Broker’s Report, November 4, 2016 –– Fireplace Retrofit and Loft (QOL)Update

Buyers, sellers, and Mammoth real estate agents are dealing with the impacts and uncertainty of two new Town of Mammoth Lakes ordinances. The fireplace retrofitting ordinance enacted a little over three years ago is maturing in understanding, function and acceptance. And last fall’s Quality of Life Ordinance has raised concerns over Mammoth’s many lofts. There are no definitive answers yet.

Fireplace Retrofits

Let’s recap about the fireplace retrofitting. A few years back the Mammoth Lakes Fire Department determined a number of local structure fires were the result of the long-term slow burning of wood components behind fireplace inserts. Many of these fireplace inserts were installed as the result of a Town ordinance enacted in 1990.

The 1990 ordinance was driven by the EPA because Mammoth had “episodes of dirty air” caused by wood smoke pollution from open fireplaces (I sat through all of those public hearings as a Town planning commissioner). The 1990 ordinance has been very affective at minimizing Mammoth’s wood burning air pollution.

Since 1990 there have been thousands of fire-box inserts installed into the original 1970’s and 80’s open fireplaces. Most were triggered by the transfer of ownership as required by the 1990 ordinance. Many more were prudent owners who simply saw the value of a more energy efficient appliance. These new inserts can burn very hot. They burn much hotter than the originally constructed “zero clearance” fireplace and chases were designed for.

It took 20 years but the problem came to light. The initial problem was primarily focused in two separate condominium projects; they had multiple structure fires. After significant investigation by the MLFD the problem became quite clear. And there were thousands of potential structure fires waiting to happen in Mammoth Lakes. So the MLFD worked with the Town to create the 2013 ordinance.

The new ordinance once again mandates a “transfer of ownership” trigger. The local real estate agents once again became the front line “explainer” of the fireplace retrofitting to buyers and sellers. But this time around every property in Mammoth Lakes has to be compliant by Oct. 31, 2022. That is only six years away.

Who pays?

So who is paying for all of this retrofitting?? When properties that need the retrofitting are newly listed, the listing clearly states the burden will fall on the new owner. And the majority of transactions are negotiated similarly. But that is really the way it should be. The new owner has options to think about, and those decisions will clearly impact the future enjoyment (and value) of the property.

There are basically three options for owners of these fireplaces in need of retrofitting if they want to maintain it as a heat source; install a pellet burning appliance (pellet stove), maintain wood burning by completely rebuilding the firebox and chase system (floor-to-ceiling), or if available, retrofitting to a propane gas fireplace.

The ordinance also has timelines for new owners; obtain a building permit within 90 days from close of escrow, 30 day extensions with good reason, the work needs to be completed within 180 days and extensions can be granted for justifiable cause. But the Town has yet to find an effective way to enforce the timelines (shh!). Most new owners are getting around to their retrofits. 2022 will come quick.

Prospective buyers and buyers are becoming more enlightened and optimistic about the probability of being involved in some level of fireplace retrofitting and remodeling. Good heating is critical to the enjoyment of a Mammoth property (and a successful nightly rental). The fireplace is most often centrally located in the living area. A warmth producing and aesthetically pleasing fireplace can easily be or become the focal point of the “great room.”

So many new and old owners are seeing the opportunity to renovate and reorganize the primary living space. More and more (and larger) flat panel TVs are being placed above the fireplace mantel. The next step is to eliminate some bulky obsolete furniture that in the past has housed the TV, stereos, VHS tapes, an array of board games, etc. That in turn allows for new furniture placement and other opportunities. Essentially, the fireplace retrofit becomes the first step in (the much needed) modernizing of the furniture layout and effectiveness of the great room.

There is one remaining source of confusion; the understanding of what is “legal” and what is not, but that is becoming clearer. If an owner or agent has any doubt about the status of any fireplace, a call to local fire Marshall Thom Heller will render a friendly inspection and decision. Some recent “approved” appliances were a bit surprising. The real culprits are the fireplace inserts placed into the 1970’s and 80’s condos fireplaces that were originally designed as open fireplaces. And for clarification, the ordinance does not apply to the majority of freestanding wood stoves.

Most newly installed appliances are either pellet or gas. There is good reason to believe that the environmental powers-that-be want to do away with most conventional wood burning. The MLFD is probably in favor of that too; wood burning in modern inserts and fire boxes can get VERY hot. Probably too hot. And the worst pollution comes from wood stoves and inserts that aren’t burned hot enough. And the whole cord-wood burning process remains “dirty.”

