HomeMy WebLinkAboutC32010 - Cultural Resources Preservation Committee - Mills Act - Shadow Mountain Golf ClubContract No. C32010
CITY OF PALM DESERT
BUILDING & SAFETY DEPARTMENT
STAFF REPORT
REQUEST: APPROVE MILLS ACT CONTRACT FOR SHADOW MOUNTAIN
GOLF CLUB
SUBMITTED BY: Russell A. Grance, Director of Building and Safety
DATE: July 12, 2012
CONTENTS:
1. Mills Act Contract
2. Mills Act Program Manual
Recommendation:
Approve Mills Act contract for the Shadow Mountain Golf Club, reaffirming the
recommendation of the Cultural Resources Preservation Committee; in accordance
with section 29.70.030 of the Palm Desert Municipal Code.
Background:
The Mills Act (Government Code 50280 et seq.) is a State law that provides incentives
for the restoration and preservation of qualified historic buildings by private property
owners. Enacted in 1972, the Mills Act legislation grants participating local governments
(cities and counties) the authority to enter into contracts with owners of qualified owner -
occupied and income -producing property who actively participate in the rehabilitation,
restoration, preservation and maintenance of their historic property. In exchange,
participating property owners may be eligible for a reduction in their property taxes.
The Mills Act is recognized as one of the most important incentive programs available in
California for use by private property owners of qualified historic buildings. Over 80
communities in the state have established a Mills Act program.
Staff Report
Mills Act Contract
July 12, 2012
Page 2 of 3
Discussion:
The Palm Desert City Council recently named Shadow Mountain Golf Course as the
City's first historic district. Founded in 1958 and designed by legendary golfer Gene
Sarazen, Shadow Mountain is the only golf course in Palm Desert to have received a
historic designation. Originally affiliated with the adjacent Shadow Mountain Tennis
Resort, the course is now privately owned and run by its members.
What started as a dream of former U.S. Senator and Washington Governor Monrad
"Mon" Wallgren is now a challenging par 70 with well-defined fairways, small greens
protected by white sand bunkers, and more than 700 mature trees. Although it has
experienced some changes throughout its 52 years, including the construction of nearby
homes and cottages, clubhouse updates, a catastrophic flood in 1976 and an expansion
a decade later, Shadow Mountain remains one of the few courses in the desert that
golfers can still walk.
The Mills Act allows the City to enter into a historical property preservation agreement,
also known as a "Mills Act contract" with the owner of a qualified owner -occupied or
income -producing property for the purpose of protecting and preserving properties of
historical significance. As a general rule, a building is considered historic if it is at least
50 years old and considered to be a good example of a particular architectural style or if
it is associated with a person or event of local, statewide, or national historic
importance.
Once a property owner enters into a contract, the County Assessor will determine the
value of the property as of January 1 of each year based upon an income approach to
valuation ("restricted value") rather than the property's market value. The income
projected for an owner -occupied property is based on comparable rents for similar
properties in the area or, if sufficient rental information is unavailable, the income that it
could reasonably be expected to produce under prudent management. In the case of an
income producing property, the income amount is based on rent actually received and
on typical rents received for similar properties having similar uses. The restricted value
can be considerably lower than the market value thereby creating a tax savings to the
property owner, especially if the building was recently purchased.
During the term of the contract, the property owner is required to allow for periodic
examinations of the interior and exterior of the premises by the County Assessor, the
Department of Parks and Recreation, the State Board of Equalization, and the City or its
agent as may be necessary to determine the Owner's compliance with the Agreement.
Staff Report
Mills Act Contract
July 12, 2012
Page 3 of 3
Applications for a Mills Act contract will be presented to the City Council for review and
approval. Staff has developed a Mills Acts Program Manual which includes an overview
of the Mills Act program, submittal requirements and work sheets needed for review and
processing of Mills Act contract requests (Attachment 2).
Fiscal Analysis:
The following is an example of the fiscal impact to the City:
Total Taxable Value $2,161,872.00 (Shadow Mt. Golf Club)
Gross Tax Increment (1%) $21,619.00
Assume fifty percent (50%) tax savings to property owner on their annual property tax
bill; therefore the Agency would receive a fifty percent (50%) reduction to their tax
increment, which would be $10,809.00.
Submitted By:
Russell A. Grance, Director of Building & Safety
Approval:
%4z�
Paul S. Gibson, Director of Finance
CITY COUNCIL ACTION
APPROVED LX- DENIED
RECEIVED ( tmr
MEETING DATE=-`��l
AYES: LOSQU, RAELV, 1 t CL(K
muth, City Manager NOES' NUo� _
ABSENT: --62nC
ABSTAIN: U b C-
VERIFIED BY:
Original on File with City Clerk's ffice
City of Palm Desert
Department of Building and Safety
MILLS ACT HISTORIC PROPERTY CONTRACT APPLICATION
73-510 Fred Waring Drive • Palm Desert • California • 92260 • (760) 776-6420 • Fax (760) 776-6392
Property Owner Information:
Name: ShoJow IVI
'17Unt"Lk1 n 0-7t)[ CLUB
Address: 7 3 Zoo T: r t) n W D n Cal S t
City: 021 m EJe CP_ r+. State: 0 A Zip: 01 Z 2-
(ri
Phone: (HM) 760-3gl� - 92y2 (WK) Email: Jr'1 —ro V shad 0�-u M��e'��
Property Information:
Address of Property: -73gUo -Tronuuoo ( Slrefj, Pa /41 DeSefl Ci/'7
Assessor's ParcelNo(s):1v2737600Z-7,(n 7�70ob3 �,630o5oOZ7-5,G30ICc62-4-1, C301Z°ot''
b30 O(X? —O v1 QOp 2. 01�L 0007-3 (03612.0008-y �30►20011-10 3v1y/o�1 /
Legal fiescnp ion (afach additionaY' heets if necessary):& 3 Q I y 0 3o g 6 301 y 1 0 3 2- v 4,3 o 1 4 I o o) - 4
Date of Purchase by Current owner:
Use of Property: dj0 L F C`. LU b
Eligibility for the Mills Act Program:
A property must be designated and recorded with the Riverside County Recorder at the time an
application is submitted. Please check the designation(s) that apply to the property:
City Historic Landmark
Contributor to a City Historic District
National Register of Historic Places (individually listed)
National Register of Historic Places (contributor to a historic district)
National Historic Landmark
Name of Historic District (if applicable)
Date of Designation:
Shc►dOw 0100VA4aIn GolP- Club
Property Owner Consent: I am (we are) the present owner(s) of the property described
above and ereby apply for consideration for a Mills Act Historic Property Contract
GZt;-lz
Signature of Pr erty "wner Date
f,CCt`11 ✓1�/�11�2C—� Lo
Signatur of Property Owner Date
For Office Use:
Mills Act Application
0
http://www.mydesert.com/article/201.
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Palm Desert may dec[are
Shadow Moun#ain protected
district
K Kaufmann � The Desert Sun • June 1fi, 261D
When Shadow Mountain Golf Club opened in 1958,
it was the first golf course in Paim Desert, and the
first and only course designed by Gene Sarazen, the
first goffer to achisve a career grand slam of major
golf tournaments in the 1920s and '30s.
Now Sarazen's course, one of a few in the desert that
can be walked, and its clubhouse could achieve
another career first — becoming the first city-
designated historic district in Palm Desert.
Club officials submitted an application to the ciry for
the designation las# month_ The Culturaf Resources
Preservation Committee toured the course and
clubhouse on Monday and held a study sessian for
club members and residents 7uesday to get their
input and answer questions about the historic
designation.
"Is it going to be a problern for people who live on
the goli course? Are there (projects) that are going
to be held back7" asked Wayne Sharp, one of about
i5 residents who attended Tuesday's meeting.
Dick Knapp, the club's membership chair, wanted to
know: "If it's historic, can we move a iee?°
Russell Grance, the city's director of building and
safety, fielded most of the questions, stressing that
the proposeci historic district would cover only the
golf course and clubhouse, with no impact on
hauses or condos on the fairways.
The goal of a histo�c dist�icf is "to preseroe the
integrity of our history. Basic preservation improves
property values," Grance said.
On the question of moving tees, Grance said the
club woufd have to submit an application to the city,
but it would likely be approved. Residents noted
that the course has undergo�e several changes
since 1958, while retaining the basics of Sarazen's
short, but challenging design.
"Changing a tee is not go9ng to change the
Page 1 of 2 �
character of a historic golf course," Grance said
after the meeting.
However, any change to the course's 700 towering
palm trees, many of them original landscaping,
could raise city concems, he said.
Thai doesn't seem likely since residents said a key
reason they want the historic designation is to
ensure the club and its carefully maintained fairways
and greens remain untouched.
"Our entire visw is the go{f course," said Knapp,
who fives on the course. `They cut our backyard."
