Bill Text: AZ SB1652 | 2024 | Fifty-sixth Legislature 2nd Regular | Introduced
Bill Title: Municipal improvement districts; petitions; authorization
Spectrum: Partisan Bill (Republican 1-0)
Status: (Introduced - Dead) 2024-02-06 - Senate read second time [SB1652 Detail]
Download: Arizona-2024-SB1652-Introduced.html
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REFERENCE TITLE: municipal improvement districts; petitions; authorization |
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State of Arizona Senate Fifty-sixth Legislature Second Regular Session 2024
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SB 1652 |
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Introduced by Senator Bennett
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An Act
amending sections 48-571, 48-574, 48-575 and 48-576, Arizona Revised Statutes; amending title 48, chapter 4, article 2, Arizona Revised Statutes, by adding section 48-623; relating to municipal improvement districts.
(TEXT OF BILL BEGINS ON NEXT PAGE)
Be it enacted by the Legislature of the State of Arizona:
Section 1. Section 48-571, Arizona Revised Statutes, is amended to read:
48-571. Definitions; appointment of officer
A. In this article and article 1 of this chapter, unless the context otherwise requires:
1. "Assessment" or "assessment roll" means a special assessment made under the provisions of this article.
2. "Block" means any parcel of ground, whether regular or irregular, which that is bounded by streets, or by one or more streets and by one or more boundary lines of the city or town.
3. "Clerk" includes any person or official who performs the duties of clerk of the city or town.
4. "Contractor" includes the contractor's personal representative or assignee.
5. "Council" or "governing body" includes and means the body or board which that by law is constituted the legislative department of an incorporated city or town.
6. "Delinquency" means delinquency in the payment of an assessment made under the provisions of this article.
7. "Designated area" means an area of the municipality which that is either designated pursuant to section 36-1479 as a slum or blighted area or designated as a pocket of poverty or a neighborhood strategy area by the United States department of housing and urban development, pursuant to title I of the housing and community development act of 1977, as amended (p.l. 95-128; 42 United States Code sections 5301 through 5320) and the department of housing and urban development act (p.l. 89-174; 42 United States Code section 3535(d)).
8. "Engineer" includes any person who, under whatever official name, is the civil engineer or surveyor of the city or town, and where there is no elected or appointed official, then the engineer is the person who may be appointed or employed by the council to perform the duties required of an engineer under the provisions of this article.
9. "Improvement bond" means a bond issue under the provisions of this article.
10. "Lighting plants" includes electric light plants, electric power plants, gas plants, distribution systems, poles, parts, pipes, conduits, wires, tanks, reservoirs, generators for gas or electricity, transmission lines, towers, lamps, transformers of every character, machinery, apparatus, equipment and all appliances and structures necessary or incidental to the construction, installation or operation of a complete municipal electric light, power and gas plant and distribution system, placed on the streets improved, though extended beyond.
11. "Lot" includes any portion, piece, parcel or subdivision of land, and includes property owned or controlled by any person as a railroad right-of-way.
12. "Mayor" includes the chairman or president of the governing body.
13. "Municipality" or "city" includes incorporated cities and towns.
14. "Owner" means the person in whom, on the day the action or proceeding is commenced, appears the legal title to the lot by deed recorded in the recorder's office, or the person in possession of the lot under claim of title, or exercising acts of ownership over the lot for the person, or as the personal representative of the owner.
15. "Railroad" includes street railroad and interurban railroad.
16. "Sewers" includes tunnels, excavations, ditches, drains, conduits, channels, outlets, outfalls, cesspools, manholes, catch basins, flush tanks, septic tanks, connecting sewers of every character, machinery, apparatus, equipment and all appliances and structures necessary or incidental to the construction, installation or operation of a complete sewer system, for either sanitary or drainage purposes.
17. "Street" includes avenues, alleys, highways, lanes, crossings, intersections, courts, places and grounds now open or dedicated or hereafter opened or dedicated to public use, including on-street parking, and public ways.
18. "Street superintendent" or "superintendent" includes any person who, under whatever official name, is charged with the care or supervision of the streets of the city or town.
19. "Time of delinquency" means the time fixed when assessments become delinquent.
20. "Treasurer" includes any person who, under whatever official name, is the custodian of the funds of the city or town.
