The Communicator, Volume 2, Number 4, November 1976 Page: 1 of 4
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An amendment to the Tax Reform Act of
1976 was passed by Congress and signed
into law by the President on October 4,
1976.
It will encourage the preservation of
historic buildings and structures certified
by the Secretary of the Interior as
registered or qualified for registration on
the National Register of Historic Places;
or located in a historic district designated
under a statute of the appropriate State or
local government if such statute is cer-
tified by the Secretary or his delegate as
containing criteria which will sub-
stantially achieve the purpose of
preserving and rehabilitating buildings of
historic significance to the district.
It limits depreciation to the straight-line
method in the case of buildings con-
structed on sites which were formerly
occupied by demolished historic struc-
tures.
It permits a 5-year writeoff of
rehabilitation expenditures incurred with
respect to historic structures which are
used in the taxpayer's trade or business or
held for the production of income provided
that property acquired in connection with
such expenditure is otherwise eligible for
the depreciation allowance.
It provides that on the disposition of a
certified historic structure, gain would be
treated as ordinary income to the extent
that the special writeoff provided under
this section exceeded the depreciation
deduction which would have otherwise
been allowable, without regard to this
provision.
It adds a new section to the InternalFor well over a year, the HPL has been
researching and developing a facade
easement program to protect properties
acquired and sold by the Historic Dallas
Fund, as well as other architecturally and
historically significant houses and
buildings in our city. A facade easement is
a legal instrument similar to deed
restriction in that it is attached to the title
of a property and restricts future
alterations and use.
The present use of easements is through
the Historic Dallas Fund. Lower Munger
Place, the initial project area, was
developed in the years from 1905 to 1915 as
a residential neighborhood of large,
substantial, two-story homes. These
houses, most of which survive today, are of
particular architectural and historic in-
terest. Many of Dallas' most prominent
citizens lived in the area during the early
years of this century. Munger Place
contains Dallas' largest surviving con-
centration of Prairie Style architecture.
This style, with its low, horizontal roof
lines, overhanging eaves, and massive
porch columns, is among the few uniquely
American contributions to architecture. It
was begun in the late 1890's by a group of
gifted Chicago architects, of whom Frank
Lloyd Wright was the leader. It flourished
in the larger cities of the midwest and
southwest in the years between 1900 and
World War I, but was replaced after 1920
by more imitative housing styles, of which
Colonial Revival, Tudor, and Spanish
Colonial were the most prominent.
Because of their brief period of
dominance, geographic restriction, and
uniquely American origins, Prairie Style
homes are of extraordinary architectural
interest. When restored to its original
character, Munger place will be a
nationally important showplace of Prairie
architecture.
When the HPL sells one of the houses it
has acquired in the project area, a facade
easement is attached which prohibits
alterations to the entire exterior of the
building, except those changes which are
designed and specified to restore the house
to its former character. In addition to the
general document, the architects on the
committee have made drawings of each
individual house with specific
requirements for restoration along with
suggested improvements. All suchRevenue Code providing that no deduction
be allowed for amounts expended in the
demolition of a registered historic
structure, or for the undepreciated cost of
such a structure.
It provides that, if a taxpayer sub-
stantially rehabilitated depreciable
property, he would be permitted to elect to
compute depreciation with respect to his
pre-existing basis in the building as though
the entire structure was first placed in
service by him. This will permit a tax-
payer who purchases a used building and
rehabilitates it to utilize the so-called
accelerated methods of depreciation, a
privilege which is not now accorded
taxpayers under the law. In order to
qualify for this special treatment, the
amounts added to capital account during a
24-month period must be at least $5,000 and
must be greater than the undepreciated
cost of the property, determined at the
beginning of the 24-month period.
It provides that a charitable deduction
will not be denied on the transfer of a
partial interest in property, where the
interest is either an easement of 30 or more
years duration granted exclusively for
conservation purposes, or is a remainder
interest in real property which is granted
exclusively for conservation purposes.
