Resolution No. 85-37 CITY OF TI:GARD, OREGON
RESOLUTION NO, 85--J_
A RESOLUTION OF THE TIGARD CITY COUNCIL ADOPTING LOCAL IMPROVEMENT DISTRICT
POLICY AND PROCEDURES.
WHEREAS, the Tigard City Council wishes to adopt policy and procedures to
clarify, and keep consistent, the Local Improvement District process used in
the City of Tigard.
NOW, THEREFORE, eE IT RESOLVED by the Tigard City Council that:
The Local Improvement District Policy & Procedure Report, as revised
on 5/6/85 and attached as Exhibit "A", is hereby adopted.
Thestaff is hereby directed to prepare the necessary Code
amendments for adoption to implement the Local Improvement District
policy and procedures attached.
PASSED: This _a0f).N day of /ks r� 1985.
or City of Tigard
ATTEST* P \i
Deputy City Recorder — City of Tigard
RESOLUTION NO. 85-3
lw/2 781 A
b
LOCAL IMPROVEMENT DISTRICT
POLICY AND PROCEDURE REPORT
Adopted 5/20/85 ��
Resolution No. 85-37
TABLE OF CONTENTS
Page
Introduction 1
O. General Policy Intent a
1. Initiation 9
2. Feasibility 13
Formrition 19
4. Improvement; 23
5. Assessment 27
6. Finance and Closure 32
Appendix 38
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LIST OF TABLES
Page
Table 1 The LID process summary: definition, 7
lead responsibility and 'key docision
for each stage.
Table 2 The LID process: Major actions, products 8
and decisions,
Table 3 hey completion .dates for different types 17
of projects.
Table 4 Types of assessments, when and how 29
they occur in the process
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LOCAL IMPROVEMENT DISTRICT
.POLICY AND PROCEDURE REPORT
The city should efficiently and effectively process proposed and established
LID projects by adopting standardized procedures and guidelines, keeping in
mind the needs and interests of current and future users of the service system.
INTRODUCTION
In the past the City of Tigard has allowed Local Improvement Districts (LID's)
to form for the multiple purposes of (1) constructing localized capital
improvement projects to the city's standards, (2) providing to the owners of
the benefited property a method For Financing the costs through special
assessments, and (3) controlling the construction so the city is better able
to operate and maintain the system. The mandated requirement: and process
guidelines currently used by the city for the entire process are listed below:
o ORS 223.005-223.020: Condemnation, fo-r City Improvements; Special
Procedure
o ORS 223.105: Municipal Condemnation Proceedings
o ORS 223.205-223.295: Financing Improvements in Cities (BancroFt
Bonding Act)
o ORS 223.387-223.401: Assessments for Local Improvements
o ORS 223.405-223,485: Reassessment
o ORS 223.505-223.650: Methods of Enforcing Liens and Collecting
Assessments
o ORS 223.705: Financing of City Improvements; Rebonding;
Reinstatement; Type of Bonds Accepted in Payment of City Liens;
Assessment of Public Property
o ORS 287: Borrowing and Bonds of Local Government
o ORS 288.520: Public Body Issuing Bonds; Interest; Discount; Terms of
Redemption; Maximum Interest Rate for State Bonds
o TMC Chapter 13: Local Improvements
o Local Contract Review Board Rules
Some of these sections of legislation are basic minimum requirements. The
state statutes provide for a wide range of differences across cities, and in
many cases the application of policies may differ across LID's within a city.
This is partially due to the many variables which may ur may not be present in
any proposed project, and partly due to vague policies which allow flexibility
in the process.
The city is now in a position where some policies can and should become more
specific. ProblEms in the areas of project design, project control, cash
flow, and citizen involvement have led to a s'udy of these policies and
procedures. The goal of this effort is to estaulish effective and efficient
LID policies and procedures for the city which will promote desired
development and also ensure the protection of the city's future fiscal
resources.
Within the context of the city as a whole, the LTD Policy fits with Council's
goals in addition to the Financial issues facing the city at this time and the
city's long-range plans. The LID Policy has been a goal since the increased
LID activity in 1982. Other related goals since 1982 include the
Comprehensive Land Use Plan, Capital Improvements Plan, other capita! project
plans and a long-range Financial plan, The fiscal condition of the special
assessment fund has been of major interest and it is being monitored closely.
The LID Policy needs to be compatible with the various community development
plans in that approval of an improvement needs to be in agreement with
relevant plans or else tha plan should be revised. Otherwise only the
procedures need to be coordinated.
LID POLICY AND PROCEDURES -- (5/2/85). PAGE 1
This report is organized into seven sections or areas of policy, the first
covering basic policy issues which are not specific to any one stage of the
process. The remaining sections are for the six "stages" of the LID process.
Each section is introduced with the intent of the city within the policy area,
followed by a brief narrative on the policy area and current practices. Next
is at listing of "Findings", including facts and statements on what sometimes
i occurs either in Tigard or in other cities with similar policies. The
"Policy" statements are then given along with "Key Administrative Actions".
"Implementation Strategies", which completes the section, further define the
policy and give a pian or direction for administering the policy as proposed.
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LID POLICY AND PROCEDURES — (5/2/85). PAGE 2
in
O. LID GENERAL POLICY INTENT
LID POLICY AND PROCEDURES - (5/2/85). PAGE 3
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0.0 LID GENERAL POLICY INTENT the city should efficiently and
effectively process proposed and established LID projects by adopting
standardized procedures and guidelines, keeping in mind the needs and
interests of current and future users of the service system.
A Local Improvement District or LID is a means to improve a defined land area
with city services to the quality levels set by the city. The process
includes both construction and financing and involves property owners, city
staff and Council, financial institutions, and various private contractors.
Alternative methods for local capital improvements are �ovailable to property
owners, but 1_I0s have been a service provided by the city.
In the past the primary reason for the city to form an LID has been to provide
the homeowner in a developed area an opportunity to finance the costs for
public improvements which specially benefit the property. Some districts are
formed because they promote economic development or else the improvements
complete portions of an adopted city plan. The third type of district which
has been contemplated by Council in the past is one in an undeveloped
residential area. A fourth type of district which has not been pursued in the
past but is a special case is one formed as an emergency. The advantages to
the property owners include the city's coordination efforts with surrounding
property owners, the assurance that construction plans are consistent with
city standards, the opportunity to share costs with other property owners
according to special benefit to the property, the use of the city's expertise
in capital construction projects, and the option to finance costs through the
to all property owners, for instance some
city. Not all reasons «pply .-p �
property owners may be seeking to form a district only for the financing
option.
The LID process begins with a need for a local capital improvement. If a
project is constructed the process does not end until 'ten or more years later
when all finances are cleared. The efficient administration of the process
depends upon the timely coordination of many activities and people.
Effectiveness includes both the quality and "smoothness" of the process and is
provided by a just and reasonable review of proposed projects, by r_onstructinr
the improvement according to previously accepted standards, by carefully
docuruenting the process, and by insuring the protection of both the city's
future fiscal resources and future citizens. Effectiveness is more concerned
with minimizing the long-term costs for operating, maintaining, and replacing
the system, and the involvement of the various people. The successful
completion of a project depends upon the cooperation of the current and future
owners of the benefited property. The city intends to maximize citizen input
at the right times in the decision making process, balancing it with the
long-term needs of the community.
0.1 FINDINGS
0.1.1 It is tc the city's advantage to facilitate the process by
controlling the types and quality of the improvements.
0.1.2 In the past, public use of private facilities has been a problem
for the city. Similar problems exist with private reimbursement
contracts for private constrcction of public facilities.
k
LID POLICY AND PROCEDURES — (5/2085). PAGE 4
0.1.3 The timing of both construction and band sales is critical,
therefore control by minimizing delays is needed in addition to
minimizing decision points and requirements.
0.1.4 Decisions are sometimes delayed due to the lack of some required
information, thereby causing inefficiencies in the use of
Council's time and inconveniences by delaying actual construction
into the late fail and winter months.
