CHAPTER 17.13
REIMBURSEMENT OF DEVELOPER’S COST OF CONSTRUCTING IMPROVEMENTS
Sections:
17.13.040 Application for developer reimbursement agreement.
17.13.050 Basis for assessment reimbursement area and assessments.
17.13.060 Preliminary determination.
17.13.070 Notice and appeal of preliminary determination.
17.13.080 Final determination of assessments – Developer reimbursement agreement.
17.13.090 Contact information.
17.13.120 Payment and release of assessments.
17.13.010 Purpose.
The purpose of this chapter is to establish a uniform process for the City’s exercise of authority to identify properties who benefit from the construction of Improvements, the assessment of an appropriate share of those costs, and to enter into Developer Reimbursement Agreements, all based on the authority granted to the City by RCW 35.72 and 35.91, as they exist or may hereafter be amended. (Ord 07-215 (Ex A))
17.13.020 Definitions.
Terms used exclusively in this chapter are defined as follows:
"Adjacent" means abutting on public roads, streets, rights-of-way or easements in which road improvement(s) is installed or directly connecting to road improvements through an interest in real property such as an easement or license.
"Application Summary" means the summary of the application of the Developer to approve an Assessment Reimbursement Area, giving rise to the creation of Assessments, as described in section 17.13.040.
"Assessed Property" means property within the Assessment Benefit Area which is subject to being assessed an equitable share of the costs of construction of an Improvement, pursuant to this chapter.
"Assessment" means, in the case of Street Projects, the pro rata share of the costs of construction and of contract administration of a Street Project; and in the case of Water or Sewer Facilities, the fair pro rata share of the cost of constructing the Water or Sewer Facilities. It is expressly recognized that the basis for an Assessment for Street Projects is different that the basis for an Assessment for Water or Sewer Facilities. The term "Assessment" also includes the interest accruing on the Assessment, as described in section 17.13.080(C)
"Assessment Reimbursement Area" means, in the case of Street Projects, that area which includes all parcels of real property adjacent to the Street Project which would require similar Improvements upon development; and in the case of Water or Sewer Facilities, property which will subsequently tap onto or use the Water or Sewer Facilities. When a Developer constructs Street Projects and Water or Sewer Facilities, it is expressly recognized the Assessment Reimbursement Area may be different for Street Projects that it will be for Water or Sewer Facilities.
"Certification of Payment and Release of Assessment" is that instrument to be filed with the Grant County Auditor’s office upon payment of an Assessment which declares the Assessment has been paid and the Assessed Property is released from the lien of the Assessment.
"Construction interest" means the amount to be added to the direct and indirect construction costs for the Improvements, which will be paid to the Developer for the use of the Developer’s moneys during the construction term. The interest rate shall be one percent (1%) above the Federal Reserve bank prime loan rate published most recently before the date of the preconstruction meeting. Interest accrual begins sixty (60) days after the date construction of the Improvements starts, will continue throughout the construction term.
"Contact Information" means the name, address, telephone number, fax number and email address of the authorized agent of the Developer.
"Cost of Construction" is the sum of:
i. direct construction costs incurred to construct the Improvements,
ii indirect costs, which are limited to the application fee paid to the City, and any additional costs and fees incurred by the City and reimbursed by the Developer;
iii. construction interest, which shall be computed utilizing the two-thirds rule (i.e., (direct cost of construction x construction interest rate/365) x (the construction term expressed in days x 0.67) = construction interest).
iv. developer administrative costs, which includes all indirect costs incurred by the Developer in managing the construction of the Improvements, such as office supplies, mailings, clerical services, telephone expenses, accounting expenses, project oversight, and the like, but in any event shall not exceed three percent (3%) of the direct construction costs.
"Developer" means the individual or entity that constructs Improvements, and desires to be reimbursed, for the Cost of Construction, pursuant to this chapter.
"Developer Reimbursement Agreement" means the written contract between the City and one or more Developers providing partial reimbursement for the cost of constructing of Improvements, to the Developer by owners of property who are likely to utilize the Improvements and who did not contribute a proportionate share to the original cost of construction.
"Improvements" mean a Street Project and/or Water or Sewer Facilities, the cost of which must be at least twenty five thousand dollars ($25,000), as determined upon a construction contract for the Improvements, bids, engineering or architectural estimates, receipts or other information deemed by the Land Use Administrator to be a reliable basis for determining cost of the Improvements.
