Chapter 3.20
Reimbursement Districts
Sections:
3.20.030 Application for a reimbursement district.
3.20.040 City Administrator’s report.
3.20.070 Resolution – Agreement.
3.20.080 Reimbursement to the applicant.
3.20.090 Notice of adoption of resolution.
3.20.100 Recording the resolution.
3.20.110 Contesting the reimbursement district.
3.20.120 Completion – Public hearing.
3.20.130 Obligation to pay reimbursement fee.
3.20.140 Annual fee adjustment.
3.20.010 Purpose.
The purpose of this chapter is to provide the process and means by which a person who chooses to make certain public improvements to serve their property may recover a portion of the cost of such improvements when the improvements benefit, within a specific time period, other properties. [Ord. 687 § 1, 2004.]
3.20.020 Definitions.
As used in this chapter, except where the context clearly indicates a different meaning, the following words and phrases shall have the meanings ascribed to them by this section:
“Applicant” means a person who submits an application to the City for establishment of a reimbursement district. The “applicant” may be the City.
“Person” means a natural person, the person’s heirs, executors, administrators or assigns; a firm, partnership, corporation, association or legal entity, its or their successors or assigns; and any agent, employee or any representative thereof.
“Reimbursement district” means the area that is determined by the City Council to derive a benefit from, and will have an opportunity to utilize, the construction of a street, water, sewer or storm water improvement, financed in whole or in part by the applicant.
“Reimbursement fee” means the fee required to be paid, as established by a resolution of the City Council and the reimbursement agreement.
“Sewer improvement” means a sewer or sewer main improvement conforming with City standards and including but not limited to extending a sewer main to property, other than property owned by the applicant, so that sewer service can be provided for such property without further extension of the main.
“Street improvement” means a street or street improvement conforming with City standards and including but not limited to streets, storm drains, curbs, gutters, sidewalks, bike paths, traffic control devices, street trees, lights and signs and public rights-of-way.
“Storm water improvement” means a storm water facility, not constructed as part of a street improvement, conforming to City standards.
“Water improvement” means a water or water main improvement conforming to City standards and including but not limited to extending a water main to property not owned by the applicant, thereby enabling water service to be provided to other properties without further extension of the main. [Ord. 687 § 2, 2004.]
3.20.030 Application for a reimbursement district.
A. Any person who chooses to finance some or all of the cost of a street, water, sewer or storm water improvement that could serve property other than property owned by the person making the improvement may request that the City establish a reimbursement district. The request must be made by written application filed with the City Administrator. The City may also initiate formation of a reimbursement district.
B. A street, water, sewer or storm water improvement is eligible for a reimbursement district if the improvement is in addition to, or in a size greater than, that which would otherwise be required by permit approval. Also, the improvement must be available to provide service to property other than property owned by the applicant. Examples include, but are not limited to, full street improvements instead of half street improvements, off-site sidewalks, connection of street sections for continuity, extension of water mains and extension of sewer mains.
C. The application shall include all of the following:
1. A description of the location, type, size and cost of the public improvement for which the applicant seeks reimbursement or a portion thereof.
2. A map showing the properties to be included in the proposed reimbursement district; the zoning district for the properties; the front footage or square footage of said properties, or similar data necessary for calculating the apportionment of the cost; and the property or properties owned by the applicant.
3. The estimated cost of the improvement as evidenced by bids, projections of the cost of labor and materials, or other evidence satisfactory to the City Administrator.
4. The estimated date of completion of the public improvement.
5. The fee, established by resolution, sufficient to cover the cost of administrative review and notice.
D. Applicant may request a discretionary annual fee adjustment, which, if granted, will be administered pursuant to BMC 3.20.140.
E. No application may be made for any improvements constructed prior to January 1, 1999. [Ord. 687 § 3, 2004.]
3.20.040 City Administrator’s report.
The City Administrator shall review the application for the establishment of a reimbursement district and evaluate whether a district should be established. The City Administrator may require that the applicant submit additional information to assist in the evaluation.
