|Finance Department||District Administrator|
|1 Civic Center Drive
San Marcos, CA 92069
(760) 744-1050, ext. 4506
Community Facilities Districts (Mello-Roos)
The City of San Marcos uses Community Facilities Districts (CFD), which are commonly referred to as Mello-Roos Districts, to finance local public facilities and services. Property owners in a San Marcos CFD are taxed annually for their share of the debt service on any bonds that the CFD has issued and/or to pay for the cost of City services. Proceeds from the taxes are used to ensure that the community is properly maintained and public improvements are constructed.
Community Facilities Districts Administered by the City of San Marcos
What is a CFD special tax?
A CFD special tax is levied on taxable property within a district area that is used to fund authorized public facilities and/or services.
When did the use of CFDs start? Why did they start?
Finding funding for local public facilities and services is very difficult. Particularly after the passage of Proposition 13 in 1978, cities were severely limited in their ability to finance such things as parks, infrastructure, and police and fire services. Senator Henry Mello and Assemblyman Mike Roos proposed the Mello-Roos Community Facilities Act of 1982 (California Government Code §53311), which gave California local governments access to community funding with the requirement that two-thirds of the voters or landowners in the proposed district must approve the special tax.
Why does San Marcos use CFD special taxes?
With the passing of Proposition 13 in 1978, the City of San Marcos became the lowest recipient of property tax revenues in the County (as measured by the City’s share of the base 1% ad valorem property taxes). For every $100 of property taxes paid by property owners within the City, approximately $7 is actually allocated to the City. The average share of property tax revenues allocated to the cities in the County is approximately $16 for every $100 of property taxes paid.
In addition, on June 7, 1988, voters in San Marcos approved Proposition R which ensures that adequate public facilities and services are available to meet the needs created by new development. In order to finance these facilities and services, it became necessary for the City to form CFDs.
How does a CFD special tax work?
Special taxes for a CFD are typically levied annually and are placed on the property tax bill issued by the County. The special taxes for CFDs created to finance authorized public facilities (infrastructure such as roads, sidewalks, water and sewer lines, police and fire stations, etc.) are typically used to pay back principal and interest on bonds that were issued for that particular CFD. Special Taxes for a CFD created to finance authorized public services are levied to pay for the service provided (such as lighting, landscaping, police protection, fire suppression, and maintenance of parks and trails, etc.).
What do CFD special taxes in San Marcos pay for?
The City uses CFDs to finance both authorized public facilities and/or services. Click on the links above to see what a particular CFD has been created to pay for.
Is my property in a CFD?
Look in the “Fixed Charge Assmts” portion of your San Diego County tax bill for any taxes that contain the acronym “CFD.” Compare CFD’s listed on the tax bill to the list of Community Facilities Districts above and click on the links to learn more about each CFD special tax.
Do CFD special taxes have a maximum amount?
All CFDs have maximum special tax amounts which cannot be exceeded. However, the amount of the special tax levied in a given year may be less than the maximum special tax rate. The amount of special taxes levied may fluctuate from year to year; however, they cannot exceed their annual maximum amount. Due to the fact that the annual CFD special taxes levied on a particular piece of property could be below the maximum special tax rate for that property, a potential buyer or seller of property should not rely on the amount shown on the property tax bill for disclosure purposes.
Do CFD maximum special taxes increase?
That depends on which CFD you are in. Except for CFD 88-1, maximum special taxes for CFDs for facilities do not have an annual escalator. The maximum special taxes for CFDs that pay for ongoing services have either a 2% or CPI (the consumer price index for San Diego) escalator on the maximum special tax. Property owners will never be charged more than the maximum special tax even if the district’s expenses are higher than the revenue generated by assessing the maximum tax.
Does a CFD special tax decrease?
Property owners may be charged less than the maximum special tax or less than the prior year’s special tax depending on the revenue needs of the district.
When does the CFD special tax expire?
CFD special taxes that fund ongoing services such as street lighting, traffic signals, landscaping, police protection, fire suppression, or the maintenance of parks and trails do not have an expiration date and can be levied in perpetuity.
Special taxes on residential property in CFDs created to finance public facilities are required to have a specific end date. If bonds were issued for a facilities CFD, the special taxes will typically not be levied once the principal and interest on the bonds have been paid in full. However, the term of the special tax (or date beyond which the special tax cannot be levied) may extend beyond the time bonds are outstanding.
To find out if and when a special tax may expire, click on the links above. For information regarding the San Marcos Unified School District’s CFDs please contact the District at (760) 752-1299.
When and how are the CFD special taxes collected?
Special taxes are usually collected by the San Diego County Tax Collector as part of your property tax bill. The special tax is generally itemized under “Fixed Charge Assmts” on your tax bill. Under certain circumstances the City can elect to bill the property owners directly. To view the payment status of the current year’s tax bill, or to make a property tax payment visit the Tax Collector’s website and enter the Assessor’s Parcel Number (Bill Number).
What is the amount of the CFD special tax for the current fiscal year?
Please refer to the San Diego County Property Tax Services website to find the amount of the CFD special tax on a particular property for the current fiscal year. You will need the property’s Assessor’s Parcel Number in order to use this site.
What happens if I don’t pay my property tax bill on time?
CFD special taxes are subject to the same penalties and interest that apply to regular property taxes. If there are outstanding bonds and the special taxes become delinquent, the City, on behalf of the CFD, may exercise its legal right to foreclose and sell the property after providing the required notifications to the homeowner.
Can the CFD special tax be pre-paid?
Yes. Please contact the City’s Finance Department at (760) 744-1050 ext. 3127 or 3133 for prepayment information.
I want to buy property in the City of San Marcos. How much will the special taxes be?
For information about the current special taxes on a particular parcel please see the San Diego County: Property Tax Services website. Please note that the special tax amount on the property tax bill may not be the maximum special tax for the parcel. In order to determine the maximum special tax, click on the link(s) above for the appropriate CFD.
A recorded document on a property says that the property is in “the future annexation area” of a CFD. What does that mean?
The entire City and/or Fire Protection District may have been designated as a “future annexation area” for certain services CFDs. If a property within this area is developed or redeveloped, it may be subject to annexation into the designated CFDs.
If you have additional questions about CFD special taxes, please contact the district administrator at 760-744-1050 ext. 4506.