The meeting was called to members of the community and other interested parties to discuss historic districts, the benefits, the process and how it affects us as a community and individually. A recap of the meeting follows.
Overview:· Our proposal is for a ”traditional” historical district, which means that after the area is researched and guidelines are established that that a community vote to held to designate the area. To qualify the Historic Resources Board will need to determine that generally 65% of the homes contribute to the historic district as representative or intact examples.
· The proposed district is an area including 77 structures starting on Sunset to St. James and includes Sheridan and Lyndon Rd. (See the drawing on the next page for your reference).· This meeting was organized as an opportunity to learn more about the proposal to begin the process of historical designation and to address questions from homeowners in the proposed district as well as to get some input on plans for next steps to proceed.
Prior to meeting, we colleted signatures from 46 homeowners representing 35 buildings (homes) requesting that we continue this initiative and since collection of the signatures additional parties have indicated support. (39 are the minimum desired for full approval and 37 have explicitly expressed interest to move ahead).
Proposed District Boundaries
Sunset West to St. James South to Lyndon. South and East to Sheridan South then East to Sunset.
Including all of Sheridan and Lyndon.
History of MH
· When George Marston and his business associates planned Mission Hills it was a restricted subdivision. (With no house built for a cost less than $3,500.00). – How does that relate to us today?
· It means that as the neighborhood took shape the homes that contribute to what we want to preserve –include some of San Diego's most renowned architects and well built homes.· Architects within the proposed district include
o Emmer Brooke Weaver
o David Owen Dryden
o William Hebbard
o Richard RequaTo name a few
· Additionally some significant community leaders lived in Mission Hills it was reported that Juan Carlos – king of Spain lived in a rented house in our proposed district at some point.
Since the area was developed over many years there is extensive variety to the styles represented -- Craftsman, Prairie, Italianate, Mission Revival, Spanish Revival, Dutch Colonial, Greek revival and hybrids of these styles too.
Many of these homes could not be constructed today because the methods of construction are different, the craftspeople are not as available at the same wage rates or sometimes the rarity of the construction materials has something to do with this. (Siding/mill practices, clinker brick etc.)
The heightened call to action comes due to the demolition of the Craftsman house at 1845 Lyndon and the new construction of an oversized structure that does not integrate with the neighborhood in terms of style and scale. We understand that the house was on the market only briefly (hours). The house that is being built has a front yard that measures only 27 inches set back from the sidewalk - there is very minimal side set backs and the structure extends so far back beyond the neighboring structures that it encumbers upon both neighboring side and back yards eliminating the neighbors privacy by extending far out into the canyon.
These plans were approved by the city of San Diego.
Now you might ask a lot of different questions. Why would such of an oversized house be approved when it is so far out of character for the neighborhood? Why build so far out that this encroaches upon the neighbors? Why tear down the craftsman style house in the first place. We can’t answer any of these questions - But it is being built and being built with the approval from the city!
So the question we went to next was - How can we preserve what we value and know as distinctively Mission Hills? We believe that the best route is in obtaining status as a traditional historic district. According to the city planner’s office, if Mission Hills had already established this historic district this plan would not have been approved. In continuing to compromise the character of our historic neighborhood.Part III Benefits of the Historic District
The Benefits to obtaining historic designation are primarily to protect the remaining structures that provide the character and charm of our community and this is by far the most important but there are other benefits to taking this action that everyone should be aware of them.
Once approved as a district the city would have follow guidelines established by our district.
Benefits:
· The review process for permits will include review for alterations and new construction ensuring compatibility with the neighborhood character preservation.
· Tax incentives to contributing properties, such as the reduced property taxes available through the Mills Act contract with city and applied by the county assessor’s office.
If you own a structure designated in a historic district you may qualify for a property tax reduction when you sign a Mills Act Contract, which could mean a 40-60% property tax reduction. Even if your current Prop 13 base value is lower than the Mills Act value, the Mills Act can really be a marketing tool or selling point if it comes time for you to move since the Mills Act contract transfers with the property when you sell.
· Cultural Resource information on properties and history of significant owners who lived within the district -telling the story of our community – since research is required and goes beyond the building by including the history of the people who proceeded us.
