Chapter 12.30
REIMBURSEMENT DISTRICTS
Sections:
12.30.030 Application for a reimbursement district.
12.30.050 Amount to be reimbursed.
12.30.070 Notice of public hearing.
12.30.080 City Council action.
12.30.090 Notice of adoption of resolution.
12.30.100 Recording the resolution.
12.30.110 Contesting the reimbursement district.
12.30.120 Obligation to pay reimbursement fee.
12.30.130 Public improvements.
12.30.140 Multiple public improvements.
12.30.150 Collection and payment – Other fees and charges.
12.30.170 Fees imposed – Tax limitations.
12.30.010 Purpose.
The purpose of this chapter is to provide a mechanism whereby property owners who benefit from the construction of public improvements by another person will share in the cost of those improvements through payment of a reimbursement fee at the time they begin to benefit from the improvement as explained in this chapter. This chapter will allow the City to examine the improvements that are constructed, their cost, and the properties that are specifically benefited by them, and will provide a reasonable method of apportioning the reimbursable costs among benefited property owners. [Ord. 855 § 1, 2007.]
12.30.020 Definitions.
“Annual inflation adjustment” means an annual adjustment in the reimbursement amount based on the Engineering News Record (ENR) Seattle Construction Cost Index.
“Applicant” means a person who is required to pay for or install (or chooses to finance) some or all of a public improvement which is available to serve real property (other than real property owned by the person) and who applies to the City for reimbursement for the expense of the improvement. With regards to the payment of a reimbursement to an applicant, the term “applicant” in that case shall refer to the person listed in the reimbursement district application as the one to whom reimbursements are to be sent. An applicant can be the City.
“City” means the City of Harrisburg.
“City Engineer” means the person holding the designation as City Engineer or any officer, employee, or agent designated by the City Administrator to perform the duties of the City Engineer.
“Depreciation adjustment” means an annual adjustment in the amount to be paid for reimbursement due to the depreciation in value of the improvement.
“Front footage” means the linear footage measured along the public right-of-way of a lot or parcel owned by a property owner to be served by a public improvement. “Front footage” excludes the front footage of property used as public right-of-way.
“Person” means a natural person, a partnership, corporation, association or any other legal entity capable of owning, holding and/or disposing of real or personal property.
“Public improvement” means the construction, reconstruction and/or upgrading of facilities covered by the terms of “street improvement,” “sanitary sewer improvement,” “water improvement” or “storm drainage improvement” as defined herein.
“Reimbursement agreement” means the agreement between an applicant and the City providing for the construction, reconstruction and upgrading of and payment for public improvements to be financed through a reimbursement district.
“Reimbursement district” means the area determined by the City Council to derive benefits from the construction of street, water, sanitary sewer or storm drainage improvements financed in whole or in part by an applicant, including property having the potential to utilize the affected improvement(s).
“Reimbursement fee” means that sum determined by a resolution of the City Council and the reimbursement agreement to be the amount of money proportionate to the benefit derived by the affected property from the public improvement.
“Sanitary sewer improvement” means a sewage pump station or sanitary sewer line improvement conforming with the City of Harrisburg’s adopted standards and specifications, and any applicable land use conditions of approval including, but not limited to, constructing or improving a sanitary pump station or extending a sanitary sewer line to property, other than property owned by the applicant, so that sanitary sewer service can be provided for such other property.
“Storm drainage improvement” means a storm drainage pump station, storm drain lines or other storm drainage improvements conforming with the City of Harrisburg’s adopted standards and specifications, and any applicable land use conditions of approval including, but not limited to, constructing or improving a pump station, constructing or extending a storm drainage line to property, other than property owned by the applicant, so that storm drainage services can be provided for such other property.
“Street improvement” means a street or street improvement conforming with the City of Harrisburg’s adopted standards and specifications, and any applicable land use conditions of approval including, but not limited to, streets, storm drains, curbs, gutters, sidewalks, bike paths, traffic control devices, street trees, lights, signs and public rights-of-way.
“Utilize” means to receive the benefit of a public improvement, manifested by either the receipt of a permit which will allow the use of an affected public improvement or a requirement that the property utilize the public improvement, or an increase in the use of the public improvement.