0.1.5 Inconsistencies due to delayed decisions or misunderstandings have
tended to increase conflicts in a process which needs consensus
building.
0.1.6 Policy indecision at any one point in the process, leads to the
development of dual or multiple policy proposals, creating
inefficiencies due to increased staff time, increased
vulnerability for Council, and confusion for the citizens involved.
0.1.7 It is very important that the city keep the files and documents
current at each step in the procass.
0.1.8 The ORS requires at least one public hearing with notices during
tho normal process and two opportunities to object; the first is
on the formation of the district, and the second is on the
spreading of the assessments.
0.1.9 Informal meetings with property owners at various times during the
process have been beneficial,
i} 0.2 LID GENERAL POLICY
0.2.1 THE ..-ITY SHALL ADOPT A SET OF POLICIES WHICH CLEARLY REQUIP,E
CERTAIN KEY DECISIONS BY COUNCIL AT SPECIFIC POINTS IN THE
PROCESS, THEREBY INCREASING THE EFFICIENCY OF THE PROCESS.
0. .2 THE CITY SHALL REQUIRE CERTAIN DOCUMENTS DURING EACH STAGE IN
PREPARATION OF THE KEY DECISION, THE ^7TNIMUM BEING THAT MANDATED
IN THE ORS.
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0.2.3 THE CITY'S POLICIES SHALL CONSIDER THE LONG TERM INTERESTS OF THE
COMMUNITY, AND DECISIONS CONTRARY TO ADOPTED POLICY SHALL DEPEND
UPON COUNCIL CHANGING ADOPTED POLICIES AND STANDARDS.
0.2.4. THE CITY'S POLICIES SHALL REFLECT THE VARYING GE11REF_S OF
ADV4NTAGES AND DISADVANTAGES TO FORMING AN LID.
0.3 HEY ADP"IINISTRATIV£ ACTIONS
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0.3.1 For each stage of the process a single person will be responsible
For coordinating activities and monitoring the process.
0.3.2 If conditions in a specific proposed project or district are
unusual, staff shall advise council of the circumstances, the e
potential impacts and how these relate to policies and past
practices.
LID POLICY AND PROCEDURES — (5/2/85). PAGE 5 1
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0.3.3 Within the service level set by Council, staff will attempt to
increase the common understanding of the process by disseminating
materials and letters, and by attending informal meetings.
0,3.4 Proposals for forming an LID will be considered in terms of the
overall advantages and disadvantages for the specific type of
proposed project.
0.4 IMPLEMENTATION STRATEGIES
0.4.1 The LID process will be outlined as consisting of a series of
stages, each of which requires a key decision which must be made
before proceeding to the next stage. The stages and the key
decisions are shown in Table 1.
0.4.2 An outline of the normal process showing the requirad actions and
reports for each stage shall be a guide for monitoring the process
of each LID. The major requirements for each stage as proposed in
this report are shown in Table 2. This same information in the
form of a flow chart is given on each of the remaining divider
pages.
0,4.3 One person will be designated as having lead responsibility for
each stage which includes responsibility fc:r coordinating the
various activities, monitoring the process, and preparing status
reports. The department which will have the lead responsibility
is shown on Table 1.
0,4.4 Wherever possible, the LID process will separate LID proposals
into general categories which will have varying requirements,
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LID POLICY AND PROCEDURES (512185). PAGE 6
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1, INITIATION
i
Citizens/ Indication of
Property Interest
Owners Informal Meeting
with Staff
i
Staff Informal Meeting
with property
owners
LID Interest
Petition
Key Administrative Preliminary
Actions Evaluation
Report by
Staff
Key Decision Resolution
Directing Staff to
Prepare the
Preliminary
Engineer's Report
FEASIBILITY
Documents LID Interest
Petition
Dreliminary
Evaluation Report
Resolution to
Prepare
Letter informing
t,
NPO of status
LID POLICY AND PROCEDURES — (502!85). PAGE 9
1.0 INITIATION POLICY INTENT the city should have a set of eligibility
requirements for prospective projects and guidelines for setting the
parameters.
The key decision for the Initiation Stage is a resolution to prepare,
directing staff to prepare the Preliminary Engineer's Report. For efficiency,
the information required in this stage must be sufficient for this decision
and also provide adequate guidance for, the next stage. For effectiveness, the
process must consider the expectations of the current property owners. The
information shared at this poin-� is a foundation for the entire process.
Currently interest is usually expressed by a petition (a copy is provided in
the Appendix). The basic plan is discussed with staff who then advises the
property owner(s) of city policies and procedures. Staff then meets
informally with the property owners to answer questions on LIDS and on their
proposal. Once there is general consensus among staff and property owners to
proceed, the petition is presented to Council by staff Por a decision of
whether or root to further study the proposal..
1.1 FINDINGS
t
1.1.1 The ORS allows a wide range of improvements, providing the city
the authority todecide on eligibility requirements. Section if
of ORS 223.397 states "any other local improvement for which an
assessment may be made on the property specially benefited".
1.1.2 The successful completion of projects depends upon physical,
economic, and political factors. Some proposals are immediately
known to not be feasible at this point in time.
1.1.3 The current petition serves as an indication of general interest
to further study the proposed project, however the language on the
petition may appear 'to some as being a greater commitment on the
part of the property owner.
1.1.4 Sometimes the petition is misinterpreted to mean those signing
will support the formation of the district, which is difficult to
assume before the district is better defined.
1.1.5 Often the only information a property owner receives is that given
by neighbors which may not be accurate. This sets false
expectations which may later create problems.
1.1.6 The boundaries of the proposed project follow only general
guidelines, with variations often made depending upon the
city-wide plans, citizen interest and political factors. This
sometimes slows or stops the process, and is therefore inefficient.
1.1.7 During the beginning stages there are often different opinions
about which improvements to include in the LID, e.g
may also include sidewalks, lighting, etc.
LID POLICY AND PROCEDURES — (5/2/85). PAGE 10
mo®
1.1.8 The NPO or the general citizenry is sometimes unaware of the
potential change.
1.1.9 There is no rigid guideline on when a petition is brought to
Council.
1,2 INITIATION POLICY
1.2.1 THE CITY SHALL NOT PROCEED TO THE FEASIBILITY STAGE AND THE
PREPARATION OF THE PRELIMINARY ENGINEER'S REPORT UNTIL THE
FOLLOWING IS COMPLETED:
(A) PROPERTY OWNERS ARE ADVISED OF POLICIES AND PROCEDURES,
(B) PROPERTY OWNERS INT'ERES'TED IN PROCEEDING HOLD MORE THAN
FIFTY PERCENT OF THE PROPERTY ESTIMATED TO BE BENEFITED,
(C) STAFF PREPARES A PRELIMINARY EVALUATION OF THE PROPOSAL,
(D) COUNCIL PASSES A RESOLUTION TO PREPARE DIRECTING STAFF To
PREPARE THE PRELIMINARY ENGINEER'S REPORT.
..� KEY ADMINISTRATIVE ACTIONS
1.3.1 A person from the Community Development Department is designated
as having lead responsibility,
1.3.2 The interest petition shall indicate only an interest in
possibly forming an LID.
1.3.3 An LID information meeting shall be held with staff where the
interest petition can be updated.
f
1.3,4 When defining the improvements to be included in the LID, staff
will include everything as defined by City plans in the defined
area which will avoid future reconstruction when adding standard
services.
1.3.5 After staff meets with the property owners and sufficient
interest is filed, staff will prepare a Preliminary Evaluation
outlining the general scope of the projeci and the interest
expressed. Staff then forwards the LID proposal to Council. A
decision not to forward is based upon city standards.
1.3.6 Staff will determine, and report to Council in their Preliminary
Evaluation, whether to forward the petition to Council using the
following guidelines for when it should not be forwarded:
(a) improper design
(b) unreasonable operating costs
(c) unreasonable maintenance costs
(d) inappropriate boundaries
(e) not in the best interests of the city at this time
(f) insufficient interest is expressed by property owners
1.3.7 The Preliminary Evaluation by staff will inc.ude a
recommendation on whether or not to proceed with the next stage
based on the general nature and timing of the project.
