City Council
October 28, 2025
Mills Act Contracts
Item 4-A
October 28, 2025
Item 4-A
October 28, 2025
Mills Act Program
• A California state law (1974) ; Santa Monica Municipal Code Section 9.56.270 Preservation Incentives (1992)
• Allows potential tax savings for the upkeep, restoration and rehabilitation of the qualified historic structures.
• Designated structures of merit, landmarks and contributing buildings or structures located in Historic Districts are eligible for Mills Act Contracts
Item 4-A
October 28, 2025
Item 4-A
October 28, 2025
Mills Act Contracts – Gov’t Code & SMMC
Historical Property Contracts: Pursuant to the provisions of Article 12, commencing with Section 50280, Chapter 1, Part 1, Division 1, Title 5, of the California Government Code. The City Council shall, by resolution approve a historical property contract with the owner of a qualified historical property, provided that:
1. The property has no confirmed and outstanding violations of this Code, or any other applicable Federal, State or local law, rule or regulation;
2. The property is not subject to a tax delinquency; and
3. All completed or ongoing alterations, construction or rehabilitation to designated buildings or structures located on the property conform to the Secretary of Interior's Standards for the treatment of Historic Properties.
Santa Monica Municipal Code Section 9.56.260(F)
Item 4-A
October 28, 2025
Item 4-A
October 28, 2025
Mills Act Program
• City and property owner enter into an agreement that includes a 10-year Restoration/Rehabilitation & Maintenance Plan known as a Mills Act Contract
• The initial contract term is 10 years, automatically renewing annually • The contract remains in effect even if the ownership changes.
The Mills Act Contract program is an important preservation incentive program because designated properties are:
• in a more rigorous regulatory environment, and
• more expensive to rehabilitate and maintain these properties. • Incentive ensures historic resources can be maintained into the future Item 4-A
October 28, 2025
Item 4-A
October 28, 2025
Mills Act Contracts by Location
Property
Types Count
Commercial 9
Single-Unit 52
Multi-Unit 43
Mills Act
Properties
Overview
Item 4-A
October 28, 2025
Item 4-A
October 28, 2025
Mills Act Contracts – Current Overview
The Annual revenue reduction for all contracts for the calendar year 2025 is estimated to be $395,185; Since the year 2000, the City’s revenue loss has been approximately $4,479,183
Item 4-A
October 28, 2025
Item 4-A
October 28, 2025
226 Palisades Avenue: 25ENT-0084
• Designated a Landmark 2025
• Rehabilitation on going,
maintenance going forward
• Rehabilitation $722,670 +
Maintenance $52,000
• $774,670 over 10 years
estimated
• Estimated property tax
reduction - $36,207.71
Item 4-A
October 28, 2025
Item 4-A
October 28, 2025
1958 20th Street: 25ENT-0076
• Designated a Landmark 2025
• Rehabilitation on going,
maintenance going forward
• Rehabilitation $104,000
Maintenance $ 20,000 +
• $124,000 over 10 years
estimated
• Estimated property tax
reduction - $17,060.91
Item 4-A
October 28, 2025
Item 4-A
October 28, 2025
137 Hart Avenue: 25ENT-0089
• Designated a Landmark 2025
• Rehabilitation on going,
maintenance going forward
• Rehabilitation $399,800
Maintenance $112,500
• $512,300 over 10 years
estimated
• Estimated property tax
reduction - $32,581.72
Item 4-A
October 28, 2025
Item 4-A
October 28, 2025
Financial Estimates
Address Estimated tax
reduction- owner
City Revenue
Reduction
1958 20th Street $17,060.91 $2,388.53
137 Hart Avenue $32,581.72 $4,561.44
226 Palisades Avenue $36,207.21 $5,069.01
Total Annual City Revenue Reduction= $12,018.98
Item 4-A
October 28, 2025
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October 28, 2025
Exploring How to Sustain the Program
• Establish an application fee for Mills Act Contracts
• Establish fees for monitoring contracts over time
• Establish a contract limit and allow for a 10-year
renewal with a new maintenance and rehabilitation
agreement
Item 4-A
October 28, 2025
Item 4-A
October 28, 2025
Study of Potential Fee
Mills Act Application, Monitoring, Code Compliance
• Santa Monica has no Mills Act application fee, no monitoring or Code Compliance fee
• Potential Mills Act fee assessment underway with comprehensive 2026 fee study
• Review of other City’s Mills Act associated fees; San Diego has both a Mills Act monitoring fee and Code Compliance fee
Item 4-A
October 28, 2025
Item 4-A
October 28, 2025
Item 4-A
October 28, 2025
Item 4-A
October 28, 2025