· Historic Building Code flexibility in the application of building code standards. - Grandfather in codes when restoring designated structures.
· Increased Property values – nationally 10-25% for homes located within a historically designated district vs. homes in a similar neighborhood. – According to the National Trust of Historic Places
· Historic districts have priority for converting power lines underground and street lighting.
What it is not – an additional permit process.
Since all homes built before 1958 are already required to go through a review process with the Historic Resources Board before permits are issued.
The process that the Historic Resources Board applies to district designations begins after all of the research is conducted - then the proposed homeowners in the district will express strong support, maybe through a neighborhood vote or petition needed to gain historic designation. If approved, any new plans for building will be reviewed in the planning department but will be different from today in that the review will recognize the special historical character of our community and will implement guidelines we approve in context with the entire district area instead of looking at building plans as a single lot –this provides us with the best protection available. The reason for a district is not an offensive measure but to keep the historic fabric of our neighborhood in tact.
Introduce the Experts
· Angeles Leira -Principle Planner Program Manager for the City of San Diego – Planning Department – Besides all of the other matters that Angeles attends as staff for the Historic Resources Board she will prepare recommendations on the Historic Designations to the Historic Resources Board.
· Sandy Woodhouse – Supervisor in the County Assessors office – She has 14 years of planning experience-- 18 years in assessment and an MBA from SDSU. Her office manages Mills Act contracts for the Assessor.
· David Marshall – David Marshall is Save Our Heritage Organisation’s President and is a ProjectManager for the firm of Architect Milford Wayne Donaldson, FAIA.David has worked on many significant buildings, including improvements to the Villa Montezuma, historic consulting for fivehistoric buildings incorporated into the downtown ballpark, andas Project Architect forthe House of Hospitality Historic Reconstruction in Balboa Park. In 2002, Mayor Murphy appointed David to the City of San Diego Historical Resources Board (HRB).
· Bruce Coons is Executive Director of Save Our Heritage Organisation – a non-profit organization with the mission to preserve San Diego County’s architectural and cultural heritage. For over thirty years SOHO has. Bruce Coons-is an expert in restoration in his own right and has repr warehouse buildings into the new Pet Co park and recent award winning Hotel Del restoration.
Community Proposed Process & Timing
A. Funding ResearchThe process to the goal of historic designation involves some nitty gritty work in order to ahead.
With help from Kathy Flanagan, Allen and I conducted the research required to apply for historic designation of our home. Kathy Flanagan provided us with the title search and San Diego Fire maps, we searched for photos and articles at the historic society, for water records at the water department at Chollas Lake, City directory records at the San Diego Library California room and checked for building permits and other records through the city and county. Even with help it took us approximately 30-35 hours to complete the research and prepare the report to apply for designation on our house.
We found this process enjoyable as we were new to the neighborhood and got to meet a lot of neighbors when we found out something about their homes in the process. The fact that there are 74 houses in the proposed district that we need to research is the daunting part.
In order to move forward we need to expedite the research process.
We know that some of you have information on your homes and we will want to collect all of it, but to prepare for this step we need to create reports specific to obtaining the designation and they need to be in the format that the Historic Resources Board and city staff requires
Obtaining research services would greatly accelerate the process for us but in order to compensate any research effort we need to address funding first
There might be some economies of scale to compile some information for the entire district and other items like the title search has no shortcuts . The information must be of high quality and will provide us insight into our own homes and those in district too. We will be provided these reports through the city during the staff evaluation and completion of the district report.
Allen suggested that we kick off fundraising with a home tour to get started and then expect that everyone would still need to contribute a few hundred dollars each. There also might be some grants available.
I would like to propose that a committee is formed to work on this process right away. Including a home tour or a historic district fair in our few blocks (a sponsored guide to the architects that are known, raffles, walking tours) to raise funds and awareness and community spirit. We need as many people as possible volunteer so that we can move to the step of completing our fundraising so that we can begin to complete our research.
A home tour/district fair would be a down payment but give us momentum for obtaining the research. Since the research poses significant up front cost we need help to accomplish this. If you are talented with obtaining funding, have access to title search reports, or want to help organize a district fair call me so we can start a committee to move forward right away It will be a lot easier to achieve if we all contribute a little so over the next week – by Saturday please consider taking on a leadership role with this important next step and get in touch with me by the July 4 th .