LID POLICY AND PROCEDURES (512/85), PAGE 11
1.4 IMPLEMENTATION STRATEGIES
1.4.1 To improve effectiveness at this stage, staff will prepare
general information materials on LIDs to distribute to
interested citizens and will meet informally with property
owners to discuss this information and its relationship to 'the
proposed project.
1.4.2 To avoid confusion on the intent and purpose of the petition, it
will be revised. The new version will be standardized, to be
used in all proposed projects.
1.4.3 More extensive research, and therefore costs, are necessary to
make a determination on the feasibility or eligibility of the
project. Therefore more specific eligibility guidelines are
given in the next stage, Feasibility.
1.4.4 Prior to the proposal being forwarded to Council in Feasibility
stage 2, staff will include a copy of the proposal to the
appropriate NPO chairperson for their next meeting, inviting
written or oral comments from the NPO.
LID POLICY AND PROCEDURES — X5/13/95). PAGE 12
2. FEASIBILITY
INITIATION
Citizens/ May have to
Property pay fee for the
Owners Preliminary
Engineer's Report
i
i
Staff Prepare the Pre—
liminary Engineer's
Report
Send status letter
to property owners
and appropriate NPO
Ny
Key Administrative Priority Ranking
Actions by Staff
t
i
Key Decision Resolution
of Intent and
setting the date
for the Public
Hearing
FORMATION
Documents Draft of
Preliminary
Engineer's Report
Status Letter
Resolution of
a, Intent
LID POLICY AND PROCEDURES — (5/2/85). PAGE: 13
a
2.0 FEASIBILITY POLICY INTENT the city should gather the information
necessary in order to determine the priority of the proposed project and
to define the city's tentative description of the entire project.
The key decision For the Feasibility Stage is a resolution of intent to fo•m
the district and to set a date for a public hearing. Again, the processing �f
information is the primary factor for efficiency. In addition, recent changes
in the bond registration costs and the construction limitations posed by the
weather can increase both time and Financial costs if not handled
efficiently. Effectiveness can be increased if staff is sensitive to the
interests of the property owners, yet not swayed from the accepted city
policies, standards, and practices.
Currently the Preliminary Engineer's Report is either prepared in–house or
staff supervises a consultant. On nearly all projects, engineering, costs are
covered by city–funds until the spreading of assessments. The costs for the
engineering study are then included in the total cost of the project.
Typically the engineering study concentrates on the physical aspects of the
proposed project.
Decisions on the eligibility of the project have been guided by the general
practice of discouraging proposed projects Formed for, the improvement of raw
or undeveloped land. Highest priority is for improvements in an established
residential area where the improvements are to upgrade to standards for
increased capacity or to replace services which are no longer satisfactory.
2.1 Findings
2.1.1 The casts associated with financing are minimized if multiple LIDs
are processed together instead of separately.
2.1.2 Slow economic times have increased the chances for defaults by
individual property owners, creating a possible cash -Flow problem
for the city. The risk increases if the future payments rely upon
future saps of newly developed land. (see Springfield article in.
the Appendix)
2.1.3 The potential economic return to the community from an LID
requires a certain amount of risk.
2.1.4 More information is needed in the Preliminary Engineer's Report on
the financial feasibility in tarns of the city's ability to
finance the project.
2.1.5 In general, the City's financial participation in an LTD has been
for oversizing and extra–capacity and varies due to the fund
balances in the appropriate funds. This level of city
participation has therefore varied.
2.1.6 The costs for this stage are paid from the city's operating funds
until the spreading of assessments. This impacts only the city's
cash flow, however if the district never forms, it is a financial
loss in the operating fund.
LID POLICY AND PROCEDURES — (5/13/85). PAGE 14
2.1.7 The Preliminary Engineer's Reports, if done by consultants, do
not use the same format, creating problems and added expense
later in the project.
2.1.8 When consultants are used by staff, the consultants are
indirectly accountable to Council through intervention by staff;
staff has a more indirect control and is t`,erefore more
vulnerable.
2.1.9 The limit on city indebtedness set by the state in ORS
223.295(1) _s "A city may incur indebtedness in the form of
bonds and other obligations by virtue of the Bancroft Bonding
Act to an amount which, exclusive of indebtedness for municipal
utilities but inclusive of all other indebtedness of the city,
shall not exceed .09 (9%) of the latest true cash valuation of
the city. Regardless of the above limitation, a city may issue
bonds under said Act in an amount not exceeding .03 (3%) of the
latest true cash valuation of the city." The legislature is now
considering revising the limitation.
2.1.10 In the past, the City has been reluctant to form LID's for
unimproved, raw land since it aides a business venture which
also can place additional long—term risks on the City. The City
has much less hesitation for developed, residential area
improvement. Proposed districts in the category of economic
development have given Council the greatest difficulty in
determining a policy.
2.1.11 There are three basic methods for calculating benefit which may
be used solely or in combination. These are:
a. By area, i.e, by lot, square footage, dwelling units,
equivalent dwelling units, etc.
b. By zones or zonal, i.e. the band of area closest to the
improvement benefits more than the band(s) further away.
C. By Frontage, i.e. front footage.
2.2 FEASIBILITY POLICY
2.2.1 THE CITY SHALL NOT PROCEED TO THE FORMATION STAGE AND THE PUBLIC
HEARING UNTIL ACCEPTING THE PRELIMINARY ENGINEER'S REPORT AND
PASSING THE RESOLUTION OF INTENT TO FORM THE DISTRICT AND
SETTING THE DATE FOR THE PUBLIC HEARING.
t
LID POLICY AND PROCEDURES — (5/2/85). PAGE 15
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2.2.2 ELIGIBILITY REQUIREMENTS FOR LIDS SHALL DEPEND UPON THE USE OF
THE LAND:
(a) IF THE PROPOSED DISTRICT IS IN A DEVELOPED AREA WITH LESS
THAN FULL TO STANDARD SYSTEMS, ELIGIBLE PUBLIC IMPROVEMENTS
SHALL BE FOR THE PURPOSE OF UPGRADING THE SERVICE(S) TO THE
PROPERTY OR SURROUNDING AREA AND SHALL INCLUDE:
(1) THE CONSTR'1CTION OR RECONSTRUCTION OF SEWERS, STREETS,
STORM DRAINS, SIDEWALKS, AND/OR ANY OFF-STREET MOTOR.
VEHICLE PARKING FACILITY;
(2) THE INSTALLATION OF STREET LIGHTS;
(3) THE UNDERGROUNDING OF OVERHEAD UTILITIES;
(4) THE MAINTENANCE OF NEIGHBORHOOD PARKS.
(5) OTHER IMPROVEMENTS MAY BE CONSIDERED ONLY IF THEY
SUPPLEMENT THE LID PROJECT.
(b) IF THE PROPOSED DISTRICT IS IN AN UNDEVELOPED COMMERCIAL
AND/OR INDUSTRIAL AREA, ELIGIBLE PROJECTS SHALL BE:
(1) FOR THE PURPOSE OF COMPLETING ELEMENTS OF' AN ADOPTED
CITY PLAN, OR
(2) TO ENCOURAGE ECONOMIC DEVELOPMENT AND SHALL_ INCLUDE
THE CONSTRUCTION TO COMPLETE THE SEWERS, STREETS,
SIDEWALKS, AND STORM DRAINS.
(3) OTHER IMPROVEMENTS MAY BE CONSIDERED ONLY IF THEY
SUPPLEMENT THE LID PROJECT.
(c) IF THE PROPOSED DISTRICT IS IN AN UNDEVELOPED RESIDENTIAL
AREA ELIGIBLE PROJECTS SHALL INCLUDE THE FOLLOWING:
(1) THE CONSTRUCTION OF SEWERS;
(2) THE CONSTRUCTION OF STREETS, SIDEWALKS, STORM DRAINS;
(3) OTHER IMPROVEMENTS MAY BE CONSIDERED ONLY IF THEY
SUPPLEMENT THE LID PROJECT.
