The Mills Act is a California program that allows owners of qualified historic homes to receive a property tax reduction. Cities utilize the Mills Act to encourage historic preservation. Each local government establishes its own criteria. And determines how many contracts they will allow in their area.
The property owner benefits by receiving property tax savings. This can be as much as 40% to 60% of their pre-Mills Act tax rate. The contracts are for 10 years initially with automatic yearly extensions. The contract extends to subsequent owners as well. And have the same rights and obligations as the original owner.
To qualify:
First, the home must be privately owned. And must be listed on any federal, state, county, city, or city and county’s official register of historical or architecturally significant sites, places, or landmarks.
The property owner must establish landmark designation for their property. Then commit to a minimum ten-year Mills Act contract. Also, identify all proposed work to be completed to their property under the Mills Act contract. Additionally, implement the work provisions contained in the contract following the U.S. Secretary of the Interior Standards and the State Historic Building Code. Finally, allow reoccurring (five-year) inspections of the interior and exterior of their premises.
The local government and the owner negotiate other specific terms of the contract. Therefore, you will need to contact your local government to determine the rights and obligations a Mills Act contract creates.