A. The City Administrator shall prepare a written report for the City Council that includes the following information:
1. A description of the proposed improvement and evaluation of the improvements likely to benefit properties owned by persons other than the applicant;
2. Whether the applicant will finance some or all of the proposed improvement;
3. The area to be included in the reimbursement district;
4. The estimated cost and completion date of the improvement within the area of the proposed reimbursement district and the portion of the cost for which the applicant should be reimbursed;
5. A methodology for spreading the cost among the parcels within the reimbursement district and, where appropriate, defining a “unit” for applying the reimbursement fee to property which may, with City approval, be partitioned, altered, modified, or subdivided at some future date. The methodology for determining the amount of the reimbursement fee shall be based on the special and peculiar benefits accruing to the parcel from the improvement and may include consideration of the cost of the improvements, prior contributions by property owners, the value of the unused capacity, rate-making principles employed to finance public improvements, and other factors deemed relevant by the City Administrator. Prior contributions by property owners will be considered only if the contribution was for the same type of improvement and at the same location (example: a sewer-related improvement in the same location as a sewer improvement would be considered; a water-related contribution in the same location as a sewer improvement would not be considered).
B. After considering the report furnished under subsection (A) of this section, the Council may:
1. Direct that a public hearing be held on the proposed reimbursement district consistent with the City Administrator’s report and direct that notice of the hearing be given as provided in BMC 3.20.050;
2. Modify the City Administrator’s report and direct that a public hearing be held on the proposed reimbursement district consistent with the modified City Administrator’s report and direct that notice of the hearing be given as provided in BMC 3.20.050;
3. Require additional information about the proposed reimbursement district; or
4. Decide not to create the proposed reimbursement district. [Ord. 687 § 4, 2004.]
3.20.050 Notice of hearing.
A. When directed by the City Council the City Administrator shall cause notice of the proposed reimbursement district and the public hearing to be given by one publication not less than 10 days prior to the public hearing in a newspaper of general circulation within the City and by mailing copies of the notice by first class, postage prepaid mail to the owner of each lot that would be included in the proposed reimbursement district.
B. The notice shall contain all of the following:
1. A general description of the proposed reimbursement district and proposed improvement(s). The description need not be by metes and bounds, but shall be such that an average person can determine the general location of the district.
2. An estimate of the total cost and completion date of the improvement, the portion anticipated to be reimbursed to the applicant by the proposed district, and the methodology and any alternate methodologies proposed for determining the method for reimbursement.
3. The time and place of the public hearing.
4. A statement regarding where additional information concerning the proposed reimbursement district is available to the public.
5. Any other information the Council may direct be included in the notice. [Ord. 687 § 5, 2004.]
3.20.060 Hearing.
A. At the time of the public hearing, the City Council shall hear and consider testimony, both oral and written, on the proposed reimbursement district.
B. After the close of the public hearing the Council may, in its discretion, order the reimbursement district to be created. If the Council determines formation of the reimbursement district is in the best interests of the City, the Council may form the reimbursement district even if affected property owners object to the proposed district.
If the Council elects to create the reimbursement district, it shall, within 90 days after the date of the creation, adopt a resolution establishing the reimbursement district and the methodology to be used when determining the amount of reimbursements.
C. At the public hearing the Council may modify the proposed reimbursement district by revising the scope of improvements, reducing or enlarging the boundaries of the district, or making other modifications as it finds reasonable. If the Council modifies the scope of the proposed reimbursement district so that reimbursement apportioned to one or more lots is substantially increased, if the Council enlarges the boundaries of the proposed district, or if the Council substantially changes the proposed reimbursement district as it was set forth in the notice, it shall hold public hearing on the revised proposed reimbursement district and shall notify affected property owners. Notification shall comply with BMC 3.20.050(B). No publication shall be required. Instead of closing the public hearing and taking action, the Council may continue the hearing to a later date. [Ord. 687 § 6, 2004.]
3.20.070 Resolution – Agreement.
A. After the public hearing held pursuant to BMC 3.20.060, the City Council shall approve, reject or modify the recommendations contained in the City Administrator’s report. If the City Council elects to create a reimbursement district the City Council’s decision shall be embodied in a resolution incorporating the City Administrator’s report. The resolution shall be approved by the Council within 90 days of the hearing or hearings described in BMC 3.20.060.
B. If the applicant is not the City, the resolution shall instruct the City Administrator to enter into an agreement with the applicant pertaining to the reimbursement district improvements. The agreement shall be contingent upon the improvements being accepted by the City. The agreement, at a minimum, shall contain the following provisions:
1. The public improvement(s) must meet all applicable City standards.
2. The estimated total amount of reimbursement to the applicant.
3. The completion date of the public improvement(s).
4. The applicant shall defend, indemnify and hold harmless the City from any and all losses, claims, damage, judgments or other costs or expense arising as a result of or related to the City’s establishment of the district.