2,2.3 PROJECTS ARE PRIORITIZED ACCORDING 1-0 THE ELIGIBILITY CATEGORIES
AND FEASIBILITY INFORMATION. FIRST PRIORITY IS PROJECTS IN
DEVELOPED AREAS (AS DESCRIBED IN 2.2.2(x)). SECOND PRIORITY IS
PROJECTS IN UNDEVELOPED COMMERCIAL/OR INDUSTRIAL AREAS (AS
DESCRIBED IN 2.2.2(b)). THIRD PRIORITY IS PROJECTS IN
UNDEVELOPED RESIDENTIAL AREAS.
2.2.4 THE CITY SHALT_ MANAGE IT'S ANNUAL INDEBTEDNESS SO THAT IF THE
INnEBTEDNESS IN ANY YEAR GOES OVER THE LIMIT, THE CITY WILL
ADJUST THE FOLLOWING YEAR. THE FORMULAS ARE:
AVAILABLE ADDITIONAL DEBT = STATE DEBT LIMITATION - EXISTING DEBT
(debt includes principal and interest)
AMOUNT AVAILABLE FOR 10%-x AVAILABLE ADDITIONAL DEBT
PROJECT CONSTRUCTION = 2
COSTS PER YEAR
2.2.5 THE CITY SHALL FURTHER PRIORITIZE THE TYPES OF PROJECTS TO BE
CONSIDERED BY IMPOSING TIME CONSTRAINTS AND BY GROUPING SIMILAR
PROJECTS TOGETHER FOR THE PURPOSE OF .COMPETING FOR LIMITED
FUNDS. TABLE 3 OUTLINES THE TIME CONSTRAINTS FOR EACH TYPE OF
PROJECT.
LID POLICY AND PROCEDURES — (5/2/85). PAGE 16
Table 3: Key completion dates for different types of projects.
Priority 1 Priority 2 Priority 3
Undeveloped Undeveloped
Developed Commercial/ Residential
Area Industrial Area Area
Resolution to Prepare September 15 September 15 or while there
(Initiation Stage) are sufficient funds.
Ordinance to Form March 1 March 1 March 1
(Formation Stage)
Construction Spring/Summer Spring/Summer Spring/Summar
Bond Sale June/July June/July June/July
Minimum Estimated Three or more Two or more More than
Total Size property owners tax lots one acre
Application Fee - - - - - - - - - - - - - - - - - Yes Yes
- - - - - - - - - - - -
2.2.6 PROPERTY OWNERS MAY BE REQUIRED BY COUNCIL TO PAY A FEE AlTHE
BEGINNING OF THE FEASIBILITY STAGE TO OFFSET COSTS INCURRED DURING
THIS STAGE IF THE PROPOSED IMPROVEMENT IS IN AN UNDEVELOPED AREA.
2.2.7 LID PROJECTS ARE l"O BE DESIGNED IN ACCORDANCE WITH ADOPTED CITY
STANDARDS.
2.2.9 CITY SHARE CONTRIBUTIONS ARE CITY BUDGETARY DECISIONS ONLY, NOT
LID POLICY,
2.3 KEY ADMINISTRATIVE ACTIONS
2.3.7. The Community Development Department has lead responsibility
during this stage.
2.3.2 Given staff workloads and expertise required, staff recommends
whether the City should contract out the preparation of the
Preliminary Engineer's report .
2.3.3 The Preliminary Engineer's report shall include the following
financial data:
(a) The city's calculated limit for bancroft
indebtedness;
(b) Cash available;
(c) Type of interim financing to be used;
(d) Special concerns For the timing of the project
for 'Financing;
(e) The assessment histories of the current
property owners for outstanding assessments;
(f) City participation or other funding.
LID POLICY AND PROCEDURES — {5/13/85)• PAGE 17
2.3.4 The Preliminary Engineer's report shall include the following:
(a) The benefits to the city the project serves,
i.e. completing a system, economic development,
or health and safety;
(b) The percentage of owners and the area
represented who are proponents;
(c) The boundaries, the general design of the
project, and the facilities approximate
location;
(d) Estimated total cost;
(e) The list of Property owners, addresses,
property descriptions (tax lot) and proposed
assessments.
2,3.5 Staff shall project the priority ranking of a proposed project
according to Council's guidelines,
2.3,6 The method used to calculate special benefit depends upon the
parti.'�ular mix of improvements and the ;pe dal conditions such as
the land configuration and slope. In general, the following
guidelines are used:
(a) Sewers by area or per equivalent unit
(b) Streets by a combination of area and frontage, or a special
application of zonal, i.e. zoned use calculated from
anticipated trip generation
(c) Storm drainage by equivalent service unit
(d) Sidewalks by linear foot
(e) Parking by an equivalent unit, i.e. floor space
(f) Undergrounding by area or per equivalent unit or by zoned
use, i.e. density,
2.3.6 If consultants prepare the report, they will also present the
report.
2.3,7 Staff may "batch" the proposals at this stage so it is more
efficient and easier to prioritize the projects for the available
funds.
2.4 IMPLEMENTATION STRATEGIES
2.4.1 Standardize the requirements for the Preliminary Engineer's Report,
2.4,2 Keep current the list of consultants eligible to do the
Preliminary Engineer's Report.
2.4,3 Determine the basic service cost for the Preliminary Engineer's
Report.
2.4.4 At the beginning of the stage, staff shall send a letter to
property owners within the district and to the NPO(s) which are
involved stating the status of the project, the next steps in the
process and a tentative timeline.
f
LID POLICY AND PROCEDURES — (5/2/85), PAGE IS
3. FORMATION
FEASIBILITY
Citizer.s/ OPoortunity to file
Property Remonstrances to
Owners the Formation of
the District
Staff L---�- Publish and mail
notices
Finalize the
Preliminary
Engineer's Report
when necessary
Key AdministrativeCnotification
nge for
Actions
for the
ic Hearing
rdinance
Key Decision Ordinance
to Form the
District
IMPROVEMENT
Documents Notices
Finalize the
Preliminary
Engineer's Report
Ordinance Forming
the
District
LID POLICY h'ND PROCEDURES
PAGE 19
3.0 FORMATION POLICY INTENT . , the city should provide to citizens the
opportunity to question and make statements in a public meeting with
regards to the proposed project and whether it meets established policies
and procedures.
The key decision for the Formation Stage is an ordinance forming the
district. This follows a public hearing on the project as proposed. The
state has clear requirements assuring the citizens the opportunity to object
which is reflected in the city's current code and practices.
Currently the city publishes the notice at least twice in the local newspaper
and sends the notice to all property owners. Property owners have at least
ten days from the first publication of the notice to file a remonstrance to
the formation of the district. If "owners of sixty-six and two-thirds percent
or more in area of the property within the assessment district may make and
file with the City Recorder written objection or remonstrance against the
proposed improvement, such objection or remonstrance shall be a bar to any
'Further proceedings in the making of such improvement for a period of six
months, unless the owners of one-half or more of the property affected shall
subsequently petition 'therefor" (TMC 13.04.050).
3.1 FINDINGS
3.1.1 ORS 223.389 states, "Provision shall. be made for at least 10 days'
notice to owners of property within the proposed district in which
the local. improvement is contemplated, which notice may be made by
posting, by newspaper publication or by mail, or by any
combination of such methods. Such notice shall specify the time
and place where the council will hear and consider objections or
remonstrances to the proposed improvement by any parties aggrieved
thereby."
3.1.2 Sometimes the city does not have the correct names and addresses
of the current owners because the listing in the county taxation
and assessment department is only periodically updated.
3.1.3 More accurate names and addresses "n be obtained through title
searches, which are more time consuming and costly ($50 or more
per property or tax lot).
