City ponders foreclosure for tax delinquents

Developers make up about half of those who have not paid

By HILLARY BORRUD Staff Writer VV Daily Press- 10-17-07

    HESPERIA — In a sign that local developers and homeowners alike are feeling the financial pinch, Hesperia is considering foreclosing on 143 parcels in the Mission Crest development at Muscatel Street and Escondido Avenue, where some property owners have not paid special taxes.
    The property owners facing foreclosure are delinquent on $35,461 total in special taxes as of Sept. 17, according to a city staff report, and the City Council will vote tonight on whether to pursue the foreclosures in court.
    About 50 percent of the parcels facing foreclosure are dirt lots, some with concrete pads, owned by developers Prestige Homes, Beazer Homes and Empire Land.
    The city is also working with owners of 82 parcels, who are delinquent on a total of $8,864 in special taxes, on payment plans.
    “The national issue is basically on our doorstep,” said Brian Johnson, Hesperia’s director of management services in reference to declines in the national housing market. “We’ve sent letters and we hope most are paid off, but we will have to go into court and seek foreclosure.”
    Property owners in the development pay special taxes in addition to their county property tax because they live within a community-facilities district, which allows developers to pass on the cost of infrastructure improvements to home buyers.
    The process was set out by the Mello Roos Community Facilities Act of 1982. Established in 1991 by Belgate Development Restructuring, the Mission Crest district was refinanced in 2005 when $18.6 million in new bonds were taken out to pay off the existing bonds. It is the only such district currently active in Hesperia, Johnson said.
    San Bernardino County must wait for property owners to be delinquent on their taxes for five years in a row before proceeding to a tax sale, said Annette Kerber, assistant treasurer-tax collector for the county. Hesperia can proceed more rapidly because bonds are involved, Johnson said.
    Among the developers who are delinquent on the special taxes, Empire Land LLC owns 18 vacant parcels, Beazer Homes Holding Corp. owns 18 and Prestige Homes LP owns 37, according to the San Bernardino County Assessor’s Property Information Management System.
    The city of Hesperia does not want to foreclose on anyone, Johnson said, but it is responsible for monitoring the special tax collections and could face a lawsuit from bond holders if it does not follow through.
    “We’re not delighted to be in this role but at the same time, the last thing we need to do is shift responsibility for this to the city,” he said.
    The City Council meeting begins at 6:30 p.m. at City Hall, located at 9700 Seventh Avenue in Hesperia.