Owners of a heritage building previously used as the official residence of the Prime Minister are asking for a rates remission so they can renovate the multimillion-dollar property.

Vogel House in Lower Hutt was owned by the Crown for more than 50 years until late last year, when the property was sold back to the Vogel family.

The historic building was the subject of a High Court battle when the government decided it was no longer needed as a Crown property, and decided to sell it on the open market.

Tim and Geoff Vogel, grandsons of the original owners, took the matter to court and argued their emotional connection to the property meant the house should be offered to them.

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The house had been gifted to the government by their grandparents, James and Jocelyn Vogel, and previously housed Sir Robert Muldoon.

Now the new owners are asking for a $6250 rates remission so they can renovate the house, which was last valued at $5 million.

The application is detailed in a report to the Hutt City Council's Policy Finance and Strategy Committee.

"In his application, Mr Vogel refers to some of the issues that a reduction in rates would enable him to address. These include replacing weatherboards, reinstating a chimney and fire exit, removing asbestos, updating interior fittings, painting the house and maintaining the grounds," the report said.

The requested rates remission amounts to a little over a quarter of the annual $20,000 rates bill for the property, which include Greater Wellington Regional Council rates.

Granting the remission would reduce the Hutt City Council portion of the rates by half.

"Vogel House is a property of outstanding historical significance in Lower Hutt and is listed by Heritage New Zealand and in Council's District Plan," the report said.

If the remission is granted, the Vogels have offered to hold an open day for the public once renovations are completed.

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Council's Rates Remission Policy allows rates relief where it is considered "fair and reasonable" to do so.

Part of policy allows remissions in order to protect sites of cultural and historical significance.

There are 110 heritage properties in Lower Hutt, none of which currently receive rates remissions under the policy.

Vogel House was listed as a Category 1 Historic Place by Heritage New Zealand in 2008.

"The main house is a good example of 1930s domestic architecture and of the work of the Helmore and Cotterill partnership, which designed a number of large homes for wealthy households and which also influenced methods of building design in the country. The practice made its name in the 1930s and Vogel House is one of their best-known works."

The report recommends the council adopts the first of three options - allow the remission and require the Vogels to demonstrate the renovation work is being carried out by providing a work plan and timetable.

The second option is to remit $3125 of the rates instead of $6250, and the third is to refuse the application.

The report notes funding for rates remissions has not been provided for in the Draft Annual Plan.

"Significant effort" was made to find operational savings to reduce a controversial proposed rates increase of up to 7.9 per cent for locals, and to offset the financial impacts of Covid-19.

"Budget cuts of $3 million were included in the plan. It would be difficult to find further savings to offset the cost of rates remissions for Vogel House."

Officers recommend the cost of the remission comes out of the $52,000 budget for the Built Heritage Incentive Fund, which has been in place since 2008.

In his letter to the council, Tim Vogel said the Crown "deferred maintenance" on the property for "quite some time", leaving a substantial amount of work for the Vogels to take over.

A Heritage New Zealand covenant on the land prevents the family from "economically utilising" the space.

The Committee will vote on the application at a meeting next Tuesday.

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