Mello-Roos Disclosure Template | California CFD Tax Disclosure

Key Information

California's Mello-Roos Community Facilities Act of 1982 (California Government Code § 53311 et seq.) allows local agencies to form Community Facilities Districts (CFDs) and levy special taxes on property within those districts to fund public infrastructure and services. Sellers of property within a CFD are required under California Civil Code § 1102.6b to disclose the existence of the CFD and provide a Notice of Special Tax to buyers before close of escrow. The special tax is not based on assessed value — it is a fixed or formulaic annual charge that can range from a few hundred to several thousand dollars per year and does not disappear when a mortgage is paid off. BuildMyListing generates Mello-Roos disclosure documentation formatted for California listing compliance.

Pricing: Starting $99/month

Time Required: Mello-Roos disclosure documentation in minutes

The Problem

California sellers who fail to disclose Mello-Roos special taxes face rescission claims and potential liability after close — the special tax is not always visible on tax bills, and buyers who discover it post-close often claim they were not adequately informed. Many agents mishandle Mello-Roos disclosure by omitting the CFD name, district bond status, or the actual annual tax amount.

The Solution

BuildMyListing generates Mello-Roos disclosure documentation that covers what California Civil Code § 1102.6b requires: CFD identification, annual special tax amount per current tax year, projected tax escalation (if known), Notice of Special Tax formatted for the transaction, and clear disclosure in listing marketing materials that the property is subject to a CFD special tax.

Key Features

Mello-Roos CFD Disclosure Documentation

Generate the Notice of Special Tax disclosure document per California Civil Code § 1102.6b — identifying the CFD, the current annual special tax amount, whether bonds are still outstanding, and the estimated remaining tax period.

Benefit: Legally required disclosure documentation generated and formatted for escrow

Listing Copy with Mello-Roos Transparency

Generate MLS description and marketing copy that discloses the Mello-Roos CFD in the listing itself — proactively informing buyers before they even enter escrow. Transparent upfront disclosure reduces transaction failure risk.

Benefit: Mello-Roos disclosed in the listing — qualified buyers only enter escrow

Annual Tax Amount Documentation

Format the current annual special tax amount (not the assessed property tax) prominently in disclosure documentation — with context on tax basis (per parcel, per square foot, or other formula) and whether the rate escalates annually.

Benefit: Buyers understand the actual carrying cost before making an offer

CFD Bond Status Framing

Document whether the CFD's underlying bonds are still outstanding, the estimated remaining bond term, and what happens to the special tax when bonds are paid off — critical context for buyers evaluating long-term carrying cost.

Benefit: Full special tax lifecycle disclosed — no post-close surprises

How It Works

Enter CFD and Special Tax Details

Input the CFD name, district number, current annual special tax amount, tax basis formula, bond outstanding status, estimated remaining bond term, and any known escalation schedule.

Generate Disclosure Documentation

BuildMyListing generates the Notice of Special Tax disclosure document, MLS disclosure language, and marketing copy that clearly identifies the CFD and annual tax amount.

Download and Deliver to Escrow

Download the Mello-Roos disclosure package — formatted for delivery to buyers per California Civil Code § 1102.6b requirements, with escrow-ready documentation and listing transparency language.

Compliance Reference

Requirement	Legal Basis	When Required	BuildMyListing Output
Disclose CFD existence	Cal. Civil Code § 1102.6b	Before close of escrow	Notice of Special Tax document
Annual special tax amount	Cal. Civil Code § 1102.6b	Before close of escrow	Current year tax amount formatted
Bond outstanding status	Cal. Government Code § 53340.2	Before close of escrow	Bond status and remaining term
MLS disclosure language	CAR best practice	At listing	Mello-Roos notation in listing copy
Escrow disclosure delivery	Cal. Civil Code § 1102.6b	Within 3 days of acceptance	Formatted disclosure document

Common Use Cases

New Construction in CFD — Mandatory Disclosure

Scenario: New home in a master-planned community subject to a Mello-Roos CFD. Annual special tax: $2,800/year (in addition to regular property tax). Bonds outstanding for estimated 20 more years. Tax escalates 2% annually.

Process: Input CFD name, $2,800 annual tax, 2% escalation, 20-year remaining term → BuildMyListing generates Notice of Special Tax document + MLS listing disclosure language → Disclosure package formatted for escrow delivery → Annual carrying cost prominently stated in marketing

Compliance: California Civil Code § 1102.6b Notice of Special Tax generated — buyers informed of $2,800/year additional charge and 20-year term before offer stage

Resale Home — Existing CFD

Scenario: Resale home subject to a 1995 CFD. Annual special tax: $650/year (declining as bonds pay down). Estimated 8 more years remaining. Agent ensures disclosure is included in listing.

