| June 7, 2001
Dr. Dan L. Morrill
Consulting Director
Charlotte-Mecklenburg Historic Landmarks Commission
2100 Randolph Road
Charlotte, North Carolina 28207
Dear Dan:
I am writing in response to your letter of May 4, 2001 in which you
posed the following question: "Can the HLC use monies derived from the
Land Banking Bonds or its revolving fund to purchase historic landmarks,
restore structures within the boundaries of historic landmarks,
construct new, compatible buildings within the boundaries of historic
landmarks and sell any or all of the above with restrictive covenants in
the deeds to assure their preservation in perpetuity?"
Your question raises two primary issues. The first is whether it
would be lawful under North Carolina law for the Historic Landmarks
Commission to take the actions which you have described, assuming the
legality of the source of funds, and the second is whether it would be
lawful for the Historic Landmarks Commission to take such action using
the funds that you have identified.
With respect to your first issue, it is possible to read the grant of
powers to the Historic Landmarks Commission as contained in G.S.
160A-400.8(3) to authorize the Historic Landmarks Commission to take
such actions as purchasing historic structures, restoring structures
within the boundaries of historic landmarks, constructing new,
compatible buildings within the boundaries of selling historic
landmarks, and selling any or all of the above with restrictive
covenants and the deeds to assure their preservation. This statute reads
as follows:
"Acquire by any lawful means the fee or any lesser included interest,
including options to purchase, to properties within established
districts or to any such properties designated as landmarks, to hold,
manage, preserve, restore and improve the same, and to
exchange or dispose of the property by public or private sale, lease or
otherwise, subject to covenants or other
legally binding restrictions which will secure appropriate rights of
public access and promote the preservation of the property;" (emphasis
added)
In order for the Historic Landmarks Commission to purchase a
property, the entire property would need to be designated as a landmark.
The above-quoted statute indicates that the Historic Landmarks
Commission may "restore and improve" properties designated as landmarks.
The word "improve", in some circumstances, can mean to construct a
building or some other type of improvement on a property. It is not
possible, however, to determine absolutely whether that was the
interpretation that was intended by the General Assembly when it adopted
this legislation, since there is no other language in Part 3C of Article
19 of 1 60A which would describe this type of activity by the Historic
Landmarks Commission.
Webster's Ninth New Collegiate Dictionarv contains the following
definitions of "improve":
intransitive "2: verb
verb "1 a: To enhance in value or quality: make better
b: to increase the value of (land or property) by
betterment (as cultivation or the erection of buildings)" to
make useful additions or amendments"
Definition l b of the transitive verb "improve" would support the
conclusion that the Historic Landmarks Commission could build new
buildings on historic landmarks which it has purchased since the verb
improve in this statute is a transitive verb (a verb with an object)
and not an intransitive verb, as it has "the same" as its object. (If
the word "improve" had been used an intransitive verb, its meaning would
not support such a conclusion.)
Other statutes which are relevant to this inquiry are found in G.S.
160A-400.9, which determines when a certificate of appropriateness would
be required for alteration of a landmark. The pertinent part of the
first sentence of this statute reads as follows:
"From and after the designation of a landmark . . . no exterior
portion of any building or other structure (including masonry walls,
fences, light fixtures, steps and pavement, or any other appurtenant
features) . . . shall be erected . . . until after an
application for a certificate of appropriateness as to exterior features
has been submitted to and approved by the preservation commission."
(emphasis added)
In addition, Subsection (c) of this same statute contains the
following sentence:
"Prior to any action to enforce a landmark or historic district
ordinance, the commission shall (i) prepare and adopt rules of
procedure, and (ii) prepare and adopt principles and guidelines not
inconsistent with this Part for new construction,
alterations, additions, moving and demolition." (emphasis added)
It can be stated very conclusively that after a property has been
designated as a landmark, the Historic Landmarks Commission could grant
a certificate of appropriateness to allow new construction on the
property designated as the historic landmark. And, as stated above, a
very good argument can be made that the Historic Landmarks Commission
itself has the authority to improve landmarks which it has purchased by
constructing new buildings within the boundaries of historic landmarks,
although I do believe that reasonable people might differ as to that
interpretation if they were not aware of the technicalities of the verb
usage.
The second issue which you have raised is whether the funds which you
identified could be used to construct these "new compatible buildings".
The Land Bonds which have been issued by the County, as we have earlier
determined, apparently can be used to purchase historic landmarks. They
cannot be used, however, to restore structures within the
boundaries of historic landmarks or to construct new buildings within
the boundaries of historic landmarks since Land Bonds can be used only
for acquisition expenses.
