Atherton Municipal Code Art. IV Historical Property Contracts

A. Purpose. The purpose of this article is to implement the Mills Act (Government Code Sections 50280 through 50290), allowing the approval of historical property contracts by establishing a uniform procedure for the owners of qualified historic properties within the town to enter into contracts with the town.

B. Property Tax Relief Incentives. In order to carry out more effectively and equitably the purposes of this chapter, the city council may approve historical property contracts pursuant to California Government Code, Article 12, Sections 50280 through 50290 which may provide economic incentives to owners of qualified properties in the form of tax relief if they pledge to rehabilitate and maintain the historical and architectural character of their properties for at least a ten-year period.

C. Applicability of the California Historical Building Code. It is the purpose of the California Historical Building Code to provide regulations and standards for the rehabilitation, preservation, restoration (including related reconstruction) or relocation as applicable to all historical buildings, structures and properties deemed of importance to the history, architecture, or culture of an area by an appropriate local or state governmental jurisdiction. Such standards and regulations are intended to facilitate the restoration or change of occupancy so as to preserve their original or restored elements and features, to encourage energy conservation and a costeffective approach to preservation, and to provide for reasonable safety from fire, seismic forces or other hazards for occupants and users of such “buildings, structures and properties” and to provide reasonable availability and usability by the physically disabled. Atherton has adopted the California Historical Building Code and any property subject to a historical property contract is subject to that code’s requirements.

D. Limitation on the Number of Historical Property Contracts. No more than five historical property contracts or no more than a twenty-five-thousand-dollar maximum cap on the annual amount of aggregate property tax loss to the town across all historical property contracts shall be in effect at any one time in the town of Atherton. (Ord. 652 § 1, 2022)

A. Application for Historical Property Contract Consideration. A request for a historical property contract may be initiated by application of the property owner of a historical building listed on the Atherton historical register. In all cases an applicant for a historical property contract shall utilize the form of application required by the town. Applicants may apply for a historical property contract by submitting the following information:

1. Payment of the Application Fee. The planning department shall determine the amount of a fee necessary to compensate the town for processing and administering an application for a historical property contract. The fee shall pay for the time and materials required to process the application, based upon the estimated actual costs to perform the work. This fee shall be separate from the fee imposed following approval of the historical property contract to pay for the actual costs of inspecting the qualified historical property, enforcing the historical property contract and any required historical alteration permit.

2. A copy of current grant deed.

3. A copy of the most current property tax bill.

4. A complete, detailed site plan of the qualified historical property.

5. Evidence that the property is a qualified historical property at a recognized federal or state level, including, but not limited to, a historical evaluation prepared by a licensed, qualified historian.

6. A ten-year restoration/rehabilitation and maintenance plan that includes a detailed written narrative describing the nature, cost and schedule of the rehabilitation, restoration or preservation work to be conducted on the property (exterior and/or interior) that will preserve the character and integrity of the historic building (i.e., repair of original wood windows). Such work shall not include projects that do not contribute to the preservation of the historical property (i.e., installation of new kitchen appliances).

7. Color photographs of all building exterior elevations, character-defining features of the structure(s), any interior photos of relevant areas where work may be proposed, both overall and detail views, and any additional related items (e.g., associated structures, house, garage, shed, and neighboring properties).

8. A description of the public benefits that are intended if the historical property contract is approved. Examples of such benefits are:

   • i. Allowing periodic public tours of the property.

   • ii. Commitment of a specified percentage of the property tax savings to rehabilitation and upgrading of the historical building.

   • iii. Public display of before and after pictures of the historic structure.

9. Any such additional information the planning department determines is necessary to make a recommendation on the historical property contract.

B. Review by the Assessor’s Office. The planning department will refer any application for a historical property contract to the San Mateo County assessor’s office for review and recommendation. The assessor will provide to the planning commission and city council an estimate of the property tax calculations and the difference in property tax assessments under the different valuation methods permitted by the Mills Act so that the town can evaluate the difference between property tax which would normally be collected by the town and the property tax which would be collected pursuant to the historical property contract. Any cost for the San Mateo County assessor’s office in providing such estimate, shall be incurred by the project applicant.

C. Staff Review. Upon receiving the tax calculations from the San Mateo County assessor’s office, town staff will work with the owner to prepare a historical property agreement for the planning commission’s consideration. The terms and conditions of that agreement will vary from property to property but in all cases be subject to the requirements detailed in Section 8.15.420.

D. Planning Commission Hearing. The planning commission will hold a public hearing on the application in accordance with Section 17.06.090. At the conclusion of the public hearing, the planning commission will make a recommendation to the city council whether to approve a historical property contract.

E. City Council Hearing. Upon receipt of the planning commission recommendation, the city council will hold a public hearing to consider approving a historical property contract in accordance with Section 17.06.080.

• F. Required Findings. To approve a historical property contract, the city council must find that:

  1. The property is listed on the Atherton historical register;

  2. The property is significant due to its historic value, location, or other attribute;

  3. The applicant can preserve and, when necessary, restore and rehabilitate the property;

  4. The preservation and, when necessary, restoration and rehabilitation of the property will enhance the town’s inventory of historic and cultural resources; and

  5. Approval of the historical property contract is consistent with the general plan. (Ord. 652 § 1, 2022)

All historical property contracts shall set forth the agreement between the town and the owner, and shall, at a minimum, contain the following provisions:

• A. Mills Act Compliance. The owner’s commitment to comply with the requirements of the Mills Act (California Government Code, Sections 50280 through 50290).

B. Tax Benefit. As long as the property owner properly rehabilitates, restores, preserves and maintains the qualified historical property as set forth in the historical property contract, the town shall comply with California Revenue and Taxation Code Article 1.9 (commencing with Section 439) of Chapter 3 of Part 2 of Division 1; provided, that the assessor determines that the specific provisions of the Revenue and Taxation Code are applicable to the property in question.

C. Term. All historical property contracts shall be for a term of ten years. Extensions may be considered on a case-by-case basis.

D. Property Maintenance. The owner’s commitment and obligation to preserve, rehabilitate, restore and maintain the property in accordance with the rules and regulations of the Office of Historic Preservation of the California Department of Parks and Recreation and the United States Secretary of the Interior’s Standards for the Treatment of Historic Properties.

E. Tax Assessment Impact. An assessment of valuation in accordance with the San Mateo County assessor’s office and California State Board of Equalization.

F. Inspections. Authorization for the town to conduct periodic inspections of the interior and exterior of the property to determine the owner’s compliance with the historical property contract with inspections being conducted no less frequently than every five years.

G. Assignment. That the historical property contract is binding upon, and shall inure to the benefit of, all successors in interest of the owner, including that the contract transfers with the property should the property be sold or otherwise transferred to another party during the term of the historical property contract.

H. Indemnification. The owner’s indemnification of the town for, and agreement to hold the town harmless from, any claims arising from any use of the property.

I. Termination and Enforcement. Agreement that the town may cancel the historical property contract, or seek enforcement of the contract, when the town determines that the owner has breached the terms of the contract or failed to comply with the provisions of this chapter. The town shall comply with the requirements of the Mills Act for enforcement or cancellation of the historical property contract. (Ord. 652 § 1, 2022)

A. Recordation. Within thirty days from the effective date of the historical property contract, the owner shall record the historical property agreement with the recorder of the county of San Mateo.

B. Notice to State Parks. Within six months from the effective date of the historical property contract, the owner shall provide a copy of the recorded historical property contract to the Office of Historic Preservation to the Department of Parks and Recreation of the state of California within six months following the effective date. (Ord. 652 § 1, 2022)