Chapter 3.24
LOCAL IMPROVEMENT DISTRICT GUARANTY FUND
Sections:
3.24.010 Local improvement guaranty fund established.
3.24.030 Subrogation rights to assessments.
3.24.060 Purchases of bonds, coupons and warrants.
3.24.070 Purchases of certificates or property.
3.24.080 Warrants against fund.
3.24.100 Assessment – Deferrals – Liens.
3.24.110 Statutes adopted by reference.
3.24.120 Delinquent installments – Penalties.
3.24.130 Foreclosure of delinquent assessment.
3.24.140 Notice to property owner.
3.24.150 Acceleration of installments – Attorneys’ fees.
Legislative history: Ord. 84-18.
3.24.010 Local improvement guaranty fund established.
There is established in the city a fund designated as the local improvement guaranty fund for the purpose of guaranteeing, to the extent of the fund, the payment of the city’s local improvement bonds and warrants issued to pay for any local improvement ordered in the city or in any area wholly or partly outside its corporate boundaries.
3.24.020 Interest earnings.
Interest and earnings from the local improvement guaranty fund shall be paid into the fund.
3.24.030 Subrogation rights to assessments.
Whenever any sum is paid out of the local improvement guaranty fund on account of principal or interest of a local improvement bond or warrant, the city as trustee of the fund shall be subrogated to all the rights of the holder of the bond or interest coupon or warrant so paid, and the proceeds thereof, or of the underlying assessment, shall become part of the guaranty fund.
3.24.040 Surplus funds.
If in any local improvement fund guaranteed by the local improvement guaranty fund there is a surplus remaining after the payment of all outstanding bonds and warrants payable therefrom, it shall be paid into the local improvement guaranty fund.
3.24.050 Tax levy.
A. For the purpose of maintaining the local improvement guaranty fund, the city shall, at the time of making its annual budget and tax levy, provide for the levy of a sum sufficient, with the other sources of the fund, to pay to warrants issued against the fund during the preceding fiscal year and to establish a balance therein; provided, that the levy in any one year shall not exceed the greater of: (1) 12 percent of the outstanding obligations guaranteed by the fund, or (2) the total amount of delinquent assessments and interest accumulated on the delinquent assessments before the levy as of September 1st.
B. The taxes levied for the maintenance of the local improvement guaranty fund shall be additional to and, if need be, in excess of all statutory limitations applicable to tax levies in the city.
3.24.060 Purchases of bonds, coupons and warrants.
Defaulted bonds, interest coupons, and warrants against local improvement funds shall be purchased out of the guaranty fund and, as between the several issues of bonds, coupons or warrants, no preference shall exist, but shall be purchased in the order of their presentation.
3.24.070 Purchases of certificates or property.
A. For the purpose of protecting the guaranty fund, so much of the guaranty fund as is necessary may be used to purchase certificates of delinquency for general taxes on property subject to local improvement assessments which underlie the bonds, coupons, or warrants guaranteed by the fund, or to purchase such property at county tax foreclosures, or from the county after foreclosure.
B. The city, as trustee of the fund, may foreclose the lien of general tax certificates of delinquency and purchase the property at foreclosure sale; when doing so the court costs, costs of publication, expense for clerical work and other expenses incidental thereto shall be charged to and paid from the local improvement guaranty fund.
C. After acquiring title to property by purchase at general tax foreclosure sale or from the county after foreclosure, the city may lease it or sell it at public or private sale at such price on such terms as may be determined by resolution of the council. All proceeds shall belong to and be paid into the local improvement guaranty fund.
3.24.080 Warrants against fund.
Warrants shall be issued against the local improvement guaranty fund to meet any liability accruing against it. The warrants so issued shall at no time exceed five percent of the outstanding obligations guaranteed by the fund. The city treasurer shall establish the interest for such warrants at a rate sufficient to cover any interest accruing on the liability to be met by such warrant.
3.24.090 Transfer of assets to general fund – When authorized – Payment of claims as general obligations, when.
A. Upon certification by the city treasurer that the local improvement guaranty fund has sufficient funds currently on hand to meet all valid outstanding obligations of the fund and all other obligations of the fund reasonably expected to be incurred in the near future the city council may by ordinance transfer assets from such fund to the general fund. The net cash of the local improvement guaranty fund may be reduced by such transfer to an amount not less than 10 percent of the net outstanding obligations guaranteed by such fund.
B. If, at any time within five years of any transfer of assets from the local improvement guaranty fund to the general fund, the net cash of the local improvement guaranty fund is reduced below the minimum amount specified in subsection A of this section, the city shall, to the extent of the amount transferred, pay valid claims against the local improvement guaranty fund as a general obligation of the city. In addition, such city shall pay all reasonable costs of collection necessarily incurred by the holders of valid claims against the local improvement guaranty fund.
3.24.100 Assessment – Deferrals – Liens.
A. Whenever payment of a local improvement district assessment is deferred pursuant to the provisions of RCW 35.43.250, the amount of the deferred assessment shall be paid out of the local improvement guaranty fund. The local improvement guaranty fund shall have a lien on the benefitted property in an amount equal to the deferral
together with interest as provided for by the establishing ordinance.
B. The lien may accumulate up to an amount not to exceed the sum of two installments; provided, that the ordinance creating the local improvement district may provide for one or additional deferrals of up to two installments. Local improvement assessment obligations deferred under this chapter shall become payable upon the earliest of the following dates:
1. Upon the date and pursuant to conditions established by the ordinance granting the deferral; or
2. Upon the sale of property which has a deferred assessment lien upon it from the purchase price; or
3. Upon the death of the person to whom the deferral was granted from the value of his estate, except a surviving spouse shall be allowed to continue the deferral which shall then be payable by that spouse as provided in this section.
3.24.110 Statutes adopted by reference.
Chapter 35.50 RCW as now and hereafter amended is hereby adopted by this reference pursuant to RCW 35A.12.140.
3.24.120 Delinquent installments – Penalties.
Whenever any annual or other installment upon any local improvement assessment shall become delinquent, each of such delinquent installments, comprised of principal and interest, together with delinquent interest, if any, shall be subject to a penalty equal to the rate of interest provided by ordinance for the bonds or warrants plus five percent, such penalty to be levied at time of payment.
3.24.130 Foreclosure of delinquent assessment.
If on the first day of January in any year two installments of any local improvement assessment are delinquent, or if the final installment thereof has been delinquent for more than one year, the city attorney is authorized to commence foreclosure proceedings on the delinquent assessment or delinquent installments by an appropriate action on behalf of the city in Snohomish County superior court. Such foreclosure proceedings shall be commenced on or before July 1st of each year.
3.24.140 Notice to property owner.
The city clerk-treasurer shall send by certified mail to each person whose name appears on the assessment roll and/or county tax rolls as owner of the property charged with any delinquent assessment or installment, at each address listed on said assessment roll and/or county tax roll, a notice at least 30 days before commencement of any action to foreclose a delinquent assessment or installment. The notice shall state the amount due on each separate lot, tract or parcel of land, and the date after which the foreclosure proceedings will commence.
3.24.150 Acceleration of installments – Attorneys’ fees.
In any action brought for the foreclosure of a delinquent assessment or installment, future installments not otherwise due and payable may, at the election of the city, be accelerated and the entire balance of the assessment with interest, penalty and cost shall become due and payable and the collection thereof shall be enforced by foreclosure as set forth in this chapter; provided, however, that in the case of such foreclosure there shall be added to the cost and expense as provided by Chapter 3.50 RCW such reasonable attorneys’ fees as the court may adjudge to be equitable.