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Senate Bill 1122 •
Disclosure Update!
New disclosure requirements usually create new problems and/or challenges; For this one however, California Tax Data has the answers
Senate Bill 1122,
was approved by the governor on October 9, 2000
and basically amends the existing Mello-Roos tax disclosure requirement to include additional Assessment Districts that were formed under the 1915 Bond Improvement Act that have levied assessments against the subject property.
These are over and above the standard county tax that property owners pay on a yearly basis. The official notices must contain, at a minimum, the current levy amounts, start and ending dates for the assessment, and a list of all facilities the monies are used for.

Like all disclosures, the buyer must review and sign the documents prior to the close of escrow. The buyer does have a 3-5 day right of rescission after receiving the information so its suggested that the information be presented as soon as possible after escrow has opened. What may be a problem for home sellers, their representative agents, or other parties to the transaction is the ability to locate, interpret, and present accurate information to the homebuyer in a timely manner.


Since the passage of proposition 13, many public agencies have had to levy property taxes, without the benefit of an administrative arm dedicated to property tax management. As a result, public agencies like school and water districts have their own tax levies, and yet are often poorly equipped to handle disclosure requirements.

Similarly, in 1998, the Natural Hazard Disclosure Law was passed, requiring sellers and/or their agents to provide location-based hazardous condition information to the buyer.

The required information was extremely difficult to locate and secure, much less interpret. Luckily, the hazard disclosure industry was born and agents were able to turn to third party vendors to provide this information at an affordable cost. The 1915 Act Assessment District disclosure is much the same.
Under the law, the information is available, but terribly difficult to locate and interpret. To comply with this new requirement, the seller and/or their agents are responsible for:
  a) obtaining current, correct tax data for the subject property,  
  b) personally reviewing and interpreting the data to determine if the property is located in one or more of the special tax and/or assessment districts (some counties have several hundred such districts),  
  c) locating the administering agencies, private consultants, etc. that will provide an official "Notice of Special of Tax or Assessment" on the subject property,  
  d) formally requesting the notice and paying the up-front processing fees, and finally  
  e) returning to the same location in five working days to pick up the official notice. This process will need to be repeated for each separate district the subject property lies in.  

More than likely. It's almost a guarantee that the local agencies will not in any way be equipped to handle the expected several hundred requests per day to process this information and have it ready for review within five working days, as the law requires. And failing to comply with the new requirement could easily lead to the obvious: Litigation filed against the seller, his/her agent/broker, etc. for negligent or incomplete disclosure when the buyer opens their first tax bill. This new disclosure requirement could clearly be a headache.

Fortunately, you do. Several years ago, Peter Placey began to take on the enormous task of compiling, interpreting, and managing a database for every Mello-Roos and Special Assessment district in California. He also developed specialized expertise in complex bond funding and issuance through an extensive background of work with local government agencies and the public finance community. He soon founded the company California Tax Data (CTD), a division of National Tax Data, headquartered in Costa Mesa, CA.
Home sellers and their agents can now choose to avoid the hassle and potential futility of trying to locate, secure and interpret the information from the vast array of local and private agencies. By accessing CTD's online reports, a home seller, agent, escrow officer, or any other party to the transaction, can order and receive a completed mandated tax disclosure report, including all official notices, electronically in less than 24 hours to be printed out and ready for the buyer's signature!

The report also includes helpful information regarding the breakdown of tax rates, property tax descriptions, information on the tax and/or assessment districts the property is in, disclosure instructions, and more. The cost of the report is $29.95, billable through escrow, which easily offsets the associated costs of trying to track down and interpret the information manually. The CTD website itself can answer a lot of questions as it contains informative fact sheets, important tax date reminders, a glossary of terms, and a list of helpful links.