarks Association of St. Louis, Inc., is a private not-for-profit organization whose mission is to preserve, enhance, and promote St. Louis' architectural heritage and to encourage sound planning and good contemporary design. Landmarks is the primary advocate for the historic built environment of St. Louis. Landmarks carries out its mission through a number of events and activities. The organization conducts architectural and cultural surveys of neighborhoods and buildings in St. Louis. This research often leads to nominations of these sites or districts for inclusion on the National Register or designation as local historic districts or city landmarks. Landmarks has received CDBG funds for many years to carry out a "Planning for Preservation" program.

Landmarks also engages in a number of educational activities geared toward various segments of the community. The "What Are Buildings Made Of?" program introduces grade-school students to building materials and provides tools to analyze the built environment through both classroom studies and field sessions. The organization's bimonthly newsletter keeps its membership and the broader public informed about preservation issues in St. Louis. Landmarks also distributes information through other publications.

An updated version of St. Louis: Landmarks & Historic Districts is scheduled to be released next year, and Landmarks has published several multi-language brochures that facilitate cultural tourism by mapping out walking tours of downtown historic sites or helping visitors locate historic areas accessible by public transportation. Each year, the organization releases St. Louis' Eleven Most Endangered Sites to call attention to the City's most threatened landmarks. More recently, Landmarks has added St. Louis' Eleven Most Enhanced Sites to honor noteworthy preservation efforts. Finally, Landmarks sponsors numerous lectures, day and weekend tours of historic areas, and other special events, many of which center around National Historic Preservation week each May.

NEEDS AND CHALLENGES

The potential for preservation and restoration of historic structures in St. Louis is better now than it has been at any time in the past decade. In the early 1980s, the City of St. Louis led the nation in historic rehab. The 1986 federal tax act reduced the tax incentives that had made many of those projects economically viable, and historic rehab activity supported by tax credits in the City declined by 96 percent. The recently enacted Missouri State Historic Tax Credits, combined with the excellent state of the U.S. economy, have again created a positive environment for historic rehab in St. Louis.

Missouri law now allows an individual who rehabilitates a historic structure to take 25 percent of the cost of rehabilitation as a credit against their state income tax liability. These tax credits are transferable, which allows a developer engaged in rehabilitation to sell the credits, directly or through a third party, to investors who wish to reduce their tax liability. To qualify for the credit, the cost of rehabilitation must exceed 50 percent of the cost of acquiring the property, and the property must be individually listed on the National Register, or must be a contributing structure in a National Register district or certified local historic district.

This tax credit, which became effective in January 1998, has made it economically feasible to rehabilitate and find new uses for historic buildings that have sat vacant for many years. Preservation Action, a national organization that monitors preservation activity, has called the Missouri tax credits the most comprehensive incentive for renovation in the nation. Several high profile projects using the tax credits include the Chase-Park Plaza in the Central West End, the Drury Inn being completed in the International Fur Exchange building downtown, and the Westin Hotel renovation of the Cupples Station warehouses.

RECOMMENDATIONS

a) Actively pursue designation of new historic districts within the City.

While upwards of 60 percent of the City's built environment may be eligible for listing on the National Register, only about 25 percent of the City is currently in a National Register district or a certified local historic district. Since state and federal historic tax credits can only be used within these designated areas, their impact on the City's redevelopment will be greater if these districts are expanded or if new districts are created to include more areas of the City.

b) Build awareness of the benefits of historic district status.

According to staff members in the CRO, property owners in historic neighborhoods sometimes oppose historic district designation because it requires a review of proposed exterior alterations. Designated historic districts have generally enjoyed higher and more stable property values, however, than the surrounding nondesignated neighborhoods. This benefit is likely to increase with the added investment the state tax credits may attract. Raising citizen awareness of these benefits will make it easier to create new historic districts. Awareness will help preserve valuable historic resources and broaden the impact of the state historic tax credits.

c) Oppose proposals to limit the funds available through the state historic tax credits.

In authorizing the tax credit for historic restoration, the state placed no limit on the amount of funds that could be dispersed through the program. An effort to limit the number of dollars available is expected in the next legislative session. Such a limit could be a major setback for preservation efforts in St. Louis. Besides limiting the available funds, a cap could have a "chilling effect" on development in less affluent historic areas.

