Page 23 - Home Buyers and Sellers Handbook English - California

Mello-Roos (California-Only)
It is possible that the property you are buying is in a “Mello-Roos District” and that a special tax will apply.
Mello-Roos is the common name for the 1982 Community Facilities District Act. This Act authorizes local
governments and developers to create Community Facilities Districts (”CFDs”) for the purpose of selling
tax exempt bonds to fund public improvements (such as streets, water, sewage and drainage, electricity,
infrastructure, schools, parks and police protection). Property owners that participate in a CFD pay a special tax
to repay the bonds.

The Mello-Roos tax stays in effect until the bonds are paid off. Sometimes after the bonds are paid off, a CFD
will continue to charge a reduced fee to maintain the improvements. This tax is typically included in the annual
county property tax bill, and is subject to the same penalties that apply to regular property taxes. If the Mello-
Roos tax is not paid, the District may exercise its legal right to foreclose and sell the property.

Under Proposition 13, Mello-Roos taxes are not based on the value of the property. Instead, they are apportioned
by taking into account property characteristics (e.g., the use of the property, square footage of the structure, and
lot size). The District submits the tax charges to the County, who adds them to your annual Property Tax Bill.
Charges for this tax vary, but they do not exceed the maximum amount specified when the CFD was created.
When there is a new purchase of a house in a subdivision, the maximum of the tax will be specified in the
public report.

Supplemental Tax (applicable in select States)
For an in-depth breakdown of Supplemental Tax, visit Section H, Understanding Supplemental Property
Taxes (page 23).

PROPERTY TAX CALENDAR

Second Installment First Installment
Lien Date Delinquent Tax Bills Mailed Delinquent
January 1 After April 10 Last week of October After December 10

JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC

Second Installment Beginning of First Installment
Due Fiscal Tax Year Due
February 1 July 1 November 1

Second Installment First Installment
January 1 — June 30 July 1 — December 31

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