Other members have more pragmatic motivations,
such as raising the club's puhlic profile and
boosting membership and tee fees.
"We feel (the historic designation) will give us help
with advertising;' said Edward Tunison, a long#ime
resident who took part in the club tour on Monday.
"It witl help generate activity for people wha don't
know the club is here:'
Grance said the next step will be a public hearing to
be hefd at the committee's June 29 meeting and if
passed there, the application would go to the City
Council ior final approval, possibly in August.
The council recently approved the city's firsE
historic building, its first fire station at 72-861 El
Paseo, now home to the Historical Society of Pafm
Dese�t.
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http://www.mydesert.com/fdcp/?i276... Wednesday, June 15, 2010
http://www.mydesert.com/article/201.{ - Page 2 of 2 �
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Who was Gene Sarazen?
One of five players to have won afl four modern major
championships in his career (U.S. Open in 1922 and
i 932, Ehe British Open in 1932, the PGA
Championship in 1922, 1823 and 1933 and the
Masters in 1935).
Remains the youngest winner of the PGA
Championship, 20 when he won In 1922.
Credited with inventing the sand wedge tor the 1932
British Open.
Made perhaps the game's most historic shot, a
double-eagle 2 on the par-5 15th In the final round
of the 1935 Masters, helping him to ti�e w[n that year.
Fiis 38 career wins €s tled for 11th on 4he aI[-time wins
lEst with Phfl Mickelson
Was a popu[ar co-host of "5he11's Wonderful World of
Golf," the game's first popular television show in the
1960s and 1970s.
Known as The Squire.
Died in 1999 at age 97.
Larry Bohannan
If you go
What: Cultural Resources Preservation Committee
meeting
When: 1 d a.m. June 29
Where: Civic Cenier Administrative Conference Room,
73-510 �red Waring Drive
lnformafion: (760) 346-06i 1
Adveftisement
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http://www.mydesert.com/fdcp/? 1276... Wednesday, June 16, 2010
Shadow Mountain Golf Club, first opened in 1358, is under
consideration to become the tirst ciiy-designated historic district
in Pa1m Desert. (Omar Ornelas The Desert Sun)
Recording Requested by:
When Recorded Mail to:
CITY OF PALM DESERT
73-510 Fred Waring Drive
Palm Desert, CA 92260
Attention: Cultural Resources
Administrator
(Space above for Recorder's Office)
HISTORIC PROPERTY PRESERVATION AGREEMENT
("MILLS ACT CONTRACT")
between
THE CITY OF PALM DESERT
a municipal corporation
and
SHADOW MOUNTAIN GOLF CLUB
Owner(s) of the property located at
73800 IRONWOOD STREET PALM DESERT CA
APN: (SEE ATTACHED LEGAL DESCRIPTION, EXHIBIT "A")
HISTORIC PROPERTY PRESERVATION AGREEMENT
("MILLS ACT CONTRACT or Agreement")
This agreement is made this ; by and between the City of Palm
Desert, a municipal corporation ("City") and Shadow Mountain Golf Club ("Owner").
RECITALS
1. California Government Code section 50280, et. seq. allow cities the discretion to
enter into contracts with the owners of qualified historic properties, as that term is
defined in Government Code section 50280.1, for the purpose of providing for the use,
maintenance, protection, and restoration of such historic property so as to retain its
characteristics as property of historic significance.
2. Owner holds fee title in and to that certain real property, together with associated
structures and improvements thereon, generally located at the street address 73800
Ironwood Street Palm Desert, California ("Historic Property"). A legal description of the
Historic Property is attached hereto as Exhibit "A," and incorporated herein by this
reference.
3. On August 26, 2010, the Cultural Resources Preservation Committee and/or the
City Council designated the Historic Property as an historic resource pursuant to the
terms and provisions of Title 29 of the Palm Desert Municipal Code.
4. City and Owner desire to enter into this Agreement for the purpose of protecting
and preserving the characteristics of historical significance of the Historic Property that
help provide the community with its own unique civic identity and character.
5. Owner, in consideration for abiding by the terms of this Agreement, shall be
entitled to qualify for a reassessment of valuation of the Historic Property, pursuant to
the provisions of Chapter 3, Part 2, of Division 1 of the California Revenue and Taxation
Code, and any corresponding adjustment in property taxes resulting therefrom.
TERMS NOW, THEREFORE, the City and Owner in consideration of mutual covenants
and conditions set forth herein, do hereby agree as follows:
2
1. Effective Date and Term of Agreement. This Agreement shall be effective
and commence on , 20 ("Effective Date") and shall remain
in effect for a term of ten (10) years thereafter.
2. Yearly Renewal. Each year upon the anniversary of the Effective Date
("Renewal Date"), an additional one (1) year shall automatically be added to the
remaining term of the Agreement unless a notice of nonrenewal is delivered as
provided in Section 3 of this Agreement.
3. Nonrenewal. If either the Owner or City desires in any year not to renew
this Agreement, Owner or City shall serve a written notice of nonrenewal upon the
party in advance of the Renewal Date ("Notice of Nonrenewal'). The Notice of
Nonrenewal shall be effective only if served by Owner upon City at least ninety (90)
days prior to the Renewal Date, or if served by City upon Owner, the Notice of
Nonrenewal shall be effective only if served upon Owner at least sixty (60) days prior
to the Renewal Date. If either City or Owner serves a Notice of Nonrenewal in any
year, this Agreement shall remain in effect for the balance of the term then
remaining.
4. Owner Protest of City Nonrenewal. Within fifteen (15) days of Owner's
receipt of the Notice of Nonrenewal from City, Owner may file with City a written
protest of the Notice of Nonrenewal. Upon receipt of the written protect, the City
Council shall set a hearing prior to the expiration of the Renewal Date of this
Agreement. Owner may furnish the City Council with any information which Owner
deems relevant and shall furnish the City Council with any information it may require.
The City Council may, at any time prior to the annual Renewal Date, withdraw its
Notice of Nonrenewal.
5. Standards for Historical Property. During the term of this Agreement, the
Historic Property shall be subject to the following conditions, requirements, and
restrictions:
3
A. Owner shall preserve and maintain the characteristics of the cultural
and historical significance of the Historic Property. Attached hereto as
Exhibit "B," and incorporated herein by this reference, is a list of the
minimum standards and conditions for maintenance, use, protection,
and preservation of the Historic Property, which shall apply to the
Historic Property and be complied with by Owner throughout the term
of this Agreement. In addition, Owner shall comply with the terms of
the City's Cultural Resources Ordinance 1168 (Title 29 of the Palm
Desert Municipal Code), and shall obtain any applicable permits
necessary to protect, preserve, restore, and rehabilitate the Historic
Property so as to maintain its historical and cultural significance.
B. Owner shall, where necessary, repair, maintain, restore, and
rehabilitate the Historic Property according to the rules and regulations
of the Office of Historic Preservation of the State Department of Parks
and Recreation and the City of Palm Desert. The condition of the
exterior of the Historic Property on the effective date of this Agreement
is documented in photographs attached as Exhibit "C" and
incorporated herein by this reference. At a minimum, Owner shall
continually maintain the exterior of the Historic Property in the same
condition as documented in Exhibit "C."
C. Owner shall carry out specific restoration, repair, maintenance, and/or
rehabilitation projects on the Historic Property, as outlined in the
attached Exhibit "D," which is incorporated herein by this reference. All
such projects shall be undertaken and completed in accordance with
the Secretary of Interior Standards for Rehabilitation and the City of
Palm Desert design guidelines.
D. Owner shall not be permitted to block the view corridor with any new
structure, such as walls, fences or shrubbery, so as to prevent the
viewing of the Historic Property from the public right-of-way.
6. Periodic Examinations. Upon reasonable advance notice, Owner shall
allow reasonable periodic examinations of the interior and exterior of the Historic
4
Property by representatives of the County Assessor, the State Department of Parks
and Recreation, the State Board of Equalization and/or City, as may be necessary to
determine Owner's compliance with the terms and provisions of this Agreement. City
shall inspect Historic Property prior to entering into this Agreement and at least
every five years thereafter to determine Owner's continued compliance with
Agreement.
7. Provision of Information of Compliance. Owner hereby agrees to furnish
City with any and all information requested by City, which City deems necessary or
advisable to determine eligibility of the Historic Property and compliance with the
terms and provisions of this Agreement.
8. Breach of Agreement; Remedies.
A. Notice of Breach, Opportunity to Cure. If Owner breaches any
provision of this Agreement, City may give written notice to Owner by
registered or certified mail detailing Owner's violations. If such violation
is not corrected to the reasonable satisfaction of City within thirty (30)
days after the date of notice of violation, or within such a reasonable
time as may be required to cure the violation (provided the acts to cure
the violation are commenced within thirty (30) days and thereafter
diligently pursued to completion), the City may, without further notice,
declare Owner to be in breach of this Agreement. Upon City's
declaration of Owner's breach, City may pursue any remedy available
under local, state, or federal law, including those specifically provided
for in this section.
