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Item 4 - Update on the Harbeck-Bergheim House3198 Broadway, Boulder, CO 80304 | www.boulderparks-rec.org | O: 303-413-7200 TO: Landmarks Board FROM: Yvette Bowden, Director, Parks and Recreation Department Alison Rhodes, Deputy Director Jeff Haley, Planning, Design and Community Engagement Manager Tina Briggs, Parks Planner SUBJECT: Update on the Harbeck-Bergheim House DATE: November 7, 2018 A.Harbeck-Bergheim House Update The Harbeck-Bergheim property (house), located at 1206 Euclid Ave., was first leased and ultimately purchased by the City of Boulder in 1979 for $82,500, utilizing Permanent Parks and Recreation Funds (PPRF). Since 1985, the former Boulder History Museum, now the Museum of Boulder (MOB), leased the building operating and managing it as a museum. Throughout that lease, the Parks and Recreation Department (department) has facilitated the MOB lease with the Facilities and Asset Management (FAM) Division of Public Works. In 2012, the MOB signed a contract to purchase the former Masonic Lodge in downtown Boulder indicating their intention to relocate museum operations. The MOB has since vacated the house, giving rise to the department’s consideration of the landmarked property’s going-forward use and maintenance in the context of the department’s mission, Master Plan, capital planning and asset management efforts. On October 25th, an information packet (IP) was presented to City Council to provide an update concerning the planning process exploring ownership/operation models and community values in determining future use of the landmarked City of Boulder property. This update provides a summary of research and background information about the property’s use and financial history as well as community feedback to date. Further, this memo outlines an overview of the remaining process including research to be completed and additional community engagement planned. Refined options will be presented to the PRAB, Landmarks Board and ultimately City Council early next year. More detailed background information and status can be reviewed by accessing the following links: Link to October 2018 IP Link to April 2018 IP Link to Harbeck-Bergheim House project web page Project Process and Approach History at a Glance 1972 Appointing official name of House 1979 Unrestricted Deed 1980 Landmark Designation Assess other docs to be linked Item 4 - Update on the Harbeck-Bergheim House page 1 3198 Broadway, Boulder, CO 80304 | www.boulderparks-rec.org | O: 303-413-7200 REPORTS AND ASSESSMENTS As outlined in the April 5, 2018 Information Packet to City Council, staff compiled a variety of studies and assessments to inform the project, give context to the community and inform decision-making. The following sections provide overview of the research completed to date with more detailed information found as links. Inspection Report An inspection report is a written evaluation of current conditions at the time of the inspection. It provides a level of deficiency but does not prioritize or provide cost estimates for repairs. It also provides information on projected capital needs for repair and maintenance, not considering restoration efforts which were not a part of the inspection. The executive summary of the home inspection report, dated Aug. 21, 2018, revealed no immediate safety hazards. This report was used to determine that there were no immediate safety concerns and allowed the department and FAM to identify short-term capital needs versus those efforts that might be addressed once future use is determined. Many property features were recommended for repair to prevent deterioration typical of structures of its age. In accordance with the report’s findings, however, no major repairs or renovations are scheduled as the city’s decision-making process continues. The department and FAM are working together to insure all critical systems are reviewed and monitored (e.g.: security and fire suppression systems). Appraisal / O&M Costs The appraisal provides current market value for lease or sale of the home. In addition, it provides the current replacement value which is necessary to accurately approximate the annual O&M. A home appraisal report was submitted on Sept. 27, 2018. The “as is” market rate value is estimated at $3,066,000 with an estimated real estate tax estimated at $57,865.53 per year. Current ownership is tax exempt. For standard facilities, FAM uses an industry standard formula (4.5 percent of the replacement value) in approximating the cost of annual O&M. In this instance, staff anticipates some lower costs due to minimal use, but such savings are offset by anticipated higher repair and renovation costs associated with historic buildings. To that end, application of the standard O&M valuation is deemed appropriate. Assuming the appraisal report’s total replacement value (estimated at $1,045,000), O&M would be approximately $47,025/yr. Exact O&M cannot be accurately accounted for due to the variety contract packages and service bundles developed for cost savings. Historic Feature Assessment The exterior of the home is protected as a local landmark. There are no current proposals underway concerning changes to the exterior of the property and, should there be any in the future, city ordinance requires the formal review by the Landmarks Board. The property’s interior currently has no similarly required level of protection. As previously