TAX TIPSSan Diego County Assessor/Recorder/ClerkFebruary 2009
The Mills Act provides for potential property tax savings on a property that is subject to a historical property contract. Mills Act properties are to be valued using the rental income and expense that could be expected from that property rather than using comparable sales to establish the assessed value. This generally results in a much lower assessment especially when the property has been recently purchased.
It must meet qualifying criteria such as significant architecture, association with a historically significant event or person, or location in a historic district (such as Marston Hills.) Once designated as a historical site, the owner can then apply for a voluntary contract with that city. The application and approval process is accomplished entirely through the city (or County for unincorporated areas) where the property is located. The Assessor’s office only administers the property tax portion of the Mills Act.
The term of the contract is a self renewing, ten year agreement, however, either the property owner or the city can file for non-renewal. As the contract follows the property and not the owner, the contract will transfer uninterrupted on the sale of the property.
No, the law was revised in 1985 when new legislation relaxed the rules to encourage the preservation of historic properties. Prior to that time, any property under contract had to be open to the public for tours.
No, only the cities of San Diego, Chula Vista, Coronado, Escondido, La Mesa, Encinitas, San Marcos, and National City have enacted ordinances to grant a Mills Act agreements. The County of San Diego has also passed an ordinance for historical properties in the unincorporated areas of the County.
Currently, there are approximately 1,200 properties under contract with the various cities that receive this property tax benefit.
The Assessor's Office must determine the assessed value based on a formula under State law, using an income and expense stream that could be generated from the property.
Typically, property owners can expect a 20% to 70% savings on their property taxes. Under State law, the lesser of 1) the current market value, 2) the Proposition 13 value, or 3) the restricted Mills Act value will be used to calculate your property taxes. It is possible that the Proposition 13 value may be lower than the restricted value, and the property would receive no property tax benefit.
Some owners who would receive no property tax benefit still apply for the Mills Act. It can be a selling point to a potential buyer because the property would not be reappraised at its full market value upon sale if it were already under a Mills Act contract.
Yes, once that property is designated on a Federal, State, or local register, it is subject to the rules and regulations of the Office of Historic Preservation of the Department of Parks and Recreation, the U.S. Secretary of the Interior's Standards for Rehabilitation, and the Historic Building Code. In effect, the owner must protect, maintain, and rehabilitate the property into perpetuity.
Additional information concerning the assessment of power plants can be obtained by calling the Assessor's Office at (858) 505-6262.
Yes. There are plans for a major electric generating plant in Otay Mesa, east of the prison sites.
No. Much of our electricity is imported through transmission lines from generating plants outside the county. Those transmission lines located in San Diego County, however, are assessed for property tax purposes.
The market value of power plants is determined after analyzing the purchase price, sales of similar power plants, replacement cost and income received from the sale of electricity.
Prior to last year, State law required the State Board of Equalization to assess all the public utilities power plants. The law was changed and now the local Assessor's Office must appraise any power plants that are sold.
The South Bay Power Plant was purchased by the Port of San Diego and leased to Duke Energy Power Services. The Encina Power Plant was purchased by Dynegy and NRG Energy Inc.
The two facilities recently sold in San Diego County were the South Bay Power Plant in Chula Vista and the Encina Power Plant in Carlsbad.
There are three major power plants in San Diego. They are the South Bay Power Plant, the Encina Power Plant, and the San Onofre Nuclear Generating Station. There are also several smaller generating plants in San Diego County that can be used as back up during times of peak demand.
An electric generating plant is a facility that uses natural gas, oil, coal or uranium, to power large turbines that create the electricity we use in our homes and businesses.
The recent news articles covering the sale of two of San Diego Gas & Electric's electric generating plants in San Diego County resulted in numerous inquiries concerning the assessment of these facilities for property tax purposes. Below are some of the most frequently asked questions concerning these power plants.
The Assessor's Office is frequently asked if businesses and homes on Indian lands are assessed for property tax purposes. Below are some of the most frequently asked questions concerning assessments on Indian reservations. For additional information on these types of assessments, please call the Assessor's Office at (619) 531-6468.
An Indian reservation is land owned by the U. S. Government which is held in trust for Indians (native-Americans).
There are twenty (20) Indian reservations in San Diego County covering over 129,000 acres as shown below:
No. These specific businesses are owned by Indians on trust lands and under Federal law, exempt from property taxes.
No. These new additions are owned by Indians on trust lands and under Federal law, exempt from property taxes.
If the expansion occurs on land that is not held in trust or if they are not owned and operated by the tribe, they will be assessable for property taxes.
Yes. Land owned by an individual Indian in "fee title" rather than held "in trust" is taxable.
Yes. Any business on Indian reservations that is owned, leased by, or operated by a non-Indian is taxable. The most common examples of these include sand and gravel operations, RV campgrounds, and retail outlets.
Yes. The outlet stores themselves are assessed not to the Indians but to the actual companies that own and operate them.
Additional information on Indian reservations can be obtained by contacting the Bureau of Indian Affairs, 3600 Lime Street, Suite 722, Riverside, CA 92501, or by calling (714) 276-6624.
Did you know that transfers between parents and children will not cause a reassessment for property tax purposes? The following questions and answers help explain this exclusion program. For further information, please call the Assessor's Office at (619) 531-5848.
This exclusion prevents an increase in property taxes when real property is transferred between parents and their children.
The principal place of residence and up to $1 million in assessed value of any other real property may be transferred by each parent or child without a property tax increase.
Natural children, children adopted before the age of 18, stepchildren (as long as the parents are still married), and sons- and daughters-in-law are considered children under this exclusion program.
A claim should be filed within three years of the date of transfer or death, or prior to a transfer to a third party. In addition, a claim may be filed within six months after the mailing date of the supplemental notice or escape assessment.
The only time the transfer from grandparent to grandchildren will qualify is if the "middle generation" is deceased and the transfer is on or after March 27, 1996.
Yes. A copy of the trust should be submitted with the application.
No. In order to qualify, the property must be transferred to the individual owner's name before the application is submitted.
In order for one to qualify, an application form must be filed with the Assessor's Office. To obtain the necessary application, please call the Assessor's Office at (619) 531-5848.