Talega's Money Baggers

Why is a group of wealthy San Clemente residents asking for a tax refund when the city's schools need repairs?

Andrea Ewell stood in front of the Capistrano Unified School District (CUSD) board of trustees during an April meeting wearing a hot-pink T-shirt, her straight blond hair framing a passionate stare. She complained to the seven-member panel about how her daughter's math class at Vista Del Mar Elementary School in San Clemente was packed with 43 students, leaving some children to stand in the back while working on class assignments. Her education, the mother insisted, has suffered due to overcrowding.

"It is our responsibility to see that all students are educated in the very best manner and environment possible," said CUSDtrustee Amy Hanacek, "and that is why this district must explore other funding options for our facilities."

"My daughter comes home upset because all the teacher does is hand out a worksheet at the beginning of class, and then collects it at the end of class," Ewell proclaimed. "How is that teaching?"

However, that wasn't the worst menace decried that night by Ewell and her fellow residents of Talega, the upper-crust neighborhood in the eastern hills of San Clemente. After she finished, seven others, including attorneys and self-proclaimed financial experts, insisted they have for years been overpaying their Mello-Roos taxes, the special levies put on new communities that require citizens to cover the pricy costs of building new roads, schools, parks and infrastructure in an undeveloped area.

Bob Aul

The group requested $30 million in tax savings—including a $9.5 million cash refund from years of back taxes.

"I think it is highway robbery," said Ewell, referring to the fees. Another resident warned the trustees there is "a huge ground swell of Talega residents who are thinking about putting their kids in private schools," which could cost CUSD "a lot of money."

Fellow Talegan Laura Ferguson said her group, Talega Residents for Fair Taxation, won't desist until the $30 million is accounted for. They weren't satisfied that CUSD had already saved $30 million through refinancing when the board voted to lower the tax rate by 12 percent to its 2006 level during the meeting or that the length of the Mello-Roos period had recently been shortened by seven years. Despite the savings, they feel they are legally entitled to CUSD's Mello-Roos funds.

"It is our issue that we cannot let go of," said Ferguson. "Law requires that the Mello-Roos refinance savings be passed on to us if all our buildings have been completed."

The irony, of course, is that the special tax Ferguson and her neighbors so hate is the lifeblood Talega needs to alleviate the very problems Ewell originally decried.

Talega is a master-planned community that started construction in 1999, making it San Clemente's youngest 'burb. The 9,000-resident neighborhood is home to everything you expect in South County: brand-new youth sports centers, private golf courses, well-manicured gated communities, a private day spa. Unlike most street, city and neighborhood names relying on nonsense Spanish, Talega lives up to its moniker; it translates as "moneybag."

Far from the beach-bum sensibilities of the Spanish Village By the Sea, Talega has more of a Stepford feel. But despite trying to think of itself as a city within a city (with the dividing line being the 5 freeway), Talega still has to rely on the rest of San Clemente for such basic needs as utilities and public education. And with property taxes forever frozen by Proposition 13, the neighborhood's Mello-Roos funds have proven crucial to a school district burdened by Talegans.

CUSD Deputy Superintendent Clark Hampton sent the Weekly a list of projects that could utilize these funds, including transportation, furniture, land and classrooms—such as the one Ewell's daughter so desperately needs. But the biggest project right now is San Clemente High School, which many Talega teens attend. The 50-year-old school has a crumbling roof and a series of other improvements that will cost $6.15 million, according to consultants WLC Architects. "Once funding is available, schools in dire need of facilities upgrades, San Clemente High School being a prominent example, will receive the extra attention they need and deserve," CUSD trustee president John Alpay told the Dana Point Times in February.

But it seems the angry Talegans may have the legal upper hand to block funding. According to a 2006 CUSD resolution, "The board has determined that it has now funded all projects intended to be funded with bond proceeds," which Ferguson argues means all the roads, schools and parks have been built in accordance with the initial Mello-Roos agreement, so tax savings should be passed on to residents. She understands the Mello-Roos fees can go to future projects, but she thinks those fees should not come disproportionately from Talega. "Taxpayers everywhere are overtaxed," said Ferguson. "Everybody wants their tax money back."

CUSD has not accepted these terms quite yet. "It was the intent in the [Mello-Roos agreement] for these funds to be used for authorized facilities," said Hampton in an email to the Weekly. "The board has requested staff to provide facilities needs in each [Mello-Roos] area that would fall under authorized uses."