Process Recommendations· Determine commitment from owners in the proposed district (We have done this through a petition process and through polling at our community meeting and presently, the support is strongly in favor).
· Collect records or information from homeowners – see the last sheet of this report.
· Obtain bids for Research of the district
· Fund raising to obtain research – Committee to work on this and may includeo Home tour/walking tour, raffles
o Homeowner contributions
o Apply for grants or find other sources for research dollars· Research Report is prepared and provided to the City of San Diego Planning Department for review – by researchers
· Review of reports by homeowners
· Guidelines meeting – another community meeting
· Guidelines report to the City of San Diego and Historic Review Board meetings
Meeting recap Q & A
Q. How are the structures selected for historic designation?
A. Janet O’Dea
Research done on each property goes to city staff that makes recommendations to the Historical Resources Board on how each property contributes to the district or potentially contributes.
If the house has aluminum windows for example it may still potentially contribute if all other architectural or historical features are maintained, and will be encouraged to changeback to woodwhen rehabilitation improvements are proposed to the structure. There are different classes of how a structure contributes based upon the research, photos, survey and building permits are reviewed.
Angeles LeiraThe first thing staff identifies in a district are the sites that are interesting architectural styles, designed by an important architect, if a historical person lived or was associated with the house. All of these reasons are part of the consideration as part of the historical study that identifies, the date built, original owner who decided to build it and subsequent owners. The sites have an interesting story and the research follows this through with the historical report. Other considerations are the integrity of the house; originality and the changes that have taken place over time. And sometimes the changes themselves are historic. Sometimes improvements have been done well and other times not but all of that is also taken into consideration.
This is all presented to the Historical Resources Board. The board decides if the site should be designated as a landmark.
Q. House and district – clarify the house within the district – Is the issue to create a district that includes boundaries or issue related to specific houses or both?
A. Bruce CoonsInstead of the entire Mission Hills area, the proposal is to start with a smaller geographic area within Mission Hills to start with, to look at individual designations to determine if there is a district. Other homes that wouldn’t qualify (aren’t outstanding examples – don’t ha If landmark, which is something that you don’t get the benefit of outside of a district. You can’t be a contributor unless you are in the district. You get the Mills act and the historic building code.
Q. Geographic boundaries of the proposed district
A. See the drawing inserted in the earlier segment. This was not available at the meeting.
Bruce Coons
That is not to say that a lot more wouldn’t qualify depending on the time and how much research
And who wants to get involved.
Janet O’Dea
This is the beginning. This is to set up a paradigm, to establish how to do it as a template for other neighborhoods
Q. What percentage has to qualify to be contributing?
A. Angeles Leira
60% need to contribute to the district. If they contribute not just the shining stars but also the modest houses that are built during the period and have the flavor that is typical of the area {contribute}.
Q. Looking through Mission Hills What is the minimum? All neighborhoods would meet that criterion.
A, David MarshallJust to clarify contributing and non-contributing. Right now many historic homes are already designated in Mission Hills, twenty-two at present with one or two a month presented to the board. Those homes met a certain threshold that is higher than a typical contributing house that is within a district. Already designated homes would be automatic contributors to the district if they were within the boundary. Then other homes that don’t meet the same threshold, but are deemed worthy, would be added as contributors.
Although it is possible to have historic homes that were built after 1958, generally, non-contributors are homes that have been altered to the extent that their historic integrity has been lost, even though it might be an old home. Examples of loss of integrity include: the windows being replaced or a bad second floor addition.
With the Mills Act, and we have dropped this term a lot tonight, the tax benefit literally compares to Proposition 13 in that there is a reduction in your property tax based on the fact that you have a historic home. Many homes that would not qualify for the Mills act as individually designated houses could qualify as a contributor to a district. So, all of a sudden, there are many more homes that have that option.
Bruce CoonsAnd the other big advantage is when you do sell the house--because you can transfer that tax rate to the new owner no matter what the purchase price is and that is much different than proposition 13.
Q. Why were the boundaries decided and will the area surrounding the district suffer when the district is approved with demolition of the small bungalows surrounding the district?
