SB371: Bill Text

SB371,7,2 (2) Notice to state historical society. If a local governmental unit issues an order or permit or other similar directive or authorization to raze a building, or if a local governmental unit intends to raze a building that is owned by the local governmental unit, and the building is either a historic building or more than 50 years old, the local governmental unit shall notify the state historical society of the order, permit, directive or authorization or of its intent.

SB371,7,5 (3) Delay in razing. (a) Except as provided in sub. (4) (a) 3. and (b), a local governmental unit may not raze a building subject to sub. (2) during the following period after the notice is given to the state historical society:

SB371,7,6 1. For a historic building, 60 days.

SB371,7,7 2. For a building more than 50 years old that is not a historic building, 30 days.

SB371,7,9 (b) Upon request by the state historical society, the local governmental unit may extend the period of delay in razing under par. (a).

SB371,7,13 (c) During the period of delay in razing under par. (a) and during any extension of a period of delay, the state historical society shall have access to the building to create or preserve a historic record and access to the building shall be a condition of the order, permit, directive or authorization issued by the local governmental unit.

SB371,7,16 (4) Opportunity to request public hearing; written findings. (a) 1. For a building subject to sub. (2), the state historical society may direct the local governmental unit to provide notice and the opportunity to request a public hearing.

SB371,7,25 2. If the state historical society directs the local governmental unit to provide notice and the opportunity to request a public hearing under subd. 1., the local governmental unit shall provide notice to any person who requests notice by mail and by publishing a class 1 notice, under ch. 985. Within 30 days after the local governmental unit publishes the notice, if 5 or more residents of the local governmental unit submit a request for a hearing on the matter, the local governmental unit shall either hold a public hearing or make written findings setting forth the reasons for denying the request for a hearing and responding to issues raised in the request for a hearing.

SB371,8,4 3. If 5 or more residents of the local governmental unit submit a request for a hearing under subd. 2., the period of delay in razing under sub. (3) (a) does not end until the local governmental unit holds the public hearing or makes written findings, as required under subd. 2.

SB371,8,9 (b) If the state historical society does not direct the local governmental unit to provide notice and the opportunity to request a public hearing, the state historical society may waive the period of delay in razing under sub. (3) (a) if the state historical society determines that the delay is not necessary to accomplish the purpose of sub. (3) (c).

SB371,8,12 (5) Reuse of building materials. The owner of the building that is razed shall reuse the building materials or contract with a demolition contractor who will reuse the building materials, to the maximum extent feasible.

SB371,8,14 (6) Applicability. This section does not apply to part of a building that is not a historic building if that part of the building is 50 years old or less.

Note: This provision creates a new requirement related to an order or permit issued by a local governmental unit to raze a building, or a decision by a local governmental unit to raze a building that it owns, if the building is a historic building or is more than 50 years old. "Local governmental unit" is defined to mean a city, village, town or county, and includes a housing, redevelopment or housing and community development authority acting on behalf of, or at the direction of, a city, village or town. This provision expands a provision in current s. 66.05 (9) (c), which is a statute relating to demolition orders. This provision also applies to housing authorities.

This provision requires a local governmental unit to notify the state historical society of the order or permit or of its intent. The bill requires a delay in razing the property to allow time for the state historical society to document the property and create a suitable historic record of it. Also, this delay will give time for public review of the decision to raze the building.

If the state historical society does not waive further review, the local governmental unit must provide notice to any person who requests notice by mail and by publishing a class 1 notice (a one-time newspaper notice) under ch. 985, stats. Thereafter, 5 or more residents of the local governmental unit may request a hearing and the local governmental unit is required either to hold a public hearing or to make written findings setting forth the reasons for denying the request for a hearing and responding to issues raised in the request for a hearing.

The time periods specified in this provision do not affect the provisions for judicial review. Under s. 68.13, stats., any party to a proceeding that results in a final determination may seek review by a court within 30 days of receipt of the final determination.

Also, the new statute requires reuse of building materials, to the maximum extent feasible, following demolition of the building.

