SAN MARCOS — A community facilities district will be used to fund the infrastructure for the Harmony Grove Village development, and on Dec. 5 the San Diego County Board of Supervisors voted to authorize the issuance of $16 million in bonds to finance the improvements.
The total payments including interest and finance charges are anticipated to be $29.13 million. The bonds have a maximum interest rate of 6 percent and the maturity date can be no later than Sept. 1, 2048. An assessment on the properties will be used for the bond principal and interest repayments.
A Community Facilities District, sometimes known as a Mello-Roos tax due to the state legislators who authored the option for services to new developments to be funded by an annual assessment, can be used if the 1 percent base property tax would not be sufficient to fund services to the properties and can also be used as a financing mechanism for infrastructure. Although a Mello-Roos assessment may deter potential homeowners, up-front funding of the infrastructure improvements may increase initial house prices and make a Community Facilities District attractive to developers.
An assessment must be approved by a majority of property owners, although a developer who owns the land before it is subdivided may cast the sole vote in favor of a Community Facilities District.
Up to $32 million of bonds for Harmony Grove Village had been authorized in 2008, although the economic downturn delayed construction of the homes and infrastructure improvements.
The Dec. 5 approval to issue $16 million of those bonds will allow county of San Diego, San Diego County Sanitation District (which is officially a separate agency although the sanitation district is administered by the county’s Department of Public Works and the Board of Supervisors is also the board of the sanitation district), and Rincon Del Diablo Municipal Water District infrastructure and services to be provided to the development.
Harmony Grove Village consists of 415 acres. The approved subdivision map created 736 residential lots along with 2.89 acres of commercial office space. The subdivision also includes a church, a fire station and a water treatment plant although those will not be subject to the assessment.
The assessment for the commercial land will be $0.305 per square foot of floor area. The assessment on the residential properties will be based on the square footage of the residence with an annual assessment of $2,417.39 for homes less than 1,650 square feet and various other assessments based on square footage parameters.
A 2,000-square-foot home would have an assessment of $2,901.63, the assessment for a 2,500-square-foot residence would be $3,177.63, and a $3,586.09 assessment would apply for a 3,000-square-foot home. Any residences exceeding 4,250 square feet would have an assessment of $5,876.77.