A. Janet O’DeaAll of Mission Hills was the original proposal but task was too daunting. We want to protect the entire community and why we are starting now
.Angeles Leira
What are the sentiments on your block? We looked at the size of the Marston subdivision and it is huge. The bigger it is the more likelihood there is that you are going to have a laborious process that could be come difficult if there is not strong enough broad support for the proposal.
At that point, the neighborhood has to make a choice Do we make it small enough so that it is manageable or big and unmanageable. A real life example is Shirley Ann Place in North Park. It is one street – one alley. It was 100% is a great neighborhoodate some of their concerns and it took much longer. Sometimes it is a matter of timing and community support. If you have the community support then you might want to consider some expansion.
Q. When you are 8 feet from something that just ate the whole lot and the balcony looks right into our backyard and doesn’t look like the neighborhood…I invite the neighborhood to look at the contrast because this could happen to you.
A. Angeles LeiraSo maybe you want to talk about it but when you do you also want to talk about it to find how many people in your neighborhoods or block want to join in because the level of success is based on support.
Q. One of the unintended consequences is that property owners that want to develop their properties feel they have to do it now. The land value is 70% there is a lot of incentive to build a larger home on that lot. If one of the problems of pursuing a larger district is that the politics takes another year--is there a way to protect homes in the interim during that year while the district is being considered?
A. David MarshallI’m not aware of any negative effect that manifests itself in adjacent neighborhoods. A proposed historic district doesn’t activate others to tear down properties before the district takes effect. People in neighboring communities see the hem more attuned to preservation, not less.
Q. I have concerns with what happened in uptown. The city approved demolition of homes that are still sitting as empty lots - they wanted to be free to build condos on those sites. I was on the Planning Board for 8 years and other communities, that weren’t historic districts (such as homes in LaJolla and Point Loma) Sometime small homes were torn down because of the property values. People in those communities were worried but didn’t do anything to change it and on the planning board we didn’t have the grounds to deny this redevelopment because they didn’t have a district that was overlaid or to be considered to get the permits.
A. Janet O’Dea
That is why we feel urgency in our call to action. That is why we want to get community support. This is the only thing that we can do. We don’t want to see it happen here any more.
Bruce Coons
This comes back to the expansion of the district. The research that is involved takes on a lot of effort.
Normally the basis of the district from a planning point of view, you would determine how the neighborhood developed--is there a theme and a time period? There is here, there is the Marston development and a number of different developments in this area came about –some of them happened simultaneously. Some of them happened in s is a little bit arbitrary as we are starting within the Mission Hills subdivision.
.Something that makes sense is to expand it and it is a huge amount of homes.
This is like a normal design review area. It is basically a level of design review, which doesn’t say you can’t build new homes, you can expand your house, and it doesn’t say you can’t add things.nt to live heater.
Q. Right now there is a house on Aquello and Sunset….
A. Janet O’Dea
If you want to walk the streets and let us know if there is support maybe we can put these two together.
Q. I live in a Mission Hills house just outside this district. We are in the initial process of applying for the Mills Act. Is there any advantage to be a part of the application for a historic district because of the cost in applying for the Mills Act and for the success in applying for the Mills Act?
A. Bruce CoonsSuccess might be higher but the research still has to be done on your house and there might be a little reduced if you are going to be a contributor.
Janet O’Dea
We are hoping to get some bids for the research and we hope to get a committee together to work on fundraising that would be across the board, have a home tour in the district and get community spirit involved and make it a little less for everybody but again that is with the district.
Comment: The research is not a scary thing. The city staff was great and very available. At the board meeting the board thanked us for saving our house
Q. If we move forward and start the research process and with the City struggling right now, what can we rely upon from the city staff for support?
Janet O’Dea
Thanks to Councilman Zucchet’s office for picking up the ball on sending out notices. There are some funding issues so that is something that we need to be aware of.
A. Angeles Leira
Showed a 6-inch thick report, which was an example of the research report conducted for the Burlingame District .
In Burlingame we had the benefit of a recognizance study done in the 1990’s by Wayne Donaldson’s firm that identifiy a description of tround of the area asbuilding was designed by a master architect, we put it in the report, if we found out that the building had been occupied by a historical person, we put it in there.