B. Remedy - Cancellation. City may cancel this Agreement if City
determines, following a duly noticed public hearing in accordance with
Government Code section 50286, that Owner breached any of the
conditions of the Agreement, Owner allowed the Historic Property to
deteriorate to the point that it no longer meets the standards for a
qualified historic property, or Owner failed to maintain and preserve the
Historic Property in accordance with the terms of this Agreement. If
5
this Agreement is cancelled, under this paragraph, Owner shall pay a
cancellation fee to the Office of the Auditor for the County of Riverside
as required by Government Code section 50286.
C. Alternative Remedies. As an alternative to cancellation of this
Agreement for Owner's breach of any condition, City may bring an
action in court necessary to enforce this Agreement including, but not
limited to, an action to enforce this Agreement by specific performance,
injunction, or receivership.
9. Destruction of Property; Eminent Domain: Cancellation. If the Historic
Property is destroyed by earthquake, fire, flood, or other natural disaster such that in
the opinion of the City Building Official more than sixty percent (60%) of the original
fabric of the structure must be replaced, this Agreement shall be cancelled because
the historic value of the structure will have been destroyed. If the Historic Property is
acquired in whole or in part by eminent domain or other acquisition by any entity
authorized to exercise the power of eminent domain, and the acquisition is
determined by the City Council to frustrate the purpose of this Agreement, this
Agreement shall be cancelled. No cancellation fee pursuant to Government Code
section 50286 shall be imposed if the Agreement is cancelled pursuant to this
Section.
10. Waiver. City does not waive any claim of default by Owner if City does not
enforce or cancel this Agreement. All other remedies at law or in equity which are
not otherwise provided for in this Agreement or in City's regulations governing
historic properties are available to the City to pursue in the event that there is a
reach of this Agreement. No waiver by City of any breach or default under this
Agreement shall be deemed to be a waiver of any other subsequent breach thereof
or default hereunder.
11. Binding Effect of Agreement. Owner hereby subjects the Historic Property
to the covenants, conditions, and restrictions set forth in this Agreement. City and
Owner hereby declare their specific intent that the covenants, conditions, and
restrictions set forth herein shall be deemed covenants running with the land and
6
shall inure to and be binding upon Owner's successors and assigns in title or interest
to the Historic Property. Each and every contract, deed or other instrument herein
after executed, covering or conveying the Historic Property, or any portion thereof,
shall conclusively be held to have been executed, delivered and accepted subject to
the covenants, reservations and restrictions are set forth in such contract, deed or
other instrument.
12. Covenants Run with the Land. City and Owner hereby declare their
understanding and intent that the burden of the covenants, reservations and
restrictions set forth herein touch and concern the land in that it restricts
development of the Historic Property. City and Owner hereby further declare their
understanding and intent that the benefit of such covenants, reservations and
restrictions touch and concern the land by enhancing and maintaining the cultural
and historical characteristics and significance of the Historic Property for the benefit
of the public and the Owner.
13. Notice. Any notice required to be given by the terms of this Agreement
shall be provided at the address of the respective parties as specified below or at
any other address as may be later specified by the parties hereto:
City: City of Palm Desert
Department of Building and Safety
73-510 Fred Waring Drive
Palm Desert, CA 92260
Owner: SHADOW MOUNTAIN GOLF CLUB
73800 IRONWOOD STREET
14. Effect of Agreement. None of the terms, provisions or conditions of this
Agreement shall be deemed to create a partnership between the parties hereto and
any of their heirs, successors or assigns, nor shall such terms, provisions or
conditions cause the parties to be considered joint venturers or members of any joint
enterprise.
15. Indemnity of City. Owner shall defend, indemnify, and hold harmless City
and its elected officials, officers, agents and employees from any actual or alleged
claims, demands, causes of action, liability, loss, damage, or injury to property or
persons, including wrongful death, whether imposed by a court of law or by
7
administrative action of any federal, state or local governmental agency, arising out
of or incident to (i) the direct or indirect use operation, or maintenance of the Historic
Property by Owner or any contractor, subcontractor, employee, agent, lessee,
licensee, invitee, or any other person; (ii) Owner's activities in connection with the
Historic Property; and (iii) any restrictions on the use or development of the Historic
Property, from application or enforcement of Title 29 of the City's Municipal Code, or
from the enforcement of this Agreement. This indemnification includes, without
limitation, the payment of all penalties, fines, judgments, awards, decrees, attorneys'
fees, and related costs or expenses, and the reimbursement of City, its elected
officials, employees, and/or agents for all legal expenses and costs incurred by each
of them.
Owner's obligation to indemnify shall survive the termination, cancellation, or
expiration of this Agreement and shall not be restricted to insurance proceeds, if
any, received by City, its elected officials, employees, or agents.
16. Binding Upon Successors. All of the agreements, rights, covenants,
reservations and restrictions contained in this Agreement shall be binding upon and
shall inure to the benefit of the parties herein, their heirs, successors, legal
representatives, assigns and all persons acquiring any part or portion of the Historic
Property, whether by operation of law or in any manner whatsoever.
17. Leaal Costs. In the event legal proceedings are brought by any party or
parties to enforce or restrain a violation of any of the covenants, conditions or
restrictions contained herein, or to determine the rights and duties of any party
hereunder, the prevailing party in such proceeding may recover all reasonable
attorneys' fees to be fixed by the court, in addition to court costs and other relief
ordered by the court.
18. Severability. In the event that any of the provisions of this Agreement are
held to be unenforceable or invalid by any court of competent jurisdiction, or by
subsequent preemptive legislation, the validity and enforceability of the remaining
provisions, or portions thereof, shall not be effected thereby.
0
19. Recordation. No later than twenty (20) days after the Effective Date, City
shall cause this Agreement to be recorded in the office of the County Recorder of
the County of Riverside.
20. Amendments. This Agreement may be amended, in whole or in part, only
by written recorded instrument executed by the parties hereto.
21. Governing Law and Venue. This Agreement shall be construed and
governed in accordance with the laws of the State of California. Any action at law or
in equity brought by either of the parties hereto for the purpose of enforcing a right or
rights provided for by this Agreement shall be tried in a court of competent
jurisdiction in the County of Riverside, State of California, and the parties hereby
waive all provisions of law providing for a change of venue in such proceedings to
any other county.
IN WITNESS WHEREOF, City and Owner have executed this Agreement on the day
and year first above written.
Dated:
Dated: , -1s
APPROVED AS TO FORM
City Attorney
CITY OF PALM DESERT
By
ATTESTED TO:
M-
10
STATE OF CALIFORNIA )
)ss
COUNTY OF RIVERSIDE )
On Imt 15ZWbefore me, �J • '�a tti the undersi ned,
a notary public in and for said State, personally appeared Ag0A lkr 4 0( �r
%ScuN.+personally or proved to me on the basis of satisfactory evidence)
to be the person(s) whose nameUs Ware subscribed to the within instrument and
acknowledged to me that heisMe/they executed the same in his #w/their authorized
capacitXies), and that by hieff►er/their signature(&) on the instrument the person(s), or
i
the entity upon behalf of which the person(s) acted, executed the instrument.
r - a L iii�i 0
cor*ior► • 1932ON
MI CMw. A r 9 Ot
WITNESS my hand and official seal.
Notary Signature
11
Exhibit "B"
Property Maintenance Minimum Standards
1. The Historic Property shall comply with all regulations of Title 8 and Title 9, Palm
Desert Municipal Code, including the "Duty of Good Repair" as outlined in
Sections 29.20.10 and 29.60.160;
2. The Historic Property, including the club house, the golf course, and associated
structures shall continue to be maintained in a manner consistent with the level of
maintenance that has customarily been employed at the Property and consistent
with the operation of a typical private country club in the Palm Desert area.
3. The Historic Property shall not have non -operational vehicles or portions of them
in public view;
4. The Historic Property shall not have stagnant or standing water;
s. The Historic Property shall not have overgrown or decaying landscaping. All
landscape features should be maintained including, but not limited to, grass,
trees, and any plantings;
6. The Historic Property shall prominently display and properly maintain its City
Landmark plaque.