highlighted, the property’s interior includes several features suggested worthy of further study and, perhaps protection or preservation. A third-party evaluation of the home’s interior features is underway. This assessment should aid in property valuation and prioritization of any easement or covenant designed to protect such features. Easements or covenants sought to protect interior features may increase sale value estimations but may also reduce the lease or sale value or interest depending on the breadth of coverage. This assessment will determine an appropriate level of protection based on authenticated historic value. Item 4 - Update on the Harbeck-Bergheim House page 2 3198 Broadway, Boulder, CO 80304 | www.boulderparks-rec.org | O: 303-413-7200 CONTINUED COMMUNITY ENGAGEMENT In April, staff provided context for the property outlining three broad options which would be further explored through the engagement process. These options (sale, lease or city owned/operated/programmed) were established to give framework to the community’s conversations hopefully leading to more fully developed options addressing particular community concerns or desires as the project moved forward. Since April, staff has conducted a thorough engagement process consisting of: •public open houses, •neighborhood association meetings, •stakeholder meeting, •survey, •web updates and community newsletter promotions •house tours (in-person and digital), •digital idea generation and story-telling, and •in-depth discussions. Staff utilized participation in the citywide open house (What’s Up Boulder) on April 30, 2018, to kick-off the project, raise awareness of the decision-making process and offer future participation opportunities. A host of digital resources were used to define the issue and share information with the community through notifications related to the history of the property and the potential options including articles as needed in the Community Newsletter, press releases from the department, regular web page updates and social media pushes with pictures, videos and stories. Staff submitted several updates to PRAB in addition to a City Council Information Packet on April 5, 2018. The stakeholder and public meetings invited participation by community members specifically interested in historic preservation, residents of the University Hill neighborhood and the broader community. Early direction from PRAB specifically requested a reach to a broader audience through a myriad of communications vehicles. In response, the kick-off meeting was held at a citywide community engagement event (What’s Up Boulder), heavy use of Parks and Recreation social media is regularly infused with project information and the citywide interactive public engagement site (BeHeardBoulder.org) was utilized and cross-promoted by other departments with active projects. The interactive online format, included idea generation, story-telling and a survey that was developed to clearly defining the issue and provide embedded links to ensure the widest degree of project education as survey responses were considered. All sign-in barriers were removed, and incentives were provided to try to capture a broader audience with the educational survey. The incentive was broadly cast via digital media for a month-long promotion. Digital analytics show nearly 6,000 people have viewed information regarding the house while approximately 200 people have been engaged in the process through the opportunities mentioned. Overall Outcomes Phase 1 of the project sought community input regarding community values related to the three proposed options (sale, lease or city ownership/operation/programming). Largely, the interaction with the most impacted groups interested in historic preservation and neighbors have expressed interest in the house remaining a public asset. However, the broader community has responded Item 4 - Update on the Harbeck-Bergheim House page 3 3198 Broadway, Boulder, CO 80304 | www.boulderparks-rec.org | O: 303-413-7200 with little preference. Both groups are aligned on a series of factors or conditions preferred which would heighten the ability of each option to meet the communities needs and values. With this feedback, staff is refining the options for further consideration by PRAB, the Landmarks Board and, ultimately, council. The community’s expressed values and priorities might be summarized as follows: •Preference for continued protection as a landmark •Preference for some degree of community access and/or benefit determined by the ultimate use •Context of use appropriate to the neighborhood, adjacent beach park and other community values. •Preference for a financially sustainable long-term solution •Preference for the department’s continued focus on the Parks & Recreation Master Plan directed services and priorities •Preference for analyzing interior features to appreciate the property's value and/or to determine whether some degree of additional protection might be warranted for the interior of the home. In addition, several organizations have approached the city expressing interest in the building use. In each case, staff has provided tours and information appropriate to those requests. In some cases, local organizations have expressed interest in leasing the property. Staff has been careful to ensure that each such organization received the same access and information and has assured organizations that – if lease of the property was