Bruce is right that when we do a district the most important thing is to have a basic description of each site that ties it to the significance of the district. If the district is significant because like this one it was one of the first subdivisions that came in of the end of the rail corridor in the expansion eastward of the city and was a subdivision of a special design that was not a typical grid pattern subdivision etc. If each site fits into this description then making that detailed description in relation to it is enough to find the contributor elements to it as long as the building has not been changed too much.
From that perspective, it is easier to do it for contributing sites but it is still quite laborious. It takes in depth survey and writing up everything about every particular site. In every district you need to identify some criteria that is going to be used to evaluate additions or new buildings that come into the district in the future.
It is not that difficult to put together because now what we use is the Secretary of Interior Standards as the basis but we do develop some additional criteria that fits in a particular neighborhood. So that is what it takes to do. The document then is turned over to city staff. Staff evaluates usually adds on to it some more and then presents it over to the Historic Resources Board.
The board has to have two hearings on it. One to decide if the information is complete and ready for an evaluation for significance; and the second hearing is the significance hearing where the board designates the district and with that they also designate the contributing sites as historic sites. That action is final unless appealed to the city council within 10 days. If appealed then the city council makes the final decision.
It is a process that involves hearings we always recommend to the activists in the district to get as close as possible 100% support. In Burlingame, we had 80% support and it took longer to develop the district. The more that you have to support, as this relates to boundaries, the better it is to manage the process. Otherwise there are delays and with delays often things get worse rather than better.
Q. If a district is designated and another street wants to --can the street add on to that district?
A: Angeles.LeiraThe City of San Diego created different types of districts. In Ocean Beach for example we have an emerging historic district. Activists in Ocean Beach wanted the district with 40 sites scattered all over the map. The homes could not be designated individually as they were modest. These people wanted to get designated as an emerging district. The emerging district allowed us to identify a community boundary and over time more people are coming on to be designated.
The first year we designated the approximately 30 out of the 40 that were submitted. The second year we designated another 30. The third year we designated six. This year we have five already coming in for designation. So we have the ability to do that too.
Q. While that is occurring. Other things are going on? (Referring to unprotected demolition)
A: Angeles.LeiraThere is no protection for the area. There is slight protection for homes that are 45 years old. When they come in for major modification or demolition the city will require a historical study. The city will see the historical study and if we think that that site meets the criteria of the district, we will bring it to the historical resources board for designation. The problem with that is that you have a nasty hearing because the owners do not want to have it designated. But there is still a possibility of designation.
One interesting thing that is happening is that because of the possibilities that the Mills act offers--either with an immediate reduction if people just bought the house or if long time residents in the future as a marketing tool--a l so a historic site is subject to the historic building code which doesn’t trigger a lot of the new building code requirements when people fix uignation talk to city staff and we look at what they want to do in the they do turn around and even though they may have started out without enthusiasm for the designation they end up coming in for designation and we have good examples of that too.
Bruce Coons
Mission Hills is the ideal place for a traditional district.
Comment: An Uptown Historical survey is currently underway. This survey is extremely important because the current survey was only up to Laurel and the last survey was done earlier than 1996. This survey allows the city to identify potential sites. This is a big help when any type of development goes in. It gives an edge over not having a survey being completed.
Angeles Leira
A. The survey is a walk survey and the whole uptown survey runs out July 2004. We have a parallel historical study that entails oral interviews and oral histories of long time residents that is part of the discussion on this coming Saturday at the Birney Elementary School.
Q. Our petition that we signed was with a hope that this survey would do a lot of our research for us and I am not sure that this survey is to the depth that we need even though it will still be a benefit - Is that true?
A . Angeles LeiraThat is true. The survey that is being done for all of uptown is going to be a recognizance survey which will basically identify in maps the properties that are potential historic sites either as stand alone or conglomerates of them in certain areas that should be districts. We will know the survey addresses, architectural style and photographs but we won’t have more detailed information that you actually need to get a district going. After having that discussion the proponents decided that it would be a good idocument for this smaller area that addresses the district standards rather than wait for the survey because that will stretch it for two years or maybe more.
