By: Libi Uremovic, March 15, 2014 | Original Article at Patch.com
Beaumont property owners in Area 7A have only one bond connected to their property. On June 30, 2005 the City issued Bond Series B for $12,280,000 payable by 532 future property owners.
EMMA page 49 (53/288) lists the interest and premium payment schedule for Area 7A. 2014 premium and interest payments total $768,845 or an average of $1,445.20 per property owner. Bond payments over 30 years total $26,810,358.87. EMMA page 50 (54/288) repeats the same payment schedule, but that
doesn’t authorize an duplicate collection of special taxes, right?
Bond Trustee Union Bank only request one payment from Area 7A, but the Riverside County Tax Assessor records two duplicate special tax assessment liens on the Area 7A properties. 532 property owners in Area 7A pay a total of $1,886,000 special taxes or an average of $3,545 per home.
Page 40 (45/288) lists the actual funds that were used within Area 7A at $609,250. The remainder of the funds were used for city-wide facilities which is in violation of the Mello Roos Laws. The residences of Area 7A are paying $1.8 million year for 30 years to pay for $600,000 worth of improvements.
Beaumont City Council Agenda Item 7.a.10: Resolution of Intention for Extending Payment Years for CFD Area 7A1
The City states in the Background that the Residences of Area 7A have met with the City and “the discussion centered on methods to eliminate the originally approved annual increase of 2%.”
The 2% administration fee is not a requirement, it is the maximum allowed by State law. The City does not have to charge additional fees to the property owners and these fees have no correlation to the bonds.
The City is telling the property owners that in exchange for an additional 10 years of special taxes they will wave the 2% increase. That’s not exactly a ‘generous offer’ and the City can’t ‘make a deal’ with the property owners to increase the length of their bond.
But the City isn’t changing the old bond, they are creating a new district and attaching a new bond. The proposed Resolution will change Area 7A to Area 7A1 so the City can obtain a new $25 Million bond.
This will not effect the old bond. Property owners will still be responsible for all debt incurred for 7A. The new bond will attach an additional $1,500 – $2,400/year in property taxes to Area 7A under the guise of creating a new Area.
Let’s Review:
For $600,000 worth of improvements the property owners in Four Seasons Area 7A pay $1.88 Million/year in Special Taxes with a 2% annual increase for administrative fees.
The property owners requested relief from the 2% administrative fee increase.
The City offers to exchange the 2% admin fee increase for a $25 Million bond that will add another $2,000/year to their property taxes plus a 2% administrative fee increase of course.
Exhibit B-1 states that the City plans to use the $25 million for city-wide construction, which violates the provisions of Mello Roos and is a slap in the face to the residences of Area 7A that attempted to have an honest conversation with the elected and appointed officials of the City of Beaumont.
2005 Bond: http://emma.msrb.org/MS235881-MS211189-MD410725.pdf
Beaumont Council Agenda Item 7.a.10: http://www.ci.beaumont.ca.us/DocumentCenter/View/18565