In purchasing your new home, your future monthly payments will be made up of principal, interest, real property taxes and insurance, but what is the tax for the Community Facilities District, otherwise known as a Mello–Roos District?
Q. What is a Mello-Roos District?
A. Mello-Roos District is an area where a special tax is imposed on those real property owners within a Community Facilities District. This district has chosen to seek public ﬁnancing through he sale of bonds for the purpose of ﬁnancing certain public improvements and services. These ervices may include streets, water, sewage and drainage, electricity, infrastructure, schools, parks and police protection to newly developing areas. The tax you pay is used to make the payments of principal and interest on the bonds.
Q. What are my Mello-Roos taxes paying for?
A. Your taxes may be paying for both services and facilities. The services may be ﬁnanced only o the extent of new growth, and services include: police protection, ﬁre protection, ambulance and paramedic services, recreation program services, library services, the operation and maintenance of parks, parkways and open space, museums, cultural facilities, ﬂood and storm protection, and services for the removal of any threatening hazardous substance. Facilities which may be ﬁnanced under the Act include: Property with an estimated useful life of ﬁve years or longer, parks, recreation facilities, parkway facilities, open-space facilities, elementary and
secondary school sites and structures, libraries, child care facilities, natural gas pipeline facilities, telephone lines, facilities to transmit and distribute electrical energy, cable television lines, and others.
Q. When do I pay these taxes?
A. By purchasing an interest in a subdivision within a Community Facilities District you can expect to be assessed for a Mello-Roos tax which will typically be collected with your general property tax bill. These special tax payments are subject to the same penalties that apply to regular property taxes.
Q. How long does the tax stay in effect?
A. The tax will stay in effect until the principal and interest on the bonds are paid off along with any reasonable administrative costs incurred in collecting the special tax or so long as it is needed to pay the expenses of services, but in no case shall exceed 40 years.
Q. How much will the Mello-Roos payment be?
A. The amount of tax may vary from year-to-year, but may not exceed the maximum amount speciﬁed when the district was created. In the case of the purchase of a new house within a subdivision, the maximum amount of the tax will be speciﬁed in the public report.