Q. Getting back to neighborhood support vs. neighborhood opposition. Is it a matter of political will to get approval of the district? If enough people are opposed to it will there be not enough political willpower to pass it?
A . Angeles Leira
It is a political decision and if most people are rising in support they are likely to approve it.
Q. If streets are added with some that have bad remodels then there might be more opposition from the owners on those streets instead of support and in terms of defining the district. If residents are opposed then it will make it tougher for the whole area.
Comment: The homes that have been decimated would not be contributors at all. If 100 houses in the area and 77 are potential contributors then you need 60% of the 77, not of the 100 – is that correct?
A. Angeles Leira
No. For a traditional district per the Federal guidelines, although we don’t have that same exact number the recommendation is 60% relates to all of tre still whole and look at reducing the size of the district. It is a federal guideline and we want to achieve this to make the proposal stronger.
Q. To clarify, for the above example of 100 homes and 77 are contributors, so the other 23 homes that are non-contributing have the potential to make a district by themselves – The 23 houses have been added on to poorly they have not been considered a contributor.
A. Angeles Leira
If it is a traditional district from the city of San Diego, they cannot opt out they need to abide to the District guidelines. The whole idea of the district is even if not all are contributing sites the guidelines for development ensure that future development is sympathetic to the historic buildings and therefore the feel of the neighborhood remains. So even if you are not a contributor you are affected and when a project comes in under a traditional district we still review the project on that property per the guidelines. They are not as strict as they would be forasa designated historic site but we deal with scale, with some features especially in the front to make sure that there is consistency in the whole, --so that in the future those sites that may not be contributors still have a good physical tie to the whole district.
Q. Explain the voluntary issue since Burlingame would not have been a district.
A. Janet O’Dea
This is not our proposal.
Bruce CoonsBurlingame is a loose collection of individually designated sites with one advantage in that you can get a contributing site individually designated it has no protection for the neighborhood, for the property values, no protection for the environment. SOHO is against these types of districts. The voluntary district would be devastatingly bad for Mission Hills it would create a situation that happened just like in La Jolla, where you would have very good historic buildings that want to be in the district. But if they don’t want to be in it then they can be torn down.
Angeles LeiraIt is not our preferred way but we did create this type of voluntary district idea because practically speaking, that is the only way that politically we are going to get the large districts approved at least that was the case about a year ago.
The idea behind the voluntary district was
1) To deal with the political situation
2) To have a way by which that it could be shown to the individuals within the district area that were not sold on historic designation that being designated historic was not bad. These are the people who were still doing minor modifications to there homes, adding second stories to their houses, life went on and historic designation was not so threatening and it does not formaldehyde a building, it sets the example. {Does not formaldehyde here refers to preservation of the home while continuing living in the home.} And that was the basis also for looking at this other type of voluntary type of district as a way to handle some areas.
In LaJolla, you couldn’t mention the word district before and now you can because they accept the voluntary principle when those people get their district other s don’t have to be included. Later on they may want to be included
Q. Isn’t there a conversion process whereby a voluntary district at a certain percentage can become a full-blown traditional district?
A. Janet O’Dea
Burlingame is approaching that also.
Angeles Leira :
We did that in order to meet our duties to the federal guidelines because we are what is called Certified Local Government (CLG) , which has a certain status. If a district is voluntary and people start coming in individually to get sites designated once they get to 85% of the properties designated as contributors then the traditional district kicks in. Then there will be hearings to be designated as a traditional district where everybody is in the district and everybody has to abide by future development guidelines. So we did that on purpose to make sure that these voluntary districts didn’t stay in limbo forever. That at some point they need to mature and be responsible.
Bruce Coons:
This is a much higher threshold than applying for a traditional district to begin with, which is 51%
And then it runs up to 85% by this route.
Q. Sandy, could you tell us about the Mills Act and how it works in conjunction with historic district status?
A. Sandy WoodhouseThe Mills Act is a property tax relief measure that applies on a case-by-case basis. Whether individually designated or part of a district, it is the contract between the city and the owner of the property that entitles an owner to the Mills Act tax relief. The fact that it is a district doesn’t change the application of the Mills act.
If you can designate your own house you qualify for the Mills Act. If you are in a district and you are designated then you qualify for the Mills Act but in either case you still have to be under contract.