SB371, s. 8 Section 8. 66.05 (1m) (a) of the statutes is amended to read:

SB371,9,23 66.05 (1m) (a) The governing body or the inspector of buildings or other designated officer in every municipality may order the owner of premises upon which is located any building or part thereof within such municipality, which in its judgment is so old, dilapidated or has become so out of repair as to be dangerous, unsafe, insanitary or otherwise unfit for human habitation, occupancy or use, and so that it would be unreasonable to repair the same, to raze and remove such building or part thereof and restore the site to a dust-free and erosion-free condition, or if it can be made safe by repairs to repair and make safe and sanitary or to raze, remove and restore the site to a dust-free and erosion-free condition at the owner's option; or where there has been a cessation of normal construction of any building for a period of more than 2 years, to raze and remove such building or part thereof and restore the site to a dust-free and erosion-free condition. The order shall specify a time in which the owner shall comply therewith and specify repairs, if any. It shall be served on the owner of record or the owner's agent where an agent is in charge of the building in the manner provided for service of a summons in the circuit court. If the owner and the owner's agent cannot be found, or if the owner is deceased and an estate has not been opened, the order may be served by posting it on the main entrance of the building and by publishing it as a class 1 notice, under ch. 985, before the time limited in the order commences to run. The time limited in the order commences to run from the date of service upon the owner or the agent in the manner of a summons or, if the owner and agent cannot be found, from the date that the order was posted on the building. The order shall also be served on the holder of any encumbrance of record by 1st class mail at the last-known address and by publication as a class 1 notice under ch. 985.

Note: This amendment deletes "old" as one of the conditions that may lead to a municipal decision to order the razing of a building. The age of a building does not determine the condition of the building. Municipal decisions to order the razing of a building are appropriately based on the other conditions addressed in the statute, such as "dilapidated" and "out of repair".

SB371, s. 9 Section 9. 66.05 (3) of the statutes is amended to read:

SB371,11,2 66.05 (3) Anyone affected by any such order shall within the time provided by s. 893.76 apply to the circuit court for an order restraining the inspector of buildings or other designated officer from razing and removing the building or part thereof and restoring the site to a dust-free and erosion-free condition or forever be barred. The hearing shall be held within 20 days and shall be given preference. The court shall determine whether the order of the inspector of buildings is reasonable, and if found reasonable the court shall dissolve the restraining order, and if found not reasonable the court shall continue the restraining order or modify it as the circumstances require. Costs shall be in the discretion of the court. If the court finds that the order of the inspector of buildings is unreasonable, the inspector of buildings or other designated officer shall issue no other order under this section in regard to the same building or part thereof until its condition is substantially changed. The remedies provided in this subsection are exclusive remedies and anyone affected by such an order of the inspector shall not be entitled to recover any damages for the razing and removal of any such building and the restoration of the site to a dust-free and erosion-free condition. For the purposes of this subsection, if the order requires the razing of a historic building, as defined in sub. (9) (a) 1m., persons affected by the order include representatives of a local historical society and the owner of a historic building, as defined in sub. (9) (a) 1m., that is located within 200 yards of the historic building that is subject to the order.

Note: Section 66.05, stats., relates to local orders to repair or raze dilapidated buildings. The current statute includes provisions related to historic buildings that require a delay in implementation of the order and a different presumption regarding the reasonableness of the cost of repairs.

Any order under s. 66.05, stats., may be appealed to circuit court by an "affected person". The issue in the appeal is the reasonableness of the order. The current statute does not define who may be an affected person. This is a matter for the court to decide, and there have not been any appellate court decisions on this issue. It is possible that a court would allow a person with a demonstrated interest in historic preservation to appeal a local order requiring demolition of a historic building, although there is no assurance of this under the current statute.

The bill does not define "affected person", but rather provides that the term "affected person" includes representatives of a local historical society and owners of historic buildings located within 200 yards of the historic building that is subject to the order.

The definition of "historic building" that is cross-referenced in this provision is "any building or object listed on, or any building or object within and contributing to a historic district listed on, the national register of historic places in Wisconsin, the state register of historic places or a list of historic places maintained by a municipality".

SB371, s. 10 Section 10. 66.05 (9) (c) of the statutes is amended to read:

SB371,11,15 66.05 (9) (c) If an order is issued under this section to raze and remove a historic building and restore the site to a dust-free and erosion-free condition, an application is made for a permit to raze and remove a historic building and restore the site to a dust-free and erosion-free condition or a municipality intends to raze and remove a municipally owned historic building and restore the site to a dust-free and erosion-free condition, the municipality in which the historic building is located shall notify the state historical society of the order, application or intent. No historic building may be razed and removed nor the site restored to a dust-free and erosion-free condition for 30 days after the notice is given. During the 30-day period, the state historical society shall have access to the historic building to create or preserve a historic record or a building that is more than 50 years old, s. 66.038 applies.

Note: The material deleted from s. 66.05 (9) (c) is recreated and expanded in s. 66.038 as created by this bill.

