MISSION VIEJO : City, Schools Call Truce on Tax Funds

City and school district officials, in calling a halt to an acrimonious week of name-calling between both sides, said they will go back to the negotiating table to resolve a dispute over how the district spends special tax funds collected in the community.

Although the city considered going to court against the Capistrano Unified School District last week, the two sides said they will again try to solve their problems amicably.

“We have begun a constructive dialogue,” Councilman Robert A. Curtis said at a City Council meeting Monday night. “Both agencies are going out of their way now to create a win-win situation.”

The city has complained about how the district spends Mello-Roos funds, a fee charged to new homeowners that is intended to pay for the impact of housing development.

Last year, city officials charged that the school district was collecting Mello-Roos money from Mission Viejo taxpayers and spending the funds in other communities.

The school district has pointed out that state law allows them to spread Mello-Roos money around to other cities within the district.

Negotiations went on for several months until last week, when district trustees rejected a city request to spend Mello-Roos money on an elementary school in Mission Viejo.

Curtis that both sides now prefer to avoid the cost of a protracted legal battle.