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Taxpayers pay dearly for preservation

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Published:   |   Updated: March 18, 2013 at 08:46 PM
TAMPA -

It's hard to find many people who oppose the idea of preserving historic buildings.

Though often rickety and faded, these weathered artifacts of past craftsmanship forge a tangible link between our world and the one our parents and grandparents inhabited.

But preservation can be an expensive proposition for taxpayers, especially when the agency in charge is a road-building department with hundreds of millions of dollars at its disposal.

A prime example locally is a historic mitigation project run by the Florida Department of Transportation. The department, in a 1996 agreement with the city of Tampa and several state and federal agencies, agreed to buy and relocate 64 houses in the Ybor City historic district to make way for a future expansion of Interstate 4.

In the latest phase of the project, 29 houses, many in poor condition, were purchased at a total price of $6.1 million, or an average price of about $210,000. The majority were acquired after the housing market started to crash in early 2007. At that time, the average value of homes in Hillsborough County was much lower.

But that's not the end of the public's investment. The department also has spent $1.7 million moving 24 of the 29 buildings in the second phase. The remaining five buildings are yet to be moved or were demolished.

During the first phase of the project, beginning in 2000 and ending in 2004, the transportation department spent $8.5 million to rehabilitate 35 buildings and $1.7 million to move them.

Even though the I-4 expansion is not expected to be built for 20 years or more, transportation officials say they save money by buying properties early rather than waiting until the project is imminent. Still, all of the properties were purchased well above market values established by the Hillsborough County Property Appraiser's Office.

For example, a house at 909 E. 12th Ave. was valued at $65,296 by the property appraiser. A real estate listing for the property in 2009 had an asking price of $34,900. But the transportation department paid $122,000 in June 2010.

Chris Koury, a builder who has criticized the highway department's tactics in enticing homeowners to sell early, called the alleged savings "laughable."

"It disturbs me when they say they purchase at opportune moments because they're good stewards of the taxpayers' money," Koury said. "There's no proof they're buying now to save us money."

Transportation officials argue, however, that there are additional costs the department has to pay that a normal homeowner wouldn't, such as relocating the occupants. If the acquisition is a rental property, the owner has to be compensated for lost income.

Also, federal and state laws prohibit the department from trying to lowball property owners with the threat of eminent domain takings, a practice critics say was common in the 1960s when the interstates were built through Tampa neighborhoods.

"We can't just go in and steamroll them," said Kris Carson, a spokeswoman for the transportation department. "There are federal processes we have to abide by."

For instance, a private appraisal in today's market would have to take into account foreclosures and short sales, which "doesn't make it fair to the seller," said Elaine Illes, a consultant who works with the department on the Ybor project.

Under the 1970 Uniform Relocation Assistance and Real Property Acquisition Act, property owners displaced by federal projects can receive replacement value for their homes rather than market value.

"Back in the 1960s, the DOT literally decimated Ybor City, cut it in half without regard for historical restoration or compensation at fair and equitable values," said Dan Almendares, a real estate agent who has sold buildings to the state under the mitigation program. "The DOT didn't have the burden they have now to work hand in glove with the homeowners and Tampa officials."

Defenders of the preservation program say there is a broader success story that overshadows the relatively high prices paid for buildings 80 years old and older. The buildings are historic, not only because of their age and architecture, but because they are in Ybor City, one of only two national historic landmark districts in Florida.

The program began in 1996 with an agreement between Tampa and state and federal highway and historic preservation authorities. Buildings that would one day be displaced by interstate construction were to be purchased and relocated to city-owned lots, where they would be rehabilitated and sold. In the second phase, which began in 2005, private buyers renovate the buildings.

The money from the sales goes into Tampa's Interstate Historic Preservation Trust Fund, which provides low-interest loans for rehabilitating houses in Ybor and two other historic districts, West Tampa and Tampa Heights. The program has loaned $3 million to date, and a grant program was established with interest earned on the loans from the trust fund.

The results can be seen in everything from a rehabilitated former cigar factory on Howard Avenue at Interstate 275 to new metal roofs and open porches on homes throughout the historic districts.

Five homes acquired under the program were moved to 19th Street next to Ybor's Centennial Park. Called Las Casitas, the renovated buildings are now leased to retail businesses by the Ybor City Museum.

"It's worked out very well as a source of income for the museum and adding to the retail in Ybor," said Tom Keating, president and chief executive officer of the Ybor City Chamber of Commerce.

In May, the transportation department agreed to move the former family home of Tampa native and Baseball Hall of Famer Al Lopez to 19th Street and Ninth Avenue. The Ybor City Museum is collecting memorabilia for a future baseball museum in the Lopez home.

While these success stories are laudable, the DOT has spent hundreds of thousands of dollars buying and relocating other buildings that were left to fester by the new owners.

"Many of those don't even get touched," said Koury, the builder who has been feuding with highway officials over the program. "They're just sitting there idle after spending $100,000 to move."

Other buildings purchased by the agency are boarded up at their original site or have been demolished. The state paid $455,000 for a building at 1212 E. 12th Ave. in July 2007. At the time, the property appraiser estimated the value at $175,000. Now, it is boarded up at the same location.

The building next door at 1216 E. 12th Ave. was sold to DOT for $620,000 but later demolished because of its deteriorated condition.

Both buildings belonged to Almendares, a real estate agent whose family lived in Ybor for generations. He said the 1212 property, which originally belonged to his grandparents, had "historic aspects." Both properties generated rental income in the tens of thousands of dollars a year, Almendares said.

Koury contends the transportation department has blighted the East 12th Avenue neighborhood by convincing owners to sell, then boarding up the houses and posting signs warning of asbestos contamination. He argues the subsequent devaluation of surrounding properties forced him to sell a house he built several years ago at a cost of $500,000 to the DOT for $400,000.

The county property appraiser assessed the home's value at $162,574.

Highway officials say they warned Koury not to build the house, which incorporates classic Ybor architecture with modern accessories. But Koury said he took the chance because DOT officials said the interstate expansion was 20 to 30 years in the future.

Illes, the DOT consultant, confirmed that the I-4 expansion is not funded in the department's 20-year construction plan, but she said it could be moved up any time.

Last year, Koury asked the DOT inspector general to investigate the agency's handling of the Ybor historic mitigation project. He accused the agency of ignoring its own rules, infringing on property owners' rights and circumventing federal law.

The inspector general declined to investigate. Now Koury is calling for an audit of the program by the federal General Accounting Office

"I think an audit will show that they were actually reckless spenders of taxpayers' money rather than good stewards of that money," he said.


msalinero@tampatrib.com (813) 259-8303

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