SUPPORTS ITEM NO. 1
P&E COMMITTEE AGENDA
NOVEMBER 28, 1996
ADMINISTRATIVE REPORT
Date: November 13, 1996
Dept. File No.592 157
TO: Standing Committee on Planning & Environment
FROM: General Manager of Engineering Services, in consultation with
the Manager of Real Estate Services, Director of Legal
Services and General Manager of Community Services
SUBJECT: Areaway Encroachment - 8 West Pender Street
RECOMMENDATION
A. THAT the unpaid fees for the encroachments at 8 West Pender
totalling $7,095, be collected and that the owner be given the
choice of retaining the areaway and paying future fees or
removing the areaway.
CONSIDERATION
B. THAT the fees for the areaway encroachment at 8 West Pender
Street be reduced from the current rate to a nominal fee
(noting that the overhead bay windows would still be subject
to an annual fee of approximately $260), and that the fee
reduction be retroactive.
COMMENTS OF THE GENERAL MANAGER OF ENGINEERING SERVICES
The General Manager of Engineering Services is of the opinion that
the owners of all areaways should be treated equitably. The
areaway at 8 West Pender Street provides extra space for private
use, and to reduce its annual areaway fees would be to subsidize
one property owner unfairly. If Council believes that there is
justification for reducing the fees, item `B' is put forward for
Council's CONSIDERATION.
COUNCIL POLICY
On March 11, 1986, Council approved the recommendation of the
Planning and Development Committee:
THAT the requested encroachments for the areaway (glass
blocks and sidewalk opening) in the restoration of the Sam Kee
Building, 8 West Pender Street, be approved, provided that the
necessary encroachment agreements are entered into, to the
satisfaction of the Director of Legal Services.
On January 25, 1990, when considering a report on the revision of
annual charges for street encroachments, Council approved an
increase in the annual charges for several types of encroachments,
including areaways, from about $.25 to $3.00 per square foot, with
a minimum of $150, to be phased in over a three year period. (The
minimum was subsequently reduced to $100, in September, 1992).
On January 25, 1990, when considering a report on the removal of
areaways to facilitate sidewalk reconstruction, Council approved a
recommendation of the Planning & Development Committee (inter
alia):
"That where removal of an areaway is necessary to allow for
local sidewalk improvements, sidewalk reconstruction, tree
planting, utility installations, or for other similar reasons,
the City terminate the encroachment agreement and
require the property owner
to abandon the areaway,
with the exception of the
Europe Hotel...and the Sam
Kee Building ." (emphasis
added)
Annual fees for various types of encroachments are specified in the
Encroachment By-law. However, Council does have the authority to
set fees and annual charges other than as specified.
PURPOSE
The purpose of this report is to give Council the background on the
areaway at 8 West Pender Street, related to a request from Mr. Rod Chow
and Mr. Reg Chow that the annual encroachment fees be waived, and to
recommend that the City continue to charge the annual encroachment fees
as long as the areaway exists.
BACKGROUND
Mr. Jack Chow owns the Provincially designated heritage building at 8
West Pender Street which is known as the Sam Kee Building, a designated
"A" category heritage building and a tourist attraction that is said to
be the "narrowest building in the world". It is approximately 6 feet
wide, with a basement "areaway" that extends a further 8 feet beyond the
property line under the City sidewalk. The areaway comprises half of
the building's total floor space.
In 1986, the building was renovated and at the same time, the owner paid
to have the sidewalk reconstructed with modern glass panels to simulate
the old glass prisms which provided light to the areaway beneath the
sidewalk. At that time, a four foot wide staircase was constructed to
access the areaway through the City sidewalk reducing the sidewalk width
at that point to six feet.
The various encroachments onto the street allowance (areaway, sidewalk
glass blocks, staircase and bay windows) became the subject of an
encroachment agreement, as is normal practice, pursuant to the
provisions of the Encroachment By-law.
In 1990, Council approved amendments to the Encroachment By-law which
increased the annual fees for some types of encroachments those where
street or under-street space is alienated), and eliminated the annual
fees for others (such as special sidewalk treatment, which does not
adversely impact public use of the space). The annual fees for
under-street areaways increased substantially, from approximately $.25
per square foot to $3.00 per square foot, phased in over a period of
three years. The result for the Sam Kee Building was that there was no
annual charge for the sidewalk glass blocks, but the annual fee for the
areaway and access stairs increased (over a period of three years) to a
total of approximately $2,400 from $226.
