What are Mello Roos?
DeeDee Riley Real Estate Agent El Dorado Hills, CA 916-225-2719 Contact Profile
What are Mello Roos?
In California, after the enactment of Proposition 13 in 1978, public agencies began having difficulties financing new projects including schools and roads. In 1982, through the facilitating of Senator Henry Mello and Assemblyman Mike Roos, the Community Facilities District Act was passed. It enabled local governments and developers to create Community Facility Districts where they could sell tax-exempt bonds to raise money for public improvements.
Initially the Act was drafted as a housing measure to pay for infrastructure need in new housing areas but is sometimes used by existing communities to make funds available for public improvement and services.
When a Community Facilities District is formed for a new subdivision, the amount of bonds which can be sold is based on the value of the new houses being constructed or planned for construction inside the CFD boundaries. The bonds are then secured by all of the property within the CFD boundaries and is repaid by special long term taxes levied on the property. If the property is owned by a developer, they pay the taxes until the property is sold and then the new homeowner pays it.
The amount of tax levied for each property varies and is determined by many factors, including how many units (houses) will be built per acre, the type of facility the bonds will
pay for (ie roads or schools), or which parcels will benefit most from the improvement. Payment of the "special tax" is levied on the owner's Property Tax bill. These charges are not deductible for the owner.
In El Dorado Hills, Mello Roos first started with the master planned community of Serrano in the mid 1990's. Those bonds were for the development of roads and several schools in the areas of Serrano. Most of the neighborhoods built before 2000 don't have Mello Roos. Of those neighborhoods that were built after 2000 some of them do and some of them don't. In my neighborhood blogs, I will try and comment if the neighborhood has them or not. If you are interested in a specific neighborhood and I don't have a post for it, email me and I'll be happy to check on it for you. Mello Roos are definitely something you will want to take into account when purchasing a home.
I am a REALTOR® in El Dorado Hills with Lyon Real Estate.Though living in El Dorado Hills is my passion, I am happy to help you with your real estate needs throughout the Sacramento Valley. For more information on me or our wonderful area visit my website at www.DeeDeeRiley.com or email me at email@example.com .
Please keep in mind -the views expressed herein are my personal views and do not necessarily reflect the views of Lyon Real Estate.Source: activerain.trulia.com