Chapter 12.35
SYSTEMS DEVELOPMENT CHARGES

Sections:

12.35.005    Findings.

12.35.010    Definitions.

12.35.020    Purpose.

12.35.030    Scope.

12.35.040    Systems development charge established.

12.35.050    Methods used to establish fees.

12.35.060    Authorized expenditures.

12.35.070    Compliance with State law.

12.35.080    Collection of charge.

12.35.090    Exemptions.

12.35.100    Change in systems development charges.

12.35.110    Notice.

12.35.120    Credits.

12.35.130    Appeal.

12.35.140    Prohibited connection.

12.35.150    Penalty.

12.35.160    Severability.

12.35.005 Findings.

The City Council hereby finds:

1. The systems development charge established herein is intended to be a charge upon the act of development by whoever needs the development. It is a fee for service because it is the development which requires essential municipal services based upon the nature of the development, and the timing and the extent of the development are within the control and discretion of the developer.

2. The systems development charge imposed by this chapter is not intended to be a tax on property or on a property owner as a direct consequence of ownership of property within the meaning of Section 11b, Article XI of the Oregon Constitution or the legislation implementing that section.

3. Even if the systems development charge herein imposed is viewed under Section 11b, Article XI of the Oregon Constitution as a tax against property or against a property owner as a direct consequence of ownership of that property, it is an incurred charge within the meaning of that section and the statutes implementing it because:

a. It allows the owner to control the quantity of the service by determining the extent of development to occur upon the property.

b. It allows the owner to determine when the service is to be initiated or increased by controlling when the development occurs.

c. State law and the ordinances of this City require the owner to provide certain basic utility services to the property when it is developed for human occupancy. The provision of these basic utility services is a routine obligation of the owner of the affected property and essential to the health and safety of the community.

4. Among the basic services which the city is required to provide its residents are the capital improvements as defined in this chapter.

5. The systems development charge imposed by this chapter is based upon the costs of providing planned-for capital improvements and does not impose charges on a person not receiving a service and imposing a burden upon the city’s existing capital improvements. [Ord. 786 § 1, 2001.]

12.35.010 Definitions.

As used in this chapter, except where the context otherwise requires, the words and phrases below have the following meanings:

“Capital improvements” means facilities or assets used for any of the following:

a. Water supply, treatment, and distribution, including storage;

b. Sanitary sewers, including collection, transmission, treatment and disposal;

c. Storm sewers, including drainage and flood control;

d. Transportation, including, but not limited to, streets, sidewalks, bike paths, street lights, traffic control devices, street trees, public transportation, vehicle parking, and bridges;

e. Parks and recreation, including, but not limited to, neighborhood parks, community parks, senior or community centers, and other recreational facilities.

“Development,” for the purpose of this chapter, includes:

a. Construction or placement of a structure, or addition thereto; or

b. Connection to the City water or sewer system; or

c. On nonresidential property, creating more than 500 square feet of nonpermeable surface.

“Improvement fee” means a fee for costs associated with capital improvements to be constructed after the date the ordinance codified in this chapter becomes effective.

“Qualified public improvement” means a capital improvement that is:

a. Required as a condition of development approval;

b. Identified in the capital improvement plan adopted by the City Council and either:

(1) Not located on or contiguous to property that is the subject of development approval; or

(2) Located in whole or in part on or contiguous to property that is the subject of development approval and required to be built larger or with greater capacity than is necessary for the particular development project to which the improvement fee is related.

“Reimbursement fee” means a fee for costs associated with capital improvements constructed or under construction on the effective date the Council adopts an implementing resolution.

“Systems development charge” means a reimbursement fee, an improvement fee, or a combination thereof, assessed or collected at the time specified in HMC 12.35.060. “Systems development charge” does not include:

a. Any fees assessed or collected as part of a local improvement district;

b. A charge in lieu of a local improvement district assessment; or

c. The cost of complying with requirements or conditions imposed upon a land use decision. [Ord. 786 § 2, 2001.]

12.35.020 Purpose.

The purpose of the systems development charge is to impose a portion of the public cost of capital improvements for water, sewers, storm drainage, transportation, and parks and recreation upon those developments that create the need for, or increase the demands on, capital improvements. [Ord. 786 § 3, 2001.]

12.35.030 Scope.

The systems development charge imposed by this chapter is separate from and in addition to any applicable tax, assessment, charge, fee in lieu of assessment, or fee otherwise provided by law or imposed as a condition of development. A systems development charge is to be considered in the nature of a charge for service to be rendered or a service charge. [Ord. 786 § 4, 2001.]