5. The applicant shall acknowledge that the City is not obligated to collect the reimbursement fee from affected property owners.
6. Other provisions as the City Council determines necessary and proper to carry out the provisions of this chapter.
C. If a reimbursement district is established by the City Council, the date of the formation of the district shall be the date that the City Council adopts the resolution forming the district.
D. The City Council resolution shall determine the boundaries of the reimbursement district and shall determine the methodology for imposing a fee. The methodology shall consider the cost of reimbursing the applicant for financing the construction of street, water, sewer or storm water improvement(s) within the reimbursement district.
E. The City shall compute the reimbursement fee on a basis that allocates the fee on an equitable basis to all properties within the boundaries of the reimbursement district, including the property of the applicant for formation of the reimbursement district. The fee shall not be charged against the applicant’s property, however; nor shall the applicant be reimbursed for the portion of the fee computed for the applicant’s property. [Ord. 687 § 7, 2004.]
3.20.080 Reimbursement to the applicant.
A. The cost to be reimbursed to the applicant, if other than the City, shall be limited to the cost of construction, engineering, and acquiring off-site rights-of-way. If the applicant is the City, the costs to be reimbursed shall also include an administration cost and all costs associated with the acquisition of easements and rights-of-way. Engineering shall include surveying and inspection and shall not exceed 15 percent of eligible construction costs. If the applicant is other than the City, the costs to be reimbursed for rights-of-way shall be limited to the reasonable market value of land or easements purchased by the applicant from a third party to complete off-site improvements.
B. No reimbursement shall be allowed for financing costs, permits or fees required for construction permits, land or easements dedicated by the applicant, costs that are eligible for system development charge credits, or any costs that cannot be clearly documented.
C. No reimbursement shall be allowed for construction costs that occur prior to the formation of the reimbursement district except as to any reimbursement districts approved and formed pursuant to this chapter for otherwise qualifying work completed subsequent to December 31, 1998, and prior to the adoption of the ordinance codified in this chapter.
D. Reimbursement for legal expenses shall be allowed only to the extent that such expenses relate to the preparation and filing of an application for reimbursement, and to working with the City through the City Administrator’s report and formation of public hearing stages of an application. [Ord. 687 § 8, 2004.]
3.20.090 Notice of adoption of resolution.
The City shall notify all property owners within the district and the applicant of the adoption of a reimbursement district resolution. The notice shall include a copy of the resolution, the date it was adopted, a short explanation of when the property owners will be obligated to pay the reimbursement fee, and the amount of the fee. [Ord. 687 § 9, 2004.]
3.20.100 Recording the resolution.
The City Recorder shall cause the resolution that formed the reimbursement district to be filed in the Office of the County Assessor so as to provide notice of the district to potential purchasers of property within the district. Said recording shall not create a lien. Failure to make such a recording shall not affect the legality of the resolution or the obligation to pay the reimbursement fee. [Ord. 687 § 10, 2004.]
3.20.110 Contesting the reimbursement district.
Any legal action contesting the formation of the district or the reimbursement fee, including the amount of the charge designated for each parcel, must be filed within 60 days following adoption of a resolution establishing a reimbursement district. [Ord. 687 § 11, 2004.]
3.20.120 Completion – Public hearing.
A. Within three months after completion and acceptance of the improvements by the City, the applicant shall submit to the City Administrator the actual cost of the improvements as evidenced by receipts, invoices or other similar documents. The City Administrator shall review the actual costs and shall prepare a written report for the City Council. The report shall include any recommended revisions to the report prepared under BMC 3.20.040. The final reimbursement amount shall not exceed by more than 10 percent the cost estimated at the time the Council created the reimbursement district, unless an exception is approved by the City Council. An exception may be approved only if the applicant can show legitimate circumstances beyond the control of the applicant that caused the cost increase.
B. After considering the report furnished in subsection (A) of this section the Council may:
1. Direct that a public hearing be held on the completed improvements in the reimbursement district consistent with the City Administrator’s report and direct that notice, consistent with the requirements of BMC 3.20.050, of the hearing be given for the final project reimbursement schedule.
2. Modify the City Administrator’s report and then direct that a public hearing be held on the completed improvements in the reimbursement district, and direct that notice, consistent with the requirements of BMC 3.20.050, of the hearing be given, for the final reimbursement schedule.