"Preliminary Determination" means the determination of the proposed boundaries of the Assessment Reimbursement Area, and the Proposed Assessments by the Land Use Administrator upon an application by a Developer for a Developer Reimbursement Agreement, as described in Section 17.13.040C.
"Street Project" shall have the meaning specified in RCW 35.72.020, as it now exists, or as it may hereafter be amended, to wit: design, grading, paving, installation of curbs, gutters, storm drainage, sidewalks, street lighting, traffic controls and other similar improvements, as required by the street standards of the City, as now or hereafter contained in the Code, which must be constructed by a Developer as a condition of further property development as required by an ordinance of the City.
"Water or Sewer Facilities" shall have the meaning specified in RCW 35.91.020, as it now exists, or as it may be hereafter amended, to wit: storm, sanitary, or combination sewers, pumping stations, and disposal plants, water mains, hydrants, reservoirs, or appurtenances where the Developer is required to construct water or sewer facilities as a result of a determination of the City. (Ord 07-215 (Ex A))
17.13.030 Applicability.
This Chapter is intended to apply to all Improvements. Except for judicial appeal, pursuant to RCW 36.70B.140 and Chapter 17.09 of the Code, the process for determining an Assessment Benefit Area and Assessments is exclusively set out in this chapter and is specifically excluded from the procedures set out in the Development Code. (Ord 07-215 (Ex A))
17.13.040 Application for developer reimbursement agreement.
A. Whenever a Developer is required to construct Improvements which may benefit properties who are not participating in paying for the cost of such construction, and prior to undertaking work on the Improvements, the Developer may apply for a Developer Reimbursement Agreement to establish Assessments to properties within an Assessment Reimbursement Area.
B. An application for a Developer Reimbursement Agreement will be considered complete upon payment of the application fee determined by the Council, and submission of an application in a form established by the Land Use Administrator which includes at least the following items, as signed and stamped by an engineer licensed by the State of Washington:
1. The Developer’s Contact Information;
2. A detailed description of the Improvements, and their location;
3. Legal description of the Developer’s property;
4. Scaled and clearly reproducible vicinity drawings depicting the Improvements and their location,
5. The proposed Assessment Reimbursement Area, including the size and county assessor’s numbers for each tax parcel,
6. The name and address of the owners of each parcel in the proposed Assessment Reimbursement Area, as shown in the records of the Grant County Assessor;
7. Itemization of the anticipated Costs of Construction;
8. The proposed Assessments, including the methodology for calculating the proposed Assessments, to the properties in the Assessment Benefit Area, based upon the standards set out in section 17.13.050;
9. An Application Summary described in subsection C.
C. Application Summary. The Application Summary shall be in a form entitling it to be recorded with the Grant County Auditor that contains the following:
1. Items 1, 2, 3 and 5 of subsection B;
2. A statement of the Developer’s intent to collect proposed Assessments from properties within the proposed Assessment Reimbursement Area;
3. The following language regarding the effect of the Application Summary:
This Application Summary shall have no further force or effect nor shall it constitute an enforceable obligation against any of the properties described herein upon the recording of a Developer Reimbursement Agreement made as to the property herein described. The terms of the Developer Reimbursement Agreement shall govern thereafter.
If a Developer Reimbursement Agreement is not recorded, this Application Summary shall have no further force or effect nor shall it constitute an enforceable obligation against any of the properties described herein after one year from the date of recording; provided, the effective term of the Application Summary may be extended by filing an extension executed by the Developer and approved in writing by the City.
D. The Developer may record the Application Summary at any time after the Land Use Administrator has determined the Application is complete. (Ord 07-215 (Ex A))
17.13.050 Basis for assessment reimbursement area and assessments.
A. Water or Sewer Facilities. For Water or Sewer Facilities, the determination of the Assessment Reimbursement Area shall be based upon a determination of which parcels did not contribute to the Cost of Construction and who may subsequently tap into or use the Water or Sewer Facility, including not only those who may connect directly thereto, but also those who may connect to laterals or branches connecting thereto. The amount of the Assessment shall be established so that each property benefitted by the construction of the Water or Sewer Facilities will be assessed a pro rata share of the Cost of Construction.