The Mills Act requires the Assessor to revalue the properties under contract each and every year. There are three calculations done to assess the property.
1) Income approach to value as though the property is being rented – it is constrained by certain factors given to us every year by theSo it is a substantial reduction if something was newly acquired.
2) Prop 13 base plus indexing - Everybody has a Prop 13 base – except owners who are taxed on their timber or oil wells. Ifu bought your property two years ago, you have a Prop 13 base. has gone up substantially more than 4% over the last two years. Even really recent owners all have Prop 13 bases.
3) Market Value – The current market value of the property.
The assessor compares these three numbers and gives you the lowest assessed value of these three calculations. People who brought prior to about 1988 or 1989 usually don’t immediately see a tax reduction under the Mills Act calculations. The Prop 13 base is lower.
Properties under the Mills Act are automatically reviewed every year. Since it is under contract, the new buyer in not subject to supplemental taxation and the new buyer is reassessed in January based on the lower of the three calculations. Often they see a 40-60% reduction. So it is a really good selling tool and it is very helpful for new owners who are moving into a district or a potential historic house to have a tremendous reduction right away for their property taxes.
It doesn’t do anything for someone who has owned and lived in the house since 1945. It is not going to cut your property taxes.
Q. If you are in a historic district do you automatically qualify for the Mills Act or do you need to be a contributing home within the district.
A. Angeles LeiraYou need to be a contributing home within the district. Then you still need to request the city to go through a Mills Act contract. Sign and notarize the contract and there is a 1% fee of the assessed value of the property but no more than $400.00. This is to process the paperwork and we keep track of it to make sure that the property is maintained.
A. Sandy WoodhouseThe Mills Act is a 10-year self-renewing contract between the property owner and the city. It starts out 10 years long and at the end of the first year it renews, so its termination is always 10 years in the future. If you want to cancel your Mills Act contract you can provide notice that you no longer want to participate, but you are not out of the contract until the 10 years runs out. To get out earlier there is a penalty where you basically pay back some of the property tax reduction that you have received.
Q. If you sell a property that is under Mills Act contract and the buyer of the property does not want to continue that contract - is the seller obligated to the buyer.
A. Sandy WoodhouseThe contract runs with the land. If the buyer opted out then they would have to pay the penalties. To date, Countywide there are currently approximately 600 contracts and none have been cancelled. There may have been one cancellation in the state of California. It is very unusual, as most people want this benefit.
Q. How do you establish the rental rate – is it done geographically?
A. Sandy WoodhouseWe conduct a field survey to research rents. We used ads in the paper and gathered information from other sources. As with any appraisal, rates are to be taken from comparable properties.
Q. We are remodeling in the back of our historic house adding more square footage and increasing the size of the home. How does that affect the tax rate under the Mills Act?
A. Sandy WoodhouseBecause you are under the Mill Act we will still be reviewing the income value, Prop 13 plus index and market value. There have been instances whereby only a very small historic portion of a building was retained and a larger new structure was added. From a tax revenue point of view this could have substantial impacts on the City and the school district. Major additions will be assessed at the market value of that addition.
Q. All we are planning is conversion a storage area above the garage, which is not taxable into a room so it will now be taxable.
A. Sandy WoodhouseThat is not the same thing as keeping a wall of a historic site and building 8 condos behind it and trying to get all 8 condos tax relief under the Mills Act.
Bruce Coons
One of the advantages of the Mills Act --if you do an addition it gets assessed at the Mills Act rate not at a new addition rate. It is an advantage within the Mills act. You are not taxed the full tax that you would be if you added a new addition or pool
Angeles Leira
Sandy is right because we have some cases with very big lots the front is left and a big house is added in the back when there is little left of the house and the historic review process approved the building. These are some of the extremes and the formula needs to be fair related to the historic portion.
Bruce CoonsThere have been quite
anumber of houses that have doubled in size whereby the original structure is still there and they fall very appropriately within the contract.
Q. How would a property like the condos be designated much less get the Mills Act? Isn’t the whole idea of the Mills Act to offer a tax reduction in exchange for protection of the property?
A, Bruce Coons : It was designated first.