C. Failure to provide the documentation required by this section shall result in the automatic lapse of any resolution adopted by the City Council pursuant to BMC 3.20.070. Following the final public hearing provided for herein, and subject to the limitations provided for herein, the City Council shall have the authority to approve, rescind, or modify the reimbursement district. [Ord. 687 § 12, 2004.]
3.20.130 Obligation to pay reimbursement fee.
A. If a person with property located within a reimbursement district receives approval of any of the activities delineated below (within the time specified in the reimbursement resolution), the person shall pay the City, in addition to any other applicable fees and charges, the reimbursement fee established by the Council.
1. A building permit for a new building;
2. Building permit(s) for any addition(s), modification(s), repair(s) or alteration(s) of a building that exceed 25 percent of the value within any 12-month period. The value of the building shall be the amount shown on the most current records of the Linn County Department of Assessment and Taxation for the building’s real market value. This paragraph shall not apply to repairs made necessary due to damage or destruction by fire or other natural disaster;
3. Any alteration, modification or change in the use of real property which increases the number of parking spaces required under the Brownsville Municipal Code at the time of permit application;
4. Connection to or use of a water improvement, if the reimbursement district is based on the water improvement;
5. Connection to or use of a sewer improvement, if the reimbursement district is based on the sewer improvement;
6. Connection to or use of a street improvement, if the reimbursement district is based on the street improvement;
7. Connection to or use of a storm water improvement, if the reimbursement district is based on the storm water improvement.
B. The City’s determination of who shall pay the reimbursement fee is final.
C. A person applying for a permit whose property is within a reimbursement district receives a benefit from the construction of street improvement, regardless of whether access is taken or provided directly onto such street at any time. Nothing in this chapter is intended to modify or limit the authority of the City to provide or require access management.
D. No person shall be required to pay the reimbursement fee on an application or upon property for which the reimbursement fee has been previously paid, unless such payment was for a different type of improvement. No permit shall be issued for any of the activities listed in subsection (A) of this section unless the reimbursement fee has been paid in full. Where approval is given as specified in subsection (A) of this section, but no permit is requested or issued, then the requirement to pay the reimbursement fee lapses if the underlying approval lapses.
E. The right of reimbursement shall not extend beyond 10 years from the district formation date. The right of reimbursement may be less than 10 years, but only if the shorter time period is explicitly set forth in the resolution and the agreement. [Ord. 687 § 13, 2004.]
3.20.140 Annual fee adjustment.
The City Council may include in the resolution creating the reimbursement district an annual fee adjustment, as provided in this section.
A. The annual fee adjustment shall be applied to the reimbursement fee beginning on the first anniversary of the date of the reimbursement agreement. The annual fee adjustment shall be fixed and computed against the reimbursement fee as simple interest. The amount of the fee adjustment shall be determined at the time that a reimbursement district is formed and shall remain fixed thereafter.
B. Each fiscal year, the City Administrator shall recommend to the City Council an interest rate to be used in determining the annual fee adjustment for reimbursement districts. The City Council shall consider the recommendation of the City Administrator and shall adopt an interest rate to be used in determining the annual fee adjustment. The interest rate adopted by the City Council shall be applied to all reimbursement districts existing during the fiscal year, for which annual fee adjustments are approved. [Ord. 687 § 14, 2004.]
3.20.150 Administration.
A. The right of reimbursement is assignable and transferable after written notice is delivered to the City, advising the City to whom future payments are to be made.
B. The City shall establish separate accounts for each reimbursement district. Upon receipt of a reimbursement fee, the City shall cause a record to be made of that property’s payment and remit the fee to the person who requested establishment of the reimbursement district or their assignee.
C. The reimbursement fee is in lieu of a local improvement district charge for the improvement. The reimbursement fee is not intended to replace or limit any other fee or charge collected by the City.
D. The amount of the City’s charge for administering the district shall be fixed by the City Council and will be included in the resolution approving and forming the reimbursement district. If the applicant is other than the City, the administration fee is due and payable to the City at the time the agreement in BMC 3.20.070 is signed. If the City is the applicant, the administration fee shall be included in the reimbursement fee and is due and payable at the time there is an obligation to pay the reimbursement fee as required by BMC 3.20.130. [Ord. 687 § 15, 2004.]