Iowa-2011-HF2178-Introduced

H.F. 2178 Section 1. Section 331.488, subsection 3, Code 2011, is 1 amended to read as follows: 2 3. The method of specially assessing and determining 3 benefits and determining individual benefits, district 4 benefits, and community benefits . 5 Sec. 2. Section 384.37, subsection 4, Code 2011, is amended 6 to read as follows: 7 4. “District” means the lots or parts of lots within 8 boundaries of a geographic area established by the council for 9 the purpose of the assessment of all or part of the cost of 10 a public improvement that is intended in whole or in part to 11 provide an individual benefit to such lots or parts of lots . 12 Sec. 3. Section 384.37, Code 2011, is amended by adding the 13 following new subsections: 14 NEW SUBSECTION . 2A. “Community benefit” means that portion 15 of the total benefit derived from a public improvement designed 16 to be used by or serve the general public and community that 17 is in excess of the district benefit, if any, including but 18 not limited to those public improvements or parts of a public 19 improvement specified in section 384.61, subsection 4. 20 NEW SUBSECTION . 4A. “District benefit” means the sum of all 21 individual benefits conferred upon lots within the district. 22 NEW SUBSECTION . 8A. “Individual benefit” means that 23 amount of the total benefit of a public improvement that is 24 proportionate to the lot’s use of the public improvement or 25 the amount of a benefit conferred upon the individual lot by a 26 public improvement that is intended to benefit, serve, or be 27 used only by the lot, including but not limited to those items 28 specified in section 384.61, subsection 3. 29 Sec. 4. Section 384.37, subsection 25, Code 2011, is amended 30 to read as follows: 31 25. “Street improvement” means the construction or repair of 32 a street by grading, paving, curbing, guttering, and surfacing 33 with oil, oil and gravel, or chloride, and street lighting 34 fixtures, connections and facilities , storm water management 35 -1- LSB 5154YH (6) 84 md/sc 1/ 12

H.F. 2178 intakes, sewers, and facilities, and traffic-control devices, 1 fixtures, connections, and facilities . 2 Sec. 5. Section 384.38, subsections 1 and 2, Code 2011, are 3 amended to read as follows: 4 1. A city may , subject to the limitations of this division, 5 assess to private property within the city the cost of 6 construction and repair of public improvements within the 7 city, and main sewers, sewage pumping stations, disposal and 8 treatment plants, waterworks, water mains, extensions, and 9 drainage conduits extending outside the city. 10 2. Upon petition as provided in section 384.41, subsection 11 1 , a city may assess to private property affected by public 12 improvements within three miles of the city’s boundaries the 13 cost of construction and repair of public improvements within 14 that area. The right-of-way of a railway company shall not 15 be assessed unless the company joins as a petitioner for said 16 improvements. In the petition the property owners shall waive 17 the limitation provided in section 384.62 that an assessment 18 shall not exceed twenty-five percent of the value of the lot. 19 The petition shall contain a statement that the owners agree 20 to pay the city an amount equal to five percent of the cost of 21 the improvements, to cover administrative expenses incurred 22 by the city. This amount may be added to the cost of the 23 improvements. Before the council may adopt the ordinance under 24 section 384.42, subsection 1A, the resolution of necessity, the 25 preliminary resolution, preliminary plans and specifications, 26 plat, schedule, and estimate of cost must be submitted to, and 27 receive written approval from, the board of supervisors of 28 any county which contains part of the property, and the city 29 development board established in section 368.9 . 30 Sec. 6. Section 384.41, subsection 1, Code 2011, is amended 31 to read as follows: 32 1. Property owners may initiate a plan for a public 33 improvement to be paid for in whole or in part by special 34 assessments, by written contract to be approved by the city and 35 -2- LSB 5154YH (6) 84 md/sc 2/ 12

H.F. 2178 signed by all of the owners of record of all property affected 1 by the proposed assessment. If all owners of record of all 2 the property to be affected by the public improvement petition 3 the council, said owners may, in their petition, waive notice 4 to property owners by publication and mailing, as provided 5 in section 384.50 , and the council may proceed to adopt the 6 ordinance under section 384.42, subsection 1A, a preliminary 7 resolution, a plat, schedule and estimate, and resolution 8 of necessity, and order preparation of detailed plans and 9 specifications. Special assessments initiated without notice 10 under this section are liens upon the property to be affected 11 by the assessment, to the same extent as provided in section 12 384.65, subsection 5 , except that they shall be subordinate 13 to any perfected lien unless the holder of such perfected 14 lien consents in writing to the initiation of the public 15 improvement. 16 Sec. 7. Section 384.42, Code 2011, is amended by adding the 17 following new subsection: 18 NEW SUBSECTION . 1A. Prior to the adoption of a preliminary 19 resolution under subsection 2, adopt an ordinance after 20 forty-five days’ notice and twenty days’ notice, each published 21 in accordance with section 362.3, and a public hearing, 22 setting forth the method to be used in determining the amount 23 of individual benefit, district benefit, and community 24 benefit projected to result from the public improvement and 25 a description of the manner in which the cost of the public 26 improvement will be allocated to each category of benefit. 27 Sec. 8. Section 384.42, subsections 2 and 3, Code 2011, are 28 amended to read as follows: 29 2. Adopt a preliminary resolution by the vote of a majority 30 of all the members of the council , after thirty days’ notice of 31 the preliminary resolution published in accordance with section 32 362.3 . The preliminary resolution shall contain the following: 33 a. A description of the types or alternate types of 34 improvement proposed. 35 -3- LSB 5154YH (6) 84 md/sc 3/ 12