3.1.4 Currently, if the public hearing is continued to a later meeting,
new notices are sent to the property owners, an extra cost of time
and money.
3.1.5 Sometimes during the process of the public hearing the
recommendations change, thereby changing some of the
remonstrances. The remonstrances however are still counted in
determining whether or not to proceed.
3.1.6 Sometimes certain weather conditions or political issues require
rapid processing and notice requirements waste precious time.
3.1.7 There is no policy on future re-submittal of a proposal once
rejected by Council for reasons other than filed remonstrances on
sixty- six and two thirds percent or more of the property area,
LID POLICY AND PROCEDURES — (5/20/85). PAGE 20
9.1.8 Non–remonstrance agreements with property owners on
which has been sold sometimes create difficulties
in transferring to the new owner and Property
ties for the City
3.2 FORMATION POLICY in enforcement.
3.2.1 THE CITY SHALL NOT PROCEED TO THE IMPROVEMENT STAGE AND THE
PREPARATION OF THE FINAL PLANS AND SPECS UNTIL COUNCIL RECEIVES
OBJECTIONS AND REMONOTHE _
AND PASSES AN ORDINANCE TO FORM THEDISTRRICT'ION Or THE DIST"RI
3.2.2I
PROPERTY OWNERS SHALL HAVE AT LEAST 10 DAYS NOTICE REMONSTRANCES WITH
1O THE
1"
PUBLIC HEARINGS TO FILE WRITTEN OBJECTIONS' OR PRIOR
THE CITY RECORDER, REMONSTRANCES CAN DE REVERSED ONLY BY THE
PROPERTY OWNER.
3.2.3 PER SPATE LAW, IF REMJNS'TRANCES ARE RECEIVED TOTALING TWO THIRDS
OR MORE OF THE AREA IN THE DISTRICT, COUNCIL SHALL DECIDE NOT TO
PROCEED.
3.2.4 IF ALL PARTIES AGREE IN WRITING TO WAIVE THEIR REMONSTRANCE THE
COUNCIL MAY WAIVE THE TIMELINE AND MAKE A DECISION ON THE
ORDINANCE FORMING THE DISTRICT.
3.2.5 THE CITY SHALL PUBLISH IN A LOCAL NEWSPAPER nt=
CIRCULATION THE NOTICE FOR THE PUBLIC HEARING -�cRAL
oycCTIOiJS AiVD REMONSTRANCES AT LEAST 10 DAYS `0 RECEIVE
MEETING. THE DATE, TIME AND PLACE OF PRIOR TO THE
BE GIVEN• IF THE HEARING THE PUBLIC MEETING SHALL
PUBLISHED IF TIME ALLOWS. IS COPJTINUED, ANOTHER NOTICE MAY BE
3.2,6 IF COUNCIL DECIDES NOT TO FORM T14E DISTRICT, COUNCIL WILL STATE
WHETHER PROPERTY OWNERS CAN RE–SUBMIT THE PROPOSAL EITHER BY
GAINING MORE SUPPORT OR BY MEETING CERTAIN OTHER CONDTTiONS.
3.3 KEY ADMINISTRATIVE ACTIONS
3.3.1 The Community Devolopment De artment
during this stage. P has lead responsibility
3.3,2
3.3.3 Staff will follow the state requirements for the public hearing.
At the
Public hearing
problems staff will be prepared to respond to known
either by recommending revisions to the Preliminary
decisions Report or by reporting the relevant policies and past
3.3.4 Record all non–remonstrance agreements as early as possible.
3.4 IMPLEMENTATION STRATEGIES
3.4.1 Staff willre
P pare the notice and be ready to publish when the
resolution of intent is passed.
3.4.2 Staff will prepare a form letter to be used if property owners
want ts.
o waive their remonstrance, thereby saving time in the
LID POLICY ANDProces
—
(5l20185).
PAGE 21
3.4.3 Staff will review the language on the non—remonstrance agreement
so it will conform to the City's intent.
LID POLICY AND PROCEDUP.ES — (5/2/85). PAGE 22
i
4. IMPROVEMEN.
TEI
Citizens/ main in contact
Propertyth Staff
Ownersgin to arrange
nancing
1 1
StaffPrepare Final Plan
and Specs
Bid Process
Manage the
construction
i Prepare the Final
Report
( Key Administrative Resolution by
Actions the Local
Contract Review
Board to Award
the Contract
Key Decision Resolution
Accepting
the
Final Report
ASSESSMENT
Documents Final Plans & Specs
Res. Award. Contract
Constr. Contract
Final Report
Resolution Accepting
th�Final
R
LID POLICY AND PROCEDURES — (5/2/85). PAGE 23
4,0 IMPROVEMENT POLICY INTENT the city should proceed with the
construction and financing of the improvements, controlling the project
p� so that it is completed to the specifications as close to the estimated
® cost as possible.
The key decision for the Improvement Stage is a resolution accepting the final
rgpart. This stage also includes an intermediate decision for Council acting
as the Local Contract Review Board and that decision is a resolution awarding
the contract.
The efficiency of both the construction and financing processes can be
enhanced if the project can take advantage of favorable weather and market
conditions. Both the efficiency and effectiveness can be facilitated at this
stage of the process by managing the construction, which includes coordinating
with the finance department. This is done by staff clearly stating
expectation and requirements to the contractor, and by staff providing
frequent status reports to Council. If changes occur, previous documentations
are needed in order to recognize the change and handle it effectively.
Currently, z,fter Council passes the ordinance forming the district, staff
prepares the Final Plans and Specs which then go out to bid. If any of the
construction is not done by staff, the lowest qualifying bid is awarded the
contract. Staff manages the construction by frequent inspections and through
the use of monetary penalties when necessary. Council receives periodic
status reports dependent upon the level of activity and tha presence of
Potential problems.
4,1 FINDINGS
4.1.1 The purchasing system addresses how a list of eligible contractors
.; made and used, how the contractor is selected and the terms and
conditions for performance and payment.
4.1.2 Guidelines on the issuance and approval of change orders are part
of the Local Contract Review Board Rules and in the contract
document.
4.1.3 Waiting for approval of change orders, not having clear
communication and documentation of communications, and not having
obtained all the rights—of--way, a'1 waste time and cause
inefficiencies.
1.1.4 Interim financing must be secured, and the type of financing
depends upon many factors.
4,1.5 If the project is funded by pre—assessments, the people forget or
fail to understand that they may have to start payments before the
construction is completed and they have a finished product.
4.1.6 Unless there is a pre—assessment, the owners forget their options
for financing, with the next stage becoming more of a shock.
4.1.7 Final payment to the contractor depends upon the staff tentatively
accepting the improvements.
LID POLICY AND PROCEDURES — (5/2/85). PAGE 24
4.1.8 At the end of the construction, a final report on what has
occurred and of the information needed for the next stage needs
to be produced.
4.2 IMPROVEMENT POLICY
4.2.1 THE CITY SHALL NOr PROCEED TO THE ASSESSMENT STAGE UNTIL PASSING
A RESOLUTION ACCEPTING THE FINAL REPORT ON THE PROJECT.
4.2.2 COUNCIL SHALL PROCEED ACCORDING TO THE POLICIES AND PROCEDURES
OF THE LOCAL CONTRACT REVIEW BOARD AND THE CONTRACT DOCUMENTS IF
ALL OR ANY PART OF THE YMPROVEMENT IS TO BE DONE_ BY PRIVATE
CONTRACTORS.
4.3 KEY ADMINISTRATIVE ACTIONS
4.3.1 The Community Development Department will have lead
responsibility during this stage.
4.3.2 Staff shall prepare the final plans and specs.
4.3.3 The designated project manager has the authority to approve
change orders consistent with the Local Contract Review Board
rules and adopted city purchasing and contracting procedures.
4.3.4 The designated project manager has the authority to tentatively
accept the improvements, thereby releasing the final payment to
the contractor.
4.3.5 Staff shall prepare the Final report at the conclusion of the
construction which will include sections on the improvement,
finance, and legal summaries.