21. "Waterworks" includes pipes, hydrants, reservoirs, wells, pumps, pumping plants, conduits, settling basins, filtering plants of every character, machinery, apparatus, equipment and all appliances and structures necessary or incidental to the construction, installation or operation of a complete municipal waterworks system, for fire protection, or for domestic irrigation, mechanical or power purposes, placed on the streets improved, though extended beyond.
22. "Work" or "improvement" includes any or all of the improvements mentioned and authorized to be made in this article and article 1 of this chapter and the construction, reconstruction and repair of all or any portion of the improvements, and all labor, services, incidental expenses and material necessary or incidental to the construction, reconstruction or repair.
B. In any city or town having no officer in this article designated, or performing like duties, the governing body may appoint a suitable person to discharge the duties.
Sec. 2. Section 48-574, Arizona Revised Statutes, is amended to read:
48-574. Improvement districts for operation, maintenance, repair and improvement of pedestrian malls, off-street parking facilities, retention and detention basins and parkings and parkways
A. In addition to the purposes for which an improvement district may be formed under the provisions of section 48-572, an improvement district may be formed for the sole purpose of the operation, maintenance, repair and improvements of pedestrian malls, off-street parking facilities, retention and detention basins and parkings and parkways.
B. Subject to the powers granted and the limitations contained in this section, the powers and duties of the governing body of the municipality and the procedure to be followed shall be as provided in this article for other types of special improvement districts.
C. If a petition for the formation of an improvement district under the provisions of this section is presented to the governing body purporting to be signed by all of the real property owners in the proposed district, exclusive of mortgagees and other lienholders, the governing body, after verifying the property ownership and making a finding of that fact, shall adopt a resolution of intention to order the improvement pursuant to the provisions of section 48-576 and shall have immediate jurisdiction to adopt the resolution ordering the improvement pursuant to the provisions of section 48-581, without the necessity of the publication and posting of the resolution of intention provided for in section 48-578. For IMPROVEMENT districts formed pursuant to this section after May 1, 2024, the governing body may not order the IMPROVEMENTS prescribed by SUBSECTION A of this section until after the governing body has received a petition prescribed by section 48-623.
D. The governing body shall make annual statements and estimates of the expenses of the district, which shall be provided for either:
1. By the levy and collection of ad valorem taxes upon on the assessed value of all the real and personal property in the district.
2. By assessment of the total sum upon on the several lots, each respectively in proportion to the benefits to be received by each lot.
E. If the expenses of the district are provided for by ad valorem taxes, the governing body shall publish notice, have hearings and adopt the taxes at the times and in the manners provided for incorporated cities and towns by the applicable portions of title 42, chapter 17, article 3. The governing body, on or before the third Monday in August of each year, shall fix, levy and assess the amount to be raised by ad valorem taxes upon on all of the property of the district. If the expenses of the district are assessed upon on the several lots in proportion to the benefits received by each lot, the governing body shall follow the procedures established in section 48-575 for the assessment and collection of the assessments. All statutes providing for the levy and collection of general county taxes, including the collection of delinquent taxes and sale of property for nonpayment of taxes, shall be applicable to the district taxes provided for under this section.
F. An improvement district formed under the provisions of this section shall not be authorized to issue improvement bonds.
G. No improvement district formed under the provisions of this section shall be authorized to engage in any activity other than as provided in subsection A of this section. If the municipality is willing to participate in the cost of the district, the governing body may, by resolution, may summarily order such participation.
H. The formation of an improvement district under the provisions of this section shall not prevent the subsequent establishment of improvement districts for any other purpose authorized by law.
I. If, in the opinion of the governing body, any portion of the territory of a district formed under this section is no longer benefited by being a part of the district, the governing body may, by resolution, may summarily delete from the district formed under this section any area and may form a new district from the balance of the original district formed under this section.
J. If, in the opinion of the governing body, territory adjacent to a district formed under this section would benefit from being a part of the district, the governing body, by resolution, may include the territory in the district formed under this section if the following conditions are met:
1. Improvements that meet the standards and specifications established by the governing body have been constructed in the territory and will be used for the purposes of the district.
2. Any required public dedications of property have been made or will be made before the inclusion of the territory in the district.