Currently, developers who want to rehab a qualifying historic structure know that as long as their plans are approved and their work complies with the Secretary of the Interior's Standards for Historic Preservation, they will receive the tax credit. If a cap were in place limiting the funds, developers could not be certain that their project would receive the tax credit. Without such an assurance, few developers would take the risk of investing in a historic property that needs the tax credit to be economically feasible. This would again leave St. Louis with numerous vacant historic buildings and no economically viable way for them to be updated to meet modern needs.

d) Ensure that design standards for historic districts are clear.

During the public involvement process in preparation for this plan, several individuals expressed confusion about City design standards and concern over the time required for design review. In historic districts, these problems stem in part from the vagueness of the ordinances that created the various historic districts. In conducting design reviews, CRO staff interprets and applies the ordinance using its knowledge of art history and the particular neighborhood's history and architectural heritage.

To make such reviews faster and simpler, CRO should develop clear and comprehensive standards for each historic district. These standards should include detailed descriptions of the types of exterior features, building materials, dimensions, and so forth that are and are not consistent with the character of a given historic district. These standards should then be made public so that developers, contractors, and homeowners can comply with them before submitting plans for review. Any objections raised by CRO should be based on deviations from these specific requirements. Such standards would make it more attractive for developers to work in historic districts and might also ease citizen concerns about the impact of historic district designation.

e) Seek funding sources to ensure that abandoned buildings in areas that may be eligible for the National Register are fully secured from the elements.

Because of funding limitations, the building division only boards up the first floor of vacant multistory buildings. Upper floors will only be secured in designated historic districts after a special request from the alderman. Leaving upper floors exposed to the elements allows them to deteriorate further. If too many buildings in an area become structurally unsound and must be razed, the area may loose its eligibility for the national register. Fully boarding buildings in neighborhoods that may be eligible for the national register preserves them for the type of redevelopment that tax credits now make economically feasible.

f) Continue to celebrate the virtues of preservation.

Preservation Week each spring is an opportunity to show off the heritage of St. Louis, and the many efforts that are being made to build on our history. Workshops, seminars, bus tours, and similar activities are important to the City's resurgence.

g) Monitor and disseminate information about historic rehabilitation trends.

The City should explore establishing a routine summary report that would highlight the use of tax credits and overall historical restoration activity. Promoting this program to the building community and the citizens at large would contribute to the City's success.

RESOURCES

The single greatest resources in pursuing preservation and restoration of historic structures in St. Louis are the applicable state and federal tax credits. The state credits were designed to encourage developers to combine them with remaining federal credits. The federal tax law allows partners in a development to take up to 20 percent of the cost of rehabilitation as a credit against their taxes.

Most of the requirements to qualify for the state credits are the same as for the federal credits. The property must be individually listed on the National Register of Historic Places, or it must be a contributing structure to a National Register district or Certified Local historic district. The rehabilitation must comply with the Secretary of the Interior's Standards for Historic Preservation. Finally, the rehabilitation must be "substantial," costing at least 50 percent of the cost of acquisition. By combining the state and federal credits, a developer may be able to take as much as 45 percent of the cost of rehabilitation of a historic structure as a tax credit. This makes the productive reuse of many historic structures economically feasible.

There is one substantial difference between the state and federal tax credits: The federal credit is limited to the rehabilitation of income-producing properties, while the state tax credit is not. Thus, the state credit may be used for the rehabilitation of single-family homes throughout the City, while the federal tax credit is limited to commercial and multifamily buildings. To encourage broader use of the state tax credit, the City's Community Development Administration (CDA) now requires that any housing redevelopment project eligible for the state historic tax credits must take advantage of those credits to receive CDBG money.

Mercantile Bank established a clearinghouse in September 1998 to facilitate the transfer of state historic tax credits from those engaged in rehabilitation to investors wishing to reduce their tax liability. Often, an individual engaged in rehabilitation will not have sufficient tax liability to take full advantage of the credits they receive. Mercantile purchases the tax credits from the developer and sells them to investors. According to officials at Mercantile, the demand for tax credits from investors has been tremendous. Currently, there is not enough rehab work taking advantage of the credits to satisfy this demand.