ANTIOCH -- Two years remaining.

For residents in southeast Antioch who have paid thousands in extra property tax over the past two decades, that's music to their ears.

Antioch is one of several Bay Area communities that has used community facilities districts, or Mello-Roos, to put the burden of funding amenities on future homebuyers. But, arguably, no where has it been more controversial yet instrumental in shaping a community.

"Yes, it worked out and we now have some beautiful schools, but we did get some problems from it," said Mayor Pro Tem Mary Rocha, who was on the council when the Mello-Roos was established.

Students and parents leave the new Carmen Dragon Elementary School in Antioch Calif., after registration on Wednesday, Aug. 18 2004.
Students and parents leave the new Carmen Dragon Elementary School in Antioch Calif., after registration on Wednesday, Aug. 18 2004. (Herman Bustamante Jr./Staff Archives)

Since 1989, homeowners in the Mello-Roos area have pumped $250 million in new construction into the East Contra Costa city, establishing schools and a community park needed to accommodate Antioch's rapid population growth. The last county tax bill with the assessment will be for the 2015-16 year, city finance officials said.

"It's done what it needed to do," said resident Larry Osorio, who has sat on its oversight board for 16 years.

The Mello-Roos' end will close a two-decades-long chapter that split what is now Contra Costa's second-largest city, with homeowners placed on different property tax payment levels and Realtors in non-Mello Roos areas using that tax-exempt status as a carrot for potential buyers. It also resulted in a technology gap in education as new schools were built while older schools languished in the city.


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"It's had quite a hand in Antioch's history," added Walter Ruehlig, an Antioch Unified trustee from 2004 to 2012. "But, I know people will be glad to see it go."

Homeowners could see their property taxes drop by about half once the Mello-Roos is gone, according to local brokers. The assessment ranges from $657 to $1,493 each year, depending on the size of the home.

"I know I won't be missing Mello-Roos on my tax bill," Osorio said.

The last piece of the spending puzzle, an all-abilities splash feature at Prewett Water Park, is under review.

Rapid growth

In the early 1980s, Antioch was poised to develop the rolling hills to its southeast. Soon, there was a dire need for new roads, water and sewer lines and utilities to accommodate growth.

As young families started moving into new homes, it became apparent that Antioch schools would become overcrowded. The answer came with Mello-Roos, a 1982 law named after its authors Sen. Henry Mello, D-Watsonville, and Assemblyman Mike Roos, D-Los Angeles.

After years of weighing the pros and cons, Antioch and Antioch Unified School District approved a Mello-Roos tax on homes planned to be built after 1989.

The Antioch Community Center, built by part of an extra property assessment called Mello-Roos, is photographed in Antioch, Calif., on Friday, Aug. 22,
The Antioch Community Center, built by part of an extra property assessment called Mello-Roos, is photographed in Antioch, Calif., on Friday, Aug. 22, 2014. (Dan Rosenstrauch/Bay Area News Group)

"We saw it as the best way to solve our problem," said Rocha, adding there was a disconnect at the time between city and school leadership.

The net gain through the program has been construction of five elementary schools, two middle schools and Deer Valley High, along with the city park, which includes Prewett Water Park, and a community center with an amphitheater and library annex with computers.

However, it wasn't always smooth sailing.

The economic recession and slump in homebuilding in the early 1990s delayed some campus construction, hitting taxpayers with the double whammy of sending children to overcrowded schools.

During the mid-1990s, the actual price tag of schools overshot estimates by millions of dollars. Deer Valley High, for example, was originally priced at $45 million, but completed at a cost of $73 million.

Some even started calling it Mello-"Ruse."

And when it came time for a community center in the mid-2000s, there was sharp opposition from residents to extend the tax. Ultimately, the community chose to scale back the Antioch Community Center, which opened in January 2011.

The Mello-Roos tax was originally scheduled to be paid off by 2025, but low interest rates and excess revenue from homes that were larger than anticipated put Antioch on track to pay it off ahead of schedule.

Tale of two cities

As residential development took off in southeast Antioch, Mello-Roos wedged a divide between the southeast area of new homes and state-of-the-art schools and the more established areas of town. In 2008, Antioch homeowners in the area without Mello-Roos passed a bond to fix up the aging schools.

Real estate agents trying to sell houses over the years have enticed potential buyers by boasting "No Mello-Roos" on For Sale signs.

"For 2001 to 2004, the No. 1 question we got was 'Does this house have Mello-Roos?'," said John Case of Intero Real Estate and member of the East Contra Costa Real Estate Group. "It scared them away because they had heard so much about it."

Similar-sized homes without the assessment, or those where Mello-Roos was paid off earlier, have sold for tens of thousands of dollars more, Case said.

Brentwood and Oakley also have Mello-Roos assessments, but they are not as high as Antioch, he said.

Meanwhile, some selling homes with Mello-Roos gave potential buyers incorrect information about what it would provide.

With Mello-Roos off the books, and ignoring all other possible external forces, home values in Antioch should go up, Case said.

"Realtors will jump all over it," he said.

Adds Osorio: "That's one good thing about Mello-Roos' completion, is that it will reunite the city financially."

About a dozen Mello-Roos homeowners interviewed this week expressed their pleasure that the tax would soon be gone.

"There will be a little bit more cohesion," Ruehlig said. "There's always been this apprehension about citywide taxes because so many are paying through the nose."

One last splash

After considering several ideas, the last $1.7 million of Mello-Roos money is being looked at for the splash park feature.

The concept, which the City Council requested be examined earlier this year, is aimed at being designed in such a way to be accessible to persons of all abilities, city officials said. It would also help eliminate ongoing maintenance issues with the park's "tad pool," which it would replace. A preliminary plan and contract to manage the project will be considered by Antioch leaders early next month.

One question that some in the community are starting to raise is what happens after 2016, and whether a smaller parcel tax should be considered for ongoing maintenance and upkeep.

Along with some of the facilities at Prewett Park, some of the school campuses are more than 20 years old and in need of repair. The last school built, Carmen Dragon Elementary, is now 10 years old.

"I think we need to start thinking about it now and ask, 'Where does the conversation continue?'" Antioch Unified trustee Diane Gibson-Gray said.

Contact Paul Burgarino at 925-779-7164. Follow him at Twitter.com/paulburgarino.

PAY TO PLAY
Single-family detached homes within Antioch Unified School District and inside city limits
Square Feet Cost
2401 & larger $1,493
2301 to 2400 $1,434
2201 to 2300 $1,374
2101 to 2200 $1,314
2001 to 2100 $1,254
1901 to 2000 $1,195
1801 to 1900 $1,135
1701 to 1800 $1,075
1601 to 1700 $1,015
1501 to 1600 $956
1401 to 1500 $896
1301 to 1400 $836
1201 to 1300 $776
1101 to 1200 $717
0 to 1100 $657
Single-family detached homes within Antioch school district but outside city limits
2401 and up $1,204
2301 to 2400 $1,156
2201 to 2300 $1,107
2101 to 2200 $1,059
2001 to 2100 $1,011
1901 to 2000 $ 963
1801 to 1900 $915
1701 to 1800 $867
1601 to 1700 $819
1501 to 1600 $770
1401 to 1500 $722
1301 to 1400 $674
1201 to 1300 $626
1101 to 1200 $578
0 to 1100 $530
Attached residential homes in Antioch school district and inside city limits
1000 and up $657
0 to 1000 $597
Attached residential homes in Antioch school district but outside city limits
1000 and up $530
0 to 1000 $482
Source: Antioch Mello-Roos District Board