“Water improvement” means a water or water line improvement conforming with the City of Harrisburg’s adopted standards and specifications, and any applicable land use conditions of approval including, but not limited to, extending a water line to real property other than property owned by the applicant so that water service can be provided for such other property. [Ord. 855 § 2, 2007.]
12.30.030 Application for a reimbursement district.
1. Any person who constructs public improvement(s) capable of providing service(s) to property other than the applicant’s may by written application filed with the City request that the City establish a reimbursement district. The public improvement must:
a. Exceed the requirements normally required by the City for the applicant’s project;
b. Benefit properties other than the applicant; and
c. Not be eligible for systems development charge credits or other reimbursement.
2. The application shall be accompanied by a fee established by resolution that is sufficient to cover the cost of administrative review, and providing and recording notices as required by this section.
3. The application for creation of a reimbursement district shall include the following:
a. Detailed plans showing the actual location, type, size and extent of all improvements for which a reimbursement fee is sought. These plans shall be used to determine the basis of the reimbursement fee, except that final approved as-built plans shall be used for applications submitted after the completion of construction;
b. A map showing the properties to be included within the proposed reimbursement district;
c. The name and mailing address of each affected property owner, the tax lot number of each affected parcel, the zoning thereof, the front footage and/or square footage of the property, and any other data (traffic studies, water modeling, etc.) necessary for or relevant to calculating the apportionment of the cost of the affected public improvement(s);
d. Detailed labor and materials costs. In the event the affected public improvement(s) have been built or installed, this information must reflect the actual cost of the improvements as evidenced by receipts, invoices or other similar documents. In the event the public improvements have not been constructed or installed, the information must reflect the estimated cost of the improvements as evidenced by bids, projections as to the cost of labor and materials and other similar information requested by the City Engineer. Costs shall not include any amount of “profit” or “overhead” of the person making the application, nor any costs for repair work constructed by the applicant or developer. In the event the City Engineer determines the contract amounts paid by the applicant exceeded prevailing market rates for a similar project, the reimbursement fee shall be based upon market rates;
e. The date the City either accepted the public improvements or estimated date of completion.
4. An application may be submitted to the City prior to the construction or installation of the public improvement but in any event must be submitted not later than 120 days after completion and acceptance by the City of the public improvements. However, the City Administrator may waive this time limitation upon a showing by the applicant of good cause for the delay.
5. The City may initiate the formation of a reimbursement district, but the City shall not be subject to the provisions of subsection (4) of this section, and the City shall not have to pay fees to itself. [Ord. 855 § 3, 2007.]
12.30.040 Engineer’s report.
The City Engineer shall review the application and evaluate whether a reimbursement district should be established. The City Engineer may require the submittal of other relevant information from the applicant in order to assist the City Engineer in the evaluation. The City Engineer shall after evaluation prepare a written report for the City Council, considering and making a recommendation as to the appropriateness of establishing a reimbursement district. The report shall include information on the following items:
1. Whether the applicant will finance or has constructed some or all of the public improvement(s) that will or have relieved another person of future obligations to construct all or a portion of the same improvements;
2. Whether those improvements exceed the requirements normally required by the City for applicant’s project and are available to serve property other than property owned by the applicant;
3. The area to be included within the reimbursement district;
4. The actual or estimated cost of the public improvement(s);
5. A methodology for spreading the cost associated with the public improvement(s) between and among the affected parcels. The methodology should take into consideration the cost of the improvement(s), the value of the unused capacity, any agreements on cost-spreading methodology reached by a majority of the property owners within the proposed district, and such other factors as may be deemed relevant by the City Engineer;
6. The amount, if any, to be charged by the City for its administration of the agreement;
7. The period of time that the right to reimbursement exists; and
8. Whether the public improvement(s) will or have met City standards. [Ord. 855 § 4, 2007.]
12.30.050 Amount to be reimbursed.
The cost to be reimbursed to the applicant is limited to the cost of construction, including property acquisition costs, the cost of engineering design, the cost of construction permits and related fees, and engineering and legal expenses related directly to the formation of the reimbursement district, as determined by the City Council in its sole discretion. The City Council may include in its sole discretion a depreciation adjustment for some improvements in determining the amount to be reimbursed, depending on the expected life of the improvement. The amount to be reimbursed shall also be based on an annual inflation adjustment. [Ord. 855 § 5, 2007.]
