What is Mello-Roos?

Mello-Roos is a special tax that is imposed on real estate within a designated community

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These Mello-Roos districts are created to raise public financing through the sale of bonds, for the purpose of paying for public improvements and services for that community. The services may include water lines, sewer treatment, drainage, streets, schools, electricity, parks, etc. The Mello-Roos tax is used to pay for the bonds used to pay for these improvements. The passage in 1978 of Proposition 13 restricted local governments ability to pay for capital facilities and services by increasing property taxes. In 1982, Senator Henry Mello and Assemblyman Mike Roos enacted the Community Facilities District (now called Mello-Roos) to provide local governments with an additional way to raise needed funds.

Frequently Asked Questions

It can vary from about $400 per year on up to about $3,000 per year dependent upon the city, community and the lot. Many communities have no Mello-Roos at all
During the Escrow process, the Seller will deliver a disclosure which will state in writing the exact amount of the Mello-Roos fee. I can also estimate the Mello-Roos prior to making an offer on a home.
The Mello-Roos is included in your normal tax bill which is billed to you twice per year.
No, unlike the Prop 13 portion of your property tax, the Mello-Roos portion of your property tax does not change when you sell your home.
Most Tax accountants are of the opinion that the Mello-Roos tax is not legitimate income tax deduction. Please consult with your Tax Advisor for final determination.
Typically, the Mello-Roos assessment is written for about 15 to 25 years dependent on the community facilities district. Although, many of the districts have the right to renew the Mello-Roos tax if needed.