Pellet stoves are quite different in that they generate heat for the property but not in the firebox and flue system. There is no need to rebuild the zero clearance fireplaces so the overall cost to retrofit with pellet can be less. But they do require some minimal maintenance. And somebody has to load the pellets. Pellet stoves do also maintain the ambiance of a fire.

Pellet stoves are becoming increasingly popular. Pellet fuel sold in 40 pound bags is readily available. They even sell bags at COSTCO in Carson City. A ton of bags can be delivered on a pallet. One local fireplace vendor is “warehousing” them and they can be bought by the ton but picked up in 10 bag increments. The modern pellet stoves are being connected to wireless thermostats that makes their operation super convenient, even in nightly rental scenarios. They go on and off like a forced air heating unit does.

Many of the propane gas fireplace retrofits are going into older condo projects that have recently plumbed propane gas into their buildings. Those projects include Chamonix, The Summit, Mountainback, etc. This is a very hassle free and clean direction for many owners.

Ultimately, new and existing owners have many options and decisions to make regarding their retrofit-required fireplace. There are some great options and many opportunities to make the great room of the property that much more enjoyable during the process.

Lofts

Meanwhile, the “Quality of Life” ordinance passed a year ago is intended to bring increased regulation and greater public safety to nightly rental units in Mammoth Lakes. The volume of owners “self renting” through the likes of VRBO and Airbnb really made this necessary. Units have to pass an inspection prior to being issued a business license. The basics like smoke and carbon monoxide detectors, accessible fire extinguishers, and other health and safety issues are certainly reasonable to regulate.

But the nightmare issue for owners and the local real estate community was the initial view of lofts in many of the condominium projects. With the lack of emergency windows in many of these lofts and compromised access and headroom, many of the these lofts are now a target for greater scrutiny and regulation under the QOL ordinance. The MLFD and TOML building division are leading the charge.

These local agencies have backed off of their hard line stance. They have spent considerable time in the affected loft properties to better understand the big picture. I don’t think they realized how prolific these lofted units are in the Mammoth Lakes real estate inventory.

There is no final disposition, yet. The agencies have studied the issues. They are forming a “task force” from a variety of the affected industries including real estate and the reservation companies. The task force recommendations will then pass through the MLFD board, the planning commission and ultimately to the Town Council.

As of now the MLFD has expressed their take on the emergency window issue. But first of all, to meet the requirement for a legally rentable loft, the stairs accessing the loft have to be of reasonable “rise and run.”  This type of stair access would include the vast majority of the lofts in Mammoth. Ladder-type access will not be acceptable.

The MLFD cracked down on the usage of these ladder-type access lofts in the late 1980’s and most of these have been converted to storage lofts or closed off. The local reservation companies refuse to allow nightly renters to access them, as they should. In my mind there is one specific floor plan in Mammoth that is still in the “grey area.” Only time will tell.

The second criteria for legally rentable lofts that do not have emergency windows; they have to be at least at 50% open to the room below. The original Snowcreek 1, 2, 3 units would meet this requirement. Most of the other original units from the 60’s to 80’s will too. A problem may occur for any of those that were enclosed over the years. I can think if one Snowcreek unit that did that. Oops.

So it appears the MLFD has a good grasp on what is reasonable, what will work for most owners and the real estate industry. But they have apparently turned the headroom portion of the debate over to the Town.

Resolving the headroom issue is a little tricky. Many of the 1970’s built condos have marginal headroom and beams with less than six feet of clearance (my head has met many of them). These loft areas are often where the kids end up, so how much does it really matter? Historically it has never really been a problem. It was part of the “funky” Mammoth experience. I’m guessing there are approximately 500 condos in Mammoth that will fall into this criteria.

So far the Town is thinking the requirement should be seven feet of clearance. But these lofts are in the roof line so they aren’t conventional rooms with right angle ceilings. This is where the task force is really going to have to put some thinking in. These lofts have been utilized (and generating bed tax) for decades. Trying to shut down their usage is a dicey proposition.

And the Town has already stated that the “sleeping allowance” for these lofts may be redistributed to other parts of the property (like the living room). The implication is that once that is done the lofts will become free game for usage, just not for sleeping (wink, wink).

So for now the loft headroom issue appears to be the only one not headed (ha) to clear resolution. Stay tuned. And if you are an owner of one of these properties you should take the time to make comment in the public process.

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