CITY OF PALM DESERT
MILLS ACT PROGRAM
APPLICATION MANUAL
Department of Building and Safety
73-510 Fred Waring Drive
Palm Desert, CA 92260
(760)346-0611
TABLE OF CONTENTS
APPLICATION INFORMATION
Introduction and Purpose 3
Property Qualifications 3
Terms of a Contract 3
Administration 4
Application and Selection Process 5
FORMS
Application Checklist 7
Application 8
10-Year Property Improvement Plan 9
Financial Analysis Worksheet 10
Financial Analysis Worksheet Instructions 11
APPENDICES
A. Sample Projects Qualified Under the Mills Act 13
B. Secretary of the Interior's Standards for Rehabilitation 14
C. Sample Mills Act Contract 15
D. Sample Site Plan 25
E. Site Inspection Form 26
F. State Mills Act Legislation 27
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MILLS ACT PROGRAM
APPLICATION MANUAL
INTRODUCTION AND PURPOSE
The City of Palm Desert Mills Act Program was established by Resolution No. in
2010. The Mills Act is state legislation, enacted in 1972, that grants participating local
governments the authority to enter into contracts with owners of qualified historic
properties who receive a reduction in local property taxes to help offset the costs to
restore, rehabilitate, repair and maintain their properties. Although it is applicable to
historic income producing properties, it is the single most important economic incentive
program available in California for owner occupied historic residential buildings,
particularly single-family homes. A Mills Act program is developed in accordance with
California Government Code, Article 12, Sections 50280-50290 and California Revenue
and Taxation Code, Article 1.0, Sections 439-439.4
This manual is designed to assist you in completing the Mills Act application and
provides a summary of the program requirements.
QUALIFYING HISTORIC PROPERTIES
To qualify for the Palm Desert Mills Act program a property must be one of the
following:
➢ Designated City Landmark
➢ Contributing feature of a designated City historic district
➢ Listed individually in the National Register of Historic Places
➢ Contributing feature of historic district listed in the National Register of Historic
Places
➢ National Historic Landmark
A property must be designated at the time an application is submitted. Questions
regarding the designation status of a property of the City's designation program can be
addressed to the Cultural Resources Administrator in the Department of Building and
Safety.
TERMS OF A MILLS ACT CONTRACT
Duration: A Mills Act contract is for a minimum term of ten years. It is automatically
renewed each year on its anniversary date and a new ten year term becomes effective.
Contracts are transferred to new owners when the property is sold.
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Termination: The property owner may terminate the contract by notifying the City at
least ninety (90) days prior to the annual renewal date. The City may terminate the
contract by notifying the owner at least sixty (60) days prior to the renewal date. The
owner may make a written protest about termination by the City. The contract remains
in effect for the balance of the term of the contract beyond the year of termination.
Alterations or Additions to a Property: Work performed on the property (interior,
exterior, and grounds) must meet all City requirements and comply with the "Secretary
of the Interior's Standards for Rehabilitation". A 10-Year Property Improvement Plan is
required as part of the application and will be re-evaluated by the City every five years
or as needed.
Annual Reports: Property owners are required to submit an annual report to the City
indicating work completed per the 10-Year Property Improvement Plan. The report is
due by December 31 of each year and should include copies of receipts and/or building
permits where applicable.
Inspection for Compliance: City staff conducts a pre -contract inspection of the
property to ensure compliance with the terms of the contract. Conditions not conforming
to the Secretary of the Interior's Standards for Rehabilitation may be required to be
brought into compliance before a contract is executed. City staff will conduct annual
property inspections following submittal of the annual report to ensure that proposed
work has been completed and meets all applicable City standards. Inspections may also
be required by the County Assessor, State office Historic Preservation and/or State
Board of Equalization. All inspections are by appointment with the property owner.
Breach of Contract: If the City determines that the property owner is in breach of
contract, the City may cancel the contract and the owner is liable for a cancellation fee
of 12.5% of the current value of the property as determined by the County Assessor.
ADMINISTRATION
City of Palm Desert: Mills Act applications and contracts are administered by the
Cultural Resources Administrator in the Department of Building and Safety. Upon
selection for the program, contracts are reviewed by the Cultural Resources
Preservation Committee and referred to the City Council for approval.
Riverside County: The County records executed Mills Act contract documents with the
County Recorder before December 31 of the applicable calendar year. After
recordation, the City transmits contract documents to the Riverside County Assessor
where the calculation for the exact property tax under the Mills Act is completed.
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The County Assessor calculates the tax saving using a stated -mandated reassessment
formula based on "capitalization of income" rather than simple "market value." Mills Act
participants may realize a property tax savings averaging about 50% each year
depending on property value, net operating income, and other variables. Recently
purchased historic properties are most likely to receive the highest reduction. The Mills
Act Program does not guarantee a reduction amount for any property.
Contracts that are recorded by December 31 are reassessed by June 30 of the
following year and the reduced tax will appear on the tax bill of October of that year.
State of California: Within six months of entering into a Mills Act contract, the property
owner must submit written notice to the State Office of Historic Preservation. This
notification states that the property owner has entered into a Mills Act contract. A copy
of the letter must be submitted to the City Cultural Resources Administrator.
APPLICATION AND SELECTION PROCESS
The City accepts up to seven (7) Mills Act contracts per year. Applications are accepted
year-round, but to be considered for the next fiscal year applications must be submitted
by July 30tn
Fees: A ,non-refundable application fee of $ is due with your application. If your
application is accepted, a non-refundable contract initiation fee of $ will be due.
Submittal Requirements: The application should include the following:
1. Application Checklist
2. Application Form
3. Copy of the grant deed, including a complete legal description
4. 10-Year Property Improvement Plan
5. Mills Act Financial Analysis Worksheet
6. Photographs — Photographs shall be black and white 35mm film including
negatives or compact disc (CD) of the building interior (all rooms) and exterior
(front, sides, rear as well as assessor buildings, and hardscape and landscape
features). Include as many views of architectural details as necessary to
document the character defining features of the building and site. Include one 8 x
10 printed image that best captures the property, (e.g. front fagade). Images shall
be printed onto archival paper in 3 x 5, 4 x 6 or multiple image letter sized sheet
format.
7. Site plan — The plan shall be drawn to scale and showing the location of all
buildings, structures and major site features on the property, street names, north
arrow, and dimensions.
8. Non-refundable application fee
5
The complete application should be submitted to:
Cultural Resources Administrator
Department of Building and Safety
73-510 Fred Waring Drive
Palm Desert, CA 92260-2578
City of Palm Desert Mills Act
Application Checklist
The following should be completed and submitted with your application packet. See the
Palm Desert Mills Act Application Manual for details on the submittal requirements.
❑ Application Form
❑ Copy of the grant deed, including complete legal description
❑ 10-Year Property Improvement Plan
❑ Financial Analysis Form
❑ Photographs
❑ Site Plan
❑ Non -Refundable Application Fee
The complete application should be submitted to:
Cultural Resources Administrator
Department of Building and Safety
73-510 Fred Waring Drive
Palm Desert, CA 92260-2578
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City of Palm Desert
Department of Building and Safety
MILLS ACT HISTORIC PROPERTY CONTRACT APPLICATION
73-510 Fred Waring Drive . Palm Desert . California • 92260 • (760) 776-6420 . Fax (760) 776-6392
Property Owner Information:
Address:
City:
Phone: (HM)
Property Information:
State:
(WK)
Address of Property:
Assessor's Parcel No(s):
Legal Description (attach additional sheets if necessary):
Date of Purchase by Current owner:
Use of Property:
Eligibility for the Mills Act Program:
Zip:
Email:
A property must be designated and recorded with the Riverside County Recorder at the time an
application is submitted. Please check the designation(s) that apply to the property:
City Historic Landmark
Contributor to a City Historic District
National Register of Historic Places (individually listed)
National Register of Historic Places (contributor to a historic district)
National Historic Landmark
Name of Historic District (if applicable):
Date of Designation:
Property Owner Consent: I am (we are) the present owner(s) of the property described
above and hereby apply for consideration for a Mills Act Historic Property Contract
Signature of Property Owner
Date
Signature of Property Owner Date
For Office Use:
Mills Act Application
8
10-Year Property Improvement Plan
For sample projects qualifying under the Mills Act see Appendix "A". Attach additional
sheets if necessary.
Year
Proposed Project
Estimated Cost
1
2
3
4
5
6
7
8
9
10
This schedule will be attached as an exhibit to the Historic Property Preservation
Agreement (Mills Act Contract). It may be revised or updated by mutual consent of the
property owner(s) and the Cultural Resources Administrator in the Department of
Building and Safety.
All projects that affect the exterior of the property are subject to review and approval by
the Cultural Resources Administrator and/or the Cultural Resources Preservation
Committee before work begins. Work must meet all City requirements and the Secretary
of the Interior's Standards for Rehabilitation (Appendix B).
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Mills Act Financial Analysis Worksheet
(See Excel Spreadsheet)
10
Income Current Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Year 9 Year 10
Annual Expenses Current Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Year 9 Year 10
Net Operating Income Current Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Year 9 Year 10
Capitalization Rate Current Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Year 9 Year 10
New Assessed Value Current Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Year 9 Year 10
New Tax Assessment Current Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Year 9 Year 10
How to Complete the Mills Act Financial Analysis
Income:
1. Monthly Rental Income: When a property is owner -occupied, the determination of "income" is
based on what a property could reasonably be expected to yield, or an amount stipulated in the
contract as the minimum income to be used. The income projected for owner -occupied property
is based on comparable rents for similar property in the area, or, if insufficient rental information is
available, the income that it could reasonably be expected to produce under prudent
management. In the case of income producing property, the income amount is based on rent
actually received and on typical rentals received for similar property in similar use. Two
suggested methods for documenting comparable rents are through newspaper advertisements or
a real estate or management company comparables.