3. Including the territory in the district will not adversely affect the district.
4. Notice of the proposed inclusion of the territory in the district has been published in five consecutive issues of a daily newspaper or two consecutive issues of a weekly or semiweekly newspaper of general circulation published in the municipality and a public hearing has been held to consider the inclusion of the territory in the district.
5. Notice has been sent by first class mail at least ten days prior to before the hearing specified in paragraph 4 of this subsection with an accurate map of the territory proposed for inclusion in the district to each owner of real and personal property within the district and in the proposed area of inclusion as shown on the statement furnished pursuant to subsection K of this section that is now or would be subject to taxation by the district in the event of inclusion of the proposed area.
K. The county assessor and the department of revenue, respectively, shall furnish to the district within thirty days after a request a statement in writing showing the name and the address of each owner of real and personal property within the district and in the proposed area of inclusion that is now or that would be subject to taxation by the district in the event of inclusion of the proposed area.
L. Within ten days after the governing body adopts a resolution pursuant to subsection J of this section, the municipality shall record the resolution in the office of the county recorder in the county in which the district is located to give notice of the inclusion of the territory in the district to all property owners in the district. If, before the governing body adopts the resolution pursuant to subsection J of this section, a majority of the property owners, by area, of either the original district formed under this section or the territory proposed to be included in the district files with the governing board written objections to the proposed inclusion of the territory, the territory shall not be included in the district. the governing body may adopt a resolution pursuant to subsectION J of this section without requiring a petition to be filed pursuant to section 48-623.
M. Within ten days after adoption of the resolution of intention to order the improvement pursuant to section 48-576, the municipality shall record the resolution in the office of the county recorder in the county in which the district is located to give notice of formation of the district to all property owners within the district.
N. For the purposes of this subsection, a property owner is an owner of real property, exclusive of mortgagees and other lienholders, that is within an improvement district that was formed as prescribed by this section. A property owner may petition the governing body to dissolve the district pursuant to the following procedures:
1. A property owner shall file with the clerk of the governing body in which the district is located a written notice of the property owner's intent to circulate a petition to dissolve the district. The notice shall include the name, address and telephone number of at least one property owner living within the district who intends to circulate the petition, the name, location and general purpose of the district which that is to be dissolved and a true and concise statement of two hundred words or less explaining the advantages of dissolving the district. A petition shall not be circulated for thirty days after the property owner files with the governing body the notice of intent to circulate a dissolution petition.
2. The governing body may provide a form of petition to be used to dissolve the district. Any petition shall include the statement provided in the notice of intent to circulate a petition regarding the advantages of dissolving the district.
3. The governing body may provide a true and concise written statement of two hundred words or less regarding the petition or dissolution of the district. If so provided, the property owner must circulate this statement affixed to the petition.
4. Property owners shall submit to the clerk of the governing body a petition for the dissolution of an improvement district formed under this section that purports to be signed by more than fifty per cent percent of the property owners in the district.
5. Within twenty days of after receipt of the signed petition, the governing body shall verify that the petition is signed by more than fifty per cent percent of the property owners as set forth in paragraph 4 of this subsection.
6. If the governing body finds the petition contains valid signatures of more than fifty per cent percent of the property owners, the governing body shall set the date for dissolution of the district within ninety days. The district may continue to operate after dissolution only as needed to collect money and make payments on any outstanding district obligations.
7. Each property in the district with outstanding assessments or liens attached shall remain subject to those assessments or liens for payment of the existing obligations of the district, notwithstanding dissolution of the district.
8. If a district formed under this section subsequently dissolves as prescribed in this subsection, the governing body may not attempt to form any district for the same purpose for at least two years after the date the district is dissolved if the proposed district includes lands formerly located within the dissolved district.
O. Districts that are located in slum or blighted areas as defined in section 36-1471 are exempt from subsection N of this section.
Sec. 3. Section 48-575, Arizona Revised Statutes, is amended to read:
48-575. Improvement districts for enhanced municipal services
A. In addition to the purposes for which an improvement district may be formed under the provisions of section 48-572, an improvement district may be formed within a designated area to provide public service within the district at a higher level or greater degree than provided in the remainder of the community, including such services as public safety, fire protection, refuse collection, street or sidewalk cleaning or landscape maintenance in public areas, planning, promotion, transportation and public parking.
