Chapter 12.40
SYSTEMS DEVELOPMENT CHARGES
Sections:
12.40.040 System development charge.
12.40.050 Authorized expenditures.
12.40.060 Expenditure restrictions.
12.40.070 Installment payment.
12.40.100 Segregation and use of revenue.
12.40.120 Prohibited connection.
12.40.010 Purpose.
This chapter provides authorization for the imposition of system development charges (SDCs) for capital improvements consistent with ORS 223.297 through 223.314 thereby creating funding source(s) to pay for the installation, construction, expansion and extension of capital improvements necessitated by impacts from growth and development on the city’s capital improvements. [Code 2000 § 3.500; Ord. 898 § 1, 2008.]
12.40.020 Scope.
The system development charges authorized by this chapter are separate from and in addition to any tax, assessment, charge, or fee otherwise provided by law or imposed as a condition of development. [Code 2000 § 3.505; Ord. 898 § 1, 2008.]
12.40.030 Definitions.
Except where the context requires some other meaning, the terms used in this chapter shall have the meaning ascribed to them at ORS 223.299 and as otherwise used in ORS 223.297 through 223.314. [Code 2000 § 3.510; Ord. 898 § 1, 2008.]
12.40.040 System development charge.
(A) Unless exempted by the provisions of CMC 12.40.080 or state law, there are hereby imposed systems development charges (SDCs) upon all qualifying development in the city for the use of the city’s capital improvements. The SDCs shall be collected at such time(s) as determined by the city manager or his designate to be appropriate such that development is responsible for payment at or near the time the capital improvement(s) are to be utilized by the development (i.e., issuance of a building permit, etc.).
(B) Systems development charges shall be established and may be revised by resolution of the city council. The city council shall hold a public hearing on the resolution prior to its adoption. [Code 2000 § 3.515; Ord. 898 § 1, 2008.]
12.40.050 Authorized expenditures.
(A) The reimbursement fee portion of the system development charge shall be applied only to capital improvements associated with the systems for which the fees are assessed, including expenditures relating to repayment of indebtedness.
(B) The improvement fee portion of the system development charge shall be spent only on capacity-increasing capital improvements, including expenditures relating to repayment of debt for such improvements. A “capacity-increasing capital improvement” is one which increases the level of performance or service provided by existing facilities or provides new facilities. The portion of the improvement(s) funded by improvement fees must be related to the increased demands created by projected development.
(C) Notwithstanding subsections (A) and (B) of this section, system development charge revenues may be expended on the direct costs of complying with the provisions of this chapter and ORS 223.297 through 223.314 including the cost(s) of developing system development charge methodologies for each capital improvement, staff costs and legal review associated with analysis and defense of the city’s system development charges and the provision of annual accounting of system development charge funds. [Code 2000 § 3.520; Ord. 898 § 1, 2008.]
12.40.060 Expenditure restrictions.
(A) System development charges shall not be expended for costs associated with the construction of administrative office facilities that are more than an incidental part of other capital improvements.
(B) System development charges shall not be expended on costs for the operation or routine maintenance of capital improvements. [Code 2000 § 3.525; Ord. 898 § 1, 2008.]
12.40.070 Installment payment.
When a system development charge is due and payable, a permittee may, consistent with the limitations imposed under ORS 223.207 and 223.208, apply for payment of the system development charge in 20 semiannual installments. [Code 2000 § 3.530; Ord. 898 § 1, 2008.]
12.40.080 Exemptions.
An alteration, addition, replacement or change in use that does not increase the parcel’s or structure’s use of a capital improvement are exempt from all portions of the system development charge. [Code 2000 § 3.535; Ord. 898 § 1, 2008.]
12.40.090 Credits.
(A) When development occurs that is subject to a system development charge for a capital improvement, the charge for the existing use (if relevant) shall be calculated and if less than the system development charge applicable to the proposed use, the difference between the two shall be the imposed SDC.
