By Jose Navarro, MBA | Financial Controller & Public Policy Analyst | San Diego, CA
September 21, 2026
SAN DIEGO — Property tax bills start landing in San Diego County mailboxes this month, with the first installment due November 1. For more than 100,000 homeowners, that bill includes a charge most of them cannot actually explain: a line item labeled only “CFD,” attached to a phone number, with no plain-language accounting of what it funds or when it ends.
That is Mello-Roos, and the county’s own grand jury has already documented how little most homeowners understand about a tax they are legally required to pay.
A TAX MOST PEOPLE CANNOT NAME
Community Facilities Districts, created under the state’s 1982 Mello-Roos Act, let cities, counties, and school districts sell bonds to build the infrastructure — streets, sewers, schools, parks, fire stations — that new subdivisions need, then repay those bonds through a special tax on the properties inside the district. It exists because Proposition 13 capped the growth of ordinary property tax revenue, leaving local governments without an obvious way to pay for growth. The workaround was elegant for local governments and expensive for homeowners: San Diego County’s grand jury found that of 936,884 taxed residential properties, 102,492 were paying Mello-Roos as of fiscal year 2020-21, at an average of $2,162.03 a year. Nearly 62,000 of those homeowners were paying into more than one district at once. Almost 2,800 were paying into six or more.
Unlike the 1% ad valorem property tax that funds general government, Mello-Roos never appears on the bill by that name. It shows up as “CFD,” followed by a district number that means nothing to most people who see it, and it can run anywhere from a few hundred dollars a year to more than $7,000, with built-in annual escalators of 2 percent or more, for terms that typically run 20 to 40 years.
WHAT THE GRAND JURY ACTUALLY FOUND
The grand jury’s core conclusion was not that anyone broke the law. Every agency it examined was technically meeting its legal disclosure obligations under state Government Code. The finding was narrower and, in some ways, more damning: technical compliance is not the same as a homeowner actually understanding what they are paying. The jury described transparency, accountability, and oversight of the CFD process as available in theory but “not easily accessible or meaningful” in practice — a homeowner has to know to look for a Notice of Special Tax disclosure, track down the CFD administrator’s contact information printed on the tax bill, or dig through the county Auditor and Controller’s active-district database to find out what their own charge is actually paying for and how many years remain on it.
FOUR YEARS LATER, THE SAME ADVICE
Nothing about that gap has closed. Real estate guidance published this year for San Diego buyers still tells them, in effectively the same language the grand jury used, to independently verify their Mello-Roos exposure before closing: check the tax bill for a “CFD” line, request the Notice of Special Tax, pull the preliminary title report, or call the county Auditor’s Property Tax Services line directly, because the number on a listing sheet cannot be trusted on its own. That is sound advice for a prospective buyer. It is also, four years after a civil grand jury flagged the exact same opacity, an implicit admission that nothing structural has changed.
WHAT SHOULD HAVE FOLLOWED
The city of San Diego formally responded to the grand jury’s report and confirmed it was meeting its legal obligations — the same conclusion the grand jury itself reached. What neither the report nor the response produced was a mandate that CFD charges appear on tax bills in plain language, with a running balance and payoff date, the way a mortgage statement does. Homeowners already paying an average of $2,162 a year into these districts are entitled to more than a phone number and an acronym. As bills go out this fall, more than 100,000 of them will open an envelope that tells them what they owe without telling them why — or for how much longer.
None of this requires new legislation to fix locally. The county Auditor and Controller already maintains the underlying district data; the fix would simply be requiring that a plain-language summary — what the district was formed to build, what portion of the bonds remain outstanding, and the year the tax expires — travel with the bill itself instead of living three clicks deep on a website most homeowners never visit. Sacramento capped how fast ordinary property taxes could grow in 1978 and handed local governments this workaround in 1982. Forty-plus years later, the workaround still owes the people paying for it a plain explanation of what they bought.
Jose Navarro, MBA, is a financial controller and public affairs analyst based in San Diego with more than two decades of experience in public finance, nonprofit management, and government contract compliance.
Contact: jose@navarro-report.com
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