Do you love old homes? I know I do. 24 years ago, my wife and I fell in love with a historic lake home back in our home state of Minnesota. We bought it and have been painstakingly restoring it over the years with no benefits to ourselves beyond the satisfaction and pride it gives us. Do you know that if we’d bought a similar home in California, including Burbank, we could have applied for a Mills Act Contract and potentially be saving as much as 75% on our property taxes for life? That’s right, California recognizes the value of these homes to the character and history of our communities, and it pays serious dividends that you can enjoy AND pass on to future owners if you choose to sell the property.
How it works
The first step toward achieving a Mills Act Contract is to get your home designated as a historical resource by the City of Burbank. The home must be at least 50-years old, and there are four criteria for a home to qualify for designation and you only must answer YES to ONE of them: 1. Has your home contributed to Burbank’s history? 2. Is your home associated with an historical figure? 3. Does your home have distinctive architectural characteristics? 4. Could your home yield important historical information?
Burbank home constructed by silent film star
A great example of this is the home at 923 E. Magnolia Blvd. This home was built by Ruth Roland, a silent film star, in 1927. This Tudor Revival home boasts classic architectural elements that were unaltered, and Ruth had built a concrete vault in the backyard to store dozens of her films in the event of a fire or natural disaster. In 1980 the vault was opened, and the perfectly preserved films were donated to the UCLA Film Archives. Again, this property checks off all four boxes for designation, but only one is necessary to qualify.
There is a single-page application to request historic designation for a property and you can download it from the City of Burbank website or reach out to me for more details. Once your application is received it will be reviewed by the Burbank Heritage Commission before a recommendation is made to the City Council to approve the designation. Currently Burbank only has 9 designated residential homes, and the Heritage Commission is eager to assist in designating more. I was a volunteer on the Heritage Commission for three years and am happy to assist anyone with their application and to explain the program in greater detail.
Mills Act Tax Abatement program
Once a home is designated as a historic resource you may then apply for the Mills Act Tax Abatement program. Again, this is a process that can be completed through the city of Burbank. In a nutshell, an applicant submits a 10-year work plan that describes the work necessary to repair or improve the property which could include landscaping, interior upgrades, and even the addition of a pool or deck. Keep in mind that all exterior work will have to be approved by the Heritage Commission to make sure the integrity of the original structure is maintained.
The justification for the tax reduction is that when windows or the roof need replacement, you cannot simply put in any kind of shingles or windows. If the original windows are wood, they will need to be replaced with new wood windows that closely resemble the originals including the number of panes of glass and the style such as double-hung as opposed to casement windows. Spanish tile roofs will need to be replaced with the original tiles if they can be salvaged, or the closest approximate replacements that can be found.
Each year, the owner submits a list of completed projects until the work plan is completed. After that time period, the tax benefits remain, and the owner simply sends a list of work projects that have been completed each year with a rough estimate of the cost of the work. It is not necessary for the cost of the work to equal or exceed the amount of tax savings.
In my next article we will discuss the benefits and myths of historic designation. Until that time, feel free to reach out to me on Instagram @jimcaseyrealtor or by email at firstname.lastname@example.org.