What the Mills Act Means for Glendale Homeowners

If you own or are eyeing a historic home in Glendale, you have likely heard about the Mills Act and its tax savings. You might also wonder what strings are attached and how it affects a future sale. You are not alone. Many Glendale owners want to preserve their home’s character while keeping ownership costs manageable.

This guide explains how the Mills Act works in California, what to confirm locally in Glendale, and the steps you can expect from application to closing. You will learn about tax benefits, owner obligations, and how to navigate a purchase or sale of a Mills Act property with confidence. Let’s dive in.

Mills Act basics

The Mills Act is a California program that lets cities and counties sign contracts with owners of qualified historic properties. In return for legally binding preservation commitments, owners generally receive lower annual property taxes.

The savings come from a special assessment method. Instead of being taxed at full market value, a Mills Act property is typically reassessed by the county assessor using an income-capitalization approach. That method often produces a lower assessed value and therefore lower yearly taxes while the contract is active.

Mills Act contracts are long term. They are commonly written with an initial 10-year term and then renew automatically each year. The contract is recorded against the property and runs with the land, which means future owners inherit both the tax benefit and the preservation obligations.

Cities or counties approve the contract. Local preservation staff and a historic commission often review applications. The county assessor handles the special assessment once the contract is recorded.

Is your Glendale home eligible?

Eligibility generally starts with historic designation. Across California, that usually means your property is designated at the local level, or listed on the California Register of Historical Resources, or the National Register of Historic Places. In practice, many single-family owner-occupied homes can qualify if they have formal designation.

Glendale-specific requirements can vary by policy. You should confirm whether Glendale requires local designation, such as listing on the city’s register or inclusion in a local historic district. Many cities do. You should also ask whether the city uses application windows, annual caps, or prioritization criteria when reviewing new contracts.

Glendale’s Planning and Community Development staff and its Historic Preservation Commission are the likely contacts for eligibility questions and procedures. They can confirm current policies, deadlines, and any local priorities for neighborhoods such as Rossmoyne or other designated districts.

What you will need to apply

Most cities ask for a clear, organized packet. Expect to prepare:

• A completed application form and proof of ownership
• A historic property description and current photographs
• Your tax parcel number and any prior designation documents
• A proposed preservation or maintenance plan outlining needed work
• Any city-specific standards or covenants you must sign as part of the contract

Benefits and owner obligations

The financial upside can be meaningful. Property tax reductions under Mills Act contracts vary, but they can be substantial in many cases. The exact savings depend on your property, the local assessment method, and the income-capitalization calculation by the county assessor. Savings recur yearly while the contract remains in force.

The program, however, is not a grant. You must maintain your home and follow established preservation standards, such as the Secretary of the Interior’s Standards for Rehabilitation or local rules listed in your contract. The emphasis is on active preservation, not deferral.

Significant exterior changes, additions, or demolition typically require prior review and approval by the city’s historic preservation authorities, along with permits. Routine maintenance and minor repairs may be exempt from review, but your contract or the city’s guidelines will define the thresholds. Expect periodic inspections or annual reporting to document compliance.

Noncompliance can carry consequences. Cities may take enforcement actions, and some jurisdictions apply penalties or cancel contracts if terms are violated. Cancellation can lead to rollback tax implications. You should confirm local enforcement procedures with Glendale before you apply.

Buying or selling a Mills Act home in Glendale

A recorded Mills Act contract typically transfers with the property at sale. Buyers inherit the tax benefit and the obligations to preserve. This can make a home more attractive to buyers who value lower ongoing taxes and historic character.

Both parties should account for the contract during price and terms discussions. Buyers should budget for restrictions on alterations and the need for city approval before major work. Sellers should be ready to provide recent compliance documentation, inspection reports, and copies of the recorded agreement.

Most lenders accept Mills Act properties. Some may request a review of the contract and any attached covenants to understand their impact on collateral and future improvements. The earlier a buyer shares the contract with their lender, the smoother underwriting tends to be.

During escrow, the recorded contract should appear in the preliminary title report. Title and escrow teams will account for the recorded covenant as part of the property’s chain of title.

