Heritage Commission Recommendation
On July 26, 2022, the Heritage Commission recommended approval of the draft ordinance (5-0-1).
The Heritage Tax Exemption Ordinance was last updated in 2019 in response to a request from the Collin Central Appraisal District (CCAD) for the City of Plano to provides its list of properties approved for heritage tax exemptions by March 1 each year (previously May 1). This update included removing the Heritage Commission from the review process and allowing properties deemed ineligible by staff to appeal straight to City Council. Although intended to streamline the process, the revised procedures have proven challenging to meet notification and appeal timelines outlined in the ordinance. The purpose of this agenda item is to update the Heritage Tax Exemption Ordinance to address these challenges and provide additional flexibility to the benefit of participating property owners.
Summary of Proposed Changes
Major updates include:
1. Introducing the flexibility of a one-time waiver from eligibility requirements that allows property owners to receive a 50% reduction in their eligible exemption percentage.
Per the current ordinance, January 1 is a firm deadline to complete required repairs and meet eligibility requirements. The granting of appeals is essentially limited to situations where there is evidence that staff made an error in finding the property ineligible. In practice, however, appeals have been routinely granted for situations where repairs were made after the deadline (but prior to City Council), where some (but not all) repairs were made by the deadline, or where work was performed without a Certificate of Appropriateness but in conformance with adopted standards. The proposed amendments would add a new feature in the appeals process that allows for the Commission to grant a one-year waiver from certain eligibility requirements for situations where property owners made good-faith efforts to maintain their property in accordance with the goals of the tax exemption program. If granted a waiver, property owners would be recommended for approval at half of their eligible tax exemption rate (i.e., if a property was eligible for a 75% tax exemption, they could receive a 38% tax exemption will approval of a waiver). The proposed amendments also give additional discretion to the Commission to grant appeals for unforeseen or extenuating circumstances.
2. Streamlining extension request procedures so that they are considered by the Heritage Commission in conjunction with the appeals process in January each year, rather than as a separate process in October/November as currently exists.
Extension requests are currently considered by the Heritage Commission each fall. This feature was added in 2019 in order to allow property owners the ability to receive an extension prior to the January 1 deadline to complete required repairs. With the additional flexibility to grant appeals or waivers as discussed above, the proposed amendments would also move the extension review procedures from the fall to become part of the same process as appeals each January. As a result, the Commission will have the authority to grant an appeal, waiver, or extension. The change streamlines the procedures and allows property owners an additional two months to determine if an extension is needed.
3. Revising procedures so the Heritage Commission would resume consideration of appeals for properties deemed ineligible for a heritage tax exemption and eliminating the formalized direct appeal process to City Council. City Council retains final approval of exemptions.
Currently, a list of properties deemed eligible for tax exemptions by staff are forwarded to City Council for approval. Any property deemed ineligible has the right to appeal directly to City Council. The ordinance stipulates that property owners deemed ineligible be notified in writing at least 20 days in advance of City Council and may submit an appeal up to 10 days prior to City Council. The proposed amendments would delegate authority of granting appeals to the Heritage Commission, to be considered at its January meeting. If granted an appeal, extension, or waiver by the Commission, the property would be included with the list of eligible properties recommended for approval by staff that is forwarded to City Council.
As formal appeals would no longer be considered by City Council, the proposed amendments also remove the 20-day notification and 10-day appeal deadlines. Instead, staff will notify property owners as quickly as possible following on-site inspections and establish a deadline in the notification. Staff intends to keep the existing timelines through administrative changes in the inspection process; however, mandating specific timelines in the ordinance is problematic as January is often a time of inclement winter weather that can delay inspections or Heritage Commission meetings. (Note: The 20-day notification requirement was added in 2017 when the Heritage Commission had until March 30th to review tax exemptions each year.) Property owners retain the right to request extensions in the fall as noted previously.
Public Outreach
A summary of the changes and a strikethrough-underline copy of the draft ordinance was published online for public review. Informational postcards and emails were sent to all owners of designated heritage properties inviting them to review the draft ordinance on the city website and attend a Zoom meeting hosted by staff to review the proposed changes on July 11, 2022.
The Zoom meeting had 19 attendees. Some questions were asked, but no one raised objections to the proposed changes. Staff also received several phone calls and emails from property owners asking for additional information. After the information was provided, these owners were supportive of the changes or had no objections.
There was one property owner at the Heritage Commission meeting whose speaker card indicated a neutral position. She spoke in opposition to the elimination of the appeal to City Council, but was supportive of other changes.