Process: Input CFD details, $650 current annual tax, 8-year remaining estimate → BuildMyListing generates disclosure language → MLS listing notes 'subject to Mello-Roos CFD special tax — see disclosure' → Buyers informed pre-offer

Compliance: Mello-Roos CFD disclosed in listing and formal Notice of Special Tax generated for escrow delivery

Frequently Asked Questions

What is Mello-Roos and what is a Community Facilities District (CFD)?

The Mello-Roos Community Facilities Act of 1982 (California Government Code § 53311 et seq.), named after co-authors Senator Henry Mello and Assemblymember Mike Roos, allows local public agencies (cities, counties, school districts) to form Community Facilities Districts (CFDs) and levy special taxes on parcels within those districts to fund public infrastructure — roads, schools, parks, utilities — and ongoing public services. The special tax is not based on assessed value; it is a separate annual charge on the property tax bill, typically stated as a fixed amount per parcel, per square foot, or by land use type. CFDs are most common in master-planned communities, newer subdivisions, and areas developed since the 1980s.

What exactly must be disclosed under California Civil Code § 1102.6b?

California Civil Code § 1102.6b requires sellers of property subject to a Mello-Roos CFD to provide buyers with a Notice of Special Tax before close of escrow. The notice must: identify the CFD and the local agency that formed it, state the current annual special tax amount, disclose whether the bonds backing the district are still outstanding, and provide information about how to obtain additional details about the district. The disclosure must be provided in writing. Failure to provide the required notice can give buyers the right to rescind the contract. Agents should confirm current-year special tax amounts with the county tax assessor or CFD administrator.

Is Mello-Roos visible on the property tax bill?

Yes — when the CFD is active and the special tax is being levied, it appears as a line item on the county property tax bill, labeled with the CFD name and district number. However, buyers reviewing the Supplemental Property Tax Estimate or agent-provided cost estimates may not notice the distinction between the base property tax and the special tax line items. The Mello-Roos charge is in addition to the 1% base property tax rate and standard supplemental taxes — it does not disappear when the mortgage is paid off and can be a significant surprise if not disclosed upfront.

Do Mello-Roos special taxes ever end?

Yes, but on a timeline tied to the CFD's bond structure, not a fixed date. Most CFD special taxes are levied to repay bonds issued to fund infrastructure — once the bonds are paid off, the special tax ceases (or drops significantly if it also funds ongoing services). Bond terms are typically 20-40 years from issuance. Some CFDs also include a services component (maintaining parks, schools, fire services) that continues after infrastructure bonds are paid. The estimated remaining term of the special tax should be included in disclosure documentation — it significantly affects a buyer's long-term cost calculation.

Must Mello-Roos be disclosed in the MLS listing?

California law requires formal written disclosure (Notice of Special Tax) before close of escrow under Civil Code § 1102.6b, not necessarily in the MLS listing itself. However, the California Association of Realtors (CAR) and most California MLSs strongly recommend disclosing CFD status in listing remarks — both as a professional practice and to filter for buyers who have budgeted for the special tax. Proactive disclosure in the listing reduces the risk of failed transactions when buyers discover the Mello-Roos charge in due diligence. BuildMyListing generates both the formal Notice of Special Tax and MLS-appropriate listing disclosure language.

How do I find out if a property is in a Mello-Roos CFD?

The most reliable method is to review the current-year property tax bill from the county assessor's office — all active CFD special taxes will appear as line items. The CFD name and district number will be listed. For properties in newer subdivisions or master-planned communities, the listing agent should proactively check with the county or the CFD administrator (often the local agency or a fiscal agent named in the bond documents). Title companies also research CFD status as part of the preliminary title report. Sellers are responsible for knowing about and disclosing any CFDs affecting their property.

BuildMyListing provides disclosure documentation — does it provide legal advice on Mello-Roos compliance?

No. BuildMyListing generates disclosure documentation templates based on information the agent provides. It does not independently verify CFD status, calculate special tax amounts, or interpret the legal requirements of California Government Code § 53311 or Civil Code § 1102.6b. Agents should confirm CFD status and current annual tax amounts with the county assessor or CFD administrator, and consult a licensed California real estate attorney for questions about specific disclosure obligations. BuildMyListing provides compliance documentation tools, not legal advice.

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Mello-Roos Disclosure Template for California Listings