Tax quarrels are old hat for CUSD. In 2005, the district drew barbs from Mello-Roos residents when its new headquarters, dubbed the Taj Mahal by critics, was largely funded with such fees. Many residents felt the building was overly lavish, especially considering some local schools were dilapidated. But unlike that incident, in which the school district completed its project despite public outcry, the Talegans are carping enough to influence CUSD. Trustee president Alpay (who represents Talega) recused himself during discussion, citing a conflict of interest, but trustee Ellen Addonizio sided with the Talegans, proclaiming CUSD is "keeping more than they need via a disproportionate fund." She requested a motion to have excess Mello-Roos taxes go directly to paying down the bond to eliminate Talega's fees quicker than required. The motion failed.

Trustee Amy Hanacek voted against Addonizio's motion, but she said of the issue, "It is our responsibility to see that all students are educated in the very best manner and environment possible, and that is why this district must explore other funding options for our facilities."

Dana Point resident Gail Benda was the sole person to speak out against the Talegans during public comments. She called it "amazing" that CUSD was able to shorten the length and tax percentage of the Mello-Roos bond while still maintaining fiscal responsibility, and she said she believed that by using the Mello-Roos funds on facilities, the board could free up more money in the general fund, allowing projects outside the parameters of the agreement to be completed.

"People buying homes in Mello-Roos areas know what they are going into," said Benda. "I think it is inappropriate to request tax money back. I have never heard of any school district giving refunds."

CUSD will vote again in August to decide how to use the excess taxes. Talegans will then get another opportunity to request their refund, moneybags in tow.

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16 comments
bphood
bphood

Its so unhip to live in a nice neighborhood its a lot cooler if you live in an edgie hood with violence and bad schools were you and your family live in fear and stupidity so you know your alive...the rush of drive-by shootings, the pcp buzz...the wealthy miss so much life man

bandiniarturo04
bandiniarturo04

The aritcle seems a tiny bit slanted against the 'upper crust' neigborhood of Talega.


You have three housing options (in general)in San Clemente:


1.  You can live west of the 5.  You get to choose between the slums of North Beach, with constant police presence, crappy schools, cars parked everywhere, trash strewn about, oh and a local gang that's currently under an injunction.  The you have South side riviera district, with $1 Million Dollar plus homes.


2. You have some older homes on the east-of-the-5 neighborhoods, with myriad of soil, slope and termite issues, need $10k's dollars or more worth of updating, and still not cheap.


3. Or you have Talega.  where you can find a reasonably priced home for your family. Safe for your kids, and a very good elementary and middle school.  Yes there are some pricey million $ plus homes, but not all of them.  Most of the people are hard working and solidly middle class with kids.


The Talega residents deserve a refund...That being said, Talega sucks for the most part.  Not the location,not the housing, but the people.  Absolute A-holes for the most part.  I can't wait to leave.


Bandini

gilsqared
gilsqared

"My daughter comes home upset because all the teacher does is hand out a wooksheet at the beginning of class and then collects it all at the end of class" "How is that teaching?"

My God, you have time, money, and means to get your children the education you want for them! If you didn't then you you should find another place to live!

  But NO! You live in Talega and that's what counts!

Did you attend any school meetings? Voice an opinion? DO ANYTHING?!

  Have any of you tried to homeschool? Find a school that will teach your kids the way you want them to be schooled? NO! Because all you see are $ signs!

 You cry because you feel as if you are overtaxed. You cry because your children are not being taught. YOU CRY!

   Then DO SOMETHING to fix it! Crying solves nothing! 

 These are YOUR children. Recall the CUSD! Recall your city managers! Get involved!

    DO SOMETHING!!!! 

Or will you just sit back, watch TV, and bitch about work. And then see your kids head for the mall and screw around at a friend's house because they don't need to learn....they will wait for you to die and inherit your money?

 My neighbor has a son that would love to meet your daughter. Get her pregnant. Move into your house. And then send their kids to the same schools to keep the vicious cycle going until your money runs out.

  And he comes from North County!

     Paybacks are a bitch!!!!

gilsqared
gilsqared

I say this because I don't shed tears for south county residents. You bought into this mess, now live with it! I do not, nor have I ever had ANY children in ANY school system! Yet I am taxed for YOUR kids! Mello-Roos taxes be damned! When you bought your property, did you read the contract you signed?! Attend meetings? Or were you down at the beach with your OC Housewives sipping drinks and wondering what the poor people were doing that night?

Seems to me that you don't have a leg to stand on if you elect the same idiots into office, stay home when the school board meets, and then complain when the tax hits the fan.

  I hope when you are old and in need of your children, that they budget their lives, and yours, based on what you do now! And that they learn how to manage money, by learning math based on "Common Core" math.

gilsqared
gilsqared

If south county money can stop an airport, that was voted in by Orange County, TWICE, what in God's name makes you think that they can't ask for a tax refund and not get one when schools need money?!  

