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San Clemente representative Assemblyman Bill Brough’s bill to amend the code relating to Community Financed Districts, a controversial bond method of paying for public infrastructure and buildings, was referred to the Assembly Local Government Committee on Feb. 4. CFDs have been criticized by groups such as the Talega Residents for Fair Taxation, which has been paying off a Mello-Roos tax for the Capistrano Unified School District that’s been around since the 1990s.
The residents say they have been overtaxed by the CFD in the past and want to close out the bond as soon as possible. The Talega organization recently sent a letter of support for the bill to Brough’s office.
Under the requirements of the bill, AB 1666, the financial reports would have to include information regarding the original maximum bond amount, the amount collected annually, amount expensed annually, specific projects to be constructed and funded and the amount committed from the CFD, specified list of projects that may be funded by the CFD, amount collected in excess of what is needed to pay the bond payments, bad debt contingencies, interest and fees associated with the CFD.
It would also require to specify the date the CFD would be paid off, the date the tax would end and how excess funds would be disbursed once the CFD and tax have ended.
In June, the Grand Jury of Orange County published a report that demanded CUSD keep more oversight of their tax districts, have more transparency with how money from the taxes are spent and set clear closeout dates for the duration of the CFD.
The bill will have to pass the committee and move forward to the Assembly floor. A hearing date has yet to be scheduled regarding the bill.