H.F. 2178 b. The beginning and terminal points or general location of 1 the proposed improvement. 2 c. An order to the engineer to prepare preliminary plans and 3 specifications, estimated total cost of the work, and a plat 4 and schedule, and to file them with the clerk. 5 d. A general description of the property or a designation 6 of the lots which the council believes will be specially 7 individually benefited by the improvement. 8 e. A detailed description of the method used for determining 9 benefits as adopted by ordinance under subsection 1A, an 10 estimate of the amount of individual benefit, district benefit, 11 and community benefit that will be conferred as a result of the 12 public improvement, and a statement of the proportion of the 13 total cost of the public improvement that the council proposes 14 to assess against all property within the proposed district. 15 3. The preliminary resolution may also contain the 16 following: 17 a. A statement of the proportion of the total cost which 18 the council proposes to assess against specially benefited 19 property. 20 b. A a short and convenient designation for the public 21 improvement by which it may be referred to in all subsequent 22 proceedings. 23 Sec. 9. Section 384.44, Code 2011, is amended to read as 24 follows: 25 384.44 Estimated cost. 26 The estimated total cost of any public improvement 27 constructed under this part must include all of the items 28 of cost listed in section 384.37, subsection 26 , which the 29 council proposes to include as a part of the cost of the public 30 improvement, and may include an item to be known as the default 31 fund amounting to not more than ten percent of the portion of 32 the total cost of the improvement which the council proposes to 33 assess against specially individually benefited property. 34 Sec. 10. Section 384.47, subsections 3 through 5, Code 2011, 35 -4- LSB 5154YH (6) 84 md/sc 4/ 12

H.F. 2178 are amended to read as follows: 1 3. The total amount proposed to be assessed to each 2 lot according to the method described in the preliminary 3 resolution , including the assessment for the default fund, if 4 any. 5 4. The proportion of the estimated total cost of the public 6 improvement which is allocated to each lot as an individual 7 benefit . 8 5. The amount of deficiency, if any, between the amount 9 proposed to be assessed and the proportion of the estimated 10 total cost of the public improvement allocated to each lot 11 as an individual benefit . The amount of deficiency shall be 12 shown as a conditional deficiency assessment as authorized by 13 sections 384.60 , 384.62 and 384.63 . 14 Sec. 11. Section 384.51, unnumbered paragraph 2, Code 2011, 15 is amended to read as follows: 16 An amendment which extends the boundaries of a district, 17 increases the amount to be assessed against a lot, or adds 18 additional public improvements, is not effective until an 19 amended ordinance, plat, schedule, and estimate have been 20 prepared and adopted, a notice published and mailed to all 21 affected property owners, and hearing held in the same manner 22 as the original proceedings, or until all affected property 23 owners agree in writing to the change. The adoption of a 24 resolution of necessity is a legislative determination that the 25 improvement is expedient and proper and that property assessed 26 will be specially individually benefited by the improvement and 27 this determination of the council is conclusive. Ownership of 28 property to be assessed by an improvement does not, except for 29 fraud or bad faith, disqualify a council member from voting on 30 any measure. 31 Sec. 12. Section 384.54, subsection 15, Code 2011, is 32 amended to read as follows: 33 15. a. The cost of all court proceedings are a legitimate 34 item of expense in connection with a public improvement, 35 -5- LSB 5154YH (6) 84 md/sc 5/ 12