4.4 IMPLEMENTATION STRATEGIES
4.4.1 The city will record with the county "lien intents" on the
properties, increasing the likelihood that title companies will
be aware of a possible lien if owners of property change.
4.4.2 Once the contractor is selected and the timetable is agread
upon, staff will sent' a letter to property owners advising them
of these things and of who to contact if they observe any
problems. If the contractor uses subcontractors, these names
will also be given.
4.4.3 In order to keep property owners inforoned of the special
assessments and to allow them sufficient time to decide how they
will pay their portion, staff will send a letter stating their-
estimated
heirestimated assessment, options available to make payment, and the
anticipated timetable. An installment application with terms
and conditions will be included which will have to be completed
at the Assessment Stage if the property owner decides to pay by
installments.
LID POLICY AND PROCEDURES — (5/2/85). PAGE 25
4.4.4 A set of form letters will be developed and used to aid in
managing the project, making it easier to documer�t the
improvement for Future reference.
4.4.5 S'o facilitate the transfer of responsibility for the next stage
the Final Report will include the following information:
(a) names and mailing addresses of owners
(b) property descriptions (tax map and lot iwmbers), the
assessed values end size of the property
(c) area of benefited property
(d) the assessment method and the computed assessments
i
i
LID POLICY AND PROCEDURES — (5/2/83).
PAGE 26
5. ASSESSMENT
IMPROVEMENT
Citizens/ Opportunity to
Property object to the
Owners spreading of assess—
merits in writing
Staff Prepare notices
for the spreading
of assessments
Publish and
send notices
Key Administrative < Preparing the
Actions proposed assess—
ments
Key Decision Ordinance spreading
the assessments
FINANCE AND
CLOSURE
Documents Notices
Ordinance Spreading
the Assessments
LID POLICY AND PROCEDURES — (5/2/85). PAGE 27
5.0 ASSESSMENT POLICY INTENT . , the city spreads the assessments across #
the properties according to the benefit the property derives from the
( improvement.
The key decision for the Assessment Stage is the ordinance spreading the
assessments. This stage is simply the official adoption of the assessments,
or portion of total cost, to be charged to each of the owners of specially
benefited property, It is similar to the Formation stage in that the property
owners have an opportunity to submit objections about this part of the
process. The determination of assessments for each property is proposed in
the Formation Staqe- Usually a formula is adopted which considers the types
-� improvements, ine land use, and any special characteristics of each lot of
land.
Currently the city mails to the property owners a notice of their, estimated
assessment and the date by which time objections shall be filed, which are to
"state the grounds thereof" (TMC 13,04.080). City Council is to consider
objections and staff's estimates and may "adopt, correct, modify or revise the
proposed assessments". Assessments are for total costs and include the "cost
of right-of--way and expenses of condemning the land, all costs of engineering,
superintendence, advertising and legal expenses and also any and all other
necessary and proper expenses" (TMC 13.04,080), The assessments are entered
into the city's lien docket, thereupon becoming a lien upon the property
assessed.
The assessment process as outlined in this section may occur after formation
and before or during the initial period of the improvement if the city decides
to have an "initial assessment" (pre-assessment). The amount to be spread is
based upon the engineer's estimate of total cost. If this is the case the
process at this time is either to do a final assessment, adjusting to the
actual final costs, or to issue refunds. The different types of assessments
allowed by state statutes and how each Tits into the structure in this report
are shown on Table 4.
Efficiency can be greatly enhanced by standardizing the process, letters and
forms which will also improve effectiveness by streamlining the
documentation. The quality of the city's LID process is also dependent upon
Council making decisions which are consistent with the current or rzvised
policy, Special interests can sway decisions and set precedents that may not
be beneficial in future decisions with other LIDs.
5.1 FINDINGS
5.1.1 ORS 223.389, "notice of such proposed assessment shall be mailed
or personally delivered to the owner of each lot proposed to be
assessed, which notice shall state the amounts of assessment
proposed on that property and shall fix a date by which time
objections shall be filed with the City Recorder. Any such
objection shall state the grounds thereof, The council shall
consider such object ons and mta, adopt, correct, modify or revise
the proposed assessments and shall determine the amount of
assessment to be charged against each lot within the district,
according to the special and peculiar benefits accruing thereto
from the improvement, and shall by ordinance spread the
assessments."
LID POLICY AND PROCEDURES — (5j2{85). PAGE 28
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LID POLICY AND PROCEDURES -- (1/11/84)
PAGE 29
s
5.1.2 The ORS does not require Council to have a public hearing to
hear objections.
5.1,3 Property sold during this time is not noted in the County's tax
lot records until later, making the identification of the
current owner difficult during the next stage. Also, the new
owner often is unaware they must soon pay the special
ass3ssments.
5.1,4 The problem of unknown mailing addresses of owners is addressed
in ORS 223.391, "Whenever a notice is required to be sent to the
owner of a lot . . .if the auj.ass uT the owner or of the owner's
agent is unknown to the recorder, he shall mail the notice
addressed to the owner or his agent at the city where such
property is located. Any mistake, error, omission or failure
with respect to such mailing shall not be jurisdictional or
invalidate the assessment proceedings . .. .
5,1.5 "If the initial assessment (pre—assessment) has been made or the
basis of estimated cost, and upon the completion of the work the
cost is found to be greater than the estimated cost, the council
may make a deficit assessment for the additional cost" according
to the standards stated above, with a notice and opportunity to
object. (ORS 223.395)
5.1.6 "If assessments have been made on the basis of estimated cost,
and upon completion the cost is found to be less than the
estimated cost, provision shall be made for refund of the excess
or over—plus" (ORS 223.395),
5.1.7 The administrative costs of determining who should receive a
refund and the amount of such refund may exceed the total amount
available for refund.
5,1.8 In the past objections have been treated like remonstrances in
that policy goals have been violated in order to make exceptions
for individuals with objections (e.g. case by case exceptions
instead of reviewing basic policy),
5.2 ASSESSMENT POLICY
5.2.1 THE CITY SHALL NOT PROCEED TO THE FINANCE AND CLOSURE STAGE
UNTIL PASSING AN ORDINANCE SPREADING THE ASSESSMENTS,
5.2.2 THE CITY SHALL PROVIDE NOTICE TO PROPERTY OWNERS OF THEIR
PROPOSED ASSESSMENTS AND THAT COUNCIL WILL BE CONSIDERING
WRITTEN OBJECTIONS AT A SPECIFIED MEETING PRIOR TO SPREADING THE
ASSESSMENTS BY ORDINANCE ACCORDING TO THE SPECIFICATIONS IN THE
ORS.
LID POLICY AND PROCaDURES — (5/13/85). PAGE 30
5.3 KEY ADMINISTRATIVE ACTIONS
5.3.1 The Finance Department has lead responsibility for this stage,
5.3.2 Staff will follow mandated requirements for the notices.
5.3.3 Standardized terminology to agree with the ORS.
5.4 IMPLEMENTATIONSTRATEGIES
5.4.1 Send a copy of the installment contract early in the previous
stage which clearly outlines the terms and conditions of payment
by installments.
5.4.2 At the time Council considers objections to the
assessments staff will proposed
review for Council the proposed
assessments, and the rationale and policies supporting the
proposals.
I
5.4,3 The problem of !<eeping a current and accurate address list is
mini^ized iF the city makes more frequent
contacts. personal and mail
5,4.4 Staff will have a record of actual personnel costs for each
L,I.D. which will be used in calculating Lhe total cost.
I
i
St
LID POLICY AND PROCEDURES
(5/2/85).
PAGE 31
e
6. FINANCE AND CLOSURE
CAEESSMENT
Citizens! Pay assessment in
Property cash or arrange to
Owners pay in installments
Pay assessment
as billed
Staff Prepare bond
Prospectus
Bond Sale
Lien Docket
Key Administrative Local Contract
Actions Review Board
\ accepts bids
for bonds by
'n
esolution
Key Decision . Closing
accounts and
releasing liens
an all benefited
;properties
Documents Bond Prospectus
Resolutiol, Accepting
Bids for bonds
Lien Docket
s
LID POLICY AND PROCEDURES -- (5/2/85).