12.35.040 Systems development charge established.

1. Unless otherwise exempted by the provisions of this chapter or other local or State law, effective May 9, 1996, a systems development charge is hereby imposed upon all development within the City and all development outside the boundary of the City that connects to or otherwise uses the water or sanitary sewer systems of the City.

2. When the Council determines to establish or revise a systems development charge for any capital improvement it shall do so by Council resolution.

3. The systems development charge may be adjusted in accordance with the Engineering News Record Construction Cost Index, which adjusts the cost figures contained in the capital improvement plan. [Ord. 786 § 5, 2001.]

12.35.050 Methods used to establish fees.

1. The methodology used to establish the reimbursement fee shall consider the cost of existing facilities, prior contributions by existing users, the value of unused capacity, rate-making principles employed to finance publicly owned capital improvements, and other relevant factors identified by the Council. The methodology shall promote the objective that future systems users shall contribute no more than an equitable share of the cost of existing facilities.

2. The methodology used to establish the improvement fee shall consider the cost of projected capital improvements needed to increase the capacity of the systems to which the fee is related. [Ord. 786 § 6, 2001.]

12.35.060 Authorized expenditures.

1. Reimbursement fees shall be applied only to capital improvements associated with the systems for which the fees are assessed, including expenditures relating to repayment of indebtedness.

2. Improvement fees shall be spent only on capacity increasing capital improvements, including expenditures relating to repayment of future debt for the improvements. An increase in system capacity occurs if a capital improvement increases the level of performance or service provided by existing facilities or provides new facilities. The portion of the capital improvements funded by improvement fees must be related to demands created by current or projected development.

3. The administrative portion of systems development charges may be expended on the direct costs of complying with the provisions of this chapter, including the costs of developing systems development charge methodologies, revising the capital improvement plan, and providing an annual accounting of systems development charge expenditures. [Ord. 786 § 7, 2001.]

12.35.070 Compliance with State law.

1. Revenue received from the systems development charges shall be deposited to the systems development fund, budgeted and expended as provided by State law. The accounting of such revenues and expenditures required by State law shall be included in the City’s annual financial audit required by ORS Chapter 294.

2. The capital improvement plan(s) required by State law as the basis for expending revenues from the improvement fees portion of the systems development charge shall be the Harrisburg capital improvement plan. [Ord. 786 § 8, 2001.]

12.35.080 Collection of charge.

1. The systems development charge is payable upon issuance of a building permit. If no building permit is involved, then the systems development charge is payable upon the first occurrence of any of the following events:

a. Upon approval of a site plan;

b. Prior to connection to the City water system;

c. Prior to connection to the City sewer system; or

d. At the time the usage of the capital improvement is increased.

2. A building permit will not be issued until the charge has been paid in full.

3. If property is annexed to the City of Harrisburg, and the property includes a structure or use for which systems development charges would have been assessed if located within the City limits, then systems development charges shall be paid at the time of annexation. However, if the City Council makes findings that it would be to the benefit of the City of Harrisburg and its citizens to have the property within the City limits, the City Council may waive all or a percentage of the systems development charges to encourage the annexation.

4. If any systems development charge is not paid when due, in addition to being a violation subject to citation under this chapter, the City can order that all work on the improvement stop until payment is made, and the unpaid systems development charge and interest thereon shall constitute a lien against the parcel of land with the same priority as a local improvement lien and subject to collection and foreclosure as a local improvement lien.

5. The City shall advise anyone who files a written objection to the calculation of charges of the right to petition for a writ of review as provided for in ORS Chapter 34. [Ord. 906 § 1, 2012; Ord. 786 § 9, 2001.]

12.35.090 Exemptions.

1. Structures and uses existing within the City limits of Harrisburg on or before May 8, 1996, are exempt from a systems development charge, including systems development charges for connecting to the water or sewer system at a future date.

2. Structures, including accessory structures, or additions that are less than 500 square feet in size. Accessory structures or additions shall be charged systems development charges only to the extent that they impact infrastructure. For example, at a residence, a 500-square-foot accessory building with no plumbing or bedrooms would be charged only the systems development charge for storm drainage and for the administrative expense.

3. If a structure is removed from real property and permit fees for a new structure or development are paid for within five years of the removal, then systems development charges shall be assessed only to the extent that the impact to the City infrastructure is greater than the original structure. If permit fees for a new structure or development are paid after five years, full systems development charges shall be assessed.

4. The placement of a dwelling as a temporary medical hardship, under Chapter 19.25 HMC, shall be exempt from systems development charges.

5. A project paid by City revenues, or by grants or gifts to the City of Harrisburg, and intended for municipal purposes shall be exempt from systems development charges.

