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Real estate tax information...

Proposition 13 (a.k.a. Prop 13) was a constitutional amendment passed by California voters on June 6, 1978. The major elements of Prop 13 were;

It set the assessed value of property at it's 1978 value and limited increases in assessed value to 2% per year.
It set the base tax rate of a parcel at 1% of the property's assessed value.
It only permits reassessment of property under limited circumstances such as a change of ownership or completion of construction.

Supplemental Taxes are an outgrowth of Prop 13. The assessed value of California property is set on the "lien date." This is on the January 1 prior to the start of the tax year (the tax year runs from July 1st to June 30th with your tax payments being due in December and April).

Prop 13 permits reassessment upon the transfer of a property. If you pay $360,000 for a home, you can expect to pay about $3,600 per year in real estate taxes (not including any bonds or other special assessments). A "Supplemental Tax" bill is necessary because the increased taxes begin the day the property is transferred but the new rate is not reflected in the first tax bills that you receive. Your supplemental tax bill(s) will be based on the number of whole months during which your actual taxes are more than the amount shown on your tax statements.

As an example, if you buy a home on July 10th for $360,000 and if that home were previously assessed for only $240,000, then the annual taxes will increase from $2,400 to $3,600. That is an increase of $100 per month. However, the first tax bill you receive will reflect taxes due of only $2,400 because the home was only assessed for $240,000 on the previous January 1st. For the first year that you own the home, you will be charged supplemental taxes of $1,100 ($100 per month for the 11 months from August through the following June). The tax collector will send you a "Supplemental Tax" bill to collect this difference.

You will receive two supplemental tax bills if you close escrow between January 1st and June 30th. For example, if the purchase date is April 15th, then you will receive a supplemental tax bill for the two remaining months of the current tax year (May and June). You will receive a second supplemental tax bill for the 12 months from July through June of the following tax year.

If you are purchasing a home, then you may want to estimate the amount of the supplemental tax bill that you are going to receive. Even if you are using an impound account for taxes and insurance, there may not be enough money set up in the account to pay for the supplemental taxes. You already have most of the information you need in order to make this estimate. The one piece of information you need to find out is the amount that the property is currently assessed for. That information is usually contained in the "Preliminary Title Report" that you receive from the title company or should be contained as a tax information supplement to the Natural Hazards Disclosure report that you should have received from the seller.

You can look up tax information on the Sutter County Treasurer & Tax Collector's Web site and on the Yuba County Treasurer & Tax Collector's Web site.

At their Web site, look for the link that says "Search the Sutter County Property Tax Roll"

When you find the property you are looking for, then click on the link in the column headed "Assessment #" and it will give you an itemized list of the taxes that affect the property as well as the current assessment information.
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Mello-Roos Taxes are assessed through special tax districts for the purpose of financing public services and/or facilities. These include schools, sewer and water treatment plants, streets, libraries and parks as well as police and fire protection. The name comes from Senator Henry Mello and Assemblyman Mike Roos who authored the Mello-Roos Community Facilities District Act of 1982. Mello-Roos is commonly found on many, but not all of the homes built in the greater Yuba City area after about 1990. It is commonly thought of as a school tax since Yuba City Unified School District is the only local entity that has taken advantage of this particular financing mechanism. Mello-Roos taxes in Yuba City are assessed through Community Facilities District #1 and appear on Sutter County tax bills as YC Unified CFD #1. The tax consists of a fixed portion based on the square footage of the home at the time it was built plus an adjustable amount that is an administrative fee. The tax remains in effect for thirty years from the time the home was first completed. An 1,835 square foot home built in 1991 had a 2004/2005 tax bill of $571. The same home built in 2005 would have an annual tax of about $685.

Improvement Bonds also affect a large number of newer homes and some older homes. They have been used mainly to pay for sewer, water and drainage lines and related facilities but have been used for street and other improvement improvements as well. An example of one of these is the Butte Vista Improvement Bond which costs homeowners approximately $450 per year.
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Street Lighting and Landscape Maintenance Districts have been used to help pay for street lighting and maintenance of the landscaping on City owned property along major roads. This tax adds about $250 per year to the tax bill.
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All of these taxes are collected with the normal real estate taxes and, if they apply to a particular property, will appear on the tax bill.

Impact - These taxes do have an impact on a buyer's purchasing power. If a home has all three of these taxes (Mello-Roos, Improvement Bond and SL&LMD), it can easily add $1,300 or more (depending on the size of the home) to the annual tax bill. Considering that loan interest rates are about 6.5%, that reduces a buyer's purchasing power by about $20,000 as compared to the same home without these additional taxes.

Last Updated February 15, 2006


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Address: 1212 Highland Avenue
Yuba City, CA 95991-6115

Phone: (530) 671-6152
Fax: (530) 671-3904

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