The County of Los Angeles is making preparations to lower the Mello-Roos tax rate for homeowners and businesses in Stevenson Ranch.
Supervisors will consider a proposal Tuesday from the county treasurer and tax collector to refinance the Mello-Roos bonds that were authorized in 1989 to pay for roads, bridges, schools, sewers, landscaping and other capital improvements.
The county is doing what several other agencies – including the Castaic Lake Water Agency – have done in recent months, taking advantage of the low bond rates that are available in the current lousy economy to give property taxpayers a break.
Under the proposal, the county would issue two new series of bonds to replace several series of earlier bonds.
“The refunding of the prior bonds will result in lower debt service and annual savings to the property owners,” according to a report from the county tax collector.
Affected are bonds in areas called Improvement Area A and Improvement Area B. Both comprise Stevenson Ranch.
The tax collector says, “based on current market conditions,” the Area A bonds would be sold at an interest cost of 2.48 percent, resulting in a savings of more than $1.7 million to property owners, while the Area B bonds would be sold at 3.72 percent for a $3.6 million savings.
Property owners in the affected areas pay the cost of the bonds every year through their property taxes.
In June 1989 when Stevenson Ranch was a glimmer in Dale Poe’s eye, the Board of Supervisors authorized up to $23 million in Mello-Roos bonds for Area A and $42 million for Area B subject to the consent of property owners within the 6.4 square-mile area. In two elections held June 9, 1989, the one and only property owner – Dale Poe’s development company – voted yes, and the bonds were issued.
At the time, the Mello-Roos bonds were viewed by critics as a mechanism for Poe to hold down his new-home prices and hide the true costs. The price of curbs, gutters, schools and so forth showed up as a line item on buyers’ biannual property tax bills, above and beyond the price of the homes, rather than being included in the sales price as was historically done.
Subsequent developers have sometimes used the same tactic, but Mello-Roos fees were new to the SCV in 1989, having been authorized by the state Legislature in 1982.
Property owners repay their share of the bonds based on the benefit they receive. Homes are taxed by square footage while commercial property is taxed by total acreage.
Roughly $1.5 million was collected from Stevenson Ranch taxpayers in Area A and $3 million in Area B in the latest fiscal year, compared to $1.5 million and $1.6 million, respectively, a decade earlier. The difference in Area B primarily reflects new development of later neighborhoods such as Southern Oaks and the accompanying issuance in 2000 and 2001 of bonds authorized in 1989. All Area A bonds were sold by 1997.