AUTHORITY TO CREATE INFRASTRUCTURE DEVELOPMENT DISTRICTS
This bill authorizes the governing body of a host municipality of the state to create, by resolution, one or more infrastructure development districts ("district") located in whole or part within the boundaries of such municipality in the manner provided in this bill. Such a district must be approved by the governing body of each host municipality.
INITIATION OF PROCESS TO ESTABLISH DISTRICT
This bill authorizes the establishment of a district to be initiated by a petition filed in the office of the clerk or other officers responsible for keeping the records of the governing body of each host municipality required to approve the establishment of such district, signed by the following:
(1) The developer;
(2) A majority of the owners of real property in the district having an assessed value of not less than two-thirds of the assessed value of all the real property proposed to be included in the district; and
(3) The owners of each parcel of property within the district which is, at the time of the filing of the petition, being assessed as residential property.
After filing such a petition, this bill prohibits a petitioning owner from withdrawing the petitioner's name from the petition. A petition with the requisite signatures is not void on account of formal or insubstantial defects. The governing body of each host municipality, at any time, may permit the petition to be amended to correct any errors in the description of the territory, or in any other particular. Similar petitions for the organization of the same district may be filed, and together must be regarded as one petition with the original. All such petitions filed prior to the hearing on the first petition filed must be considered by the governing body of each of the host municipalities in the same manner as if filed with the first petition placed on file.
This bill requires the initiating petition to set forth (i) the name of the proposed district; (ii) an identification of each host municipality; (iii) a description of the boundaries of the district or the territory to be included in the district, identified with sufficient certainty to enable owners to determine whether their property lies within the district; (iv) a list of each parcel in the district, identified by parcel identification number of the county assessor, with the owner of each parcel and the address of such owner as shown on the property records of the county assessor; (v) a site development plan for the district showing the area in the district that is anticipated to be utilized for residential housing, including owner-occupied housing and rental housing; (vi) the name and address of the developer; (vii) a description of the infrastructure required to develop the district; (viii) a description of the estimated infrastructure costs and an estimate of the cost of the entire development in the district upon completion; (ix) the proposed rate of levy of the special assessment to be imposed; (x) a statement that the petition is filed pursuant to the terms of this bill; and (xi) a request that a district be established pursuant to this bill and that the administration of the district be governed by this bill.
DISTRICT AREA
This bill requires an infrastructure development district created by one or more host municipalities to be composed of not less than five acres or contemplate a capital cost for the development of the district of not less than $5,000,000. The boundaries must not overlap with the boundaries of another district.
This bill requires at least one half of the area in the district to be expected to be used for residential housing, as described in the petition.
This bill authorizes a district created by one or more host municipalities to embrace two or more separate property areas. The jurisdiction of a host municipality to make and provide, finance, and levy assessments for infrastructure costs within a district is not impaired by a lack of commonness, unity, or singleness of the location, purpose or character of the infrastructure, or by the fact that any one or more of the properties included in the district are subsequently determined not to be benefited by such infrastructure, or by a particular portion of the infrastructure, and is not assessed for such infrastructure costs.
This bill clarifies that the creation or existence of a district is not subject to challenge if any of the projections of capital costs, residential use, or other matters contained in the petition are not achieved.
PUBLIC HEARING
Upon the filing of an initiating petition purporting to contain the requisite number of signatures, this bill requires each governing body of a host municipality required to receive filing of such petition to order a public hearing to determine whether the infrastructure development district will be established. When a district must be approved by two or more host municipalities, the governing bodies may hold one or more joint public hearings.
This bill requires a hearing to be held not less than 30 days, nor more than 45 days, following the filing of the initiating petition with the clerk or secretary of the applicable governing body or bodies.
NOTICE
This bill requires notice of the public hearing to be provided to the public by posting the notice in a location where a member of the community may become aware of such notice as well as on a website maintained by the host municipality, if the host municipality has a website. The notice must provide a summary detailing those facts required to be included in the initiating petition, but is not required to set out in full the proposed establishment resolution. The notice must be posted not less than at least 14 days before the governing body convenes for the public hearing. The notice must also be provided by mail to each owner of real property within the proposed district at the address of each such owner as shown in the records of the county assessor or county trustee for providing tax notices.
PUBLIC HEARING PROCEDURE
This bill authorizes all persons whose property may be affected by such improvement to appear at the public hearing in person, by attorney, or by petition and protest against the creation of the district. The governing body must consider the objections and protests, if any, and may change the district boundaries or modify the proposal in such manner as may be deemed advisable by the governing body.