H.F. 2178 and may be included within the final assessment against any 1 property specially benefited in the assessment district. 2 b. Whenever on a hearing by the court, the amount of any 3 assessment is reduced or canceled so that there is a deficiency 4 in the total amount remaining assessed in the proceeding, the 5 court may assess the deficiency to the city or distribute the 6 deficiency upon the other property abutting upon or adjacent to 7 the improvement or in the district assessed, in a manner the 8 court finds to be just and equitable, not exceeding, however, 9 the amount the property would be specially individually 10 benefited by the improvement, and not exceeding twenty-five 11 percent of the value of the lot as shown by the plat and 12 schedule of assessments or as reduced by the court. 13 Sec. 13. Section 384.61, Code 2011, is amended to read as 14 follows: 15 384.61 Assessment of benefits. 16 1. The total cost of a public improvement, except for 17 paving that portion of a street lying between railroad 18 tracks and one foot outside of the tracks, or which is to 19 be otherwise paid, must may be assessed against all lots 20 within the assessment district in accordance with the special 21 individual benefits conferred upon the property, and not in 22 excess of such benefits. That portion of the total cost of 23 a public improvement that is not assessed to individual lots 24 in the district as the result of individual benefits shall be 25 attributable to the community benefit and shall be paid by the 26 city. 27 2. A property owner may divide property that is subject to 28 a special assessment into two or more lots for the purpose of 29 separating improved portions of the land from those portions 30 of the land which are unimproved or used for agricultural 31 purposes. If an owner of property subject to special 32 assessment divides the property into two or more lots, and if 33 the plan of division is approved by the council, the owner 34 may discharge the lien upon any of the lots by payment of the 35 -6- LSB 5154YH (6) 84 md/sc 6/ 12

H.F. 2178 amount unpaid, calculated as determined by the council. 1 3. All of the following public improvements are presumed to 2 confer an individual benefit on a lot within a district: 3 a. A public improvement that benefits, serves, or that 4 is intended for use by only one lot, unless such public 5 improvement is replacing an existing public improvement of 6 acceptable or working quality and is required as a result of 7 work on or repair of another public improvement that does not 8 benefit, serve, or that is not intended for use by only that 9 lot. 10 b. A sidewalk upon a lot that is single-family residential 11 property located along the frontage of the lot not to exceed 12 four feet in width at a standard thickness. 13 c. A sidewalk on a lot that is commercial property or 14 multifamily residential property located along the street 15 frontage of the lot not to exceed six feet in width at a 16 standard thickness. 17 d. Underground gas, water, heating, sanitary sewer, storm 18 sewer, and electrical connections and accessories located in a 19 public street right-of-way and that serve only the lot. 20 4. All of the following public improvements are presumed to 21 confer a community benefit: 22 a. A public improvement or part of a public improvement 23 that is intended for use by or intended to serve lots outside 24 the district. 25 b. A sidewalk or recreational trail, or part thereof, that 26 is part of a community-wide public recreational trail system. 27 c. The portion of a sidewalk that exceeds the portion of the 28 sidewalk presumed to be an individual benefit under subsection 29 3, paragraph “b” or “c” . 30 d. Notwithstanding any provision of this division to the 31 contrary, the planning, legal, administrative, and inspection 32 costs, including city employee salary costs, associated with 33 a public improvement that is paid for in part by special 34 assessments. 35 -7- LSB 5154YH (6) 84 md/sc 7/ 12

H.F. 2178 5. a. Notwithstanding any other provision in this 1 division to the contrary, each city undertaking the repair 2 or construction of a public improvement that includes a 3 street improvement paid for in whole or in part by a special 4 assessment shall, prior to the preparation of the schedule 5 under section 384.47, complete a vehicle traffic analysis and 6 forecast for the location of the proposed street improvement 7 that includes but is not limited to a determination of the 8 current amount of vehicle traffic generated by each lot within 9 the proposed district, a determination of the current amount of 10 vehicle traffic generated by sources other than the lots within 11 the district, and a determination of the amount of vehicle 12 traffic forecasted to be generated from each such source 13 in the future based on the type of street being analyzed, 14 completion of the public improvement, full development of the 15 district, and future planned land use within the district. 16 In conjunction with actual vehicle traffic data available to 17 the city, the vehicle traffic analysis and forecast shall be 18 completed using the most current trip generation data from the 19 institute of transportation engineers for planned land uses. 20 b. The individual benefit accruing to each lot within the 21 district as the result of the street improvement shall not 22 exceed the percentage of the total benefit from the street 23 improvement that is proportionate to the lot’s forecasted 24 amount of traffic generated as it bears to the total forecasted 25 amount of vehicle traffic. 26 Sec. 14. Section 384.63, subsection 2, Code 2011, is amended 27 to read as follows: 28 2. The council shall, by resolution, provide that the 29 deficiencies for the lots specially individually benefited by a 30 public improvement shall be certified to the county treasurer, 31 who shall record them in the county system as “special 32 assessment deficiencies”, and to the appropriate city official 33 charged with the responsibility of issuing building permits, 34 who shall notify the council when a private improvement is 35 -8- LSB 5154YH (6) 84 md/sc 8/ 12