12.30.060 Public hearing.
1. Within a reasonable time after the City Engineer has completed the report described in HMC 12.30.040, the City Council shall hold a public hearing at which any person who is or may be monetarily affected by the formation of the reimbursement district is given the opportunity to comment on the formation of the proposed reimbursement district. The formation of the reimbursement district is not subject to termination because of remonstrances, and the City Council has the sole authority and discretion to decide whether a reimbursement district shall be formed.
2. If a reimbursement district is formed prior to the actual construction of and/or acceptance by the City of the improvement(s), the City Council may set a not-to-exceed reimbursable amount which may or may not reflect the applicant’s actual costs. A second public hearing shall be held after the improvement(s) have been accepted by the City. At that time, the City Council may modify the resolution described in HMC 12.30.080 to reflect the actual cost of the improvement(s). [Ord. 855 § 6, 2007.]
12.30.070 Notice of public hearing.
Not less than 10 nor more than 30 days prior to any public hearing, the applicant and all owners of property within the proposed district shall be notified of such hearing and the purpose thereof. Such notification shall be accomplished by either regular mail or personal service. If notification is accomplished by mail, notice shall be mailed not less than 12 days prior to the hearing, which notice is deemed effective on the date the notice is mailed. Failure of the applicant or any affected property owner to receive notice shall not invalidate or otherwise affect the authority of the City Council to act. [Ord. 855 § 7, 2007.]
12.30.080 City Council action.
1. After the public hearing held pursuant to HMC 12.30.060, the City Council shall approve, reject or modify the recommendations contained in the City Engineer’s report. The Council’s decision shall be embodied in a resolution. If a reimbursement district is established, the resolution shall include the City Engineer’s report as approved or modified, and shall specify that payment of the reimbursement fee, as designated for each parcel, is a precondition of receiving City permits applicable to development of that parcel as provided for in HMC 12.30.120.
2. When the applicant is other than the City, the resolution shall authorize the City Administrator to enter into an agreement with the applicant pertaining to the reimbursement district improvements. The agreement, at a minimum, shall contain the following provisions:
a. That the public improvement(s) shall meet all applicable City standards;
b. The amount of potential reimbursement to the applicant;
c. That the total amount of potential reimbursement shall not exceed the actual cost of the public improvement(s);
d. That the annual inflation adjustment shall be calculated based on the Engineering News Record (ENR) Seattle Construction Cost Index;
e. That the applicant shall guarantee the public improvement(s) for a minimum period of 12 months after the date of written acceptance by the City;
f. Applicant shall defend, indemnify and hold harmless the City from any and all losses, claims, damages, judgments, or other costs or expense arising as a result of or related to the City’s establishment of the reimbursement district;
g. That the City will make reasonable efforts to properly account for and collect the reimbursement fee from any affected property, including the City’s costs or expenses related to collection of the reimbursement fee, but is not liable for any failure to collect such fee or costs;
h. If the agreement is entered into prior to construction, the agreement shall be contingent upon the improvements being accepted by the City.
3. 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. [Ord. 855 § 8, 2007.]
12.30.090 Notice of adoption of resolution.
The City shall notify by mail 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 and a short explanation of when the property owner is obligated to pay the reimbursement fee and the amount thereof. [Ord. 855 § 9, 2007.]
12.30.100 Recording the resolution.
The City Recorder shall cause notice of the formation and nature of the reimbursement district to be filed in the office of the County Clerk so as to provide notice to potential purchasers of property within the district. Said recording shall not create a lien. Failure to make such recording shall not affect either the lawfulness of the resolution nor the obligation to pay the reimbursement fee. [Ord. 855 § 10, 2007.]
12.30.110 Contesting the reimbursement district.
Any legal action intended to contest the formation of the district or the reimbursement fee, including the amount of the charge designated for each parcel, shall be filed within 60 days following the adoption of a resolution establishing a reimbursement district, and shall be by writ of review as provided in ORS 34.010 through 34.100. [Ord. 855 § 11, 2007.]