This bill requires, at the conclusion of the public hearing, each applicable governing body to adopt, adopt as amended, or reject the organization of the proposed district by the adoption or rejection of a resolution setting out the district. In host municipalities requiring two or more readings before passage of a resolution due to local charter or ordinance requirements, all required readings must be held prior to the public hearing, except the final reading, so that the adoption may take place at the conclusion of the public hearing.
This bill provides that a person who fails to file a protest, or who fails to appear at the public hearing or protest, or, having filed a protest, withdraws the protest, is deemed to have waived any objection to the creation of the district, the making of the improvements, and the inclusion of the person's property in the district.
This bill provides that a district must only be established by resolution passed by a majority vote of the members of the governing body present and voting upon conclusion of the public hearing procedure as set forth in this bill. In the event two or more host municipalities are required to approve the establishment of an infrastructure development district, and the establishment resolutions adopted by the governing bodies of such municipalities vary in any material respect, then the establishment resolutions do not go into effect until one or more of the governing bodies adopts amendatory resolutions sufficient to cause the establishment resolutions to be consistent in all material respects.
ESTABLISHMENT RESOLUTIONS
This bill requires the establishment resolution adopted by the governing body of the municipality to include (i) the name of the district as set forth in the original or amended initiating petition; (ii) an identification of each host municipality; (iii) a description of the boundaries of the district as set out in the original or amended initiating petition; (iv) a statement that the properties in the area established by the resolution must be subject to the special assessment; (v) the name and address of the developer; (vi) a statement of the infrastructure and infrastructure costs authorized to be funded with special assessment revenues within the district; (vii) the rate of levy of the special assessment to be imposed; (viii) the time and manner in which special assessments authorized by the resolution must be paid; (ix) the portion of special assessments to be retained by the host municipality for the payment of administrative expenses, as described in this bill; and (x) a statement that the district is established pursuant to this bill and that the administration of such district is governed by this bill.
BONDS, NOTES, AND OTHER OBLIGATIONS
This bill provides that a host municipality has the authority and power to borrow money and issue bonds, notes, or other obligations for the purpose of paying infrastructure costs identified in the establishment resolution, reimbursing the developer for the prior payment of infrastructure costs, or refunding or refinancing such bonds, notes, or obligations, under and pursuant to all the procedures and requirements set forth in the Local Government Public Obligations Act of 1986. A host municipality is further authorized to do the following:
(1) Pledge to the payment of the principal, premium, and interest on the bonds, notes, or other obligations, and use for the payment of the bonds, notes, or other obligations the special assessment revenues authorized to be collected by the host municipality in the same manner as revenues may be pledged pursuant to the Local Government Public Obligations Act of 1986;
(2) Delegate to an industrial development corporation incorporated by the host municipality or another host municipality for the district the authority to issue the revenue bonds, in which case such host municipality must enter into an agreement with the industrial development corporation pursuant to which the host municipality agrees to promptly pay to the industrial development corporation the assessments, including any interest on the assessments, as collected. The assessments must be held in trust by the host municipality for the benefit of the industrial development corporation when received. The host municipality may direct any property owner that is required to pay assessments to make the payments directly to an industrial development corporation or its assignee. If an industrial development corporation issues such bonds, then the assessments, and any interest collected on the assessments, constitutes "revenues" and the infrastructure financed thereby, whether transferred to the industrial development corporation on behalf of the host municipality, to the host municipality itself, or to another governmental entity or provider of public utilities, constitutes a project; and
(3) Delegate to a public building authority the authority to issue the revenue bonds, in which case the host municipality must enter into an agreement with the public building authority pursuant to which the host municipality agrees to promptly pay to the public building authority the assessments, including any interest on the assessments, collected. The assessments must be held in trust by the host municipality for the benefit of the public building authority when received. The host municipality may direct a property owner that is required to pay an assessment to make the payment directly to a public building authority or its assignee. If a public building authority issues such bonds, then the assessments, and any interest collected on the assessments, constitutes "revenues," and public facilities and related expenses described in this bill, whether transferred to the public building authority on behalf of the host municipality, to the host municipality itself, or to another governmental entity or provider of public utilities constitutes a project.
Additionally, this bill authorizes a host municipality, industrial development corporation, or public building authority, as the case may be, to do the following:
(1) Refund or refinance or otherwise cause the refunding or refinancing of any bonds or other obligations issued pursuant to this bill in the manner provided in the Local Government Public Obligations Act of 1986, the Public Building Authorities Act of 1971, or the law regarding industrial developmental corporations, as applicable. Without limiting this provision, a host municipality may refund or refinance any bonds or loan agreements secured by the full faith and credit of the municipality and revenues received from assessments with bonds or a loan agreement secured only by such revenues. Upon any such refunding, the amount of assessment payments may be adjusted pursuant to policies approved by the host municipality; however, the assessment rate must not exceed that set forth in the establishment resolution; and
(2) Make the proceeds of bonds, except any bonds secured by the full faith and credit and taxing power of a municipality, issued pursuant to this bill available to a developer pursuant to one or more loan agreements, and to assign or pledge the host municipality's rights under the loan agreement to the holders of the bonds.
