Empire Mello-Roos options discussed

Board told paying down debt is doable

September 9, 2010 

Options for relieving the tax burden on southeast Modesto homeowners were discussed Thursday by the Empire Union School District trustees, but no promises were made.

Homeowners throughout the Empire district pay extra Mello-Roos property taxes, up to $459 per year. Those taxes are supposed to pay for school construction and improvements.

The southwest Modesto schools, however, have rapidly declined in enrollment, so the district does not need more classrooms. In fact, it recently closed one of its largest campuses because there were too few students.

But the district continues to collect increasingly higher taxes.

More than 30 community members attended Thursday's board meeting to hear why that is and what could be done about it.

Here's the bad news: The district borrowed so much money to build schools it thought it needed that it must continue raising taxes for an additional 22 years to pay off the debt.

But district officials acknowledged they have been collecting more than they need from homeowners.

Rather than continuing to spend those extra tax dollars for things such as new telephones and technological equipment, the district's trustees could opt to save the money and pay off the debts sooner.

This year, for example, home-owners are expected to pay an extra $2.7 million in property taxes. The district's debt payments, however, are less than $2.2 million.

District officials revealed they have accumulated more than $2 million in extra taxes, which they put into a "construction" account for future projects.

Superintendent Bob Price told trustees they have the option to stop spending that money and instead start paying down the district's debt.

Doing so would reduce the number of years homeowners would be forced to pay extra property taxes.

That idea was endorsed by numerous members of the audience, most of whom were elderly homeowners upset over how high those taxes have risen and how long they've gone on.

The district has been collecting extra taxes since 1988. Unless trustees stop spending that money on new projects, homeowners will be stuck paying the ever-increasing taxes through 2032.

The taxes will total $20,682 per home for most of the southwest Modesto houses, while most of the houses in older Empire neighborhoods would pay a total of $6,894 each.

Bee staff writer J.N. Sbranti can be reached at jnsbranti@modbee.com or 578-2196.

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