PAGE 32
6.0 FINANCE AND CLOSURE POLICY INTENT" the city should provide a
financing option, should enforce payments so 'the project does not impact
other operating funds, and maintain the improvements according to
agreements and city policy. The Finance and Closure Stage is not
completed until all assessments are paid and the bonds are retired. It
is primarily a stage of staff activity unless more extreme enforcement
procedures become necessary.
The key decision for the Finance and Closure Stage is actually an intermediate
decision and does not mark the end to the stage and the project. The "key
decision" is the resolution accepting bids for bonds and to pay-off warrants,
thereby recovering the city's costs for long-term financing along with the
total amount property owners agree to pay in installments. The final decision
for this stage is an action closing accounts and releasing liens on properties
as they are paid. The LID is not actually ended until all accounts are closed
and the bond is retired.
Currently, once assessments are spread, staff receives cash or applications to
to pay in installments within some specified time period. Staff then proceeds
with bond counsel through the bond selling process according to Local Contract
Review Board rules and the ORS.
Once this initial activity is completed, there are three major activities,
first with collections, second with changes which occur to the property
ownership, and third with maintaining the new system. Bills for those paying
in installments are currently sent twice a year. Billing costs are estimated
and become part of the total amount bancrofted. No penalties are charged for
early pay off. If owners of property sell any part of the property which has
a special assessment, the city in the past has had a "due-on-sale" policy.
6.1 FINDINGS
6.1.1 Whenever there has been a special assessment placed upon a
property for a local improvement, if the owner is assessed in the
sum of $25 or more, at any time within 10 days after notice of
such assessment is first published, the owner may file a written
application to pay part or all of the assessment in installments.
(ORS 223.210) A property owner cannot apply to pay in
installments if the amount remaining unpaid upon such assessment
together with the unpaid balance of any previous assessment for
improvements against 'the same property equals or exceeds double
the assessed valuation of the property as shown by the last county
tax roll. (ORS 223.220)
6.1.2 On the computation of installments, "with interest at such rate as
the governing body of the city may provide on all unpaid
assessments, together with an amount sufficient to pay a
proportionate part of the cost of administering the bond
assessment program and issuing the bonds including, but not
limited to, legal, printing and consultant's fees, such amount to
be determined by the governing body" (ORS 223.215),
LID POLICY AND PROCEDURES -- (5/20185). PAGE 33
6.1.3 The maximum effective rate of interest which general obligation
bonds shall bear is 13 percent per annum, unless the agency is
unable to sell the bonds after a reasonable marketing effort,
then the interest may be increased but shall not excaed 14
percent per annum (ORS 288.520(2)).
6.1.4 "The actual rates of interest paid are determined by a
combination of the general market levels, the security behind a
given issue, the pattern of the maturity of the debt, and the
credit standing of the city. The city can do something about
each of these, except the general interest level prevailing in
the market." (from Moak and Hillhouse, Concepts in Finance,
cited in the Guide for Local Government in Oregon)
6.1.5 The interest rate charged to those bancroFting their assessments
has been determined in varying ways on different LIDS, thereby
making the interest rate a political issue instead of a
technical issue to be applied consistently.
6.1.6 Technically interest begins to accrue when the assessment is
spread. This happens iF the property owner pays after 30 days
or if the owner bancrofts.
6.1.7 "Whenever all or part of any assessment 'For improvement was or
is declared void or set aside for any reason or its enforcement
refused by any court by reason of jurisdictional or other
defects in procedure, whether directly or by virtue of any court
decision or when the council is in doubt as to the validity of
all or part of any such assessment by reason of such defects in
procedure, the council may by ordinance make a new assessment or
reassessment. .." (ORS 223.410)
6.1.8 The time involved in gathering applications to pay in
installments is sometimes extensive either due to efforts to
find correct addresses, or because people do not respect the
time limits for filing, often creating problems in preparing
documents for the bond sale.
6.1.9 The total amount to be bonded is the total of the assessments
which have valid installment applications filed plus the
interest for the bonds, plus administrative costs for the bond
sale and costs which are part of all assessments, such as
recording and removing liens from the county docket.
6.1.10 The City has not been recovering total costs on all of the bonds.
6.1.11 Occasionally if the property owner is late completing their
installment application, Council will accept it, even though it
can not be included in the bond sale, with the condition that
payments will equal what they would have been if part of the
bond sale.
l
LID POLICY AND PROCEDURES — (5/2/£5). PAGE 34
6 9
i
6.1.12 In the past the city has decided not to proceed with foreclosure i
if the property owner, makes any token payment towards their-
assessment, therefore possibly creating a future deficit in the
fund.
6.1.13 Past practices by the city has created ver
the y lax expectations on
Part of property owners to the point where paying the
assessment seems to have a very low priority fe:- some.
6.1.14 Legally, if property is segregated, the assessment can be
reapportioned if the property is not part of a new subdivision.
6.1.15 If the improvement is a new subdivision, the lot cannot be
segregated and the assessment cannot be reapportioned. All
assessments rust be paid–in–full before the final plat is
approved (ORS 92.095).
6,1.16 If property is segregated, the city must be careful to make sure
that the segregation is not to separate out less desirable land
which the owners may have no intention of developing, or of
paying the assessment.
6,1.17 The process for the collection of payments is the same for all
property owners within any level of collection, i.e. the initial
billing with an administrative charge, a reminder, and finally a
meeting is set to negotiate payment,
6.2 FINANCE AND CLOSURE POLICY
6.2.1 THE LID IS NOT "COMPLETED' UNTIL ALL ASSESSMENTS ARE PAID AND
THE BONDS HAVE MATURED.
6.2,2 FOR INFORMATION PURPOSES AT TIME OF INITIATION, INTEREST RATES
AT CURRENT URS LIMITS PLUS 2% WILL BE QUOTED TO PROPERTY OWNERS.
6.2.3 THE INTEREST RATE CHARGED WILL BE THE NET EFFECTIVE INTEREST
RATE OF THE BOND SALE PLUS 2% FOR ADMINISTRATIVE EXPENSES, i.e.,
RECORDING THE LIEN WITH WASHINGTON COUNTY, BILLING COSTS, ETC.
6.2.4 INTEREST ON THE ASSESSMENT SHALT_ BEGIN TO ACCRUE TEN WORKING
DAYS AFTER THE PASSING OF THE ORDINANCE SPREADING THE
ASSESSMENTS FOR ALL PROPERTY OWNERS, WHETHER REQUESTING
INSTALLMENT PAYMENTS OR PAYING IN CASH.
6.2.5 IF THE CITY DOES NOT RECEIVE AN APPLICATION 1-0 PAY IN
INSTALLMENTS WITHIN TEN WORKING DAYS OF NOTIFICATION OF
ASSESSMENT, IT WILL BE ASSUMED THE PROPERTY OWNER WILL BE PAYING
IN CASH.
6.2.5 IF A PROPL'TY OWNER MISSES THE DEADLINE FOR MAKING APPLICATION
TO PAY IN INSTALLMENTS, AND THE BANCROFT BONDS HAVE BEEN SOLD,
THEN THE APPLICANT MUST PLEAD HIS CASE TO COUNCIL, If COUNCIL
APPROVES, PAYMENTS ARE SET AT ACTUAL COSTS, WITH A PAYMENT
-e- SCHEDULE DESIGNED TO REPAY THE CITY AS PROMPTLY AS POSSIBLE,
LID POLICY AND PROCEDURES — (5/2/85).
PAGE 35
eat.
6.2.7 IN ADDITION TO THE APPLICATION TO PAY IN INSTALLMENTS, A
PROPERTY OWNER SHALL SIGN A SEPARATE TERMS AND CONDITIONS
CONTRACT OUTLINING THE PAYMENT POLICIES OF THE CITY, INCLUDING
PENALTIES FOR NON-PAYMENT.