SPECIAL ASSESSMENTS
Upon the filing of a petition in the manner required by this bill and the adoption of an establishment resolution that satisfies this bill, this bill authorizes each host municipality to levy special assessments against all properties located within that portion of the infrastructure development district lying within the boundaries of such host municipality. When a portion of an infrastructure development district lies within the boundaries of more than one host municipality, only one of the host municipalities may levy special assessments in the area, and the identification of the host municipality responsible for levying assessments for the area must be identified in the establishing resolution. The proceeds of the special assessments must be applied to the cost of all infrastructure costs and expenses of making public improvements within the district.
This bill requires special assessments proceeds in excess of the amounts needed for the foregoing to be applied to the defeasance or prepayment of any bonds, notes, or other obligations issued as provided in this bill, and upon the payment of such bonds, notes, or other obligations, any remaining special assessment proceeds may be retained by the host municipality. Special assessments must be levied on an assessed value basis, in the amount set forth in the establishment resolution. An establishment resolution may provide that a total of up to 5 percent of special assessments may be set aside for administrative expenses.
However, this bill prohibits a special assessment from being levied on government-owned property without the approval of the governing body of the applicable governmental entity.
ASSESSMENT ROLE
After all assessments have been determined, this bill requires the host municipality to prepare an assessment roll that shows the location of the property and the owner of the property as shown in the records of the assessor and the amount of the assessment. The assessment roll must be updated whenever a parcel within the district is subdivided. The host municipality may include the projected cost of maintaining the assessment roll in the special assessment.
ADMINISTRATION OF ASSESSMENTS
This bill authorizes the governing body of a host municipality to adopt policies and procedures that the governing body deems appropriate to administer assessments imposed under this bill. The policies and procedures may also address the reapportionment of assessments upon the request of property owners, reallocation of assessments upon subdivision of property, credits against assessment payments based upon other available funds, including earnings on reserve funds, maintenance of an assessment roll, and procedures for the prepayment of assessments.
This bill authorizes a host municipality to levy a maximum assessment under this bill based upon the estimated costs of the infrastructure and other permitted costs being assessed, and, in such case, the amount of the assessment must be reduced by the host municipality once the actual costs are established by the host municipality. The host municipality may provide that such assessments may become effective at different periods of time to take into account when the costs being assessed will be incurred. The governing body of the host municipality may also provide that assessments must only be effective upon any issuance of bonds, notes, or other obligations imposed or incurred pursuant to this bill.
As long as a district remains in existence, this bill requires the host municipality to maintain a record of the general description of the boundaries of such district and the rate of assessment for properties within such district. The record must be made publicly available in substantially the same manner as ad valorem property tax rates.
LIENS
This bill provides that an assessment, any interest accruing on the assessment, and the costs of collection of the assessment constitutes a lien on and against the property upon which the assessment is levied as of the effective date of the resolution levying the assessment. The lien is superior to a lien of any trust deed, mortgage, mechanic's or material supplier's lien, or other encumbrance, except a lien of the state, county, or municipality for taxes.
This bill prohibits amounts collected by the host municipality from being allocated to the payment of a special assessment by an owner in the district until all taxes, penalties, and interest relating to real property taxes imposed by any governmental entity with the power of taxation have been paid in full.
This bill authorizes the host municipality to allocate any payment received by an owner that is designated to pay special assessments to the payment of taxes, penalties, and interest until such amounts are paid in full. Otherwise, a host municipality must collect and enforce special assessments in a district in the same manner as the collection and enforcement of real property taxes.
DELINQUENT ASSESSMENTS
This bill provides that if any assessment is or becomes delinquent and the property subject to the delinquency has been or is to be sold to the host municipality for the delinquency, then redemption of such property is permitted upon payment, not later than one year after the date of sale, of the full amount due, plus interest, any taxes paid by the host municipality, and accrued costs and redemption fees as may be prescribed by resolution of the host municipality, unless, in the judgment of the governing body of the municipality, the interest of the host municipality is served by accepting a lesser sum in settlement for the delinquency.
INTEREST AND PENALTIES
In case of failure to pay an assessment or instal