Item 30 - Fiscal Year 2026-27 Budget Work Study Session

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Fiscal Year 2026-27 Budget Work Study Session May 5, 2026 Page 5 Historic Resources Commission The City's Historic Resources Commission (HRC) reviews projects to preserve and maintain the City's historic assets, pursuant to Chapter 30 of the Santa Ana Municipal Code. This includes a review of property listings and categorizations, as well as recommendations on Mills Act agreements, exterior modifications, demolitions, and other changes that may impact historically significant resources. Historically, the City recovered the full cost of administering this program through application and review fees charged to project applicants. In FY 2014-15, the City Council approved a reduction in these fees, lowering the level of cost recovery and resulting in a portion of program costs being subsidized by the General Fund. If the City were to return to full cost recovery, fees would be updated to reflect the actual cost of staff time and administrative support associated with historic review, including research, site visits, evaluation of historic aerial imagery and records, genealogy research, and discussions with property owners. These updates would be incorporated into the City's Miscellaneous Fee Schedule and would be limited to cost recovery. Participation in the Mills Act program provides a financial incentive to property owners by reducing property tax obligations in exchange for preserving and maintaining historic properties. For example, a property valued at $1.5 million may realize approximately $7,875 in annual property tax savings under a Mills Act agreement. This reduction in property tax revenue results in an estimated annual loss of approximately $1,496 to the City. Returning to full cost recovery is estimated to reduce the General Fund subsidy by approximately $54,800 annually. The estimated $54,800 in savings reflects the elimination of the remaining General Fund subsidy, as approximately $46,000 in program costs is already recovered through existing fees. A summary of current fees and estimated full-cost recovery levels is provided in the table below. Fee Type Current Full Rate Recovery Historic Register Categorization / Application $500 $7,501 Historic Property Preservation Agreement $2,954 $5,887 The HRC serves as the decision-making body for applications and other matters required by Chapter 30. It comprises nine members, including seven officials appointed by the City Council, and one representative each from the Planning and Community Development commissions, which elect those representatives. While this commission performs specialized functions for historical properties and districts, it is not a commission required by State law. As a result, the number of its commissioners may be modified or eliminated, and its functions may be delegated to staff and/or the Planning Commission. Its functions could be consolidated with the Planning Commission, resulting in additional General Fund