You also questioned whether your revolving funds could be used to
build new structures within the boundaries of historic landmarks. As you
know, you really have two sources of funds just for the use of the HLC:
the proceeds from the sale of bonds which have been approved by the
voters for the Historic Landmarks Commission; and the proceeds from the
sale of historic landmarks, which proceeds are being held by the County
in a capital project ordinance separate from the one in which proceeds
from the sale of historic landmarks bonds have been placed.
The bond order with respect to the $7,500,000 historic landmarks
bonds approved by the voters in the 1999 referendum reads as follows:
"Shall the order authorizing $7,500,000 of bonds secured by a pledge
of the faith and credit of the County of Mecklenburg to pay capital
costs of providing for preservation of historic properties, including
the acquisition of historic property, the improvement and renovation of
historic property and the acquisition and installation of furnishings
and equipment and the acquisition of interests in real
property required therefore, and a tax to be levied for the payment
thereof, be approved?"
In my opinion, the proceeds from these bonds cannot
be used to finance the construction of new buildings, even though
the bond question does indicate that these funds can be used for the
"improvement" and renovation of historic property. This is because the
basic statement of what these funds can be used for is "to pay capital
costs of providing for preservation of historic properties." Everything
else following that statement is designed to provide details as to what
that statement means. Within this context, the word "improvement", in my
opinion, relates to construction activity in connection with the
preservation of historic properties, and does not contemplate
construction of new structures since such would not be a capital cost
"of providing for preservation of historic properties." (emphasis
added)
The other source of funds is the monies in the
"Historic Preservation Revolving Fund Capital Project Ordinance" adopted
by the Board of Commissioners on February 15, 2000. This Capital Project
Ordinance holds funds from the sale of real estate and from
contributions. This fund, which contained $747,779.57 when it was
established, does not have the same constraints on its use as the
proceeds from the sale of the 1999 bonds. The statement as to the way
the funds could be used as contained in the Capital Project Ordinance
itself, however, would have to be altered in order to use the funds from
this Capital Project Ordinance to build new buildings within the
boundaries of historic landmarks. This Ordinance as written says that
the funds are to be used "for the purpose of providing funds, together
with any other available funds, to provide for preservation of
historic landmarks as well as properties located in locally established
historic districts (which may, but are not required to be, historic
landmarks), including the acquisition of lands or rights-in-land and the
acquisition and restoration of buildings." (emphasis added) This Capital
Project Ordinance would need to have the purpose portion amended to
include, as one of the purposes for which the funds could be used, the
construction of buildings within the boundaries of historic landmarks.
Such a change could be adopted by the Board of County Commissioners
without violating any State law.
The last element which we need to consider in
determining the answer to your questions is the document creating the
Historic Landmarks Commission. The Joint Resolution adopted by the City
Council and the Board of County Commissioners in 1973 indicates that the
"CharlotteMecklenburg Historic Properties Commission is hereby
authorized to carry out the powers as set forth in Chapter 157A of the
General Statutes of North Carolina." The General Statutes indicate that
the provisions of Chapter 157A were transferred to G.S. 160A-399.1
through 160A-400 in 1973, which Section was replaced in 1989 by G.S.
160A-400.1 through 400.14, which statutes currently set forth the powers
of what were previously referred to as historic properties
commissions in the statutes. Thus, it appears that the
Historic Landmarks Commission has been authorized by the City Council
and the Board of County Commissioners to exercise the full extent of its
statutory powers.
In summary, it would be lawful for the Historic
Landmarks Commission to purchase historic landmarks, restore structures
within the boundaries of historic landmarks, construct new compatible
buildings within the boundaries of historic landmarks, and sell any or
all of the above with restrictive covenants and the deeds to assure
their preservation. The acquisition of historic landmarks can be
accomplished using Land Bonds, proceeds from the sale of bonds
authorized in the 1999 bond referendum, and funds in the Historic
Preservation Revolving Fund Capital Project Ordinance adopted by the
Board on February 15, 2000. The restoration of structures within the
boundaries of historic landmarks cannot be accomplished using Land
Bonds, but can be accomplished by using proceeds from the sale of the
1999 bonds or funds in the Historic Preservation Revolving Fund Capital
Project Ordinance. The construction of new compatible buildings within
the boundaries of historic landmarks appears to be a statutory power of
the Historic Landmarks Commission, but the only funds which would be
available for that purpose would be the monies in the Historic
Preservation Revolving Fund Capital Project Ordinance, and then only if
the Ordinance were amended to include as one of the purposes for which
the funds could be used, the construction of buildings within the
boundaries of historic landmarks.
Should you have any additional questions with respect
to this matter, please feel free to let me know.
Very truly yours,
Marvin A. Bethune
Mecklenburg County Attorney
cc: Mr. Jeff Bradsher
Historic Landmarks Commission Chairman
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