Since late 1992, Mr. Chow has spoken with many members of staff in
several departments in an effort to have the annual fees for the areaway
encroachment waived. He has withheld payment of his annual encroachment
fees for 1993, 1994 and 1995, for a total of $7,095. There are half a
dozen letters on file from the Chows, and an equal number of responses.
The Chows' position, followed by staff's response, has been that:
1. The areaway space is too narrow to be useable, and they derive no
economic benefit from it. They request therefore, that the annual
fees be waived.
- Staff have responded that this areaway should be treated the
same as other areaways (of which there are approximately 100
left in the City).
2. They have enhanced the public realm at their cost (glass blocks in
sidewalk), and should be rewarded for bringing back a significant
heritage feature, which has created a tourist attraction with large
economic spin-offs.
- Staff have acknowledged the renovation project; and in fact
the building won a City of Vancouver Heritage award in 1986.
(Note: They do not pay an annual fee for the special sidewalk
treatment.)
3. There was no provision in their encroachment agreement for the 1990
fee increase.
- Council considered the matter of the discrepancy between
by-law fees and the fees in individual agreements on November
26, 1996. It is arguable by the Chows that the precise
wording of the encroachment agreement may not permit any fee
increases during the term of that agreement. However, the
agreement does clearly provide that it may be revoked by the
City at any time, in which case the City could, among other
things:
(a) require that the encroachment be discontinued and the
street restored at the encroaching owner's expense; or
(b) require that a new agreement drawn to the City's
satisfaction, be entered into in order to continue the
encroachments.
4. The 1990 fee increase specifically exempted the Sam Kee Building's
encroachment, which has been "incorrectly categorized".
- This is a misunderstanding by the Chows. In January 1990,
Council considered two reports on the same day, in one the
fees for areaways were raised, and in the other (unrelated)
report the Sam Kee areaway was exempted from being removed to
accommodate a sidewalk reconstruction and tree planting local
improvement. The Chows have mistakenly linked these two
matters.
DISCUSSION
Given the current situation, the options are:
1. The areaway be retained and Council confirm that it requires the
outstanding annual fees to be paid.
The General Manager of Community Services is of the opinion that the Sam
Kee Building is an important heritage resource, which has been carefully
restored. The General Manager of Engineering Services believes,
however, that those portions of it that extend into the street allowance
should be subject to the same regulations as other similar
encroachments. All areaways are a benefit to the adjacent property, and
should be charged equitably. Whether or not it is rented should not be
a factor.
2. Council require the areaway and access stairs in the City sidewalk
be removed, at the property owner's cost, leaving the special
sidewalk treatment and glass blocks (and overhead bay windows).
This option would allow the Sam Kee Building to continue to be a tourist
attraction as the "narrowest building in the world". It would meet
Council's policy of encouraging the removal of areaways, while keeping
the sidewalk safe and attractive. (Note that a report back on the
Europe Hotel areaway, and areaways in general, is being prepared by
staff.) This option also meets the Chows' concern that the areaway is
not useable and of no economic benefit. If the areaway is removed,
Council must decide whether or not to waive the outstanding unpaid fees.
It is noted that the bay windows would still remain as encroachments,
for which there would continue to be an annual charge of approximately
$260.
In addition, removal of the access stairs will constitute an exterior
alteration to this heritage building, thereby requiring careful review.
3. Council permit the areaway to be retained, but the annual fees be
waived or reduced.
Council does have the authority to set fees and annual charges other
than as specified in the Encroachment By-law. However, the General
Manager of Engineering Services recommends against waiving or reducing
the annual fees for any one particular encroachment, since similar
representations could be made by other property owners that their
encroachments be granted similar treatment. To waive the fees for this
areaway would not be equitable.
CONCLUSION
Council policy is to charge a fee for the space created by areaways that
encroach into City streets. The General Manager of Engineering Services
believes that this policy is appropriate and opposes exempting any class
of buildings from this fee.
This report recommends that the outstanding charges be collected and
that the owner be given the choice of continuing the areaway as per the
existing arrangement or removing it and not paying future costs.
Council could consider if they wish to waive fees, however, the Manager
of Real Estate Services and the General Manager of Engineering Services
recommend against this.
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