"Conservation purposes" mean the
preservation of open land areas for public
outdoor recreation or education, or scenic
enjoyment. The preservation of
historically important land areas or
structures, or the protection of natural
environmental systems.recommendations are aimed at securing
the basic structure and restoring the
facade so far as possible, to its original
state. (See drawing). In addition to
easements attached to Fund properties,
we are also seeking protective easements
from other home owners in the area.
Easements are a definite plus in a neigh-
borhood because homeowners and
potential buyers are assured that the
flavor and style of the homes in the area
will be retained and that their investment
in restoration, in love, time, and dollars, is
protected. Owners who give easements to
the HPL have a sense of contributing to the
cultural and historical heritage of their
community.
So far, we have only utilized easements
on the facades of buildings, but this
protective covenant can also be written to
include interiors in the case of unusual
architectural features inside a structure.
Open-space easements can also be utilized
where, for example, a farm, its out-
buildings, and the land around it deserve
to be retained as is. "Positive" easements
can be effectively used to save buildings.
In such cases, the owner of a property
gives a facade easement to the HPL in
exchange for a specific amount of money
to do a particular job, such as painting,
roofing, restoring original windows, or a
missing porch. In all cases, easements are
given over to the HPL "for 99 years or
perpetuity" and are legally binding in
courts of law. Together with the revolving
fund concept, the facade easement is
proving to be a versatile and valuable tool
in our preservation efforts in Dallas.
-r--The Regional Director of the National
Trust for Historic Preservation, Cynthia
Emrick, flew to Dallas October 20. She
said that before she left Oklahoma she had
received calls from New York and
Washington asking her to check on those
"people in Munger Place" while in Dallas
to give a speech. She explained that the
reports that have reached the East Coast
about Munger Place seem so fantastic that
people wanted her to fly in and see if, in
fact, it all is true.
Munger Place is true. But perhaps the
closer you are to Munger Place, the more
overwhelming the impact of the changes
occurring there are.
Munger Place is the project area of the
Historic Dallas Fund, the revolving fund
sponsored by the Historic Preservation
League. It is the heart of the lending
program undertaken by the Lakewood
Bank & Trust and Federal National
Mortgage Association (FNMA) (see ad-
jacent story). Munger Place is part of the
East Dallas Design Committee's plan to
return to residential zoning one of the
largest parcels of land in recent City
history, just one of the Design Com-
mittee's many programs.
Recent developments in Munger Place
have involved the Design Committee, the
people in the neighborhood, the City, the
leadership of the Lakewood Bank and
FNMA, and the Revolving Fund. This
story will attempt to deal with only the one
aspect of the Revolving Fund for the
edification of the readers on the intricacies
of that project.
Munger Place is the area located be-
tween Munger and Columbia comprised of
the streets Junius, Worth, Tremont,
Victor, and Reiger. Two years ago, ap-
proximately 80% of the Prairie-style
houses were owned by absentee landlords,
and many of those houses had been sub-
divided into tenements, falling gradually
into disrepair because of the ownership
pattern. Because many of the tenants were
immigrants, staying in a $25-$30 a week
room just long enough to get settled and
then move out, the average tenant spent
less than 6 months in Munger Place.
A few new people like Alan Mason of the
Dallas City Plan Department and Betty
Cook, of writing fame, moved into Munger
Place over unbelievable financing odds.
Since the area had been "red-lined,"
practically no one could get the money to
acquire or fix-up property in the area.
Munger Place became the major con-
centration area of a beefed-up Code En-
forcement program because many of the
houses were unfit for human habitation.
Residents watched as houses around them
became red-tagged, and, in many cases,
destroyed. In the process of saving the
human environment, the irreplaceable
physical environment was being torn
down.
The problem then, was uninterested
absentee owners, coupled with Code
Enforcement and no easy way to purchase
individual houses, because many were
held in "blocks" and financing was not
readily available.
About three years ago, the League ap-
plied to the National Trust for a grant to
survey the architecture and housing of
Munger Place. A year and a half later te
HPL finally received a grant for a survey
of Munger Place, which Mike Brown, and
Dr. Lee McAlester of SMU, School of Arts
and Humanities, conducted with guidance
from the Dallas City Plan Department.