B. The powers and duties of the governing body of the municipality and the procedure to be followed shall be as provided in this article for other types of special improvement districts.
C. If a petition for the formation of an improvement district under the provisions of this section is presented to the governing body purporting to be signed by all of the real property owners in the proposed district, exclusive of mortgagees and other lienholders, the governing body, after verifying such ownership and making a finding of such fact, shall adopt a resolution of intention to order the improvement pursuant to the provisions of section 48-576 and shall have immediate jurisdiction to adopt the resolution ordering the improvement pursuant to the provisions of section 48-581, without the necessity of the publication and posting of the resolution of intention provided for in section 48-578. For IMPROVEMENT districts formed pursuant to this section after May 1, 2024, the governing body may not order the IMPROVEMENTS prescribed by SUBSECTION A of this section until after the governing body has received a petition prescribed by section 48-623.
D. The engineer shall make duplicate diagrams of the property contained within the improvement district. The diagram shall show each separate lot numbered consecutively, the area in square feet of each lot, and the area in square feet of any building or buildings located on each lot. Prior to before making any assessment upon on the district, the diagram shall be approved by the governing body.
E. The governing body shall make annual statements and estimates of the expenses of the district, and shall assess the total sum upon on the several lots, each respectively in proportion to the benefits to be received by each lot. When the assessments have been completed, the governing body shall fix a time when it will hear and pass upon on the assessments and the prior proceedings relating thereto, which shall not be less than twenty days from after the date of the notice. Notice of hearing shall be given in the manner provided by section 48-590, subsection E. Any person owning real property affected by the assessment who has any objection to the legality of the assessment, or to any of the previous proceedings connected therewith, may prior to before the time fixed for the hearing may file a written notice briefly specifying the grounds of the objection. At the time fixed for the hearing or at any time not later than ten days thereafter to which the hearing may be postponed, the governing body shall hear and pass upon on the objections. The decision of the governing body shall be final and conclusive upon on all persons entitled to object as to all errors, informalities and irregularities which that the governing body might have remedied or avoided any time during the progress of the proceedings.
F. The assessments for the annual expenses shall be collectible in the manner and by the officers provided by law for the collection and enforcement of general taxes the municipality is authorized to levy. All statutes providing for the levy and collection of county and city taxes, including the collection of delinquent taxes and sale of property for nonpayment of taxes, shall be applicable to the district assessments provided for under this section.
G. An improvement district formed under the provisions of this section shall not be authorized to issue improvement bonds.
H. No improvement district formed under the provisions of this section shall be authorized to engage in any activity other than as provided in subsection A of this section. If the municipality is willing to participate in the cost of the district, the governing body may, by resolution, may summarily order such participation.
I. The formation of an improvement district under the provisions of this section shall not prevent the subsequent establishment of improvement districts for any other purpose authorized by law.
J. If, in the opinion of the governing body, any territory of a district formed under this section is not benefited by being a part of the district, the governing body may, by resolution, may exempt such territory from assessment under this chapter, or if any portion of the territory of a district formed under this section is no longer benefited by being a part of the district, the governing body may, by resolution, may summarily delete from the district formed under this section any such area and may form a new district from the balance of the original district formed under this section.
K. Any real property that is within the boundaries of the district, that is utilized used for residential purposes and that is not specifically benefited by the public services at a higher level or greater degree shall be exempt from assessment pursuant to this section for that year. Existing improved real property utilized used for residential purposes with four units or less per building at the time of formation of the district is presumed to not be specifically benefited by a public service at a higher level or greater degree.
L. Within ten days after adoption of the resolution of intention to order the improvement, the municipality shall record the resolution in the office of the county recorder in the county in which the district is located in such a way as to give notice of formation of the district to all property owners within the district.
M. If, in the opinion of the governing body of the municipality, territory adjacent to a district formed under this section would benefit from being a part of the district, the governing body, by resolution, may include the territory in the district formed under this section if all of the following conditions are met:
1. Including the territory in the district will not adversely affect the district.
2. Notice of the proposed inclusion of the territory in the district has been published in five consecutive issues of a daily newspaper or two consecutive issues of a weekly or semiweekly newspaper of general circulation published in the municipality and a public hearing has been held to consider the inclusion of the territory in the district.