Angeles Leira :
That is right. We use guidelines that allow additions to properties. So designation doesn’t mean formaldehyding a building. You can make sensitive additions and some additions are large. Some are on large lots and some are zoned for higher density and we have to balance and weigh razing the whole building or do we maintain a remnant. And when we only have a remnant we have to discuss it.
Q. If I am a contributor am I limited? What does it mean? Can I add a bathroom?
A. David Marshall
You’ll hear the term The Secretary of the Interior’s Standards - these are federal guidelines from the National Park Service, which are general standards for historic properties. They are very subjective and it’s the role of the Historical Resources Board to interpret whether a proposed change to a building meets The Secretary of Interior’s Standards. Briefly, I would like to touch on what these Standards are.
If the home is designated or determined to be contributing to a district, it is based on the exterior of the home that is in public view, or the street facade. If you have a corner house you have two street facades.
Facades are less sensitive where there are items that are not visible to the street. For example, a very nice historic home with a large addition on the back – even if it was done poorly – can be designated as long as the addition is not something that affects the street view. A home’s contribution to a district is really intended for public viewing and not just for the private residents of the home.
Also, a historic home should have a very intact exterior shell. Some have had the interior gutted by a previous insensitive remodel, but are still considered historic because -- from their exterior appearance – the homes still contributed to the neighborhood.
That’s nor those aspects of building. Designation is mainly focused on the exterior and street facing facades.
There are 10 Secretary of the Interior’s Standards when talking about rehabilitation, or remodeling, of a historic property. I will paraphrase these:
1) Try to keep the use. If it’s a house don’t convert it into a carwash. That is the easiest way to destroy the integrity of the building. This is not just for homes it is for any type building.
2) Avoid removal or alteration of historic features.
3) Don’t make changes that create a false sense of history. Don’t add a bell tower to make your house look like it was once a schoolhouse and don’t add fake rocks to a retaining wall to make it look old. These things can alter the historic character of the neighborhood.
4) Previous changes that have been made to the building sometimes have significance in their own right . If you have a home built in 1910 and they enclosed the porch in 1930, that porch wouldn’t need to be removed. Older alterations may be contributing features in their own right because they may have obtained their own significance based on when they were done.
5) Preserve distinctive features.
6) Repair rather than replace. If there is a case where you have a porch railing that is badly decayed, the Standards would not want it completely replaced by new wood. Basically, just replace the area that requires repair. Once you lose original features they are gone forever; so the intent is to save as much of the original building as possible.
7) Use the gentlest means possible to restore the home. No sandblasting. Most of these homes are wood, so there are certain methods that you should use -- and should not use.
8) Archeological resources should be preserved. This does not come into play generally with homes, but relates more to buildings in downtown San Diego, for example.
9) Exterior additions, alterations, and new construction shall not destroy historic materials. If you’re adding something on don’t demolish the existing wiisting building. This goes back to the false sense of history issue. The Standards don’t want you to build an addition that someone might think is part of the original building because it changes the character and the reality of what was there historically
There are some very well done homes in the Mission Hills area where they have done additions. As an architect I prefer the “squinty eye” approach, which means that when you stand back from a distance an addition does not call attention to itself. But if you really look at the details, the windows are slightly different in design, the cornice may be changed, or there’s a slight color change between the original house and the new addition.
There are two terms that sometimes clash – “Differentiated” but “Compatible.” An ach is part of the HRB, which works with h on The Secretary of Interior’s Standards.
10) Additions and new construction shall be removable or reversible. If you sell your home in 20 years and you’ve added a sunroom to the back the new ow still there between the two walls? If you remove a historic window you should keep it in storage, so if someone wants to reinstall the window later they can.
There is really a lot of flexibility within the Standards and a lot of interpretation. With contributing homes The Standards are not as critical as they are with an individually designated home. In the case of the Villa Montezuma it has a very high standard of historic integrity. The Standards really don’t severely limit what people can do regarding interior alterations.
If a building permit is required, or if the home is older than 45 years, or if it’s within a district it will automatically get sent to the Historical Resources Botimes it doesn’t if the new work is limited to the interior. It is just a process that is in place to prevent people from destroying the historic integrity of a neighborhood.
End