SB371, s. 11 Section 11. 66.05 (10) (a) and (b) of the statutes are consolidated, renumbered 66.05 (10) and amended to read:

SB371,12,8 66.05 (10) First class cities may adopt by ordinance alternate or additional provisions governing the placarding, closing, razing and removal of a building and the restoration of the site to a dust-free and erosion-free condition. (b) This subsection shall be liberally construed to provide 1st class cities with the largest possible power and leeway of action, except that any alternate or additional provision adopted shall be no less stringent than the corresponding provision in s. 66.038.

Note: Under the current statute, a 1st class city (the city of Milwaukee) may adopt alternate or additional provisions regarding orders to demolish buildings. This provision creates an exception to that broad authority by requiring a 1st class city to comply with the requirements in the cross-referenced statute, as affected by this bill.

SB371, s. 12 Section 12 . 71.07 (9m) (c) of the statutes is amended to read:

SB371,12,14 71.07 (9m) (c) No person may claim the credit under this subsection unless the claimant includes with the claimant's return evidence that the rehabilitation was approved recommended by the state historic preservation officer for approval by the secretary of the interior under 36 CFR 67.6 before the physical work of construction, or destruction in preparation for construction, began.

Note: Under the U.S. Internal Revenue Code, the owner of an income producing historic building is eligible for a federal income tax credit equal to 20% of certain specified costs of rehabilitating the historic building. The building must be listed on the national register of historic places or eligible for listing or located in certain national, state or local historic districts. The rehabilitation work must comply with standards that have been established by the U.S. Secretary of the Interior.

Wisconsin provides a supplement to the federal income tax credit equal to 5% of the eligible costs of rehabilitation. This Section amends s. 71.07 (9m) (c), stats., which provides the supplemental state income tax credit for historic rehabilitation.

Under the current statutes, the state income tax credit is only available if the state tax return includes evidence that the rehabilitation was approved by the secretary of the interior before the physical work of rehabilitation was commenced. As the federal program has been implemented by the secretary of the interior, the state historic preservation officer must first recommend approval of the project before the application is considered by the secretary of interior. This bill makes the state supplement available upon recommendation of the state historic preservation officer, rather than final approval by the secretary of the interior, which will allow owners to commence projects sooner. If, for any reason, the owner is determined not to be eligible for the federal tax credit, the owner will still be eligible for the 5% state supplement based on the approval by the state historic preservation officer.

SB371, s. 13 Section 13 . 71.21 (6) of the statutes is created to read:

SB371,13,7 71.21 (6) Credits computed by a partnership under s. 71.07 (9m), 71.28 (6) or 71.47 (6) may be allocated to partners either as provided under this chapter or pursuant to an agreement among the partners establishing an alternate allocation method. The partners shall notify the department of an agreement within 30 days after the agreement is executed and shall provide any additional information requested by the department regarding the agreement.

Note: This Section relates to the state supplement to the federal historic rehabilitation income tax credit. The supplement is equal to 5% of the eligible costs of historic preservation.

Under current law, each partner in a partnership is allocated a portion of any tax credit for which the partnership is eligible based on the partnership agreement. The partnership agreement must have economic substance.

This bill creates s. 71.21 (6) to provide that a tax credit for historic preservation claimed by a partnership may be allocated to the partners either as permitted under current law or pursuant to an agreement executed by the partners that establishes an alternate distribution method. This will allow partners who do not have a Wisconsin income tax liability (e.g., out-of-state investors) to transfer the credit to partners who do. The bill requires the partners to notify the department of revenue of the agreement within 30 days of executing such an agreement and also requires the partners to provide any additional information requested by the department of revenue.

SB371, s. 14 Section 14 . 71.28 (6) (c) of the statutes is amended to read:

SB371,13,13 71.28 (6) (c) No person may claim the credit under this subsection unless the claimant includes with the claimant's return evidence that the rehabilitation was approved recommended by the state historic preservation officer for approval by the secretary of the interior under 36 CFR 67.6 before the physical work of construction, or destruction in preparation for construction, began.

Note: This amendment corresponds with the amendment in this bill to s. 71.07 (9m) (c), stats., which includes an explanatory note.

SB371, s. 15 Section 15 . 71.47 (6) (c) of the statutes is amended to read:

SB371,14,5 71.47 (6) (c) No person may claim the credit under this subsection unless the claimant includes with the claimant's return evidence that the rehabilitation was approved recommended by the state historic preservation officer for approval by the secretary of the interior under 36 CFR 67.6 before the physical work of construction, or destruction in preparation for construction, began.

