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Unlocking Savings: Dive into The Mills Act and Its Tax Benefits

November 8th, 2024

 

The Mills Act is an important legislation in California that offers economic incentives for preserving historic properties. In Santa Barbara County, the Mills Act plays a vital role in maintaining the region’s rich architectural and cultural heritage, ensuring that historic landmarks are preserved for future generations.

1415 Dover Road was constructed in 1928, designed by architect Leonard Cook. SOURCE: SB Historic Preservation.

History of the Mills Act


The Mills Act is a law created in California in 1972, thanks to the efforts of Senator James Mills. Its main goal is to help preserve historic buildings by offering financial incentives to their owners. The idea is to recognize the importance of these historic sites and assist with the costs of keeping and restoring them.

This law has been essential for preserving local history in places like Santa Barbara County, where the architecture and heritage are key parts of the area’s identity.

Santa Barbara County has many historic buildings that showcase beautiful architecture and tell important stories about the past. Thanks to the Mills Act, property owners can receive significant tax breaks, encouraging them to take care of these special places. 

Currently, about 250 homes in the county are recognized as historic landmarks. These buildings represent a variety of architectural styles, from Spanish Revival to Craftsman, and they contribute to the region's rich heritage.

This elegant Italianate-style house at 1407 Chapala Street was designed in 1872 by Peter Barber. SOURCE: SB Historic Preservation.
This beautiful Craftsman style bungalow was constructed in 1920 at 1311 North Salsipuedes Street. SOURCE: SB Historic Preservation.

How the Mills Act Works


Under the Mills Act, homeowners with historic properties can sign a 10-year agreement with their city or county. This agreement sets out certain rules to help preserve the property’s history and character. In return, these homeowners can enjoy a big decrease in their property taxes, anywhere from 20% to 70%.

This reduction is based on the property's worth before any major repairs or renovations.

This Queen Anne-style building was designed by Thomas Nixon. SOURCE: SB Historic Preservation.

Guide to Applying for the Mills Act


  1. Determine if Your Property is Eligible: Homeowners should determine if their property is already recognized as historically important or can be designated as such. This usually means checking if it meets certain guidelines set by local authorities, like having special historical or architectural features.
  2. Contact Local Authorities: If you’re interested in the Mills Act, contacting your local planning or historic preservation office is a good idea. They can help you understand how to apply, what documents you’ll need, and any local rules or deadlines you should know.
  3. Prepare Documentation: Gather all required documentation, including a detailed description of the property’s history, architectural significance, current condition, and previous restoration efforts. Photographic evidence and historical records can bolster your case.
  4. Submit an Application: Fill out and send in the Mills Act application form available from your city or county. Ensure you include all the necessary documents and that your application is complete and correct.
  5. Do a Property Evaluation: You might need to have your property checked by experts who focus on preserving history. Be ready to let them come in, look around, and give them any extra information they ask for.
  6. Enter a Contract: If your application is accepted, the next step is to work with your local government to create a Mills Act contract. This agreement will set clear goals and guidelines for preserving your property, and in return, you can receive tax benefits.
  7. Maintain Regular Compliance: Once you've signed a contract, follow the required preservation standards. Local authorities may need to check in regularly to ensure you qualify for tax benefits.

By following these steps, you can apply for Mills Act benefits. This program helps you maintain the historical importance of your property while also giving you significant savings on your taxes.

1920s Tudor Revival style house at 3135 Calle Mariposa sits in Santa Barbara’s San Roque neighborhood. SOURCE: SB Historic Preservation.
English Cottage style house constructed in 1925 has a rare curved thatched roof, that is typical of the original style. SOURCE: SB Historic Preservation.

Benefits of Participating in the Mills Act


2014 Garden Street is Mission Revival home built by A. Page Brown in 1895. REPRESENTED BY Marsha Kotlyar Estate Group in 2022.
Historical sites are recognized across the county, with plaques providing information about the properties' historical significance.

Joining the Mills Act program comes with several advantages. For starters, it can lower property taxes for owners. It also encourages careful and respectful restoration of historic homes, helping them keep their original beauty and character. This program can inspire neighborhood renewal, attracting people who want to invest in restoring historic buildings. As these buildings become more appealing, they can even turn into tourist spots, which helps local businesses thrive.

When a property that is part of the Mills Act changes hands, the new owner takes on the same responsibilities outlined in the original agreement. This means they must uphold the standards for preserving and caring for the property, helping to maintain its historic value. The new owner also benefits from the tax reductions with the Mills Act. It's important for anyone considering buying a property under this program to fully understand these responsibilities because not following the rules could result in penalties or losing tax benefits. This consistent commitment is vital for protecting the community’s history and encouraging ongoing investment in preserving historic homes.


Impact on Santa Barbara County


The Mills Act has made a big difference in Santa Barbara County, with over 150 properties participating since it started. This includes homes, stores, and even whole neighborhoods. Thanks to this program, some of the area’s most famous landmarks, like the Santa Barbara Courthouse and El Paseo shopping plaza, have been preserved while keeping the county’s unique style intact.

This program plays a key role in protecting Santa Barbara County’s rich history and architectural beauty. It helps property owners and contributes positively to community growth and development. By promoting careful restoration, the Mills Act ensures that future generations can enjoy the county’s historic buildings. For anyone who owns a historic property in Santa Barbara County, joining the Mills Act is a great way to be part of this preservation effort. Remember, taking care of our history is important for creating a better future!

Entrance to the Santa Barbara Central Library, designed in 1925 by Carlton Winslow.

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