3. Notice, including an accurate map of the territory proposed for inclusion in the district, has been sent by first class mail at least ten days before the hearing prescribed in paragraph 2 to each owner of property listed on the tax roll within the district and in territory that is now or would be subject to taxation by the district in the event of inclusion of the territory.
N. Within ten days after the governing body of the municipality adopts a resolution pursuant to subsection M of this section, the municipality shall record the resolution in the office of the county recorder in the county in which the district is located to give notice of the inclusion of the territory in the district to all property owners in the district. If, before the governing body of the municipality adopts the resolution pursuant to subsection M of this section, a majority of the property owners, by area, of either the original district formed under this section or the territory proposed to be included in the district files with the governing body of the municipality written objections to the proposed inclusion of the territory, the territory shall not be included in the district. the governing body may adopt a resolution pursuant to subsectION M of this section without requiring a petition to be filed pursuant to section 48-623.
O. An improvement district to provide enhanced municipal services may continue to exist in an area that is no longer in a designated area as defined in section 48-571, if at the time of district formation all of the following apply:
1. The area contained in the improvement district has been in a designated area for five or more years.
2. Not more than ten per cent percent of the frontage of the property fronting on the proposed improvement, or if the cost of the improvement is to be made chargeable on a district, not more than ten per cent percent of the frontage of the property contained within the limits of the improvement district, is owned by the same person.
3. Not more than one-third of the property owners by frontage of the area contained in the improvement district files with the governing body of the municipality written objections to the improvement district.
4. The municipality otherwise complies with the provisions of this article for the process of forming the improvement district.
Sec. 4. Section 48-576, Arizona Revised Statutes, is amended to read:
48-576. Resolution or ordinance of intention to order improvement; petition
A. Before ordering an improvement authorized by this article and after receiving a petition signed by the owners of real property in the proposed district as prescribed by section 48-623, the governing body of the municipality shall comply with both of the following:
1. Pass a resolution or ordinance of intention so to do make an IMPROVEMENT, briefly describing the improvement. By the resolution or ordinance and the proceedings subsequent thereto, one or more improvements may be made on one or more streets and shall constitute one improvement and be constructed under one or more contracts. The resolution or ordinance of intention may be combined in a single resolution or ordinance of intention to open, extend, widen, straighten or close public streets or off-street parking areas pursuant to section 48-505. If the work proposed is already done for a lot, the lot shall be excepted from the assessment therefor to the extent of the work done.
2. If the governing body determines that the district should be formed after the final resolution of any protests made pursuant to section 48-579, the governing body shall submit within one hundred twenty days to the city or town clerk a petition to form the district that is signed by owners of more than one-half of the taxable property units within the area of the proposed district and that is signed by persons owning collectively more than one-half of the assessed valuation of the property within the area of the proposed district. Property that is exempt pursuant to title 42, chapter 11, article 3 is not considered in determining the total assessed valuation of the proposed district and owners of property that is not subject to taxation are not eligible to sign the petition. On verification of the petition signatures, the governing body may form the improvement district and order the improvement as otherwise provided by law.
B. When the proposed improvement, in the opinion of the governing body, is of more than local or ordinary public benefit, it may order the expense of the improvement chargeable upon on a district, and shall describe the extent of the district in general terms in its resolution or ordinance of intention, either by reference to street lines or block numbers, or by designating its exterior boundaries by their courses and distances from the street or streets the improvement of which is contemplated, and may refer for a more particular description thereof to a map on file with the city or town engineer, showing the exterior boundary lines of the district, and delineating block and lot numbers or containing such details as will show the location of the lines. A city or town shall not assess the costs of an improvement which that is for the general public benefit against land in an assessment district. If a portion of the expense of an improvement is for general public benefit, the city or town shall assess the district only that portion of the expense which that benefits the property within the district.
C. The governing body, in the resolution or ordinance of intention, may provide that the improvement described therein may be made according to any of several alternative plans and specifications, or methods, classes or kinds of construction, or classes and kinds of material to be thereafter determined by the legislative body.
Sec. 5. Title 48, chapter 4, article 2, Arizona Revised Statutes, is amended by adding section 48-623, to read:
48-623. Petition to establish improvement district; verification; deposit; applicability
A. Beginning on May 1, 2024, before the governing body may order an improvement and adopt a resolution of intention to do so as prescribed by section 48‐576, the governing body must receive a petition that is filed with the clerk, signed by both of the following:
1. A majority of the persons owning real property within the area of the proposed district.
2. The owners of fifty‐one percent or more of the real property, determined by acreage, within the area of the proposed district.