The purpose of the comprehensive study
was not only to ascertain the architectural
and structural survey of the 200 plus
houses in Munger Place, but also to
develop a study which would facilitate the
Historic Designation of the area, should
the residents request it later. The study,
completed two months ago, shows that
over 90% of the structures are of
significant architectural status, and
almost 100% of the structures, even those
already red-tagged by the City, can be
rehabilitated structurally. Furthermore,the Munger Place area is of extreme ar-
chitectural significance because it is the
largest intact Prairie-style residential
area in Dallas.
Before completion of the study,
following a Dec. 10, 1975 field trip, the HPL
requested a loan-grant recommendation
from the National Trust for Historic
Preservation to give a substantial base for
a revolving fund. For over a year, Jerry
Tahu, who has volunteered countless
hours, and Bill Harris developed the
facade easements and researched the
legal problems related to the working of
the Fund and the protection of acquired
properties.
As a model for the Fund, Lee McAlester
purcahsed three properties on Reiger
Street. The HPL Board and the individuals
involved with the Fund concepts had on
their hands their first experiment in
property management and the reality of
how the Fund could work.
BASICALLY, the Fund's prupose is to
acquire block properties from absentee
landlords, properties which are par-
ticularly outstanding architecturally or
keys in the conservation, of particular
blocks. Facade easements and deed
restrictions are developed which required
the properties at least be brought up to
Code. Then, the properties are sold to
individuals who will live in them and fix
them up.
The rationale behind the Fund's
operation in Munger Place was not only
architectural; it is rather easy to see that
when there is such a large percentage of
absentee owners and many of the
properties are block holdings, that one
individual desiring a single-family house
usually can not buy one property from that
landlord. He generally sells in blocks. So
the Fund could acquire the block
properties and act as the facilitator for
individual acquisitions.
Negotiations were begun to acquire a
few of the major block holdings of ab-
sentee landlords in Munger Place in the
early summer, and fund raising activities
among the HPL Board were initiated. The
five committee structure of the Historic
Dallas Fund was set up, with Martha
Heimberg chair of the Facade Easement
Committee; Lee McAlester, chair of
Development Committee; Virginia
Talkington, chair of Investment Com-
mittee; Lyn Dunsavage, chair of the
Public Relations and Communications
Committee; and Doug Newby, chair of the
Investment Management Committee,
later to be assumed by Harrison Woods.
A word needs to be said about the In-
vestment Management Committee. No
other committee has such a visible job.
They are the team that has to respond
immediately when the water or electricity
is cut off; they spray for rat and roach
infestation; they clean-out the houses for
tenants and later for realtor inspection;
they collect the rents and handle the day-
to-day tenant problems. The two chairs of
the Investment Management Team, first
Doug Newby and later Harrison Woods,
have put an inordinate amount of time and
physical effort into the job, supported by
Craig Woods, Thayer Davis and Ken
Wardlaw. It's all volunteer, except for a
few jobs they have to hire out, and it's
because of their successful handling that
we've gotten such favorable response from
tenants in the properties.
The National Trust Grant came through
in July. The Fund began the actual
acquisition of properties, and by August
had purchased or had options on 22
properties in Munger Place.
By the end of September, the Fund had
its first three houses ready for sale. It ran
its first advertisement in conjunction with
Urban Pioneer House Tour, which
featured a few open houses in Munger
Place.
Over 700 people descended upon Munger
Place that week-end. Realtors selected to
handle Fund properties and educated
(CONTINUED ON PAGE 2)THE COMMiNCATOR
THE QUARTERLY JOURNAL of the HISTORIC PRESERVATION LEAGUE.INC.
vol.2 no. 4 November 1976Good News for
PreservationHPL
Revolving Fund
LYN DUNSAVAGEHPL Facade Ease ment Program
Martha Heimberg
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Dallas Historic Preservation League. The Communicator, Volume 2, Number 4, November 1976, periodical, November 1976; Dallas, Texas. (https://texashistory.unt.edu/ark:/67531/metapth887856/m1/1/: accessed March 28, 2024), University of North Texas Libraries, The Portal to Texas History, https://texashistory.unt.edu; crediting Preservation Dallas.