B. Street Projects. For Street Projects, the determination of the Assessment Reimbursement Area shall be based upon a determination of which parcels of property adjacent to the Improvements would have been required to construct similar Improvements as a condition of development had it not been for the Street Project which is the subject of the Developer Reimbursement Agreement. The amount of the Assessment shall be established so that each property benefitted by the construction of the Street Project will be assessed a share of costs of the Street Project, which is proportional to the benefits which accrue to the Assessed Property. (Ord 07-215 (Ex A))
17.13.060 Preliminary determination.
The Land Use Administrator shall review the Application and shall preliminarily determine the proposed Assessment Reimbursement Area and the proposed Assessments, and shall issue a Preliminary Determination based on the following:
1. The likelihood property within the proposed Assessment Reimbursement Area will be developed within 15 years from the date of recording of the Developer Reimbursement Agreement.
2. For Street Projects, the likelihood that at the time of development of such proposed Assessed Property, it will not be required to install similar Improvements because they were already installed by the Developer.
3. For Street Projects, that the proposed Assessed Properties are adjacent to the Improvements or likely to require connection to or service by the Improvements.
4. An equitable allocation of the Cost of Construction among the properties within the Assessment Reimbursement Area, so that each pays for benefits attributable to the Improvements, based upon a method reasonably calculated to equitably allocate the Costs of Construction, according to the standards set out in Section 17.13.050. Credit may be given to owners of Assessed Property who have already paid a higher share by monetary or in-kind value for the already developed portion of the Improvements. (Ord 07-215 (Ex A))
17.13.070 Notice and appeal of preliminary determination.
A. Notice. Notice of the Preliminary Determination shall be sent by certified mail to the Developer and owners of record of the properties within the proposed Assessment Reimbursement Area, with said notice including a copy of the Application Summary, the Preliminary Determination, and advising that the Preliminary Determination will become final if an appeal of the Preliminary Determination is not filed with the Land Use Administrator within twenty (20) days of mailing of the notice.
B. Appeal. Any person entitled to notice of the Preliminary Determination who desires to contest the Preliminary Determination must file a written request for an appeal before the Hearing Examiner within 20 days of mailing notice of the Preliminary Determination. Upon an appeal, the Hearing Examiner shall determine the Assessment Benefit Area and the Assessments, based upon the standards set out in this chapter. The hearing before the Hearing Examiner shall be conducted as soon as is reasonably practical, and notice of such hearing shall be mailed not less than 20 days before the date of the hearing to the owners of record of all property within the Assessment Reimbursement Area. The decision of the Hearing Examiner shall be final.
C. Finality. In the event no written request for a hearing before the Hearing Examiner has been received, as set out in sub section (A), the Preliminary Determination shall be final.
D. Except as set out in this section, decisions of the Land Use Administration implementing this chapter shall be considered administrative approvals, either with or without notice, as described in sections 17.09.010 and 17.09.020, and any appeal therefrom shall be according to the process set out in Chapter 17.09. (Ord 07-215 (Ex A))
17.13.080 Final determination of assessments – Developer reimbursement agreement.
A. Final Determination of Assessments. Upon acceptance of the Improvements by the City, the Developer shall provide the City with the actual Costs of Construction paid by the Developer, as certified by an engineer licensed by the State of Washington, with which the Land Use Administrator shall determine the final Assessments, based upon the final Preliminary Determination.
B. Developer Reimbursement Agreement. Based upon the final determination of the Assessments, the City Attorney shall prepare a Developer Reimbursement Agreement in a form consistent with this chapter and RCW 35.72 and RCW 35.91. Upon execution of the Development Reimbursement Agreement, it shall be recorded with the Grant County Auditor’s Office.
C. Term. No Developer Reimbursement Agreement shall provide for the payment of Assessments for a period longer than fifteen (15) years from the date of final acceptance of the Improvements by the City.
D. Effect. Upon recording, the Developer Reimbursement Agreement shall have the following effects:
1. The Developer’s right to be paid the Assessments shall relate back to the date the Application Summary was recorded.
2. Assessed Property shall be subject to the Assessments determined pursuant to this chapter.
3. Each Assessment shall bear interest from the date the Developer Reimbursement Agreement is recorded at an interest rate fixed at the Federal Reserve rate for one-year treasury bills on the secondary market.