(B) If the change in the use results in a system development charge for the proposed use being less than the system development charge would be for the existing use, no system development charge shall be sought; however, no refund or credit shall be given unless provided for by another subsection of this section.
(C) A credit shall be given to a developer or applicant for the cost of a qualified public improvement upon acceptance by the city of the affected capital improvement if the improvement meets the qualifications set out in ORS 223.304(4) and (5).
(D) The credit shall be only for the improvement fee portion of the system development charge charged for the type of improvement being constructed, and credit for qualified public improvement(s) may be granted only for the cost of that portion of such improvement that exceeds the city’s minimum standard facility size or capacity needed to serve the particular development project or property. An applicant for a credit shall have the burden of demonstrating that a particular improvement qualifies for credit. The request for credit shall be filed in writing no later than 60 days after acceptance of the improvement by the city.
(E) When establishing a methodology for a system development charge, the city may provide for a credit against the improvement fee, the reimbursement fee, or both, for capital improvements constructed as part of the development which reduce the development’s demand upon existing capital improvements and/or the need for future capital improvements.
(F) When the construction of a qualified capital improvement gives rise to a credit amount greater than the improvement fee that would otherwise be imposed against the project, the excess credit may be applied against improvement fees that accrue in subsequent phases of the original development project.
(G) Credits shall not be transferable from one type of system development charge to another.
(H) Credits shall be used within 10 years from the date the credit is given.
(I) A credit may be transferred from one developer to another developer for use in another development as allowed by ORS 223.304(5)(c).
(1) A request for transfer of a credit shall be made in writing to the city manager signed by the developer who owns the credit. The request for transfer of a credit shall contain the information in subsection (I)(2) of this section. The city shall respond in writing to the developer’s request for transfer of the credit within 30 days of receipt of the written request.
(2) When a credit transfer is approved, a credit transfer notice shall be sent from the city to both developers.
(a) The credit transfer notice shall reference the original developer, original property address or other property identification, original credit amount, remaining credit amount and original credit expiration date which is associated with the original credit and the new developer, new property address or other property identification, transferred credit amount and the original credit expiration date.
(b) The transferred credit shall have the same expiration date as the original credit.
(3) The city shall maintain a record of approved credit transfers.
(4) The transferred credit may be used by presenting the approved credit transfer notice.
(5) The use of a transferred credit shall be subject to all provisions regarding the use of credits, including subsection (G) of this section.
(6) The city may charge a fee for administration of the transfer of credits.
(7) A credit may only be transferred one time. [Code 2000 § 3.540; Ord. 898 § 1, 2008; Ord. 2021-04 § 1 (Exh. A), 2021.]
12.40.100 Segregation and use of revenue.
(A) All funds derived from a particular type of system development charge are to be segregated by accounting practices from all other funds by the city. That portion of the system development charge calculated and collected on account of a specific facility system shall be used for no purpose other than those set forth in this chapter.
(B) The city council shall provide an annual accounting, based on the city’s fiscal year, of system development charges showing the total amount of system development charge revenues collected for each type of charge and the projects funded from each account. [Code 2000 § 3.545; Ord. 898 § 1, 2008.]
12.40.110 Appeal procedure.
A person aggrieved by a decision required or permitted to be made by the city council under this chapter or a person challenging the propriety of an expenditure of system development charge revenue(s) may appeal the decision or the expenditure to the city council by filing a written request with the city council describing with particularity the decision of the city council or the expenditure from which the person appeals. Any such challenge must be made by a party recognized as having standing under ORS 34.010 through 34.100 and the time limitations imposed by ORS 223.302 and/or 223.304. [Code 2000 § 3.550; Ord. 898 § 1, 2008.]
12.40.120 Prohibited connection.
No person may connect to the water or sewer systems of the city unless the appropriate system development charge has been paid. [Code 2000 § 3.555; Ord. 898 § 1, 2008.]
12.40.130 Severability.
The invalidity of a section or subsection of this chapter shall not affect the validity of the remaining sections or subsections. [Code 2000 § 3.560; Ord. 898 § 1, 2008.]