Benefits and Responsibilities of Historical Designation
What are the benefits and responsibilities of historical designation?
An owner with a designated historical property accrues the responsibilities and benefits of historical designation as summarized below. More detailed information is available at the benefits and responsibilities section of this website.
- To retain and maintain the resource. The Secretary of the Interior's Standards for Treatment of Historic Properties will be utilized to review development proposals on historical properties. The Standards are administered at the local level by City staff and the Historical Resources Board because the City of San Diego is a Certified Local Government.
- Proposed relocation, substantial alteration and demolition are discouraged, and would require a historical Site Development Permit in accordance with San Diego Municipal Code Section 126.0502(d)(E) to be approved by the Planning Commission with a recommendation from the Historical Resources Board.
- Alterations are carefully reviewed for consistency with the Secretary of the Interior's Standards; those alterations that meet the Standards may be exempted per San Diego Municipal Code Section 143.0220 from the requirement for a historical Site Development Permit unless the project qualifies as a major alteration (see Section 143.0250 in the previous link). Attention is focused on those areas of the site or building that are visible to the public.
- Typically, local historical designation does not affect proposed interior alterations (unless portions of the interior were specifically called out in the designation of the site).
- The Mills Act property tax reduction for locally designated sites in certain areas of the City of San Diego. The Mills Act may not be available for all designated sites in Redevelopment Areas. Contracts entered into based on the Mills Act state law allow a different method of property tax valuation to be prepared by the County Tax Assessor.
- Per San Diego Municipal Code Section 126.0303, access to a historical Conditional Use Permit that may allow a use for historical sites not normally permitted in the zone.
- Use of the more lenient California Historical Building Code (see Part 8 of California Code of Regulations, Title 24) for all local, state and federal historically designated sites.
- Within designated historical districts, legislative protection for all historically designated sites within the district, contributing to retention of desirable neighborhood fabric and character. Some historical districts have design guidelines that affect all properties within the district to ensure neighborhood character is retained.
- Ability to donate a facade easement to the City or other historic preservation agency as a charitable donation deduction from income taxes.
- For National Register sites and districts, the ability to obtain tax credits for improvement expenditures related to the substantial rehabilitation of the site. The tax credit applies to personal or corporate taxes.
- Many studies show that historical designation increases property values.
Are there property tax advantages to historical designation?
Yes. California state law provides for a potential property tax reduction, called the Mills Act, that is available to most owners of City of San Diego designated historical properties. There are also income tax relief incentives for some historical properties. There are cases where an income-producing site that is listed on the National Register of Historic Places, either individually or within a National Register historical district, can obtain a 20 percent tax credit (more a savings than a deduction) for substantial rehabilitation. This is a fairly involved process that requires approval by the National Park Service for the proposed work before you do it, and certification after you do it, that the rehabilitation complies with the Secretary of the Interior's Standards.
I'm not sure I want any restrictions placed on the use of my own property. If I lived in a new house, would I have any restrictions?
With a new house in a new subdivision, you would be required to comply with zoning, safety, health and building codes. Also, many newer subdivisions and housing tracts have stringent design guidelines for paint colors, landscaping, vehicle parking, and a multitude of other restrictions. These are frequently called Codes, Covenants and Restrictions (CC&Rs) which are a set of rules governing what can be done with your property. Homeowner Associations frequently tell you what you can or cannot do with your property. Historical designation generally places fewer restrictions on property alterations than most newer homes that have CC&Rs.
What are some intangible benefits from historical designation that I may not know about?
Historical districts benefit from improved image; people take better care of their homes and take pride in the neighborhood. New owners are attracted to historical areas and fix up dilapidated homes; when this happens to multiple properties overtime, property values can increase substantially as the overall character of the neighborhood improves. Some historical districts have programs in which area merchants give discounts to residents shopping in the district, or raise money each year for their neighborhood association through house or garden tours which continue to publicize the benefits of living in that community. According to nation-wide studies, "Heritage Tourism" is one of the major revenue generators in many cities across the country; the majority of people vacationing choose vacation spots with historical places to visit. Owners of designated properties also find that having a Mills Act agreement and the prospect of lower property taxes for the purchaser actually helps them sell their buildings. More detailed information is available at the benefits and responsibilities section of this website.
What will happen to my property values?
According to the County Tax Assessor and many real estate professionals, values either remain the same or improve. In cases where a residential area has fallen into decay, property values are increased by actions of homeowners in designated homes or districts to improve their properties. Studies in various areas of the country show that historical district designation can increase property values upwards of 30 percent beyond normal appreciation. Appraisers of historical properties believe that as a historical district provides protection to individual homes by maintaining community context, property values are substantially increased. This is of greater benefit than individual historical designation, as all properties are protected. However, there are areas where a number of individually designated structures are located even if they are not historical districts. These areas are often known for having a lot of historical homes (e.g., Mission Hills, and areas of La Jolla), and people looking for historical homes are attracted to these areas. New owners fix up their homes, and this encourages other people to take better care of their homes, and the net result in property values can be similar as within a historical district.
Handout on Historical Plaques
After your site is designated, this historical plaque handout shows the specifications for historical plaques. Plaques that meet these specifications are approved for placement on designated historical sites. Owners are responsible for purchasing and installing a plaque.