School Board OKs Tax Hike for District

Trustees of Orange Unified School District had hoped to give some property owners a tax break, but on the advice of experts, they changed their minds.

July is when the school board must approve annual rate increases for special Mello-Roos assessment districts, which are formed to issue the bonds that pay for new schools. The rates are adjusted each year to meet interest and principal payments to bondholders.

Trustee Maureen Aschoff said last month that she was tired of having to give formal approval to something over which the board has little control. “What if we don’t do it?” she asked the district’s consultants.

The answer came back this week: If the board does not make the recommended adjustment, then the district rather than bondholders would shoulder the risk if taxpayers in the special district should default.

With one large piece of land in the assessment district still undeveloped, the school district would not be wise to deviate from established procedure, said Lyn Gruber, a consultant on special districts.

“I don’t feel comfortable recommending you take that risk,” Gruber said.

The district at issue was formed in 1982 to raise $5.1 million for Chapman Hills Elementary School on Handy Creek Road. The district’s consultant had recommended raising by 2% the annual taxes on property, which now range from $265 to $1,500, depending on the size of the home.

The board voted 5 to 1 to raise the levy by 2%, with Aschoff voting “no” and Trustee Martin Jacobson absent. But the trustees agreed to review the situation at the same time next year.