Thursday, July 25, 2013
Homeowners who pay Mello-Roos taxes might want to double-check their bills as more mistakes discovered in tax calculations.
SAN DIEGO The Poway Unified School District conceded Wednesday some homeowners in its district are being taxed incorrectly after an inewsource investigation first uncovered the problem. The mistakes center around a special tax called Mello-Roos. Some homeowners are being taxed the wrong amount because the city of San Diego has an incorrect record of the square footage of their homes.
Over the past several weeks, inewsource has uncovered over and undercharges on Mello-Roos property tax bills in Del Sur, an upscale suburb in the city of San Diego.
Last week, we discovered the inaccuracies are not confined to just one tax district after learning a homeowner who pays Mello-Roos property taxes in the Poway Unified School District was also over-charged hundreds of dollars every year.
Mello-Roos is the name of a special property tax homeowners in newer developments pay to offset the cost of roads, schools and other infrastructure. The tax can be levied if a developer and government body, such as a school district or city, forms a Community Facilities District, or CFD.
Homeowner Michael Tagulao discovered he was paying too much when he used inewsource’s interactive tax map.
In many cases, Mello-Roos taxes are based on the square footage of a house. Tagulao’s building permit shows his house is 2,149 square feet, but Tagulao says the actual size of his house is only 1,778 square feet. The error in square footage resulted in the mistake on his tax bill. He is expected to get a refund.
In an email to inewsource, John Collins, the superintendent of the Poway Unified School District said “it has come to our attention that the building permits issued by the City of San Diego contain some instances of incorrect information...“
“I will be working with staff to ensure that we work cooperatively with the city to help them identify any such errors and to make corrections,“ he wrote.
Collins said he doesn’t know how many mistakes have been identified so far.
Much of the Poway school district spills into city of San Diego Councilman Mark Kersey’s jurisdiction.
Kersey says many of his constituents pay Mello-Roos taxes and so he’s asking the Poway school district for an audit of all its Mello-Roos districts (also called Community Facilities Districts).
“I request a full review of the process by which homeowners’ required payments are calculated, the accuracy of the data used in those calculations, and safeguards (or lack thereof) to prevent and identify errors,” Keresey wrote in an email to the Marc Davis, the president of the Poway School Board, an elected position.
Kersey said the inewsource investigation and an email from another constituent prompted him to ask for the audit.
“We just want to make sure that the bills taxpayers are paying for infrastructure and school-related services are what they should be,” Kersey said.
Kersey also asked the city’s independent auditor to look at a city of San Diego Mello-Roos district last week, after an inewsource investigation found 28 inconsistencies in tax bills.
The audit is now underway, and Kersey expects to see results in the Fall.
The special tax districts also have an obligation to provide accurate information to the bond market because in most cases, the districts have issued bonds to build a new school or new roads. The tax payments pay the debt with interest.
The Securities and Exchange Commission would not comment on whether it would investigate cases in which the tax payments were miscalculated.
inewsource has been investigating Mello-Roos taxes since last Fall. The rate of taxation varies dramatically in each of the county’s 232 Mello-Roos districts, making it difficult to determine just how much each homeowner should be paying.
Compounding the problem in one of Poway’s Mello-Roos districts in Del Sur (CFD 14), is the number of variables that impact how much each homeowner should pay, including square footage, the year the house was built, and a building index that changes year to year.
Homeowners in that district with the same house on the same street could be paying hundreds or even thousands of dollars more or less than their neighbor based on when the building permit of the house was issued.
The school district has not responded to several requests to provide Mello-Roos tax tables for each year the tax has been levied in CFD 14.
However, Collins said he is working with his staff to provide this information and will also be changing the district’s website to help taxpayers identify whether they are paying the correct amount.
“This matter is being taken very seriously by PUSD and we will take steps to communicate this information to all PUSD CFD taxpayers and resolve any existing errors that may have resulted from the inaccurate information listed on the building permits,” Collins said in his email.
Marc Davis, Poway’s district president, did not respond to a request for comment.
School boards and cities which form Mello-Roos tax districts are required to file status reports with the California State Treasurer every year, but the state office has no oversight over Mello-Roos payments.
“The Treasurer has no regulatory or law enforcement authority, either with respect to bond disclosure and issuance or calculating tax bills,” said Tom Dressler, spokesman for the treasurer.
You can find out whether you pay Mello-Roos and how much by using our interactive map.
Data journalist Kevin Crowe contributed to this story