B. to determine a majority of the persons owning real property within the area of the proposed district, the governing body and other persons may rely on the taxable property units as determined by the county assessor as of the date of the petition. This determination of a majority of the persons owning real property shall include real property that is not subject to general property taxes, but may not include the owners of public property prescribed by section 48-582 or rights-of-way owned by those owners of public property. to determine the acreage within the area of the proposed district, public property and rights of way shall be excluded. Public property may still be included within the proposed improvement district subject to the declaration of the governing body in the resolution of intention pursuant to section 48-576.
C. A petition with the required number of signatures may not be declared void as a result of any alleged defect, and the governing body shall allow the petition to be amended in form and substance to conform to the requirements of this article. One or more similar petitions or copies of the same petition with additional signatures to establish any improvement district may be filed before the governing body orders the improvement and adopts a resolution of intention to do so, and shall be deemed to be filed with the first petition. The petition shall be presumed to contain the signatures of the persons whose signatures appear on the petition, unless proven otherwise. The governing body may provide a form of petition to the owners.
D. The petition shall set forth all of the following:
1. The name of the proposed improvement district.
2. The necessity for the proposed improvement district.
3. That the public convenience, necessity or welfare will be promoted by establishing the improvement district and that the property to be included in that improvement district will be benefited.
4. A legal description of the boundaries of the proposed improvement district, and a map that shows generally the location of the proposed improvement district.
5. A general description of the proposed improvement.
6. That the petitioners consent to assessment, except that an assessment will not be levied without the governing body's compliance with sections 48‐577 through 48-594.
7. the assessor's parcel number for each lot to be included in the proposed district. each petition signer shall indicate the applicable ASSESSOR'S parcel number that corresponds to the lot owned by the signer.
8. Any other matters that are required by this article.
E. Notwithstanding any other provision of this section, if the petition is signed by owners of all of the real property within the proposed improvement district, other than public property as prescribed by section 48-582 and is approved by the municipality, the municipality and those owners may enter into a written agreement waiving any or all requirements relating to posting, publication, mailing, notice, protest and objection, including the provisions of sections 48-578, 48-579 and 48-580, and the written requirement regarding alternative plans in section 48-584, subsection C. On receipt of a petition prescribed by this subsection, the governing body, after verification of the petition as prescribed by subsection F of this section, shall adopt a resolution of intention to order the improvement pursuant to section 48-576 and shall have immediate jurisdiction to adopt the resolution ordering the IMPROVEMENT pursuant to section 48-581, and may combine those resolutions into one resolution.
F. The clerk shall verify property ownership as of the date of the petition based on the official records of the recorder of the county and as otherwise prescribed by subsection A of this section. For purposes of this section, owners do not include mortgagees or other lienholders, or persons holding an interest in real property pursuant to a purchase contract. Following verification of the property ownership, the clerk shall add a written verification of the clerk to the verified petition. The resolution of intention to order the improvement shall ratify the verification of the property ownership as a finding of fact and approve the area to be included with the proposed improvement district in accordance with the verified petition, except that any such legislative action is at the sole and absolute discretion of the governing body. The clerk may, and at the direction of the governing body or the petitioners shall, record a copy of the verified petition.
G. Costs incurred by the petitioners or the municipality in connection with the petition may be included as incidental expenses as provided for in this article.
H. On receipt of the petition pursuant to this section, or at any time after receipt but before consideration of the resolution of intention ordering the improvement, the municipality may require the petitioners to deposit monies or file a bond, with security approved by the governing body, that is sufficient to pay the expenses connected with the proceedings if the governing body refuses to establish the improvement district. At any time during the proceedings, if the governing body determines the deposit or bond to be insufficient, it may order the deposit of an additional amount or the filing of an additional bond within a specific time that is not less than ten days after the date of its order. On failure of the petitioners to provide for an additional deposit or to file the additional bond, the petition may be dismissed by the governing body.
I. For purposes of a community facilities district issuing special assessment bonds pursuant to section 48-721, this section does not apply and a petition is not required.
