By: Libi Uremovic | Original Article at patch.com
Developers have a duty of care to ensure that the houses they Build include Infrastructure, Safety Facilities, and Resale Value.
BEAUMONT DEVELOPERS
The City of Beaumont’s population increased from 10,000 to 40,000 in the last 15 years. Beaumont Elected and Appointed Officials allowed Developers to pay Mitigation Fees with Mello Roos Bonds, which eliminated developers’ investment risk. The result is that Beaumont housing values are a fraction of price in the rest of Riverside County, Beaumont Property Owners and paying the Developers’ Mitigation Fees, and the City’s Infrastructure was never built.
Homeowners have an expectation of basic infrastructure and access to fire and health services when they purchase their homes.
The Developers have a duty of care to their perspective customers to ensure that the houses they build and sell will include infrastructure and safety facilities. Developers knew or should have known that it was illegal for the City of Beaumont’s Elected and Appointed Officials to use Mello Roos Bonds to pay Mitigation Fees.
Developers continue to build new houses in Beaumont because the City continues to promises to exchange Mello Roos Bond Debt for Mitigation Fees. On July 21, 2015 Beaumont City Council Approved Agenda Item 4.a. to Acquire Mello Roos Bond Debt for CFD Areas 8E, 8F, 8G, 8H, 8G, 8H, 8I, and 8J in order refund Pardee Homes for all of the City’s Mitigation Fees.
PARDEE HOMES
2002 Series A: $10,635,000
2003 Series B: $10,930,000
2004 Series C: $8,685,000
2006 Series B: $7,110,000
2007 Series E: $6,520,000
2009 Series B: $2,640,000
2011 Series A: $12,145,000
2012 Series A: $5,650,000
BEAUMONT 194 LLC
2004 Series A: $4,735,000
BEAUMONT GATEWAY L.P.
2004 Series B: $5,980,000
LB/L-SUNCAL OAK VALLEY LLC
2004 Series D: $22,830,000
2006 Series A: $14,220,000
SENECA SPRINGS INVESTMENT CO
2005 Series A: $18,325,000
2005 Series C: 19,155,000
K HOVNANIAN
2005 Series B: $12,280,000
2009 Series A: 1,725,000
2012 Series C: $3,655,000
KB HOMES
2006 Series B: 7,110,000
2007 Series E: $6,520,000
DEBOSE MODEL HOME INVESTMENTS
2007 Series E: $6,520,000
2009 Series B: $2,640,000
FAIRWAY CANYON DEVELOPMENT
2008 Series A: $4,090,000
LENNAR HOMES
2008 Series A: $4,090,000
FAIRWAY CANYON DEVELOPMENT
2008 Series A: $4,090,000
STANDARD PACIFIC
2008 Series A: $4,090,000
GMAC
2008 Series A: $4,090,000
RICHMOND AMERICAN
2011 Series A: $12,145,000
2012 Series A: $5,650,000
RSI DEVELOPMENT
2012 Series B: $3,265,000
From WRCOG vs City of Beaumont Judgement:
“THE BONDS, PAID BY A SUPPLEMENTAL — OR A SUPPLEMENTAL BILL ADDED TO THE ANNUAL PROPERTY TAX LEVY. NO UP FRONT MONEY WAS REQUIRED TO BE PAID BY ANY DEVELOPER WHO OPTED FOR THIS FORM OF FINANCING. THE DEVELOPERS THEREBY HAD NO CARRYING CHARGES FOR THE COST OF BORROWED MONEY TO PAY UP FRONT FOR CONSTRUCTION OF THESE TRANSPORTATION PROJECTS. MOREOVER, THE COSTS ARE EFFECTIVELY HIDDEN FROM THE PROPERTY BUYERS, WHO DO NOT SEE PRICE INCREASES TO COVER DEVELOPER OUT-OF-POCKET DEVELOPMENT COSTS. INSTEAD, THE BUYER PAYS FOR THE PROJECT INCREMENTALLY OVER THE LIFE OF THE BOND THROUGH THOSE TAX ASSESSMENTS OR ADDITIONS TO THE TAX BILLS.”