H.F. 2178 subsequently constructed on any lot subject to a deficiency. 1 Certification to the county treasurer shall include a legal 2 description of each lot. The period of amortization for a 3 public improvement for which there are deficiencies shall 4 commence with the adoption of the resolution of necessity 5 and extend for the same period for which installments of 6 assessments for the project are made payable. Deficiencies may 7 be assessed only during the period of amortization, which shall 8 also be certified to the county treasurer and the city official 9 charged with the responsibility of issuing building permits. 10 Certification to the county treasurer shall include a legal 11 description of each lot. 12 Sec. 15. APPLICABILITY. This Act applies to public 13 improvements undertaken on or after July 1, 2012. 14 EXPLANATION 15 This bill relates to special assessments imposed by cities 16 and counties on private property for the cost of a public 17 improvement. 18 The bill establishes definitions of “community benefit”, 19 “district benefit”, and “individual benefit” under Code chapter 20 384, division IV. The bill also adds storm water management 21 intakes, sewers, and facilities and traffic-control devices, 22 fixtures, connections, and facilities to the definition of 23 “street improvement” under Code section 384.37. 24 The bill amends the definition of “district” in Code section 25 384.37 to mean the lots or parts of lots within boundaries of 26 a geographic area established by the council for the purpose 27 of the assessment of all or part of the cost of a public 28 improvement that is intended in whole or in part to provide an 29 individual benefit to such lots or parts of lots. 30 The bill requires that prior to the adoption of a preliminary 31 resolution related to a public improvement, a city must 32 adopt an ordinance, after specified notices and a hearing, 33 setting forth the method to be used in determining the amount 34 of individual benefit, district benefit, and community 35 -9- LSB 5154YH (6) 84 md/sc 9/ 12

H.F. 2178 benefit projected to result from the public improvement and 1 a description of the manner in which the cost of the public 2 improvement will be allocated to each category of benefit. 3 The bill requires that 30 days’ notice of a resolution 4 be published prior to adoption of the preliminary resolution 5 related to a public improvement. The bill requires the 6 preliminary resolution to contain a detailed description of 7 the method used for determining benefits as previously adopted 8 by ordinance, an estimate of the amount of individual benefit, 9 district benefit, and community benefit that will be conferred 10 as a result of the public improvement, and a statement of the 11 proportion of the total cost of the public improvement which 12 the council proposes to assess against property within the 13 proposed special assessment district. 14 The bill specifies that the total cost of a public 15 improvement, except for certain paving near railroad tracks 16 or improvements to be otherwise paid, may be assessed against 17 all lots within the assessment district in accordance with the 18 individual benefits conferred upon the property, and not in 19 excess of such benefits. The bill provides that the portion 20 of the total cost of a public improvement that is not assessed 21 to individual lots as the result of individual benefits is 22 attributable to the community benefit and shall be paid by the 23 city. 24 The bill strikes the provision of Code section 384.54 that 25 designated the cost of all court proceedings to be a legitimate 26 item of expense in connection with a public improvement and 27 allowed such costs to be included within the final assessment 28 against any property specially benefited in the assessment 29 district. 30 The bill allows a property owner to divide property that 31 is subject to a special assessment into two or more lots for 32 the purpose of separating improved portions of the land from 33 those portions of the land which are unimproved or used for 34 agricultural purposes. 35 -10- LSB 5154YH (6) 84 md/sc 10/ 12

H.F. 2178 The bill designates certain public improvements that are 1 presumed to confer an individual benefit and designates certain 2 public improvements that are presumed to confer a community 3 benefit. Under the bill, the planning, legal, administrative, 4 and inspection costs, including city employee salary costs, 5 associated with a public improvement that is paid for in part 6 by special assessments may not be assessed to individual lots 7 within a district and shall instead be paid by the city as a 8 community benefit. 9 The bill requires each city undertaking the repair or 10 construction of a public improvement that includes a street 11 improvement, as defined in the bill, paid for in whole or in 12 part by a special assessment to complete a vehicle traffic 13 analysis and forecast for the location of the proposed 14 street improvement that includes but is not limited to a 15 determination of the current amount of vehicle traffic 16 generated by each lot within the proposed special assessment 17 district, a determination of the current amount of vehicle 18 traffic generated by sources other than the lots within the 19 district, and a determination of the amount of vehicle traffic 20 forecasted to be generated from each such source in the future 21 based on the type of street being analyzed, completion of the 22 public improvement, full development of the district, and 23 future planned land use within the district. In conjunction 24 with actual vehicle traffic data available to the city, the 25 vehicle traffic analysis and forecast must be completed using 26 the most current trip generation data from the institute of 27 transportation engineers for planned land uses. The bill 28 specifies that the individual benefit accruing to each lot 29 within the district as the result of the street improvement 30 shall not exceed the percentage of the total benefit from 31 the street improvement that is proportionate to the lot’s 32 forecasted amount of traffic generated as it bears to the total 33 forecasted amount of vehicle traffic. 34 By operation of law, the bill modifies similar provisions 35 -11- LSB 5154YH (6) 84 md/sc 11/ 12