Is A Historic District Necessary? How About Easements And CC&Rs?
Can Laurelhurst be protected through "easements" or CC&R-type "covenants"?
In a word: no.
This post will explain what easement and CC&Rs are, and why they don't work in our situation. Our thanks for the input of Oregon's leading historic protection organization, Restore Oregon, and three neighborhood attorneys with whom we consulted.
Historic Protection Easements: Useful For Landmark Properties, Not For A Neighborhood.
An easement is a legal document that gives certain legal interests (rights to) in your property to another person or organization. Typically easements are used to give the other person access to land, e.g. an easement to use the property in some way or run a road or pipeline through the property.
A “historic protection easement” is a (very uncommon) type of easement, meant to give another person the right to, through a lawsuit, block activity on your property that would damage the historic character of a building on your property.
Typically the property owner donates the easement to a historic preservation organization, who accepts and owns that legal interest, and takes on the responsibility of enforcing the easement in perpetuity (forever). The historic preservation organization is responsible for periodically inspecting the property and filing lawsuits if the original property owner, a subsequent property owner, a developer, or anyone else attempts to demolish or inappropriately alter the historic building.
If the building is an individual landmark structure and a historic preservation organization is willing to take on that responsibility, and the building is to be preserved exactly as it is (as a sort of “museum piece”), then a historic protection easement can sometimes work.
For the Laurelhurst neighborhood, the historic protection easement will not work. Here’s why:
1. The neighborhood won’t be protected, because there won’t be 100% owner consent to the easement.
Without 100% owner participation, only some houses here and there will be covered. Suppose you give such an easement, your neighbor doesn’t, and then your neighbor’s house is sold to a developer who demolishes it and builds a boxy, "cubist", incompatible infill duplex - what has been accomplished?
In a historic district, even if that house can be demolished (as a non-contributing house), the new construction will have to be compatible with the neighbor's historic character.
2. Such easements won’t be accepted or enforced by a qualified organization.
A genuine historic preservation organization will not accept the responsibility of accepting, owning, and enforcing historic preservation easements on thousands of houses in a neighborhood the size of Laurelhurst.
Restore Oregon is the primary historic preservation organization in Oregon which accepts and owns historic protection easements. Due to the cost of periodic inspections and legal action to enforce such easements, Restore Oregon charges a significant fee for doing so. Restore Oregon has indicated that it is not likely to accept such easements for an entire neighborhood in a situation like this one.
3. Easements will be expensive to prepare and may ultimately not be enforceable.
Our houses are not museum pieces; they are living, evolving residences for our families. We wish to respect and preserve their historic characteristics and unique distinguishing architectural features, while also perhaps adding rear additions, dormers and solar panels, new electrical and other systems, new kitchens and baths, new roofs and siding, etc (all allowed in a historic district).
A lawyer will have to prepare each house’s easement with language tailored to each house, specifying what can and can’t be done. As Restore Oregon states:
"Because each property is unique, conservation easements are individually written and tailored to each property, defining the precise elements that are to be preserved. Protected features may include the facade, interior, grounds, view sheds, or air rights. Any number of features may be included according to the specifics of the property in question; those listed above are some of the more common details."
Even If the easement is carefully written, developers’ lawyers may find loopholes allowing them to essentially demolish the house under the guise of a “remodel”. Developers and the lawyers who represent them are very clever: this trick, and other tricks they use to demolish houses, are explained in this article.
4. A cloud on the property's title. As a very unusual document recorded on the property’s title, such an easement may interfere with obtaining title insurance, which is necessary for obtaining a mortgage (to buy or refinance).
The last word from Restore Oregon: historic protection easements are used for individual properties, not for a whole neighborhood:
“never in 15 years have I seen historic easements used as a tool to protect a neighborhood or a district”. (Dan Everheart, Restore Oregon.)
Covenants, Conditions & Restrictions (CC&Rs): Do You Want A Homeowners' Association? Won’t Work Either.
CC&Rs, also called “restrictive covenants”, are typically used in conjunction with a homeowners’ association (HOA) which charges annual dues and enforces the CC&Rs. They are typically recorded on the title of each property when the neighborhood is first developed, before each lot is sold.
Historically, restrictive covenants were sometimes used to prohibit sales of property to certain classes of people. In modern developments, HOAs typically use CC&Rs to require a uniform appearance of houses (only certain colors, identical materials, etc) or to prohibit certain activities (parking on the street, fencing the yard, etc).
CC&Rs share the same problems of historic protection easements. Without 100% owner consent, so only a few houses here and there will be protected. There will be no-one willing or able to enforce the CC&R - unless the neighborhood is willing to establish an HOA and pay it dues to fund legal fees, or a neighbor wishes to spend his personal money filing lawsuits against developers. They will cost money to prepare. And they may cloud title to the property, making title insurance and mortgage financing difficult or impossible.
In the words of Scott Pratt, a Laurelhurst attorney with 35 years' experience in Oregon real estate law:
"as a substitute for historic status in Laurelhurst, CC&Rs would be impractical and unworkable. I also see serious legal questions regarding enforcement of CC&Rs in Laurelhurst."
There is a reason that almost all CC&Rs are created by a developer at the outset of a development before houses have been sold. This is a tried and true process that has been written into law. Private CC&Rs among already developed homes are rarely created these days. The practical problems of creating them and enforcing them, and the substantial legal questions that would continue to exist, make private CC&Rs a costly and uncertain option.
I strongly believe that a Laurelhurst Historic District has far more chance of success at less cost than private CC&Rs, particularly since the people backing historic status are avoiding the Eastmoreland problems by reaching out to their neighbors in advance. If there are people out there who truly want to pursue the CC&R option, more power to them. Anyone who wants to prevent demolitions and excessive development will find their time better spent pursuing historic status for Laurelhurst."
Scott Pratt's full analysis can be read here.
Historic District Will Work.
Historic district, on the other hand, will work. In Irvington, in Ladd’s Addition, in many other Portland neighborhoods, and in 2,300 other historic districts in the country, National Register Historic Districts protect historic neighborhoods like ours.