Chapter 3.12
LOCAL IMPROVEMENT DISTRICT ASSESSMENTS – GUARANTY FUND

Sections:

3.12.010    Administration of LID and ULID proceedings.

3.12.020    LID and ULID petitions to be filed with city clerk.

3.12.030    Officer designated to make preliminary estimates.

3.12.040    Penalty for delinquent assessments and installments.

3.12.050    Commencement of foreclosure proceedings.

3.12.060    Acceleration of installments.

3.12.070    Maintenance and operation of the guaranty fund – General.

3.12.080    Minimum balance prescribed for the guaranty fund.

3.12.090    Use of guaranty fund to pay local improvement district obligations.

3.12.100    Use of guaranty fund to pay arbitrage rebate.

3.12.110    Ratification.

3.12.120    Extension of due date(s) for installments.

3.12.010 Administration of LID and ULID proceedings.

The city shall administer and prosecute all proceedings related to its local improvement districts and utility local improvement districts in substantial compliance with the laws of the state of Washington, including Chapters 35.43 through 35.54 RCW, as the same may be amended from time to time. No city action taken in substantial compliance with then-applicable state statutes ever shall be invalidated for failure to comply with any provision of this chapter. (Ord. 1424 § 2, 1999).

3.12.020 LID and ULID petitions to be filed with city clerk.

Any petitions required by Chapter 35.43 RCW (or any successor statutes) to be filed with the city to initiate the formation of a local improvement district or utility local improvement district shall be filed with the city clerk (or such city officer who may hereafter assume the duties of the city clerk). (Ord. 1424 § 3, 1999).

3.12.030 Officer designated to make preliminary estimates.

The city administrator is designated as the city’s officer responsible for taking, or causing to be taken, such actions as are required to be taken by RCW 35.43.130, as such statute may be amended from time to time. (Ord. 1424 § 4, 1999).

3.12.040 Penalty for delinquent assessments and installments.

Each assessment or installment thereof that is collected by the city pursuant to Chapter 35.49 RCW shall be subject, at the time of delinquency, to a charge of 12 percent penalty levied on both principal and interest due upon that installment. Notwithstanding the foregoing, the city may, by ordinance, waive or reduce the penalty on any delinquent installment to the extent the city council determines the delinquency may have been caused by an error on the city’s behalf (e.g., a delinquency resulting from an inadvertent understatement by the city of the amount owed on account of an installment). (Ord. 1540 § 1, 2003; Ord. 1424 § 5, 1999).

3.12.050 Commencement of foreclosure proceedings.

All assessment lien foreclosure proceedings initiated by the city under Chapter 35.50 RCW shall be commenced for purposes of RCW 35.50.030 on or before October 1st of each year; provided, any delay in commencing an assessment lien foreclosure proceeding beyond October 1st in any given year shall not preclude the city from commencing such proceeding on any date thereafter, and for purposes of RCW 35.50.030, such later date shall be deemed to be the other date fixed by general ordinance pursuant to RCW 35.50.030. (Ord. 1540 § 2, 2003; Ord. 1424 § 6, 1999).

3.12.060 Acceleration of installments.

Upon the failure to pay the city any installment of a local improvement district assessment, when due, the entire assessment shall be due and payable as of the date of such delinquency, and the collection thereof enforced by foreclosure pursuant to Chapter 35.50 RCW. (Ord. 1424 § 7, 1999).

3.12.070 Maintenance and operation of the guaranty fund – General.

The city shall maintain and operate its guaranty fund in accordance with the laws contained in Chapter 35.54 RCW and such other laws that specifically or generally apply to the guaranty fund or obligations secured thereby, as the same may be amended from time to time. Obligations guaranteed by the guaranty fund shall include, in addition to those obligations referred to in Chapter 35.54 RCW, obligations issued under Chapter 39.50 RCW in anticipation of the issuance of local improvement district bonds. (Ord. 1424 § 8, 1999).

3.12.080 Minimum balance prescribed for the guaranty fund.

The city shall maintain a balance in the guaranty fund during each calendar year that is at least equal to the interest scheduled to come due on all outstanding obligations guaranteed by the guaranty fund during the following calendar year. Notwithstanding the foregoing, the city council may, with respect to the obligations issued on account of any local improvement district, require by ordinance that the minimum balance in the guaranty fund on account of such obligations be greater than is otherwise required by the preceding sentence. (Ord. 1424 § 9, 1999).

3.12.090 Use of guaranty fund to pay local improvement district obligations.

If, prior to an interest payment date of obligations secured by the guaranty fund, the finance director (or other city official then responsible for overseeing the city’s funds and accounts) determines that there is insufficient money in the local improvement fund or other fund or account established to pay debt service on those obligations to pay the interest or principal and interest scheduled to come due on that interest payment date, then the finance director (or other city official then responsible for overseeing the city’s funds and accounts) shall withdraw from the guaranty fund and apply an amount sufficient to pay that deficiency on that interest payment date. To the extent the amount available in the guaranty fund on such interest payment date is not sufficient to cure the deficiency, the finance director (or other city official then responsible for overseeing the city’s funds and accounts) shall issue interest bearing warrants drawn on the guaranty fund as prescribed by statute. This section is intended to supplement Chapter 35.54 RCW and to prevent defaults in the payment of obligations secured by the guaranty fund. (Ord. 1604 § 1, 2005; Ord. 1424 § 10, 1999).

3.12.100 Use of guaranty fund to pay arbitrage rebate.

To the extent that the city is required by Section 148 of the Internal Revenue Code of 1986, as amended, or any successor federal law, to make arbitrage rebate payments to the U.S. Treasury on account of the investment of the guaranty fund, such payments may be made from amounts on deposit in the guaranty fund. The city may establish subaccounts within the guaranty fund from time to time, if necessary or desirable for purposes of accounting for the investment of money therein. (Ord. 1424 § 11, 1999).

3.12.110 Ratification.

All acts heretofore taken by the city in connection with the formation of its local improvement districts and utility local improvement districts, the levying, collection and enforcement of special assessments therein, and the operation and maintenance of the guaranty fund, are ratified and approved. (Ord. 1424 § 12, 1999).

3.12.120 Extension of due date(s) for installments.

Pursuant to RCW 35.49.020, the city shall provide by ordinance the annual due date for assessment installments. If, during the course of administering the collection of such installments, the city makes an error (e.g., an inadvertent understatement by the city of the amount owed on account of an installment) in the process of collecting such installments, the city may extend one or more installment due dates so long as the city council finds that the rights of bondholders will not be adversely affected by such extensions. The city shall provide for such extensions by ordinance. (Ord. 1540 § 3, 2003).