Note: This amendment corresponds with the amendment in this bill to s. 71.07 (9m) (c), stats., which includes an explanatory note.

SB371, s. 16 Section 16 . 101.05 (2) of the statutes is amended to read:

SB371,14,12 101.05 (2) A bed and breakfast establishment, as defined under s. 254.61 (1), is not subject to rules on residential occupancy or to other building codes adopted by the department under this subchapter, except that the uniform dwelling code adopted in rules promulgated under s. 101.63 (1) applies to the 3rd floor level of a bed and breakfast establishment that uses, other than as storage, the 3rd floor level of the bed and breakfast establishment structure.

Note: The current statutes provide that the 3rd floor of a bed and breakfast establishment is subject to the uniform dwelling code if the 3rd floor is used for purposes other than storage. The bill moves the provision related to the 3rd floor of a bed and breakfast establishment so that it appears in the statutes related to the uniform dwelling code. [See Section 28 .] This change is solely for the purpose of better statutory organization and is not intended to make any change in the current building code provisions applicable to bed and breakfast establishments.

SB371, s. 17 Section 17. 101.121 (3) (c) of the statutes is created to read:

SB371,14,15 101.121 (3) (c) The historic building code shall be liberally interpreted to facilitate the preservation and restoration of qualified historic buildings.

Note: The department of commerce is authorized to promulgate the historic building code under s. 101.121, stats. The statute includes a statement of legislative purpose, as follows:

"101.121 (1) Purpose. It is the purpose of this section to provide alternative standards, when necessary, for the preservation or restoration of buildings or structures designated as historic buildings. The development and application of these alternative standards is a matter of statewide concern. These alternative standards are intended to facilitate the restoration of historic buildings so as to preserve their original or restored architectural elements and features, to encourage energy conservation, to permit a cost-effective approach to preservation and restoration and to provide for the health, safety and welfare of occupants and visitors in historic buildings.".

The legislature incorporated additional guidance regarding the purpose of the statute into the substantive provisions of s. 101.121 (3) (a), stats., as follows:

"101.121 (3) (a) For any rule under this chapter or ch. 145 which applies to buildings, the department may provide an alternative rule which accomplishes the same general purpose and applies only to qualified historic buildings. These alternative rules shall permit, to the maximum extent possible, the use of original or duplicates of original materials, the maintenance of the original appearance of all components of a historic building and the use of original construction techniques...."

The special committee determined that some decisions regarding the implementation of the historic building code may be unnecessarily restrictive. The additional statutory language proposed in this Section creates an express statement of the legislature's intent that the statute is to be interpreted liberally to facilitate the preservation and restoration of historic buildings.

The intent is not to shift the balance in the historic building code between preservation and restoration of historic buildings on one hand, and public health, safety and welfare on the other hand. The intent is to favor the preservation and restoration of historic buildings in questions involving close judgments.

SB371, s. 18 Section 18. 101.121 (4) (a) of the statutes is renumbered 101.121 (4) (a) 1.

SB371, s. 19 Section 19. 101.121 (4) (a) 2. of the statutes is created to read:

SB371,15,8 101.121 (4) (a) 2. Upon the request of the owner of a qualified historic building, the department shall review any decision of a city, village, town or county that requires the owner to comply with a provision of a county or municipal building code, or of any other local ordinance or regulation, to determine if the provision concerns a matter dealt with in the historic building code. The procedures in s. 101.02 (7) apply to any review conducted by the department under this subdivision.

Note: Section 101.121 (4) (a), stats., authorizes the owner of a "qualified historic building" to elect to be subject to the historic building code. A qualified historic building is a building that is listed on the national or state register of historic places or a certified local register of historic property, or is within a historic district on one of those lists and has been determined to contribute to the historic significance of the district. Under the historic building code, the owner of the historic building may use alternative standards that allow preservation of the historic aspects of the building while still providing for the health, safety and welfare of occupants and visitors in the building.

One of the consequences of the election to use the historic building code is that the owner of the historic building is not required to comply with any provision of a county or municipal building code or other local ordinance or regulation that concerns a "matter dealt with" in the historic building code (the phrase used in the statute). In the rules creating the historic building code, the department of commerce has elaborated on this statutory provision by providing explicitly that local regulations pertaining to land use, zoning, fire districts or "other similar requirements" are not affected by the historic building code. [s. Comm 70.04 (2), Wis. adm. code.]