ultimately determined to be the preferred community option – selection of the tenant(s) would be through a fair and transparent process. The information packet submitted in October reviews outcomes of each outreach effort in-depth with linked meeting notes and full survey results. PROCESS AND APPROACH The project process and approach has been extended since the initial project was outlined to City Council in April. This refined process will continue to apply the tenets and strategies recommended during the city’s public participation process enhancements effort. The extended process will allow time to complete the additional research necessary for the decision-making process, exploration of additional options including public-private partnership models and other community beneficial options reflecting expressed community prioritized values. The process will also include additional community touchpoints including opportunities for public input during meetings with the PRAB and Landmarks Board. While no recommendation on the options is being proposed at this time, staff anticipates working closely with the PRAB and Landmarks Board through this process to refine the options and then further develop a preferred option that will be provided to City Council for consideration in 2019. In the next step, the refined options should reinforce the summarized community values and priorities listed above while further exploring sustainable sale/lease/retain options (whether city, philanthropic or other). Item 4 - Update on the Harbeck-Bergheim House page 4 3198 Broadway, Boulder, CO 80304 | www.boulderparks-rec.org | O: 303-413-7200 Phase 1: Defining the Issue and Information Sharing (Q1-2 2018 - Complete) It is important to engage the entire community in this initiative and to ensure the community has a thorough understanding of the situation and issues involved with the property. Staff facilitated a variety of opportunities to share information and outline the options, so all community members can be involved in the project. Staff utilized the city-wide open house (What’s Up Boulder) on April 30, 2018 to kick-off the project, raise awareness of the decision-making process and offer future participation opportunities. A host of digital resources were used to define the issue and share information with the community through notifications related to the history of the property and the potential options including articles as needed in the Community Newsletter, press releases from the department, regular web page updates and social media pushes with pictures, videos and stories. Staff submitted several updates to the PRAB in addition to a City Council Information Packet on April 5, 2018. Phase 2: Values and Options (Q2-Q4 2018 – In Progress) Feedback from a broad range of the community is key for this city-wide asset. Staff is making an effort to engage interested community members who have a more varied background of interest in Parks and Recreation. The second round of public engagement focused on defining community values as an important lens for exploring possible future use options. Stakeholder and public meetings were combined with an online survey and other digital opportunities on BeHeardBoulder.org such as story-telling and idea generation. Two self-guided tours were hosted with a third opportunity is November. Social media pushes, web updates and community newsletter articles appear on a regular basis. Monthly updates are sent directly to those who signed up. PRAB and the Landmarks Board will receive updates in October and November to coincide with the IP. Phase 3: Research and Scenarios (Q4 2018 – Q1 2019) Staff will use the research and background information collected in combination with community values and feedback from community boards and City Council to develop potential scenarios to inform the future use and ownership of the house. This will include another round of community engagement with stakeholder and public meetings in conjunction with a broad digital engagement effort to reach beyond those currently invested. Potentially, scenarios and additional research would focus on: o Use preferential to community expressed values and considering community context as well as zoning implications; o Public-private partnership exploration including implications potentially related to use by nonprofits, home foundation models and sale/use with philanthropic purposes; o Maintenance forecasting as balanced by other community capital needs; o Subsequent processes necessary to ensure regulatory compliance/review and/or transparent and competitive processes; and o Considered conditional or conservation easement inclusion for certain aspects of the home’s interior. A joint PRAB and Landmarks Board meeting in early 2019 is anticipated. Item 4 - Update on the Harbeck-Bergheim House page 5 3198 Broadway, Boulder, CO 80304 | www.boulderparks-rec.org | O: 303-413-7200 Phase 4: Identify Preferred Scenario (tbd 2019) Based on the outcomes of the community outreach including discussions with the PRAB and Landmarks Board, staff will evaluate all ideas and feedback to identify a preferred option for consideration by the community and the PRAB. The goal of this phase is to get final feedback prior to seeking consideration and approval from the PRAB and ultimately City Council. Staff anticipates providing the PRAB and City Council with the preferred option in 2019. Item 4 - Update on the Harbeck-Bergheim House page 6