One of O.C.’s wealthiest enclaves seeks its own ZIP code — and lower sales taxes

North Tustin, a hillside community of luxury homes dotted along narrow, winding roads, may soon get its own ZIP code — and a clear exit from one of the highest sales tax rates in Orange County.

Republican Rep. Young Kim, whose 40th congressional district encompasses the enclave, has cosponsored a bill that would designate single, unique ZIP codes for North Tustin and several other communities across the nation within 270 days of its passage.

The largest unincorporated island in the county is designated by the Census as North Tustin, but the U.S. Postal Service assigned it a ZIP code shared with Santa Ana. Another ZIP code is shared with Tustin.

“Its status as an unincorporated area can cause confusion,” Kim said of the community in a press statement. “Providing North Tustin with a unique ZIP code will create certainty for residents who have called North Tustin home for decades and clarity for tax purposes, to surrounding areas and the USPS.”

Richard Nelson, a 55-year North Tustin resident and president of the Foothill Communities Assn., noted that he and his neighbors have talked with Rep. Kim’s office for a year about the importance of the community having its own ZIP code.

“Until 1996, North Tustin did have its own ZIP code and then the post office needed some more addresses in Santa Ana, so they expanded it into the eastern part of Santa Ana,” He said. “Now we share the ZIP code, and that has generated a lot of problems for people in North Tustin.”

According to Census data, 69% of North Tustin’s roughly 25,000 residents are white, and the median household income is $174,000.

Its hillside homeowners in neighborhoods like Lemon Heights, Cowan Heights and Red Hill include current and former politicians like Curt Pringle, a onetime Anaheim mayor turned lobbyist, and Don Wagner, current chairman of the Orange County Board of Supervisors.

Over the years, residents have been sticklers against any annexation attempts, halted a shopping center development and even a proposed Gelson’s supermarket. They have pushed for their own ZIP code amid protests of being overtaxed, especially in the past five years.

In 2018, Santa Ana voters passed Measure X, which raised its sales tax rate to 9.25% for the next decade to shore up budget woes and fund key civic services like public safety for its largely Latino, immigrant residents.

The city shares the highest sales tax rate in the county alongside cash-strapped Los Alamitos and Westminster.

“The people of North Tustin did not vote for that,” Wagner said. “The tax revenue goes to Santa Ana, not North Tustin.”

But sharing a ZIP code with the city can mean that North Tustin residents who use their home addresses while buying a car or shopping online for big ticket purchases like furniture or appliances are sometimes assessed Santa Ana’s higher sales tax rate.

“If you’re buying something for $10 on Amazon, that’s not a problem,” Nelson said. “But if you’re buying a $50,000 automobile, it can get to be a big deal.”

Nelson has had to negotiate refunds on a company by company basis.

Wagner called the ZIP code issue “taxation without representation” in supporting Rep. Kim’s legislative efforts.

On Wednesday, the House Oversight Committee passed the bill out of markup.

If it becomes law, North Tustin residents would fall under the jurisdiction of the county with the board of supervisors overseeing its tax rates. Currently, the county’s sales tax rate is 7.75%.

“People just want to get back to where we were, and it can be done,” Nelson said. “The post office just has to do it.”