The statutes contain a general procedure, in s. 101.02 (7), stats., to resolve conflicts between local standards, decisions and ordinances and the statutes and rules enforced by the department of commerce. The statute provides that local units of government continue to have authority to enact and enforce regulations for the protection of public health and safety. However, rules and decisions of the department of commerce are deemed by the statute to amend or modify conflicting local regulations. Any person who is affected by a local regulation that is in conflict with a state regulation or an order of the department may petition for a hearing by the department on whether there is a conflict, and the department may nullify a local regulation that conflicts with state regulations.

The appeal process in s. 101.02 (7), stats., focuses on conflicts between state and local safety or health regulations. This provision of the bill makes it clear that the department may determine the proper scope of local regulation with respect to buildings that are subject to the historic building code, including issues related to historic preservation and restoration.

SB371, s. 20 Section 20. 101.121 (5) of the statutes is created to read:

SB371,16,6 101.121 (5) Advisory opinion of state historical society. (a) The owner of a qualified historic building may submit to the state historical society a request for an advisory opinion with respect to any decision of the department, or of a city, village, town or county that is an agent of the department, if the decision pertains to any of the following:

SB371,16,8 1. This section or a rule promulgated under this section, except for a decision of the department under sub. (4) (a) 2.

SB371,16,9 2. A variance to a rule promulgated under this section.

SB371,16,11 3. The inspection of a qualified historic building for compliance with a rule promulgated under this section.

SB371,16,14 (b) Upon receiving a request under par. (a), the state historical society shall review all information related to the decision and shall render a written opinion on the following:

SB371,16,16 1. Whether the decision is consistent with this section and the rules promulgated under this section.

SB371,16,19 2. Whether the alternative decision requested by the owner of the qualified historic building, or any other alternative decision, is consistent with this section and the rules promulgated under this section.

SB371,17,6 (c) The state historical society may negotiate with the department or the city, village, town or county and the owner of the qualified historic building to seek agreement on an alternative decision that will allow the greatest possible degree of restoration and preservation of the qualified historic building, while continuing to meet the standards for the health, safety and welfare of occupants of and visitors to the qualified historic building.

SB371,17,8 (d) The department or a city, village, town or county may modify any decision described under par. (a) based on negotiations with the state historical society.

SB371,17,10 (e) This subsection does not modify any procedures for appeal of a decision of the department or of a city, village, town or county under this section.

Note: Current s. 101.02 (7) provides a formal appeals process for decisions of the department of commerce and local units of government acting as agents of the department with respect to building code issues. The review process involves a review within the department, followed by judicial review. The standards for judicial review require the court to uphold the decision of the department or the local unit of government if there is "substantial evidence" to support the decision, a difficult standard for a building owner to overcome. Also, judicial review is time-consuming and expensive.

This provision of the bill creates a new, informal process for review of a decision of the department or the local unit of government. The request for review must be submitted to the state historical society. The state historical society reviews all information related to the decision and renders an opinion on whether the decision of the department or the local unit of government is consistent with the historic building code and whether there are other ways to meet the requirements and objectives of the historic building code. The bill authorizes the historical society to negotiate with the department, the local unit of government and the historic building owner. The department or local unit of government may modify its decision based on the negotiations.

This new procedure does not change any time limits or procedures for formal review of any decisions.

SB371, s. 21 Section 21. 101.121 (7) of the statutes is created to read:

SB371,17,16 101.121 (7) Informational pamphlet. (a) In cooperation with the state historical society, the department shall develop an informational pamphlet designed to increase awareness and use of the historic building code. The pamphlet shall be updated as statutes and rules relating to the historic building code are amended. The pamphlet shall include the following information:

SB371,18,1 1. A description of the historic building code.

SB371,18,3 2. A description of the types and qualities of buildings that are subject to the historic building code.

SB371,18,6 3. An explanation of how the owner of a qualified historic building may elect to be subject to the historic building code and a description of the consequences of that election.

SB371,18,8 4. A description of other alternative building codes that a historic building owner may be eligible to use.

SB371,18,10 5. A description of where further information regarding historic buildings and the historic building code may be obtained.

SB371,18,13 (b) The department and the state historical society shall distribute the pamphlets as they consider necessary to increase awareness of the historic building code.

Note: This Section creates s. 101.121 (7), stats., which requires the department of commerce, in cooperation with the state historical society, to develop a pamphlet designed to inform owners of historic buildings of the scope and applicability of the historic building code and alternatives to using the historic building code. The pamphlet is also intended to increase awareness of the historic building code. The department of commerce must update the pamphlet as statutes and rules relating to the historic building code are amended. The provision requires the department of commerce and the state historical society to distribute the pamphlets as they consider necessary to increase awareness of the historic building code.