2. Annual Rental Income: Annual Rental Income is calculated by multiplying the monthly rental
income by twelve (12) months. Subtract a reasonable amount or percentage for vacancy and
collection. 3-5% is a reasonable percentage.
nnual Ex enses:
3-8. Add typical expenses such as insurance, utilities, maintenance and repairs, and management
fees to arrive at annual expenses. Exclude expenses include debt service, depletion charges, and
interest on funds invested in the property.
9. Subtract annual expenses (Line 8) from Income (Line 2)
.. . - The capitalization rate for both owner -occupied and income -producing property
includes an interest component, a historical property risk component, an amortization component, and a
property tax component.
10. An interest component is determined by the State Board of Equalization and announced no
later than September 1 or the year preceding the assessment year. The Yield rate is equal to the
effective rate on conventional mortgages as determined by the Federal Home Loan Bank Board,
rounded to the nearest % percent.
11. The historic property risk component is 4% in the case of owner -occupied single -family -
dwellings. In all other cases, the property risk component is 2%.
12. The property tax component is defined as the "percentage of the estimated total tax rate
applicable to property for the assessment year times the assessment ratio." This component will
be 1 % (0.1 post -Prop 13 tax rate X 100% assessment ratio). Special district assessments are not
included in this component. The Riverside Tax Assessor's Office has the latest tax rate are
information at (951) 955-6250.
13. The amortization component is a percentage equal to the reciprocal of the remaining life of the
improvements. Although this calculation varies by individual structure, as an estimate, the typical
remaining life of a frame building would be 20 years; for masonry buildings, the remaining life
might be up to 50 years.
14. The capitalization rate is the sum of Line 10-12.
15. Calculate the Mills Act Assessment by dividing the net operating income by the capitalization rate.
16. Write in the current total taxes due. (The subsequent years are increased by 2%)
17. Calculate the tax under the Mills Act by multiplying the Mills Act Assessment (Line14) by
.01142593 and then in the direct assessments as shown on your tax bill. (The Mills Act does not
allow a reduction in direct assessment taxes)
18. Calculate the tax savings by subtracting the current tax under the Mills Act. (Line 18)
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APPENDICES
A. Sample Projects Qualified Under the Mills Act
B. Secretary of the Interior's Standards for Rehabilitation
C. Sample Mills Act Contract Agreement
D. Sample Site Plan
E. Site Inspection Form
F. State Mills Act Legislation
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APPENDIX A
Sample Projects Qualified Under the Mills Act Program
Access Modifications — Exterior
Access Modifications — Interior
Accessory Structure — Repair or Replace
Annual Maintenance and Repairs
Appliance Vent
Architectural — Remove Non -historic feature and
Restore to Original
Architectural Trim — Repair
Architectural Trim — Replace
Architectural Trim — Install New
Balcony/Decks — New Railings
Balcony/Decks — Repair or Replace
Basement — Access — Repair or Replace to Code
Basement — New or Rebuild
Cabinets — New Built-in Bathroom
Cabinets — New Built-in Kitchen
Cabinets — New Built-in Other
Caulking
Chimney — Inspect and Clean
Chimney — New
Chimney — Rebuild or Repair
Code Repair Item
Column — Replace or Rebuild
Corbels/Structural Brackets — Replace or Repair
Door — Hardware
Door — New Basement Hatch Cover and Base
Door — Repair or Replace
Drain for Deck — Install or Repair
Drainage Protection or Correction
Dry -Rot Remove, Repair, and/or Replace
Electrical — Rewire or Install New Outlets
Electrical — Complete Rewire and Service Upgrade
Electrical — Ground and Service Entry
Electrical — Install New Circuits
Electrical — Lighting Fixtures
Electrical — New Service Lines to Garage
Electrical — Security Lighting and Alarm
Electrical — New Outlets
Flashing
Floor Furnace — Remove or Restore
Flooring — Carpet
Flooring — Repair
Flooring - Repair Wood Floors
Flooring — Replacement
Foundation — Bolting and Seismic Work
Foundation — New
Foundation — Repair
Gable or Attic — Re -screening
Garage Door
Garage — Repair or Replace
Gutters and Downspouts
HVAC — Complete New System
HVAC — Maintenance or Repair
Insulation — Walls
Insulation — Attic
Interior Trim — Refinish
Kitchen — New Counters
Masonry — New
Masonry — Repair or Replace Tile Hearth
Masonry — Repairs
Masonry — Re -point Brick
Mechanical — Air Conditioning
Mechanical — Heating Unit
Mechanical —Ventilation and Duct Work
Painting — Exterior
Painting — Interior
Painting — Lead Based Paint Removal
Painting — Exterior Trim
Patio — Repair
Plastering — Remove, Replace, or Refinish
Plumbing — DWV (Drain, Waste, Vent)
Plumbing — Fixtures
Plumbing — Install New Supply Lines Plumbing —
Install Sump Pump & discharge drain
Plumbing — Minor Repairs
Plumbing — New Supply
Plumbing — Service Lines
Plumbing — Sewer
Porch — Ceiling Replacement
Porch — Repair or Replace
Porch Railing — Repair or Replace to Code
Porch — Resurface
Remove Substandard Construction
Repair Eaves and/or Overhangs
Repair Exterior Stucco
Replace Non -historic Feature
Roof — Minor Repair
Roof — Re -roof
Roof — Tear off and Install New
Security Lighting and Alarm System
Seismic Retrofitting
Siding — Remove Asbestos Siding and Restore
Siding — Repair or Replace
Skylights — Repair or Replace
Stair — Repair or Replace
Stone Work
Stoop — Repair or Replace
Structural — New Framing or Repairs
Structural Bracing
Structural Modifications
Structural Repairs — Roof and or Ceiling Joists
Termite Treatment
Termite Damage — Repair
Tile — Replace, Repair, Re -point
Utility Enclosure — New
Ventilation — Attic Fan
Waterproofing
Weatherproofing
Window — Screens or Hardware
Windows — Repair or Replacement
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APPENDIX B
The Secretary of the Interior's Standards for Rehabilitation
The Standards (Department of Interior regulations, 36 CFR 67) pertain to historic buildings of all
materials, construction types, sizes, and occupancy and encompass the exterior and the
interior, related landscape features and the building's site and environment as well as attached,
adjacent, or related new construction. The Standards are to be applied to specific rehabilitation
projects in a reasonable manner, taking into consideration economic and technical feasibility.
1. A property shall be used for its historic purpose or be placed in a new use that requires
minimal change to the defining characteristics of the building and its site and environment.
2. The historic character of a property shall be retained and preserved. The removal of historic
materials or alteration of features and spaces that characterize a property shall be avoided.
3. Each property shall be recognized as a physical record of its time, place, and use. Changes
that create a false sense of historical development, such as adding conjectural features or
architectural elements from other buildings, shall not be undertaken.
4. Most properties change over time; those changes that have acquired historic significance in
their own right shall be retained and preserved.
5. Distinctive features, finishes, and construction techniques or examples of craftsmanship that
characterize a property shall be preserved.
6. Deteriorated historic features shall be repaired rather than replaced. Where the severity of
deterioration requires replacement of a distinctive feature, the new feature shall match the old in
design, color, texture, and other visual qualities and, where possible, materials. Replacement of
missing features shall be substantiated by documentary, physical, or pictorial evidence.
7. Chemical or physical treatments, such as sandblasting, that cause damage to historic
materials shall not be used. The surface cleaning of structures, if appropriate, shall be
undertaken using the gentlest means possible.
8. Significant archeological resources affected by a project shall be protected and preserved. If
such resources must be disturbed, mitigation measures shall be undertaken.
9. New additions, exterior alterations, or related new construction shall not destroy historic
materials that characterize the property. The new work shall be differentiated from the old and
shall be compatible with the massing, size, scale, and architectural features to protect the
historic integrity of the property and its environment.
10. New additions and adjacent or related new construction shall be undertaken in such a
manner that if removed in the future, the essential form and integrity of the historic property and
its environment would be unimpaired.
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Recording Requested by:
When Recorded Mail to:
CITY OF PALM DESERT
73-510 Fred Waring Drive
Palm Desert, CA 92260
Attention: Cultural Resources
Administrator
APPENDIX C
(Space above for Recorder's Office)
HISTORIC PROPERTY PRESERVATION AGREEMENT
("MILLS ACT CONTRACT")
between
THE CITY OF PALM DESERT
a municipal corporation
and
Owner(s) of the property located at
APN
15
HISTORIC PROPERTY PRESERVATION AGREEMENT
("MILLS ACT CONTRACT")
This agreement is made this
Desert, a municipal corporation ("City") and
RECITALS
by and between the City of Palm
("Owner').