Where was OCWEEKLY then? Where was OCWEEKLY when the airport vote came up for a vote, for the third time? Where was OCWEEKLY when Larry Agran and his minions stopped the airport and gave us a big orange balloon instead? Where was OCWEEKLY when Larry and his minions wasted MILLIONS on a plan for a Great Park, that they had already submitted a plan for a Great Park? Where is this park? Where are the playgrounds promised? Amphitheater? Golf Courses? And if we get a Great Park....Why does anyone NOT LIVING in IRVINE, not have full access to the park like we were promised? Hell..........Where is the damn park!!!!!!

If you are going to ask a fool question, and write an article like why South County residents demand a tax refund when schools need money,.........DO SOME HOMEWORK!  Better yet, ASK LARRY AGRAN!
  Better yet, hire me! If you can't ask those questions,   I CAN!

sweetliberty17761776
sweetliberty17761776

we know all you wannabes love the thrill that you could be the next


urban victim of some unspeakable crime as there can be no other reason for your "bullying writings" about


"blond hair and the burbs" 


*outrage*

lauraferg
lauraferg


As a resident of Talega, a few observations come to mind after reading Reporter Deto's story. I appreciate him taking the time to attend the meeting and to write on the subject matter even though I might disagree with some of his reflections; after all, diversity of opinions is a hallmark of American life!  


  • Talega residents purchased in a Mello-Roos community knowing our special tax obligations and are happy to pay them but do not want to be overtaxed  more than our fair share just because CUSD needs money for its neglected schools.  Talega did not raid the districts deferred maintenance funds for the past 6 -7 years; the district created this problem on its own.

  • Mello-Roos taxes are restricted funds and may only be used within the Community Facilities District boundaries outlined in the formation documents.

  • Talega residents represent 14% of the entire San Clemente population, paying 25% of the tax burden, and 39% of the tax burden when we add in Mello-Roos taxes. 

  • Talega property owners contribute more than Mello-Roos taxes--we also pay the basic levy (1% ad valorem tax) which contributes nearly $5 million annually in additional property tax revenue to the City coffers which helps our entire beautiful town of San Clemente.

  • Talega kids represent less than 10% of the student population at San Clemente High School (300 kids of the total 3,200).

  • $10.3M in Talega Mello-Roos taxes have been spent on San Clemente High School, this in addition to the ad valorem taxes Talega residents pay, and most of this was spent on maintenance which is not an authorized use of Talega CFD monies. Even their own attorney Mr. Bowie stated this at the meeting, not only can our surplus taxes not be used for maintenance projects, but they cannot be used in any way the district pleases.

  • CUSD has identified a mounting number of improvements at all of their schools, especially the 50-year old San Clemente High School that they feel Talega should fund at a disproportionate levels for the total population the high school serves. All of San Clemente should contribute, not one development just because it has special taxes.

  • $3.9 Million of Talega Mello-Roos taxes were used for the District Headquarters.

  • The fact that, other than the occasional one person (and never a Talega homeowner) who speaks against the fair taxation of Talega, this shows just how ridiculous, inequitable and unlawful this situation is considering there are few, if any, true dissenters of our movement.

  • Talega residents have presented the board with many examples of other governing agencies that refunded refinance tax savings to their taxpayers, including these recent examples from 2013-2014: Fullerton Unified School District, City of Beverly Hills, City of San Clemente, City of Lake Elsinore, Goleta School District, and Santa Margarita Water District.

  • Lastly, our "self proclaimed financial experts" referenced in the article are CPA's, CFO's, CEO's of multi-million and billion dollar companies. I would say they earned the right to be called "financial experts". 



andrea593
andrea593

Ryan,

This is Andrea Ewell, who is quoted frequently and referred to often in the above article. I strongly disagree with most of this article. Primarily the "irony" that the Talega Mello Roos can solved the over crowding in my daughter's classroom. What you conveniently ommitted, Ryan, (as you heard when I stated to the board) is that there is inequality in our class sizes. We have some math classes at a 10:1 ratio and my daughters accelerated class at 43:1.

OVERCROWDED CLASSROOMS HAS NOTHING TO DO WITH MELLO ROOS TAX DOLLARS THAT HAVE BEEN PLUNDERED FROM TALEGA TAX PAYERS.

Law states what Mello roos funds can be allocated for, primarily building new structures. At vista del mar school, we have empty classrooms because the school district continues to overcrowding our classrooms instead if hiring more teachers. Mello roos cannot be used for more teachers.

This article hints that this "Stepford, upper crust neighborhood" called Talega is whining about paying too much tax. The truth is that CUSD has over taxed Talega and they got caught stealing money.

