Homeowner wants to make sure Heathside Cottage will outlive her
By Gretchen McKay,
Post-Gazette Staff Writer
Saturday, July 12, 2003
Anyone who’s ever fixed up a neglected old house knows it takes more than time and money. It takes some of your soul.
Judith Harvey in the “urban garden” at her Fineview home. She restored the dilapidated Gothic Revival cottage then bought the abandoned house next door, had it torn down and created the garden. (Robin Rombach, Post-Gazette)
Just ask Judith Harvey. She spent close to five years restoring Heathside Cottage, a six-room Gothic Revival cottage in the North Side’s Fineview neighborhood. Snow White herself would feel at home within its rounded walls and fanciful gingerbread trim.
“Some houses talk to you,” says Harvey with a delicate shrug of her shoulders. “I knew the moment I saw its chimney from the street up above that I had to have it.”
What one person loves, however, another might surrender to the wrecking ball. So soon after the meticulous restoration was complete, the former librarian began worrying about her tiny house’s future. What would happen when she was gone?
“It really troubled me,” she recalls. “It was important that I find a way to protect it.”
A member of the Pittsburgh History & Landmarks Foundation, Harvey said her first thought was to simply leave it in her will to the historic preservation group. It didn’t matter if it used it as an art gallery or a study; all she wanted was peace of mind that her 165-year-old house — which is listed on the National Register of Historic Places and bears a Landmarks plaque — would survive intact for years to come.
But while gifts of property provide Landmarks with much-needed cash to support its mission, “we’re not in the real estate business,” says Jack Miller, director of gift planning. Besides, even though Landmarks would get the proceeds from the eventual sale of the house, buyers would be able to do anything they wanted with the property. So he suggested protecting it first, then making a “retained life estate” gift.
Here’s how it works: Harvey granted a facade easement to Landmarks that guarantees no one could ever change the exterior of the house. She then deeded the house to the foundation but retained the right to live in or rent it for the rest of her life. She would also be responsible for property taxes and maintenance.
Heathside Cottage sits on Caroma Street in Fineview. Owner Judith Harvey is making sure that the house and all the work she put into restoring it will outlive her by making a “retained life estate gift” of the property to Pittsburgh History & Landmarks Foundation. (Robin Rombach, Post-Gazette)
“Nothing changes until the day she dies,” Miller says.
But what about taxes? Harvey is entitled to a charitable income tax deduction. Also, the property is no longer part of an estate that could be attached — by a nursing home, for instance — if Harvey could no longer care for herself. The best part, however, is that Harvey’s home and handiwork will be preserved for future generations.
Built around 1855 by bridge engineer James Andrews, the brick cottage is so unusual that it was featured in Rick Sebak’s 1997 documentary “North Side Story.” It is a model of Early Victorian design, with lacy bargeboard, a steeply pitched roof and diamond-paned sash windows. And its location on a hilly outcrop gives it a mighty fine view of Downtown, hence the neighborhood’s name.
Harvey bought the dilapidated house in 1992 as a weekend “playhouse,” then moved in permanently after her husband died in 1996. She also purchased the abandoned house next door and then had it torn down to create an urban garden (the stone foundation serves as a wall).
The largest rooms in the two-story cottage measure just 14 feet square, though the 11 1/2-foot ceilings on the first floor –many with beautiful wallpaper — lend an airy feel. Antiques and collectibles reflect Harvey’s love for anything old.
But there are some modern touches, as well. A large mirror above the mantel in the “futon” room is an inspired background for several smaller mirrors; Harvey herself designed the dining room’s enormous rosewood sideboard, which was handmade in Pakistan.
A narrow staircase leads to the light-filled second floor. Here, slanted walls and a whimsical diamond-shaped window in the bedroom (it’s held up by a chain attached to a hook) add to the cottage’s storybook feel. A slender, pointed “lancet” window in the bedroom-turned-closet room reminds visitors of the home’s Gothic roots. Harvey couldn’t bear to think of it in ruins.
“It’s protected as much as it can be,” she says. “It’s where people can see history and be a part of it.”
“Judith obviously cared very much about the property, so it worked out well,” says Miller.
Many people are not aware that they can give their house or farm — or in the case of one donor, a pizza manufacturing plant — to a charitable organization.
Miller says such “planned gifts” work best for people who want to do something for the community and, in some cases, receive income from an asset that is not normally an income-producing property. With a planned gift, donors find that they are able to contribute more than they thought possible while still providing for their family. Miller is quick to note that no one should enter into one of these agreements without the advice of a lawyer and/or financial consultant or accountant.
Harvey’s retained life estate gift of Heathside Cottage, the first gift of its kind to Landmarks, is only one way to go, Miller says. A charitable gift annuity, for instance, allows someone to give a gift of property in exchange for fixed income payments for life that are based on the age and number of beneficiaries. An added benefit is an upfront tax deduction.
A charitable remainder trust, by way of contrast, permits someone to transfer a property to a trust, avoid capital-gains tax and receive a fixed or variable payment each year for up to 20 years or the lifetime of the income beneficiary. Like the annuity, the gift also carries a federal income tax deduction for the donor.
Lucille Tooke chose the charitable remainder trust option when she donated her historic property, Hidden Valley Farm in Pine, to Landmarks in 2001.
Tooke and her husband, Jack, bought the farm in 1954 and spent the next 40 years raising their three daughters on its 64 acres. After Jack died in 1993, it became increasingly difficult for Tooke to take care of it on her own.
“It got to be more than I could handle,” says Tooke, a longtime Landmarks member who now lives in Chambersburg, Franklin County.
So in 2000, she asked Landmarks officials if they knew anyone who might be interested in buying and preserving the property. Most of the land surrounding the farm, which was built in 1835 by Lewis Ross and his wife, Temperance, had already been developed. The thought that it, too, might one day become part of the ‘burbs “made me shudder,” says Tooke.
Unlike Harvey, Tooke was ready to sell the house so she could move closer to her daughters. However, she also needed an income to meet living expenses. Landmarks helped her work out a plan.
She avoided capital-gains tax by turning the farm over to the trust and received a charitable deduction for a portion of the property’s value and a percentage of the trust’s value each year.
When the trust put the farm up for sale, Landmarks had the right to match the highest bid and ended up buying it.
Before reselling it, Landmarks added deed restrictions that required owners to get prior approval from Landmarks before altering the house’s exterior. They also stipulated that the land could not be subdivided or used for non-agricultural commercial purposes.
Even though the restrictions lowered the selling price and made it more difficult to find a buyer, it helped preserve a historic landmark.
“The land and building will be there forever,” says Miller. “And one day, when urban sprawl takes over, the public will be able to see what an early 19th-century farm looked like.”
OK, you’re thinking, a property has to be of historical or architectural significance for Landmarks to be interested in it. Not so. Mary Ann and Tony Kopczynski recently donated the buildings that housed their pizza manufacturing business in McKees Rocks in the form of a charitable gift annuity. In exchange for the 5,000-square-foot warehouse and adjoining office building, the couple receive fixed annual payments for as long as they live.
They also got a sizable federal charitable income tax deduction for the gift portion of the property transfer.
“It gave them an opportunity to retire without having to worry about selling the property,” says Miller.
For more information on the Pittsburgh History & Landmarks Foundation’s Planned Giving Program, visit http://plannedgifts.phlf.org/or call Jack Miller at 412-471-5808, ext. 538.