CFD Frequently Asked Questions
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What is the CFD (Mello Roos) special tax or 1913/1915 Act assessment appearing on my property tax bill?
A CFD special tax and 1913/1915 assessment appears on your County property tax bill as a separate charge from the 1% ad valorem (general) property tax. The line item for the charge includes the name of the district, the amount due for the tax year, and district contact information. There are many agencies throughout the County, including municipalities and school districts, that have formed CFDs and/or assessment districts. The City's districts were formed under California law through City Council approval and a property owner election to provide funding for public infrastructure improvements required in connection with development of property within the respective district. The special taxes and assessments were established during district formation proceedings through the Rate and Method of Apportionment in the case of CFDs and the Assessment Engineer's Report, in the case of assessment districts. The City's districts are:
City of San Diego - Community Facilities Districts
- CFD No. 1 (Miramar Ranch North)
- CFD No. 2 (Santaluz) - Improvement Area No. 1
- CFD No. 2 (Santaluz) - Improvement Area No. 3
- CFD No. 2 (Santaluz) - Improvement Area No. 4
- CFD No. 3 (Liberty Station)
- CFD No. 4 (Black Mountain Ranch Villages)
City of San Diego - 1913/1915 Assessment Districts
- Reassessment District (READ) 2003-1
- Piper Ranch Assessment District (No. 4096)
Special taxes and assessments are due at the same time as the general property tax portion of the County property tax bill (the payment is considered late if not received by December 10 and April 10 of each tax year). If the payment is late, the same penalties apply for special taxes and assessments as for general property taxes (an initial penalty of 10% of the delinquent amount is charged for each delinquent installment, and, if not paid by June 30 of the tax year, an additional 1½% is applied each month until payment is made).
It is important to note that if payment is not received on time, the City of San Diego is also empowered under the California Government Code and Streets and Highways Code to remove the delinquent special tax or assessment from the County Tax Roll to start a judicial foreclosure action against the subject parcel to collect the delinquent amount in accordance with applicable law. This foreclosure procedure does not involve the same noticing requirements and opportunities for redemption as the foreclosure procedure for non-payment of general property taxes. In addition, the timing of possible foreclosure is significantly accelerated from the timing of a County tax sale in connection with general property taxes. The special taxes and assessments directly support debt service payments to bondholders of the respective district bonds, and the City may be compelled under the district bond indentures to commence foreclosure proceedings to recover delinquent amounts.
California law requires that sellers make a good faith effort to disclose a CFD special tax or 1913/1915 Act special assessment when transferring property subject to a special tax or special assessment. Additional information can be found in California Civil Code Section 1102.6b and Selling Your Home Subject to a Special Tax or Special Assessment .
The City of San Diego cannot provide tax advice concerning special tax and assessment payments. Please consult a qualified tax advisor for guidance.
Special Tax Prepayments
Under the Rate and Method of Apportionment of Special Tax (the taxing formula) for each respective Community Facilities District, property owners are permitted to prepay their special tax lien, based on the formula set forth in the Rate and Method of Apportionment. If you would like to pay off your special tax obligation, please contact the City's CFD Administrator/Special Tax Consultant, Willdan Financial Services. Additional information is available under Special Tax and Assessment Prepayments.
In a 1913/1915 assessment district, a specified amount of bond principal is recorded as a lien against each district parcel based on the methodology established through the Assessment Engineer's Report approved by City Council during district formation proceedings. Each property owner has a statutory right to prepay the outstanding assessment on his/her parcel. If you would like to pay off your assessment obligation, please contact the City's Special Assessment Consultant, Willdan Financial Services. Additional information is available under Special Tax and Assessment Prepayments.
If you believe the special tax levied on your property is in error, in accordance with the Rate and Method of Apportionment (taxing formula) established at the time of district formation, you may file an appeal with the City's CFD Administrator/Special Tax Consultant, Willdan Financial Services. Additional information is available under Special Tax Appeals.
The City's existing CFDs and assessment districts do not authorize the collection of special taxes/assessments for on-going services or facilities. Therefore, the special taxes and assessments are programmed to terminate once the bonds issued in connection with the respective district are paid in full, which is not more than 30 years after the initial issuance of bonds for the district, except in the case of Reassessment District 2003-1, in which certain property owners voted to extend the term of the assessment at the time the original bonds were refunded. The City's CFDs and assessment districts vary in age, with district bonds slated to mature between 2015 and 2037, depending on the district. Note that under applicable law, the City may still collect any delinquent amounts that exist at the time the respective bonds are paid in full.
For the City's CFDs, pursuant to each district's respective Rate and Method of Apportionment of Special Tax ("RMA"), a maximum term for the levy of Special Taxes is specified, generally 25 to 50 fiscal years. As referenced above, the RMAs specify Special Taxes will cease to be levied in an earlier fiscal year if all debt service payments on the district's bonds have been paid and all public facilities to be financed have been acquired by the City.
For the City's assessment districts, pursuant to the California Streets and Highways Code, assessments will be paid for the period of years corresponding to the term of the district's bonds.
The following table illustrates the scheduled final maturity date of each district's bonds and approximate years the levies are anticipated to cease:
|District||Final Maturity of Bonds||Anticipated Final Levy|
|CFD No. 1 (Miramar Ranch North)||9/1/2020||2019-2020|
|CFD No. 2 (Santaluz) Improvement Area No. 1||9/1/2030||2029-2030|
|CFD No. 2 (Santaluz) Improvement Area No. 3||9/1/2030||2029-2030|
|CFD No. 2 (Santaluz) Improvement Area No. 4||9/1/2033||2032-2033|
|CFD No. 3 (Liberty Station) Improvement Area Nos. 1 and 2||9/1/2036||2035-2036|
|CFD No. 4 (Black Mountain Ranch Villages)||9/1/2037||2036-2037|
|Piper Ranch Assessment District (No. 4096)||9/2/2033||2032-2033|
|Reassessment District (READ) 2003-1(3)||9/2/2017||2016-2017|
(3) Located in Otay Mesa area