In 1978 California voters approved Proposition 13 by an almost two thirds majority. The impact that this had at the time and has caused over the last 29 years has been immeasurable. Prior to Proposition 13 property taxes averaged almost 3%, upon passage, the tax valuation was rolled back to the 1976 assessed value and then increases were limited to a maximum of 2% per year. When a property was sold, the value was reassessed at 1% of the new value with increases limited to 2% per year.
Senator Henry Mello and Assemblyman Mike Roos in 1982, in an effort to establish a new funding mechanism, affected the passage of the "Community Facilities District Act or CFD". This grants municipalities the authority to establish Community Facilities Districts which can be used for schools, parks, libraries, police and fire protection and similar services and facilities. Before a district is established it must be approved by two thirds of the voters in the district unless there are fewer than 12 voters in which case the current landowners can pass the measure. It is possible that an area could fall within more than one Mello Roos district.
The basic property tax is referred to as an "ad valorem" tax which means according to value. Mello Roos taxes are levied solely to repay and administer bond debt.
Real Estate Articles