1. California Government Code section 50280, et. seq. allow cities the
discretion to enter into contracts with the owners of qualified historic properties, as
that term is defined in Government Code section 50280.1, for the purpose of
providing for the use, maintenance, protection, and restoration of such historic
property so as to retain its characteristics as property of historic significance.
2. Owner holds fee title in and to that certain real property, together with associated
structures and improvements thereon, generally located at the street address
Palm Desert, California ("Historic Property"). A legal description of the
Historic Property is attached hereto as Exhibit "A," and incorporated herein by this
reference.
3. On , the Cultural Resources Preservation
Committee and/or the City Council designated the Historic Property as an historic resource
pursuant to the terms and provisions of Title 29 of the Palm Desert Municipal Code.
4. City and Owner desire to enter into this Agreement for the purpose of protecting and
preserving the characteristics of historical significance of the Historic Property that help
provide the community with its own unique civic identity and character.
5. Owner, in consideration for abiding by the terms of this Agreement, shall be entitled
to qualify for a reassessment of valuation of the Historic Property, pursuant to the provisions
of Chapter 3, Part 2, of Division 1 of the California Revenue and Taxation Code, and any
corresponding adjustment in property taxes resulting therefrom.
TERMS NOW, THEREFORE, the City and Owner in consideration of mutual covenants and
conditions set forth herein, do hereby agree as follows:
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1. Effective Date and Term of Agreement. This Agreement shall be effective and
commence on 200_ ("Effective Date") and shall remain in
effect for a term of ten (10) years thereafter.
2. Yearly Renewal. Each year upon the anniversary of the Effective Date
("Renewal Date"), an additional one (1) year shall automatically be added to the
remaining term of the Agreement unless a notice of nonrenewal is delivered as provided
in Section 3 of this Agreement.
3. Nonrenewal. If either the Owner or City desires in any year not to renew this
Agreement, Owner or City shall serve a written notice of nonrenewal upon the party in
advance of the Renewal Date ("Notice of Nonrenewal"). The Notice of Nonrenewal shall
be effective only if served by Owner upon City at least ninety (90) days prior to the
Renewal Date, or if served by City upon Owner, the Notice of Nonrenewal shall be
effective only if served upon Owner at least sixty (60) days prior to the Renewal Date. If
either City or Owner serves a Notice of Nonrenewal in any year, this Agreement shall
remain in effect for the balance of the term then remaining.
4. Owner Protest of City Nonrenewal. Within fifteen (15) days of Owner's receipt
of the Notice of Nonrenewal from City, Owner may file with City a written protest of the
Notice of Nonrenewal. Upon receipt of the written protect, the City Council shall set a
hearing prior to the expiration of the Renewal Date of this Agreement. Owner may
furnish the City Council with any information which Owner deems relevant and shall
furnish the City Council with any information it may require. The City Council may, at any
time prior to the annual Renewal Date, withdraw its Notice of Nonrenewal.
5. Standards for Historical Property. During the term of this Agreement, the
Historic Property shall be subject to the following conditions, requirements, and
restrictions:
A. Owner shall preserve and maintain the characteristics of the cultural and
historical significance of the Historic Property. Attached hereto as Exhibit
"B," and incorporated herein by this reference, is a list of the minimum
standards and conditions for maintenance, use, protection, and
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preservation of the Historic Property, which shall apply to the Historic
Property and be complied with by Owner throughout the term of this
Agreement. In addition, Owner shall comply with the terms of the City's
Cultural Resources Ordinance 1168 (Title 29 of the Palm Desert Municipal
Code), and shall obtain any applicable permits necessary to protect,
preserve, restore, and rehabilitate the Historic Property so as to maintain
its historical and cultural significance.
B. Owner shall, where necessary, repair, maintain, restore, and rehabilitate
the Historic Property according to the rules and regulations of the Office of
Historic Preservation of the State Department of Parks and Recreation
and the City of Palm Desert. The condition of the exterior of the Historic
Property on the effective date of this Agreement is documented in
photographs attached as Exhibit "C" and incorporated herein by this
reference. At a minimum, Owner shall continually maintain the exterior of
the Historic Property in the same condition as documented in Exhibit "C."
C. Owner shall carry out specific restoration, repair, maintenance, and/or
rehabilitation projects on the Historic Property, as outlined in the attached
Exhibit "D," which is incorporated herein by this reference. All such
projects shall be undertaken and completed in accordance with the
Secretary of Interior Standards for Rehabilitation and the City of Palm
Desert design guidelines.
D. Owner shall not be permitted to block the view corridor with any new
structure, such as walls, fences or shrubbery, so as to prevent the viewing
of the Historic Property from the public right-of-way.
6. Periodic Examinations. Upon reasonable advance notice, Owner shall allow
reasonable periodic examinations of the exterior of the Historic Property by
representatives of the County Assessor, the State Department of Parks and Recreation,
the State Board of Equalization and/or City, as may be necessary to determine Owner's
compliance with the terms and provisions of this Agreement.
7. Provision of Information of Compliance. Owner hereby agrees to furnish City
with any and all information requested by City, which City deems necessary or advisable
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to determine eligibility of the Historic Property and compliance with the terms and
provisions of this Agreement.
8. Breach of Agreement; Remedies.
A. Notice of Breach; Opportunity to Cure. If Owner breaches any provision of
this Agreement, City may give written notice to Owner by registered or
certified mail detailing Owner's violations. If such violation is not corrected
to the reasonable satisfaction of City within thirty (30) days after the date
of notice of violation, or within such a reasonable time as may be required
to cure the violation (provided the acts to cure the violation are
commenced within thirty (30) days and thereafter diligently pursued to
completion), the City may, without further notice, declare Owner to be in
breach of this Agreement. Upon City's declaration of Owner's breach,
City may pursue any remedy available under local, state, or federal law,
including those specifically provided for in this section.
B. Remedy - Cancellation. City may cancel this Agreement if City
determines, following a duly noticed public hearing in accordance with
Government Code section 50286, that Owner breached any of the
conditions of the Agreement, Owner allowed the Historic Property to
deteriorate to the point that it no longer meets the standards for a qualified
historic property, or Owner failed to maintain and preserve the Historic
Property in accordance with the terms of this Agreement. If this
Agreement is cancelled, under this paragraph, Owner shall pay a
cancellation fee to the Office of the Auditor for the County of Riverside as
required by Government Code section 50286.
C. Alternative Remedies. As an alternative to cancellation of this Agreement
for Owner's breach of any condition, City may bring an action in court
necessary to enforce this Agreement including, but not limited to, an
action to enforce this Agreement by specific performance, injunction, or
receivership.
9. Destruction of Property; Eminent Domain; Cancellation. If the Historic
Property is destroyed by earthquake, fire, flood, or other natural disaster such that in the
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opinion of the City Building Official more than sixty percent (60%) of the original fabric of
the structure must be replaced, this Agreement shall be cancelled because the historic
value of the structure will have been destroyed. If the Historic Property is acquired in
whole or in part by eminent domain or other acquisition by any entity authorized to
exercise the power of eminent domain, and the acquisition is determined by the City
Council to frustrate the purpose of this Agreement, this Agreement shall be cancelled.
No cancellation fee pursuant to Government Code section 50286 shall be imposed if the
Agreement is cancelled pursuant to this Section.
10. Waiver. City does not waive any claim of default by Owner if City does not
enforce or cancel this Agreement. All other remedies at law or in equity which are not
otherwise provided for in this Agreement or in City's regulations governing historic
properties are available to the City to pursue in the event that there is a reach of this
Agreement. No waiver by City of any breach or default under this Agreement shall be
deemed to be a waiver of any other subsequent breach thereof or default hereunder.
11. Bindinq Effect of Agreement. Owner hereby subjects the Historic Property to
the covenants, conditions, and restrictions set forth in this Agreement. City and Owner
hereby declare their specific intent that the covenants, conditions, and restrictions set
forth herein shall be deemed covenants running with the land and shall inure to and be
binding upon Owner's successors and assigns in title or interest to the Historic Property.
Each and every contract, deed or other instrument herein after executed, covering or
conveying the Historic Property, or any portion thereof, shall conclusively be held to
have been executed, delivered and accepted subject to the covenants, reservations and
restrictions are set forth in such contract, deed or other instrument.
12. Covenants Run with the Land. City and Owner hereby declare their
understanding and intent that the burden of the covenants, reservations and restrictions
set forth herein touch and concern the land in that it restricts development of the Historic
Property. City and Owner hereby further declare their understanding and intent that the
benefit of such covenants, reservations and restrictions touch and concern the land by
enhancing and maintaining the cultural and historical characteristics and significance of
the Historic Property for the benefit of the public and the Owner.