The real article here should be written on the 1/4 MILLION that CUSD plans to pay for further expert analysis on all CFDs. How many math teachers could be hired with that mismanaged money?

whateveryousay
whateveryousay topcommenter

This one will go to a Judge.  


If they made the claim the work was completed then they just may have to give it back.

BBAIN
BBAIN

Mello Roos is meant to pay for infrasructure, like the article states, not to fund schools.

lauraferg
lauraferg

@gilsqared

After reading your comments about the airport, Irvine, Larry Agran, homeschooling and Common Core, among other things, I think I finally extracted what you are saying about Talega residents. First, I educated myself about Mello-Roos before moving here. Second, I happily pay my special taxes; I just don't want to pay more than my fair and legal share.I have not heard from one fellow resident who is upset by the fact that our group is pursuing fair taxation or that they received refunds for overpayment or that they will now see a reduction on their future tax bills. What started out as $60 million in over-taxation by the school district on just 3,515 properties is now down to about $33 million excess taxation over the life of our Mello-Roos bonds. I do however commend the school board for doing the right thing so far, though there is more to be done. $33 million is still a whole lot of money being over-collected --money that could, as our San Clemente Representative and Board President John Alpay said, "have gone towards diapers or AYSO soccer registration during the great recession." When I asked OC Weekly Reporter Ryan Deko: "Is this a lot of money to you?" His response was, "The only person I can think of who would not think this is a lot of money is Donald Trump." I liked his response; it was perfect and honest.

lauraferg
lauraferg

@gilsqared

You think over-taxation of one development is OK because why? Your comments are exempt of logic, fairness and the law.CUSD has not been a responsible financial steward of taxpayer's funds. It is not OK to overtax one segment of the population to serve the whole (read the Mello-Roos Act) and are simply doing our part on behalf of our friends and neighbors to ensure we are treated fairly in accordance with the law regardless of income levels. Besides, Mello-Roos taxes are restricted to the boundaries of the Community Facilities District and cannot be used to address dilapidated schools outside the CFD boundaries even if you want them to.

You say we should do something about this? I have not counted the hours I have given to our cause but surely it is in the hundreds over the past 6 months since we started out. Others have done the same. I have attended numerous school board meetings too, and have addressed the board 6-7 times, as have other residents. We all work jobs, raise families and volunteer in our community too.You say we should recall the school board? Well, ideally, before Measure H passed, addressing this at the ballot box would have been a good remedy.  Or, exercise every strand of energy to un-elect those who we feel have disenfranchised us and elect those who will do right by the taxpayers. We cannot do that. We have one elected board member per district. There are 7 board members so this idea of yours, does little good for us.

The Talega Residents for Fair Taxation have a very strong message to carry to the school board and will continue to do so in the months ahead.

Debaser7
Debaser7

@lauraferg Your posting was informative.  Thanks for clarifying the issue in a way that the article's author could/would not:  Thinly veiled resentment at Talega residents precluded a more objective piece.  OC Weekly hates successful people and seems intent on stirring up class/race issues regardless.  Well done.

sweetliberty17761776
sweetliberty17761776

@andrea593  


I sympathize with parents who care and cant seem to beat the socialist system that demands you pay mo and mo n mo 


so that others can feel grateful at the revenge tactics of the dirty left


same thing in housing etc


until America regains its pride about hardworkers being the heros and not accept the 

Leftists version of Che being the hero


nothing will change

gilsqared
gilsqared

@GustavoArellano @Debaser7@lauraferg Typical Gustavo BS! So I will tell you this. I am a mexican as well. And all I see from you is a wish to make this country as bad as Mexico is. If this country, is as bad for you as you whine about it being......Then GO SOUTH! And don't stop at Mexico. Don't stop until you get to Antarctica. 

After all, the birds down there are the only ones who give a rat's ass about anything you say.

  "Ask a Mexican"!  BULL! It should read, "Ask a Mexican who hates America so much that he spews Anti-American crap because he is in a country that has people die for his right to let him speak his Anti-American BS!"

 I read your crap years ago. And the reason I don't anymore, is because a reader responds with an honest reply. And you respond with nine words that in no way contributes to the conversation.

  They should fire you and hire me!

I can say stupid, pig-headed, asinine, bigoted, and slow-witted stuff like you. And do it for half the price they pay your dumb ass.

 I was born here! Raised here! And live here! I speak english! Not that half baked spanglish you use.

If you don't like it here Gustavo, you are more than welcome to go a hundred miles south! There you can speak all the dumb ass spanglish you want. I'm sure they will listen to you.    

 
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