How is community funding provided?
Let’s say for example, that plans for a new Carlsbad school are approved in your Community Facilities District. To finance the San Diego school, tax-exempt municipal bonds are issued. These public bonds are repaid (or secured) over an extended time through the levy of a special tax (Mello-Roos) on properties that benefit from the facility. This tax is usually added to the annual San Diego North County property tax bills (over a 20-25 year period) of residences within the CFD.
How Much Will be Assessed?
An adopted formula that relates to the size of the San Diego North County home (square footage or lot size) is used to determine the amount of an individual assessment. In general, the special taxes and assessments do not exceed 1% to 1.5% of the market value of new new homes. Moreover, the total amount of all annual taxes (including property tax) usually does not exceed 2% to 2.5% of the North County home’s market value.
Can my Mello-Roos increase?
This special tax on your North County home can increase only at a maximum rate of 2% per year over a 25 year period. On the other hand, it’s possible that this tax will decrease.
Can I choose how to pay for Mello-Roos?
Yes. As already mentioned, the special assessment can be added to your San Diego property tax bills until your portion of the tax is paid off. A schedule of maximum special tax payments over a period of 25 years is available to San Diego North County home owners prior to the close of escrow. Those who purchase a new North Country home also have the option to pay for their Mello-Roos tax in it’s entirety at the time they buy. However, because statistics indicate that the average homeowner in California moves every 7 years, it’s often prudent to spread the payment over time.
Find out more about Mello Roos in San Diego North County by reading “How to Avoid Mello Roos.” To get more info, contact Gary Harmon, your Real Living Lifestyles real estate agent.