12.30.120 Obligation to pay reimbursement fee.
1. The applicant for a permit related to property within any reimbursement district shall pay to the City, in addition to any other applicable fees and charges, the reimbursement fee established by the City Council, if within the time specified in the resolution the person applies for and receives approval for any of the following activities:
a. A building permit which will cause either the use of a public improvement or an increase in the use thereof;
b. The connection to a public improvement which results in the use of a public improvement, or an increase in the use thereof;
c. Any City approval of development activity which results in utilization of a public improvement as defined in HMC 12.30.020.
2. The City determination of who shall pay the reimbursement fee is final. Neither the City nor any officer or employee shall incur liability of any nature whatsoever as a result of this determination.
3. A permit applicant whose property is subject to payment of a reimbursement fee receives a benefit from the construction of street improvement(s), regardless of whether access is taken or provided directly onto such street. Nothing in this section is intended to modify or limit the authority of the City to provide or require access management.
4. 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 other improvement(s). No permit shall be issued for any of the activities listed in subsection (1) of this section unless the reimbursement fee, together with the annual inflation adjustment referred to in HMC 12.30.080(2)(d), has been paid in full. In the case of multiple improvements, a reimbursement fee may be collected for selected improvements which the new development actually utilizes.
5. The date when the right of reimbursement ends shall be as follows:
a. For sewer and water improvements, 10 years from the district formation date. Upon application for an extension, the City Council may, by resolution, authorize up to two consecutive five-year extensions for a total reimbursement period not to exceed 20 years. A decision as to whether to grant any extension shall be the sole discretion of the City Council.
b. For street improvements, 10 years from the district formation date. The reimbursement fee shall be calculated over the 10-year reimbursement period based on the City Engineer’s determination of the useful life of the street improvement and shall decline five percent per year to a value not exceeding 50 percent of the original fee in the tenth and final year of the reimbursement agreement. The reimbursement fee shall be calculated to decline beginning at six months and five percent every year thereafter. No extensions may be applied for or authorized in the case of street improvements.
6. Any property owner may prepay the established reimbursement fee prior to applying for a building permit or connecting to the affected public improvement.
7. Failure by the City to collect the reimbursement fee when due will not relieve the property owner of the obligation. Should an error or omission be discovered, payment of the reimbursement fee shall be due upon notification by the City. [Ord. 855 § 12, 2007.]
12.30.130 Public improvements.
Public improvements installed pursuant to reimbursement district agreements shall become and remain the sole property of the City, or other appropriate public entity as directed by the City. [Ord. 855 § 13, 2007.]
12.30.140 Multiple public improvements.
During the initial formation of a reimbursement district, more than one public improvement may be considered for inclusion in the reimbursement district. [Ord. 855 § 14, 2007.]
12.30.150 Collection and payment – Other fees and charges.
1. Applicants shall receive all reimbursement collected by the City for their public improvements, less five percent of the amount collected which will be retained by the City as a processing fee. Such reimbursement shall be delivered to the applicant for as long as the reimbursement district agreement is in effect. Such payments shall be made by the City within 30 days of receipt of the reimbursements.
2. The processing fee is not intended to replace or limit, and is in addition to, any other existing fees or charges collected by the City.
3. Payments by the City will be made to the last known address of the applicant. It shall be the responsibility of the applicant to inform the City in writing of any change of address.
4. In the event the City is not successful in delivering a reimbursement to the applicant because the provided address is no longer correct or for any other reason, it shall not relieve a benefited and obligated property owner from paying a reimbursement amount that has been determined to be the property owner’s fair share of the cost for public improvements benefiting their property. In such a case, the reimbursement shall be credited to the City if not claimed by the applicant within six months and shall be used to help finance similar future public improvements. [Ord. 855 § 15, 2007.]
12.30.160 Violation.
1. No person may cause or maintain a connection to a utility improvement for which a reimbursement district fee has been established and which is due and payable, unless the fee has first been paid.
2. A violation of any provision of this chapter is subject to a fine not to exceed $500.00 per day until the violation is resolved.
3. The remedies provided under this section are cumulative to any other remedies provided by law. [Ord. 855 § 16, 2007.]
12.30.170 Fees imposed – Tax limitations.
The City Council finds that the fees imposed by this chapter are not taxes subject to the property tax limitations of Article XI, Section 11(b) of the Oregon Constitution. [Ord. 855 § 17, 2007.]