6.2.8 IF AN APPLICANT 7'O PAY IN INSTALLMENTS IS CURRENT ON OTHER LIDS,
SEWER BILLS OR PROPERTY TAXES ON THE ASSESSED PROPERTY, THEY
SHALL BE ELIGIBLE FOR FINANCING.
6.2.9 IF THE IMPROVEMENT IS IN THE FIRST PRIORITY (A DEVELOPED
RESIDENTIAL AREA), THE PROPERTY OWNER CAN FINANCE 100% ALLOWABLE
BY ORS. IF )'HE IMPROVEMENT IS IN THE SECOND PRIORITY
(UNDEVELOPED COMMERCIAL AND/OR INDUSTRIAL), THE PROPERTY OWNER
CAN FINANCE 75% ALLOWABLE BY ORS. IF THE IMPROVEMENT IS IN THE
THIRD PRIORITY (UNDEVELOPED RESIDENTIAL), THE PROPERTY OWNER CAN
FINANCE 50% ALLOWABLE BY ORS.
6.2.10 IF THE INITIAL_ ASSESSMENT (PRE-ASSESSMENT) HAS BEEN MADE ON THE
BASIS OF ESTIMATED COST, AND UPON COMPLETION OF THE PROJECT THE
ASSESSED COST IS LESS THAN THE FINAL COST, COUNCIL SHALL MAKE A
DEFICIT ASSESSMENT.
6.2.11 IF THE INITIAL ASSESSMENT (PRE-ASSESSMENT) HAS BEEN MADE ON THE
BASIS OF ESTIMATED COST AND UPON COMPLETION OF THE PROJECT THE
ASSESSED COST IS MORE THAN THE FINAL COST, COUNCIL SHALL PROVIDE
FOR A REFUND IN THE SAME MANNER AS THE PROJECT WAS ORIGINALLY
ASSESSED.
6.2.12 IF OWNERSHIP OF PROPERTY CHANGES, THE ASSUMPTION OF THE
REMAINING BALANCE OF THE INSTALLMENT AGREEMENT SHALL BE BASED ON
THE CRITERIA ADOPTED BY COUNCIL, BUT SHALL IN NO CASE BE ALLOWED
FOR BALANCES OF $3,000 OR LESS Oid HOMESTEAD PROPERTY.
6.2.13 INTEREST EARNINGS ON BOND PROCEEDS SHALL BE PLACED IN THE
SPECIAL ASSESSMENT FUND 'UNTIL THE BONDS HAVE MATURED, AT WHICH
TIME THE REMAINING AMOUNT SHALL BE TRANSFERRED TO THE GENERAL
FUND.
6.2.14 IF A PAYMENT IS 30 DAYS LATE, A PENALTY OF $25.00 SHALL. BE
CHARGED.
6.2.15 SHOULD THE OWNER NEGLECT OR REFUSE TO PAY INSTALLMENTS AS THEY
BECOME DUE AND PAYABLE FOR A PERIOD OF ONE YEAR, THE ACCOUNT IS
CONSIDERED DELINQUENT AND THE ENTIPE BALANCE BECOMES DUE
IMMEDIATELY. THIS ACTION REQUIRES A RESOLUTION.
6.2.16 THE COUNCIL SHALL DO A FINAL ACCEPTANCE OF IMPROVEMENTS BY
RESOLUTION AFTER ALL PENDING PROBLEMS WITH THE IMPROVEMENT ARE
RESOLVED AND THE CONTRACTOR IS RELEASED FROM RESPONSIBILITY.
6.3 KEY ADMINISTRATIVE ACTIONS
6.3.1 The Finance Department has lead responsibility in this stage.
LID POLICY AND PROCEDURES — (5/2/85). PAGE 36
o
6.3.2 Immediately following the passage of the ordinance spreading the
assessments, staff will publish in the local newspaper the list
of property owners and the" special assessments and mail the
same to each property owner along with an installment
application.
6.3.3 Staff shall enter the assessments on the city's lien docket, but
shall also record them in the county so title companies are
aware of the assessment if property is sold.
6.3.4 The terms established for the bonds on the date of sale, the
Pattern of maturity, etc. are dependent upon the condition of
the bond market at the specific time of the sale. Therefore,
staff needs the authorit
response to the market. y to make immediate decisions in
6.3.5 Interest to be charged on installment contracts for unbonded
assessments is to be two percent greater than the interest
ji charged in the most recent bond sale or two percent greater than
what is charged the Other' property owners in the same IID,
whichever is greater.
6.3.6 Prior to the expiration of the maintenance bond, staff will do a
final inspection, arrange to clear everything y g pending with the
contractor, and when cleared, inform the finance department who
in turn, informs the bonding company to release the maintenance
bond.
�• 6.4 IMPLEMENTATION STRATEGIES
6.4.1 The costs of issuing the bonds are estimated and added to the
total costs for those applying to pay in installments.
6.4.2 Determine service charges for the successive billings, and
review the rate annually.
6.4.3 Determine service charges for covering costs to update the
county's lien docket and other costs, and review the rate
annually.
6.4.4 Develop and adopt a process for reviewing applications to
reapportion a bancroft account.
LID POLICY AND PROCEDURES — (5/2/85).
PAGE 37
i
APPENDIX
LID POLICY AND PROCEDURES - (5/2/86). PAGE 38
'PO: 'C1IE HONORABLI. MAYO:( ANO ('17Y �'UU NCII.
cit, of Tig'�r'I
Count}' of 41aa hmy toll
State of Oregon
In the Matter of the Improvement )
of lands described as: )
PETITION FOR AND CONSENT
TO CREATE A
} LOCAL IMPROVEMENT DISTRICT
Petitioners hereby request that the hereinbelow described area be improved by
creation of an assessment district for the express purpose of
(1) That the undersi—ed is in fact the owner(s) or the contract purchaser(s) of
the indicated property(s).
(2) That the undersigned represent one-half or more of the affected area as here-
inbelow described.
(3) That the cost of this improvement to be borne by the benefited properties and
In respect thereto respectfully show:
That the area proposed hereby to be improved by creation of an assessment
;strict comprises approximately acres, and is legally described hereinbelow
—z in the attached sheet marked Exhibit "A" which by reference herein is made a part
hereof)_
WHEREFORE, petitioners pray that said lands be improved by creation of an
assessment district and that the City Council of the City of Tigard, Oregon, expedite
creation of the same as provided by law,
Signature Address Nap k Book #
Tax Lot ' Page #
-r
LI �. 95
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.ath property roar-s Engineer's notices and Specs the spreading of prospectus
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and appropriate itPd when necessa-y Prepare time Final
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Key Prelimitsary Priority Rantcinq� ,�Arrangr for Resolution \ I /� Preparingthe �!t Local Contract
Administrative £valuation ,
by Staff rwtification , ttse local proposed mase semis` ` Review Hoard
Actions
Repo by — - ---f and for the Contract Review I l accepts bids
Staff - __-
Public Nearing Board to Award / i for bonds by
vn Ordinance/ the Contract € Resolution
S
a � i
Key Decision Resolution Resolution Ordinance to Resolution
/. Ordinance apreadirg� /Closing accounts \
Directing Staff to i of Intent and Form the District Accepting Lhe\ tho assessments // and releasing
Prepare the ) setting the date \ Final Report liens on all
Preliminary \ for the Public \_ benefited ropertieV
\Engineer's Report/ Nearing j � --
--- __1___ Bond Prospectus --
Documents LIO Interest Draft of �. Notices Finalize Final Plans 6 Specs Notices Resolution Accepting )
Petition Preliminary the Preliminary Res. Award. Contract Ordinance S readi
PreliminaryP ng Bids for bonds
j Engineer's Report j Engineer's Report Constr. Contract the Assessments Lien Docket
Evaluation Report Status Letter i. Ordinance Forming Final Report
Resolution to Resolution of the District �-
Prepare Intent - y
Letter informing
NPO of status
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