Step-by-step: Applying in Glendale

If you already own a designated historic property and want to pursue the Mills Act, use this checklist as your roadmap:

1. Confirm designation status
   • Check whether your home is listed as a local historic resource, within a local district, or on the state or national registers. When in doubt, contact Glendale’s historic preservation staff.
2. Contact Glendale’s preservation team
   • Request the city’s Mills Act application packet, current timelines, and any local guidelines or prioritization policies.
3. Prepare your documentation
   • Gather photographs, a concise history, proof of ownership, the parcel number, and a draft maintenance or preservation plan.
4. Submit and prepare for review
   • The city’s preservation staff and Historic Preservation Commission typically review applications. Be ready to answer questions and refine your plan.
5. Coordinate with the County Assessor
   • After city approval, the Los Angeles County Assessor will complete the special assessment using the income-capitalization approach.
6. Execute and record the contract
   • Once approved, you and the city sign the contract. It is recorded against the property, and the special tax assessment applies per county procedures.
7. Maintain and document
   • Keep records of preservation work, permits, and inspections. Meet any annual reporting requirements to stay in compliance.

Buyer due diligence checklist

If you plan to purchase a Mills Act home in Glendale, include these steps in your process:

• Verify that a Mills Act contract is recorded on title and obtain a full copy
• Review preservation obligations and approval thresholds for planned work
• Include a contingency to consult city staff if you intend to remodel
• Share the contract with your lender early to avoid underwriting delays
• Request recent compliance documentation and inspection reports from the seller
• Consult a tax professional for guidance on property tax and other potential tax matters

How the tax math works

The Los Angeles County Assessor typically uses an income-capitalization method for Mills Act properties. This is a special assessment that estimates a hypothetical income stream and applies a capitalization rate to arrive at assessed value. The result is often lower than market-based assessments, which is why many owners see annual tax savings.

Your specific outcome will vary. It depends on factors such as your property’s characteristics, the assessor’s methodology, and current market conditions. Only the assessor can establish the assessed value under the program, so build in time for their review when you plan your application.

Risks and tradeoffs to consider

• Contract obligations can limit some future changes and require historic-appropriate methods and materials.
• You may face penalties or contract cancellation if you do not comply, which can trigger rollback tax implications.
• Preservation standards can increase long-term maintenance responsibilities and costs, even as your property tax burden may decrease.
• Buyers should evaluate both the legal obligations and the physical condition of historic features to plan realistic budgets.

When the Mills Act fits your goals

The Mills Act can be a win if you want to steward a historic home in Glendale and value year-over-year tax relief. It rewards owners who plan for sensitive maintenance and are comfortable seeking approvals for major exterior work. If you plan a thoughtful restoration or wish to retain original character, the program’s long-term benefits can align well with your goals.

If you are considering an application or weighing a purchase or sale involving a Mills Act contract, experienced guidance helps. Connect with a local team that understands Glendale’s preservation process, contract language, and the practical details that matter in escrow and beyond.

Ready to talk strategy for your home in Rossmoyne, Northwest Glendale, Verdugo Woodlands, Adams Hill, or nearby? Reach out to Chris Cragnotti for preservation-minded advice, clear next steps, and a plan tailored to your goals.

FAQs

What is the Mills Act and how does it lower taxes?

• The Mills Act lets cities and counties sign contracts with owners of qualified historic properties, and the county assessor typically uses an income-capitalization approach that often results in lower annual property taxes.

Is local historic designation required in Glendale to qualify?

• Many California cities require local designation or equivalent listing, but you should confirm Glendale’s current policy with the city’s historic preservation staff and review any local program guidelines.

What obligations come with a Glendale Mills Act contract?

• Owners must maintain the property to preservation standards, seek prior approval for significant exterior changes, comply with inspections or reporting, and keep the home’s historic character intact.

Does a Mills Act contract transfer to a new owner at sale?

• Yes, the contract is recorded and runs with the land, so buyers inherit both the tax benefits and the preservation obligations when they purchase the property.

How will a Mills Act contract affect my financing?

• Most lenders accept Mills Act properties, but they may want to review the recorded contract and covenants, so share the documents with your lender early in escrow to avoid delays.

When do property tax savings start after approval?

• Timing depends on county processing and when the contract is recorded; the Los Angeles County Assessor applies the special assessment after the contract is in place.

Can I cancel the contract if I move or change plans?

• Cancellation is uncommon and subject to strict rules, and contracts usually continue with the property after a sale; check Glendale’s procedures before assuming you can cancel.