20
13. Notice. Any notice required to be given by the terms of this Agreement shall
be provided at the address of the respective parties as specified below or at any other
address as may be later specified by the parties hereto:
City: City of Palm Desert
Department of Building and Safety
73-510 Fred Waring Drive
Palm Desert, CA 92260
Owner:
14. Effect of Agreement. None of the terms, provisions or conditions of this
Agreement shall be deemed to create a partnership between the parties hereto and
any of their heirs, successors or assigns, nor shall such terms, provisions or
conditions cause the parties to be considered joint venturers or members of any joint
enterprise.
15. Indemnity of City. Owner shall defend, indemnify, and hold harmless City and
its elected officials, officers, agents and employees from any actual or alleged claims,
demands, causes of action, liability, loss, damage, or injury to property or persons,
including wrongful death, whether imposed by a court of law or by administrative action
of any federal, state or local governmental agency, arising out of or incident to (i) the
direct or indirect use operation, or maintenance of the Historic Property by Owner or any
contractor, subcontractor, employee, agent, lessee, licensee, invitee, or any other
person; (ii) Owner's activities in connection with the Historic Property; and (iii) any
restrictions on the use or development of the Historic Property, from application or
enforcement of Title 29 of the City's Municipal Code, or from the enforcement of this
Agreement. This indemnification includes, without limitation, the payment of all
penalties, fines, judgments, awards, decrees, attorneys' fees, and related costs or
expenses, and the reimbursement of City, its elected officials, employees, and/or agents
for all legal expenses and costs incurred by each of them.
Owner's obligation to indemnify shall survive the termination, cancellation, or expiration
of this Agreement and shall not be restricted to insurance proceeds, if any, received by
City, its elected officials, employees, or agents.
21
16. Binding Upon Successors. All of the agreements, rights, covenants,
reservations and restrictions contained in this Agreement shall be binding upon and
shall inure to the benefit of the parties herein, their heirs, successors, legal
representatives, assigns and all persons acquiring any part or portion of the Historic
Property, whether by operation of law or in any manner whatsoever.
17. Legal Costs. In the event legal proceedings are brought by any party or
parties to enforce or restrain a violation of any of the covenants, conditions or
restrictions contained herein, or to determine the rights and duties of any party
hereunder, the prevailing party in such proceeding may recover all reasonable
attorneys' fees to be fixed by the court, in addition to court costs and other relief ordered
by the court.
18. Severability. In the event that any of the provisions of this Agreement are held
to be unenforceable or invalid by any court of competent jurisdiction, or by subsequent
preemptive legislation, the validity and enforceability of the remaining provisions, or
portions thereof, shall not be effected thereby.
19. Recordation. No later than twenty (20)days after the Effective Date, City shall
cause this Agreement to be recorded in the office of the County Recorder of the County
of Riverside. Owner shall provide written notice of the contract to the State Office of
Historic Preservation within six (6) months of entering into the contract.
20. Amendments. This Agreement may be amended, in whole or in part, only by
written recorded instrument executed by the parties hereto.
21. Governing Law and Venue. This Agreement shall be construed and governed
in accordance with the laws of the State of California. Any action at law or in equity
brought by either of the parties hereto for the purpose of enforcing a right or rights
provided for by this Agreement shall be tried in a court of competent jurisdiction in the
County of Riverside, State of California, and the parties hereby waive all provisions of
law providing for a change of venue in such proceedings to any other county.
22
IN WITNESS WHEREOF, City and Owner have executed this Agreement on the day and
year first above written.
Dated:
Dated:
APPROVED AS TO FORM
City Attorney
23
CITY OF PALM DESERT
By
ATTESTED TO:
By
Owner
Owner
STATE OF CALIFORNIA )
)ss
COUNTY OF RIVERSIDE )
On , before me, , the undersigned, a
notary public in and for said State, personally appeared
personally known to me (or proved to me on the basis of satisfactory evidence) to be the
person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to
me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by
his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which
the person(s) acted, executed the instrument.
WITNESS my hand and official seal.
Notary Signature
24
APPENDIX D
SAMPLE SITE PLAN
`ERTY
1E
EXISTIMi1PPROP€ SEQ
STREET
Pride and observe the following:
1. Provide two 12) nets of plans [minimum} are required for all bdMrrg permits.
#. Plans are to bah drawr neatly and must be &Mible (no graph p-
3. Minimum 8112" x 11" sheet sb*- (Fill sheet with she plan. Do not use edge d paper for
property lines.
4. Provide project ,address. owners name, and phone number.
5. Shaw all sbeefs, drN*way s, and a" (if arty).
$. Clem Iy 3tmuw all pt upuftW we id ram ig mu r-A LpWun will i uLni VIrLe d6im rbiL Fb.
7. Indicate all easment kwal ons {refer to your TideReport for this �-farrnaton.
8. Show MoM arrow -
Note: All dimensions shown on this sample plan ane for reference only. Your
site plan must show the actual dimensions for the lot located at the address.
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APPENDIX E
MILLS ACT PROGRAM
CITY STAFF ANNUAL INSPECTION REPORT
Date of inspection: ❑ Drive -by ❑ Site Visit
Staff Name:
Was work completed in accordance with all City requirements? ❑ Yes ❑ No
Comments:
Signature:
26
APPENDIX F
GOVERNMENT CODE SECTION 50280-50290
50280. Upon the application of an owner or the agent of an owner of any qualified historical property, as
defined in Section 50280.1, the legislative body of a city, county, or city and county may contract with the
owner or agent to restrict the use of the property in a manner which the legislative body deems
reasonable to carry out the purposes of this article and of Article 1.9 (commencing with Section 439) of
Chapter 3 of Part 2 of Division 1 of the Revenue and Taxation Code. The contract shall meet the
requirements of Sections 50281 and 50282.
50280.1. "Qualified historical property" for purposes of this article, means privately owned property which
is not exempt from property taxation and which meets either of the following:
(a) Listed in the National Register of Historic Places or located in a registered historic district,
as defined in Section 1.191-2(b) of Title 26 of the Code of Federal Regulations.
(b) Listed in any state, city, county, or city and county official register of historical or
architecturally significant sites, places, or landmarks.
50281. Any contract entered into under this article shall contain the following provisions:
(a)The term of the contract shall be for a minimum period of 10 years.
(b) Where applicable, the contract shall provide the following:
(1) For the preservation of the qualified historical property and, when necessary, to restore and
rehabilitate the property to conform to the rules and regulations of the Office of Historic
Preservation of the Department of Parks and Recreation, the United States Secretary of the
Interior's Standards for Rehabilitation, and the State Historical Building Code.
(2) For the periodic examinations of the interior and exterior of the premises by the assessor,
the Department of Parks and Recreation, and the State Board of Equalization as may be
necessary to determine the owner's compliance with the contract.
(3) For it to be binding upon, and inure to the benefit of, all successors in interest of the owner.
A successor in interest shall have the same rights and obligations under the contract as the
original owner who entered into the contract.
(c) The owner or agent of an owner shall provide written notice of the contract to the Office of
Historic Preservation within six months of entering into the contract.
50281.1. The legislative body entering into a contract described in this article may require that the
property owner, as a condition to entering into the contract, pay a fee not to exceed the reasonable cost
of administering this program.
50282. (a) Each contract shall provide that on the anniversary date of the contract or such other annual
date as is specified in the contract, a year shall be added automatically to the initial term of the contract
unless notice of nonrenewal is given as provided in this section. If the property owner or the legislative
body desires in any year not to renew the contract, that party shall serve written notice of nonrenewal of
the contract on the other party in advance of the annual renewal date of the contract. Unless the notice is
served by the owner at least 90 days prior to the renewal date or by the legislative body at least 60 days
prior to the renewal date, one year shall automatically be added to the term of the contract.
(b) Upon receipt by the owner of a notice from the legislative body of nonrenewal, the owner may make a
written protest of the notice of nonrenewal. The legislative body may, at any time prior to the renewal
date, withdraw the notice of nonrenewal.
(c) If the legislative body or the owner serves notice of intent in any year not to renew the contract, the
existing contract shall remain in effect for the balance of the period remaining since the original execution
or the last renewal of the contract, as the case may be.
(d) The owner shall furnish the legislative body with any information the legislative body shall require in
order to enable it to determine the eligibility of the property involved.
(e) No later than 20 days after a city or county enters into a contract with an owner pursuant to this article,
the clerk of the legislative body shall record with the county recorder a copy of the contract, which shall
27
describe the property subject thereto. From and after the time of the recordation, this contract shall impart
a notice thereof to all persons as is afforded by the recording laws of this state.
50284. The legislative body may cancel a contract if it determines that the owner has breached any of the
conditions of the contract provided for in this article or has allowed the property to deteriorate to the point
that it no longer meets the standards for a qualified historical property. The legislative body may also
cancel a contract if it determines that the owner has failed to restore or rehabilitate the property in the
manner specified in the contract.
