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Mello-Roos Districts

MELLO-ROOS COMMUNITY FACILITIES DISTRICTS

A Brief Explanation

CIVIL CODE SECTION 1102.6 & GOVERNMENT CODE SECTIONS 53311 & 533420.2

California law requires a seller of real property to make a good faith effort to obtain a "Notice of Special Lien" from each local agency which levies a special tax pursuant to the Mello-Roos Community Facilities Act which special tax is a lien on the property and to deliver that notice to the buyer.

  • If the "Notice of Special Lien" is issued by the agency and received by the seller, the notice must be delivered to the buyer. If the "Notice of Special Lien" is so delivered to the buyer, then the seller and seller's agent are not required to provide additional information concerning the special lien and the district. The law does not impose a duty to discover a special tax or district not actually known to the seller's agent. (California Civil Code, Section 1102.6b).

To enable a seller and seller's agent to comply to these disclosure requirements, Government Code Section 53340.2 provides that the legislative body levying the special tax shall designate an office, department, or bureau of the local agency which shall be responsible for establishing procedures to promptly respond to inquiries concerning current and future estimated tax liability. A "Notice of Special Tax" shall be furnished to an individual or an owner of property subject to a special tax levied by the local agency within five (5) working days of receiving a request for such notice. The local agency may charge a reasonable fee for this service not to exceed ten dollars ($10.00). The form of the "Notice of Special Tax" is set forth in the California Government Code. After a seller receives the "Notice of Special Tax" from the agency, said Notice must be provided to the buyer.

BACKGROUND:

A Mello-Roos Community Facilities District(s) ("CFD") is a special taxing authority that may be formed to finance certain designated public services and capital facilities by levying special taxes which are continuing liens levied against the real property within the service area. Facilities which may be funded by a CFD include:

  • Police and Fire Protection Services

  • Ambulance and Paramedic Services

  • Cultural Facilities

  • Elementary and Secondary
    Schools

  • Libraries

  • Museums

FUTURE ASSESSMENTS:

Information regarding Mello-Roos Districts in the report is derived from the County Real Property Tax Records. Mello-Roos Assessment Districts which have been formed but which have not yet levied assessments may exist and the property may become suject to assessments in the future. Recipient is advised to review a current preliminary report or title commitment for the property for possible additional disclosure of Mello-Roos Assessment District information that has been recorded in the official records of the County Recorder's Office for the county where the property is located. If a Mello-Roos District is in the process of being formed as of the report date, such information will not appear in the county records.



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