Indio council approves 1,500-home 55+ development while rejecting Mello-Roos financing

The Indio City Council unanimously approved a development agreement Wednesday for the Desert Retreat housing project while making clear its opposition to Mello-Roos special tax financing, clearing the way for construction of up to 1,500 homes north of the freeway.

The council voted 5-0 to introduce the first reading of the ordinance, which establishes a 15-year framework for the housing development to be located between 40th Avenue and 38th Avenue, east of Jefferson Street and west of Madison Street. The project includes a central community clubhouse with outdoor amenities such as pickleball courts, bocce ball courts, tennis courts, and water features.

The agreement requires the home builder, Pulte Home Company, to fund and construct significant road improvements that will benefit the broader community. The developer will widen Avenue 40 with additional travel and turn lanes, install a new traffic signal at the project’s main entrance, and extend improvements from the project’s western boundary all the way to Jefferson Street.

Pulte will contribute approximately $5.5 million toward construction of a new electrical substation that will provide additional power capacity and system reliability for existing residents and future development in the area.

Several councilmembers expressed strong opposition to potential Mello-Roos financing during the meeting.

Mello-Roos Community Facilities Districts (CFDs) were created by state law in 1982 after Proposition 13 limited public agencies’ ability to finance new projects. The CFDs allow local governments and developers to issue tax-exempt bonds for infrastructure and public services, with costs passed to homeowners through annual special taxes that can last up to 35 years. 

Many communities in North Indio already carry Mello-Roos taxes from developments built between 2005 and 2007. 

“I’m just not a Mello-Roos person,” said Mayor Glenn Miller during the discussion. He said he consistently fields questions from residents of developments that are subject to the taxes.

“I think if you’re going to build the project, you need to be able to do it through the funding that you need to charge more for the houses,” Miller said. “It’s just not worked out well for us as a city, and I promised myself I wouldn’t do it.”

A city staff member clarified that the development agreement the council ended up approving does not require Mello-Roos or a CFD formation, and any consideration of Mello-Roos would have to be brought back to council.

Councilmembers emphasized the importance of maintaining communication with neighboring residents, particularly those in Sun City Shadow Hills, who had previously expressed concerns about traffic and dust impacts from the development.

The ordinance will return for final adoption at a future council meeting before taking effect 30 days after approval.

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