HPA No. 2012-023 (In re. 1232, 1234, and 1236 New Jersey Avenue, NW)

• HPA Number: 2012-023
• Case Name: In the Matter of: 1232, 1234, and 1236 New Jersey Avenue, NW
• Location of Property: 1232, 1234, and 1236 New Jersey Avenue, NW; Square 1035, Lot 70
• Date of Decision: October 31, 2012
• Type of Case/Type of Permit Sought: Demolition
• Disposition: Denied
• Subject Matter(s): Economic Hardship – Generally; Historic District – Contributing Building; Demolition; Historic District; Integrity, Loss of;

Summary of Decision:

The Third Street Church of God (the "Applicant") sought a permit to demolish three Civil War-era rowhouses in the Mount Vernon Square Historic District. Pursuant to a Historic Preservation Review Board ("HPRB")-approved compromise between the Applicant and the Historic Preservation Office ("HPO"), the Applicant would demolish the deteriorated rear portions of the rowhouses and stabilize the front portions, which were considered to have continuing significance and integrity. In the process of partial demolition, HPO and the Applicant agreed that the discovery of seriously compromised joists raised the question of whether the building continued to possess sufficient integrity to contribute to the historic district. HPO inspected and recommended the buildings not be torn down because they retained sufficient integrity and could be restored. Based in part on this recommendation, the HPRB denied the Applicant's permit to demolish the remainder of the three rowhouses.

On appeal to the Mayor's Agent, the Applicant again sought a permit to demolish the rowhouses because the cost of preserving them would impose an unreasonable economic hardship on the Church. The Mayor's Agent found that the Applicant had not demonstrated that preserving portions of the rowhouses would pose an unreasonable economic hardship and denied the demolition permit.

Economic Hardship – Generally:

When considering whether the failure to issue a permit would impose an unreasonable economic hardship, the Mayor's Agent can only look to circumstances where failure to issue a permit would amount to a taking of the owner's property without just compensation—in other words, the judicially crafted standard for a regulatory taking. Citing 900 G Street Assoc. v. Dep't of Consumer and Reg. Affairs, 430 A.2d 1387, 1391 (D.C. 1981), the Mayor's Agent stated that the Applicant has the burden of showing that no other reasonable economic use for the building exists. Moreover, the decision maker must consider the property as a whole.

The Mayor's Agent concluded that while preserving the rowhouses may pose an economic burden to the Applicant, it would not rise to the level of an unreasonable economic hardship within the meaning of the Act. The Applicant purchased the properties for a combined price of $98,000; the Applicant recently received what it considered an inadequate offer to purchase the properties for $400,000. The cost to partially demolish and stabilize the properties as agreed in the compromise is approximately $77,500.

Since the Applicant was engaged in an expensive expansion of its facilities at a cost of $1.8 million, the Mayor's Agent considered the additional cost for stabilization not to be unreasonably burdensome. The Mayor's Agent also concluded that since the Applicant could sell the properties for four times the purchase price, the repairs would not impose an unreasonable economic hardship. The fact that the Applicant did not want to sell but rather keep the properties for additional parking is understandable and deserving of great respect, but the Mayor's Agent ultimately treated the Applicant like all other similarly situated property owners in a historic district. The Mayor's Agent explained that while preservation of a contributing building might make "carrying out worthwhile plans more inconvenient or more expensive," it "does not constitute an unreasonable economic hardship within the meaning of the Act."

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