50285. No contract shall be canceled under Section 50284 until after the legislative body has given notice
of, and has held, a public hearing on the matter. Notice of the hearing shall be mailed to the last known
address of each owner of property within the historic zone and shall be published pursuant to Section
6061.
50286. (a) If a contract is canceled under Section 50284, the owner shall pay a cancellation fee equal to
121/2 percent of the current fair market value of the property , as determined by the county assessor as
though the property were free of the contractual restriction.
(b) The cancellation fee shall be paid to the county auditor, at the time and in the manner that the county
auditor shall prescribe, and shall be allocated by the county auditor to each jurisdiction in the tax rate area
in which the property is located in the same manner as the auditor allocates the annual tax increment in
that tax rate area in that fiscal year.
(c) Notwithstanding any other provision of law, revenue received by a school district pursuant to this
section shall be considered property tax revenue for the purposes of Section 42238 of the Education
Code, and revenue received by a county superintendent of schools pursuant to this section shall be
considered property tax revenue for the purposes of Article 3 (commencing with Section 2550) of Chapter
12 of Part 2 of Division 1 of Title 1 of the Education Code.
50287. As an alternative to cancellation of the contract for breach of any condition, the county, city, or any
landowner may bring any action in court necessary to enforce a contract including, but not limited to, an
action to enforce the contract by specific performance or injunction.
50288. In the event that property subject to contract under this article is acquired in whole or in part by
eminent domain or other acquisition by any entity authorized to exercise the power of eminent domain,
and the acquisition is determined by the legislative body to frustrate the purpose of the contract, such
contract shall be canceled and no fee shall be imposed under Section 50286. Such contract shall be
deemed null and void for all purposes of determining the value of the property so acquired.
50289. In the event that property restricted by a contract with a county under this article is annexed to a
city, the city shall succeed to all rights, duties, and powers of the county under such contract.
50290. Local agencies and owners of qualified historical properties may consult with the State Historical
Resources Commission for its advice and counsel on matters relevant to historical property contracts.
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California Revenue and Taxation Code, Article 1.9, Sections 439 - 439.4
439. Historical Property Restrictions; enforceably restricted property.
For the purposes of this article and within the meaning of Section 8 of Article XIII of the
Constitution, property is "enforceably restricted" if it is subject to an historical property
contract executed pursuant to Article 12 (commencing with Section 50280) of Chapter 1
of Part 1 of Division 1 of Title 5 of the Government Code.
439.1. Historical Property; definitions.
For purposes of this article "restricted historical property" means qualified historical
property, as defined in Section 50280.1 of the Government Code, that is subject to a
historical property contract executed pursuant to Article 12 (commencing with Section
50280) of Chapter 1 of Part 1 of Division 1 of Title 5 of the Government Code. For
purposes of this section, "qualified historical property" includes qualified historical
improvements and any land on which the qualified historical improvements are situated,
as specified in the historical property contract. If the historical property contract does not
specify the land that is to be included, "qualified historical property" includes only that
area of reasonable size that is used as a site for the historical improvements.
439.2. Historical Property; valuation.
When valuing enforceably restricted historical property, the county assessor shall not
consider sales data on similar property, whether or not enforceably restricted, and shall
value that restricted historical property by the capitalization of income method in the
following manner:
(a) The annual income to be capitalized shall be determined as follows:
(1) Where sufficient rental information is available, the income shall be the fair rent that
can be imputed to the restricted historical property being valued based upon rent
actually received for the property by the owner and upon typical rentals received in the
area for similar property in similar use where the owner pays the property tax. When the
restricted historical property being valued is actually encumbered by a lease, any cash
rent or its equivalent considered in determining the fair rent of the property shall be the
amount for which the property would be expected to rent were the rental payment to be
renegotiated in the light of current conditions, including applicable provisions under
which the property is enforceably restricted.
(2) Where sufficient rental information is not available, the income shall be that which
the restricted historical property being valued reasonably can be expected to yield under.
prudent management and subject to applicable provisions under which the property is
enforceably restricted.
(3) If the parties to an instrument that enforceably restricts the property stipulate therein
an amount that constitutes the minimum annual income to be capitalized, then the
income to be capitalized shall not be less than the amount so stipulated. For purposes
of this section, income shall be determined in accordance with rules and regulations
issued by the board and with this section and shall be the difference between revenue
and expenditures. Revenue shall be the amount of money or money's worth, including
any cash rent or its equivalent, that the property can be expected to yield to an owner -
operator annually on the average from any use of the property permitted under the
terms by which the property is enforceably restricted. Expenditures shall be any outlay
or average annual allocation of money or money's worth that can be fairly charged
Q61
against the revenue expected to be received during the period used in computing the
revenue. Those expenditures to be charged against revenue shall be only those which
are ordinary and necessary in the production and maintenance of the revenue for that
period. Expenditures shall not include depletion charges, debt retirement, interest on
funds invested in the property, property taxes, corporation income taxes, or corporation
franchise taxes based on income.
(b) The capitalization rate to be used in valuing owner -occupied single family dwellings
pursuant to this article shall not be derived from sales data and shall be the sum of the
following components:
(1) An interest component to be determined by the board and announced no later than
September 1 of the year preceding the assessment year and that was the yield rate
equal to the effective rate on conventional mortgages as determined by the Federal
Housing Finance Board, rounded to the nearest 1/4 percent.
(2) A historical property risk component of 4 percent.
(3) A component for property taxes that shall be a percentage equal to the estimated
total tax rate applicable to the property for the assessment year times the assessment
ratio.
(4) A component for amortization of the improvements that shall be a percentage
equivalent to the reciprocal of the remaining life.
(c) The capitalization rate to be used in valuing all other restricted historical property
pursuant to this article shall not be derived from sales data and shall be the sum of the
following components:
(1) An interest component to be determined by the board and announced no later than
September 1 of the year preceding the assessment year and that was the yield rate
equal to the effective rate on conventional mortgages as determined by the Federal
Housing Finance Board, rounded to the nearest 1/4 percent.
(2) A historical property risk component of 2 percent.
(3) A component for property taxes that shall be a percentage equal to the estimated
total tax rate applicable to the property for the assessment year times the assessment
ratio.
(4) A component for amortization of the improvements that shall be a percentage
equivalent to the reciprocal of the remaining life.
(d) Unless a party to an instrument that creates an enforceable restriction expressly
prohibits the valuation, the valuation resulting from the capitalization of income method
described in this section shall not exceed the lesser of either the valuation that would
have resulted by calculation under Section 110, or the valuation that would have
resulted by calculation under Section 110.1, as though the property was not subject to
an enforceable restriction in the base year.
(e) The value of the restricted historical property shall be the quotient of the income
determined as provided in subdivision (a) divided by the capitalization rate determined
as provided in subdivision (b) or (c).
(f) The ratio prescribed in Section 401 shall be applied to the value of the property
determined in subdivision (d) to obtain its assessed value.
439.3. Historical Property; notice of nonrenewal.
Notwithstanding any provision of Section 439.2 to the contrary, if either the county or
city or the owner of restricted historical property subject to contract has served notice of
WE
nonrenewal as provided in Section 50282 of the Government Code, the county
assessor shall value that restricted historical property as provided in this section.
(a) Following the hearing conducted pursuant to Section 50285 of the Government
Code, subdivision (b) shall apply until the termination of the period for which the
restricted historical property is enforceably restricted.
(b) The board or assessor in each year until the termination of the period for which the
property is enforceably restricted shall do all of the following:
(1) Determine the full cash value of the property pursuant to Section 110.1. If the
property is not subject to Section 110.1 when the restriction expires, the value shall be
determined pursuant to Section 110 as if the property were free of contractual
restriction. If the property will be subject to a use for which this chapter provides a
special restricted assessment, the value of the property shall be determined as if it were
subject to the new restriction.
(2) Determine the value of the property by the capitalization of income method as
provided in Section 439.2 and without regard to the fact that a notice of nonrenewal or
cancellation has occurred.
(3) Subtract the value determined in paragraph (2) of this subdivision by capitalization of
income from the full cash value determined in paragraph (1).
(4) Using the rate announced by the board pursuant to paragraph (1) of subdivision (b)
of Section 439.2, discount the amount obtained in paragraph (3) for the number of years
remaining until the termination of the period for which the property is enforceably
restricted.
(5) Determine the value of the property by adding the value determined by the
capitalization of income method as provided in paragraph (2) and the value obtained in
paragraph (4).
(6) Apply the ratios prescribed in Section 401 to the value of the property determined in
paragraph (5) to obtain its assessed value.
439.4. Historical Property; recordation.
No property shall be valued pursuant to this article unless an enforceable restriction
meeting the requirements of Section 439 is signed, accepted and recorded on or before
the lien date for the fiscal year in which the valuation would apply.
31