The Mills Act was enacted by the State of California in 1972 as a way of encouraging partnerships between local governments and property owners of historic resources. Carmel is a voluntary participant in the Mills Act program. The Mills Act contract is for a period of 10 years and includes renewal provisions. The property owner agrees to specific rehabilitation/restoration efforts that occur over the life of the contract. In turn, the property owner receives a reduced property tax assessment. The assessment is performed by the Monterey County Assessor’s Office. The City benefits by having historic resources rehabilitated and maintained, while the property owner benefits by having a reduced tax burden, which in turn reduces property tax subventions to the City.
The City’s Historic Preservation Ordinance (CMC 17.32.100) offers Mills Act contracts as a potential benefit to property owners of historic resources that are listed on the City’s Historic Register. The Historic Resources Board (HRB) is advisory to the City Council on Mills Act contracts.
Municipal Code Section 17.32.100.B.6 establishes the following specific findings that must be made by the City in order for the property to qualify for a Mills Act contract:
Finding #1: The building is designated as a historic resource by the City.
Finding #2: The proposed rehabilitation and maintenance plan is appropriate in scope and sufficient in detail to guide rehabilitation and long-term maintenance. Required maintenance and rehabilitation should be more significant than just routine maintenance that would be expected for any property.
Finding #3: Alterations to the historic resource have been in the past, and will continue to be in the future, limited to interior work and to exterior rehabilitation and alterations that:
(A) Comply with the Secretary’s Standards (future additions only), and
(B) Do not significantly alter, damage or diminish any primary elevation or character-defining feature, and
(C) Do not increase floor area on the property by more than 15 percent beyond the amount established in the documented original or historic design of the resource, and
(D) Do not result in any second-story addition to a single-story historic resource, and
(E) Meet all zoning standards applicable to the location of the property.
Finding #4: The Mills Act contract will aid in offsetting the costs of rehabilitating and/or maintaining the historic resource and/or will offset potential losses of income that might otherwise be achieved on the property.
Finding #5: Approval of the Mills Act contract will represent an equitable balance of public and private interests and will not result in substantial adverse financial impact on the City.
At the August 21, 2017 HRB meeting, the Mills Act contract application was reviewed by the HRB. The Board recommended City Council approval of the contract with modifications to the rehabilitation/maintenance plan. Upon further review of the existing condition of the property, the Applicant revised the plan and requested reconsideration by the HRB on some of the recommended revisions. At the October 16, 2017 HRB meeting, the HRB reviewed the revised plan and determined it was consistent with the required findings and recommended City Council approval of the contract with some additional modifications to the plan. The Applicant has incorporated the revisions into the rehabilitation/maintenance plan which is included as Attachment 3. Also attached are the DPR 523A Form, existing photos of the historic resource and a draft Mills Act Contract.
The historic resource is known as ‘Doll’s House’ and is located at the northwest corner of Santa Rita Street and Ocean Avenue. The residence sits on a 2,600 square foot lot and is approximately 1,150 square feet. The residence is a one-and-one half story, wood-framed Tudor Storybook cottage. The home was designed and constructed by Hugh Comstock in 1928. Mr. Comstock developed the “Fairy Tale” style with which Carmel has become closely identified. He is listed in the Historic Context Statement as one of the notable Designers and Builders of Carmel.
The Maintenance Program includes rehabilitation/maintenance work such as replacing the eaves/roof overhang, repainting the residence, repairing the stucco, window and door rehabilitation, termite tenting and tree trimming. The HRB recommended that the City Council approve a Mills Act contract for this residence. Staff notes that this is the only Mills Act contract application received by the City for 2017.