New bill could lessen tax stress for low-income homeowners
By Sylvie Belmond belmond@theacorn.com

Home ownership may soon become more affordable for lowincome homebuyers in Moorpark.

Prompted by an assessment situation that affected a group of local home buyers last year, Assemblymember Audra Strickland (R-Moorpark) has proposed tax reduction legislation.

Homeowners who paid discounted prices for their houses are being taxed on a silent trust deed that is held by the city. They shouldn't be, city officials say, because including the "silent second" in assessments resulted in increased taxes last year for some homes sold through the Moorpark Affordable Housing program.

These homebuyers can never resell their home at the market rate. They can't borrow against the home in the standard way because the silent trust deed limits equity growth, said Nancy Burns, senior management analyst for Moorpark.

"Unless it's revoked, the assessment increase will prevent some homeowners from qualifying into the program and it's causing hardship on existing homeowners who already live on a limited income," Burns said.

"The tax also goes against the city's efforts to provide housing for low- and very-low-income families in Moorpark," said city officials.

Strickland introduced State Bill AB-793 to the Assembly Revenue and Taxation Committee last week. The bill would require that county assessors exclude the fiscal impact of affordable housing agreements from the assessed value of real estate property.

It states that deed restrictions must be removed from the calculations before properties are assessed, said Moorpark Mayor Patrick Hunter, who traveled to Sacramento to lobby for AB-793.

Hunter said he testified for the bill because "the current process by which properties such as these are valued is unfair and counterproductive."

In addition to alleviating the set of circumstances that Moorpark experienced, the bill will clarify issues for all 56 county assessors in California. It will have a statewide impact, Hunter said.

"I'm very optimistic that it will pass in both houses and be signed by the governor," Hunter said.

Even if it's successful, however, the new law won't be retroactive and may not help the 22 affordablehome buyers who purchased houses in the city in recent years.

Most of these residents are appealing the tax increase with the help of Cabrillo Economic Development. They didn't receive a supplemental tax bill until last year because their homes are in new developments that aren't reassessed right away, Burns said.

"The Moorpark program prices the homes based on all costs, and we would have assessed the homes lower if we had known the taxes would be this high," Burns said.

Ventura County Assessor Dan Goodwin said he's working with the state and the city of Moorpark to solve the tax dilemma that affects residents who buy homes at a discounted rate.

Moorpark's problem is unique and it's not based on reassessments, Goodwin said. It developed when the city underestimated property taxes for affordable home buyers because it didn't include the silent trust deed in the value of the homes, he said.

Even so, Goodwin said, affordable-home buyers in Moorpark get a discounted tax rate because "the houses were never assessed at full market price."

A home that would normally sell for $600,000 on the market is valued at $400,000 for those who participate in the program, so they pay significantly less taxes, he said.

Strickland's bill may help settle things for Moorpark, but the legislation is still a work in progress. It includes a number of clauses that are being reviewed by a committee of county assessors.

Goodwin said he's also working with the state to reduce the taxes on silent trust deeds issued by the city for affordable homes.

"I've been working to find a way to properly address that silent second to discount it. But it needs to be fully legal and proper," he said.

The discount would benefit existing homeowners and those who plan to purchase a home through the program in the future, he said.