Title
Sale of Delinquent Tax Receivables
Finance Office
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Brief Description:
description
(Sale of Delinquent Tax Receivables) Recommends approval of sale of delinquent tax receivables to the California Statewide Delinquent Tax Finance Authority for Fiscal Years 2026, 2027, and 2028, and authorize execution and delivery of related documents and actions.
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Recommendation
Action Proposed:
1) Approve the attached resolution (Attachment A) approving the sale of delinquent tax receivables to the California Statewide Delinquent Tax Finance Authority ("Finance Authority") for the fiscal years ending June 30 in each of the years 2026 through 2028
2) Authorize the execution and delivery of related documents and actions related to the transactions
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Body
Background:
In June 2001, the Board authorized the Chief Financial Officer to join a Joint Powers Authority (JPA) enabling the Chief Financial Officer, on behalf of the District, to sell or transfer the District's right to its delinquent property taxes to the JPA. The JPA created is the Finance Authority.
Under this program, the District receives annually 100% of the amount of the delinquent taxes plus a negotiated premium, which for 2025 was 8.5%. The JPA or the County Auditor-Controller only reports to the State the principal portion of the delinquent property taxes. The District retains the premium, which is not subject to State revenue limit offset. Since the initial financing in 2002, this program has generated $43.7 million in unrestricted revenue to the District.
Expected Outcomes:
The District will be able to sell its delinquent property taxes to the California Statewide Delinquent Tax Finance Authority and generate the negotiated premium.
Board Options and Consequences:
The Board may elect not to sell the delinquent property taxes. This would mean that the District will not generate the negotiated premium that is part of the agreement, which averaged $1.9 million over the last 4 years. T...
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