6. Harrisburg Fire/Rescue and Harrisburg School District No. 7 shall be exempt from systems development charges. [Ord. 869, 2008; Ord. 794 § 1, 2002; Ord. 786 § 10, 2001.]

12.35.100 Change in systems development charges.

1. When approved by Council resolution following a public hearing, a decrease in systems development charges shall take place immediately.

2. An increase in systems development charges shall be effective no sooner than 30 days after the Council action; however, if a land use application has been accepted by the City prior to the increase taking effect, then for six months after the date of the Council action, any systems development charge increase relating to the land use application shall be assessed at the rate in existence at the time of the acceptance of the application. [Ord. 906 § 1, 2012; Ord. 786 § 11, 2001.]

12.35.110 Notice.

1. The City shall maintain a list of persons who have made a written request for notification prior to any City Council action that may result in an increase in systems development charges. The written request to be on the list shall be delivered to the City Recorder.

2. The City shall notify any person on the list of pending City Council action that may result in an increase in systems development charges at least 90 days prior to the City Council meeting. Notice shall be in written form, delivered by mail, or by electronic delivery (facsimile transmission or e-mail) if the person has indicated electronic delivery is appropriate. The failure of a person to receive a notice shall not invalidate the action of the City.

3. The City may periodically delete names from the list if, after being notified at least 30 days prior, the person does not confirm in writing their desire to continue to be on the list. [Ord. 906 § 1, 2012; Ord. 786 § 12, 2001.]

12.35.120 Credits.

1. A credit shall be given for the cost of a qualified public improvement upon acceptance by the City of the public improvement.

2. If a qualified public improvement is located in whole or in part on or contiguous to the property that is the subject of development approval and is required to be built larger or with greater capacity than is necessary for the particular development project, a credit shall be given for the cost of the portion of the improvement that exceeds the City’s minimum standard facility size or capacity needed to serve the particular development project or property. The applicant shall have the burden of demonstrating that a particular improvement qualifies for credit under this subsection.

3. When the construction of a qualified public improvement located in whole or in part or contiguous to the property that is the subject of development approval gives rise to a credit amount greater than the improvement fee that would otherwise be levied against the project, the credit in excess of the improvement fee for the original development project may be applied against the improvement fees that accrue in subsequent phases of the original development project.

4. Credits shall not be transferable from one development to another.

5. Credits shall not be transferable from one type of systems development charge to another. [Ord. 786 § 13, 2001.]

12.35.130 Appeal.

1. A person aggrieved by a decision made by the City Recorder or the City Recorder’s designee under HMC 12.35.040 through 12.35.090, or a person challenging the propriety of an expenditure of systems development charge revenues, may appeal the decision or the expenditure by filing a written request with the City Recorder’s office for consideration by the City Council. Such appeal shall describe with particularity the decision or the expenditure from which the person appeals and shall comply with subsection (3) of this section.

2. An appeal of an expenditure must be filed within two years of the date of the alleged improper expenditures. Appeals of any other decision must be filed within 15 days of the date of the decision.

3. The appeal shall state:

a. The name and address of the appellant;

b. The nature of the determination being appealed;

c. The reason the determination is incorrect; and

d. What the correct determination of the appeal should be. An appellant who fails to file such a statement within the time permitted waives his/her objection, and his/her appeal shall be dismissed.

4. Unless the appellant and the City agree to a longer period, an appeal shall be heard within 35 days of the receipt of the notice of intent to appeal. At least seven days prior to the hearing, the City shall mail notice of the time and location thereof to the appellant.

5. The City Council shall hear and determine the appeal on the basis of the appellant’s written statement and any additional evidence the court deems appropriate. At the hearing the appellant may present written testimony and oral argument personally or by counsel. The rules of evidence as used by courts of law do not apply.

6. The appellant shall carry the burden of proving that the determination being appealed is incorrect and what the correct determination should be.

7. The City Council shall issue a written decision within 35 days after the hearing date.

8. Nothing herein shall alter a person’s right to appeal or to file a petition for a writ of review as provided by State law. [Ord. 906 § 1, 2012; Ord. 786 § 14, 2001.]

12.35.140 Prohibited connection.

No person may connect to the water, sewer, or drainage systems of the City unless the appropriate systems development charge has been paid. [Ord. 786 § 15, 2001.]

12.35.150 Penalty.

Violation of HMC 12.35.080 is punishable by a fine not to exceed $500.00 per day, until the matter is resolved. [Ord. 786 § 16, 2001.]

12.35.160 Severability.

The invalidity of a section or subsection of this chapter shall not affect the validity of the remaining sections or subsections. [Ord. 786 § 17, 2001.]