Residents living in the Mello-Roos district will make their last tax payment in April of next year, according to an update from a community meeting last week.
Officials said the city is on track to pay off the district debt by August 2015. Created in 1990, the special tax is levied on a geographic area of Atwater homes and businesses. The Mello-Roos district in Atwater stretches from Highway 99 to Bellevue Road.
The district includes more than 1,000 taxed parcels, the majority of them residential properties. The parcels are taxed based on their size, officials said.
The money collected from the Mello-Roos tax funds infrastructure costs and pays for public improvements, such as parks maintenance, streetlights, and water and sewer extensions. Roughly $17.75 million in bonds were issued, according to city documents.
The sale of two properties within the Mello-Roos district helped reduce the district debt and lower payments for residents. The special tax was previously extended by a couple years when the owners of two large parcels in the Mello-Roos district defaulted on their payments.
The sale of the two properties lowered Mello-Roos tax payments by close to 20 percent, officials reported.
The best offer for both properties was $1.2 million, according to city documents. About $400,000 of back taxes and assessments were used to reduce the district debt in the 2013-14 fiscal year.
“The only reason you’re seeing the decrease is because of the property sales,” said Councilman Jeff Rivero. He said there was a lot of misinformation about Mello-Roos taxes, prompting him to host a few special public meetings to answer questions since 2009.
Rivero also pushed to have the City Council put together a resolution requiring the city to notify residents via two letters if the Mello-Roos taxes will be extended or increased.
“This would give people assurance that they would have to be notified,” he said. “It gives people an opportunity to show up and explain that they don’t want it to be increased or extended.”
Atwater resident Bill Barkman, who is running for City Council this year, said he doesn’t want to see the candidates using questions about Mello-Roos to manipulate voters during an election year. He said there are other issues that need to be addressed.
At the next City Council meeting, Barkman said he’ll present the City Council and candidates for office a declaration to sign that promises not to extend or increase Mello-Roos taxes.
“I don’t think it’s fair to use this issue to manipulate the public for votes,” Barkman said. “The best way to deal with an issue is to take it on upfront. By everyone making a commitment that this is ending, it will alleviate the fear of those in the district.”