4. If Assessed Property is developed, the amount of the Assessment shall be a binding obligation upon the Assessed Property and the owner of record (and successors) of the Assessed Property. (Ord 07-215 (Ex A))
17.13.090 Contact information.
A. Developer’s Responsibility. It shall be the Developer’s responsibility to keep the City advised of its Contact Information.
B. Updating Contact Information. Upon any change in the Contact Information of the Developer, and otherwise on or before December 31 of the second (2nd) year following the date of the Development Reimbursement Agreement, and every second (2nd ) year thereafter, the Developer shall provide the City with the Developer’s Contact Information.
C. Failure to Provide Updated Contact Information. If the Developer fails to provide the City with its Contact Information, or otherwise the Developer does not respond to notices directed to the Contact Information on file with the City, any Assessment received by the Developer by the City may be deposited by the City in the fund(s) utilized by the City for streets and/or sewer improvements, and the proscriptions against the issuance of permits for development and the connection to Water or Sewer Facilities shall cease as to such Assessments, and the City may record a Certificate of Payment and Release of Assessment, as an agent of the Developer with the Grant County Auditor. (Ord 07-215 (Ex A))
17.13.100 Costs and fees.
The Developer shall pay all costs and fees incurred by the City in establishing or attempting to establish a Developer Reimbursement Agreement under this chapter. The City’s costs and fees shall include, without limitation, the costs for mailing notices, filing fees, fees for professional consults and reasonable attorneys fees. The application fee for the approval of a Developer Reimbursement Agreement shall be considered as an advance of the City’s fees and costs, and the execution of the Developer Reimbursement Agreement by the City shall be contingent of the payment of the excess of the costs and fees incurred by the City in excess of the application fee. (Ord 07-215 (Ex A))
17.13.110 Segregation.
The Land Use Administrator shall, upon the request of any owner of Assessed Property, segregate the Assessment. The segregation shall be based upon the same factors applied when the Assessments were originally established. The property owner seeking segregation of the Assessments shall pay an administrative fee established by the Council. (Ord 07-215 (Ex A))
17.13.120 Payment and release of assessments.
Within twenty (20) days of payment of any Assessment, the Developer shall record with the Grant County Auditor a Certification of Payment and Release of Assessment. (Ord 07-215 (Ex A))
17.13.130 Enforcement of assessments.
A. City’s Role. Subsequent to the recording of a Developer Reimbursement Agreement, the City shall not, in the case of Street Projects, issue any permit for development upon Assessed Property, or in the case of Water or Sewer Facilities, permit connection of Assessed Property to any sewer or water facility constructed pursuant to the Developer Reimbursement Agreement, unless the Assessment has been paid to the Developer, as evidenced by a Certificate of Payment and Release of Assessment recorded with the Grant County Auditor. Whenever any tap or connection is made to the Water or Sewer Facilities without such payment having first been made, the City may remove, or cause to be removed, such unauthorized tap or connection and all connecting tile, or pipe located in the facility right of way and dispose of unauthorized material so removed without any liability whatsoever.
B. Responsibility of Developer and Owner. The City’s role in the payment and satisfaction of Assessments is limited to the processes described in subsection (A). The City in no way guarantees payment of Assessments or the filing of a Certificate of Payment and Release of Assessment, nor will the City be used for enforcement or collection of Assessments or those obligations beyond those set out in this chapter. It shall be the responsibility of the Developer and the owner of Assessed Property to take whatever means available to enforce payment of Assessments and the release of Assessments against Assessed Property.
C. Costs and Fees. The party prevailing in any proceeding undertake to resolve disputes relating to the payment and satisfaction of Assessments, and the release of Assessed Property upon the payment of an Assessment, shall be entitled to reimbursement of all costs and fees incurred by them, including reasonable attorneys fees. (Ord 07-215 (Ex A))
17.13.140 City participation in assessment reimbursement.
As an alternative to financing Improvements under this chapter, the City may join in the financing of Improvements, and may be reimbursed in the same manner as Developers pursuant to this chapter, to the extent that the Improvements will benefit that portion of the public who will use the Improvements within a given Assessment Reimbursement Area, and no costs of Improvement that benefit the general public may be reimbursed; provided, that as to Street Projects, the conditions of the City’s participation shall be specified by ordinance. (Ord 07-215 (Ex A))