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Chapter 17.14 Financing of, and Exemptions from, Systems Development Charges

- Note

(Chapter added by Ordinance No. 145785; amended by Ordinance Nos. 166334 and 189050, effective August 1, 2018.)

17.14.010 Purpose.

(Amended by Ordinance Nos. 183447 and 189050, effective August 1, 2018.)  The purposes of this Chapter are to authorize financing agreements that provide for payments deferrals and installment payments of City system development charges and to provide exemptions from such charges.  This Chapter fulfills the following mandates:

A.  The requirement of Chapter 722 Oregon Laws of 1977 (ORS 223.207 and 223.208) that the rights and duties accorded the City and property owners by the laws relating to assessments and financing of local improvement districts shall also apply to assessments and financing of those charges imposed by the City that are defined by Subsections 1 (a) and (b) of Section 2, Chapter 722 Oregon Laws of 1977 (ORS 223.208 (1) (a) and (b)); and

B.  The decisions of City Council to establish certain exemptions from the assessment of system development charges.

17.14.020 Definitions.

(Amended by Ordinance No. 183447, effective July 1, 2010.)  As used in this Chapter the following terms shall be defined as follows:

A.  “System development charge” means a charge imposed pursuant to Chapters 17.13, 17.15, 17.36 and 21.16 of this Code.

B.  “Owner or property owner” means all persons who appear on the County property tax record for the property subject to the system development charge.

C.   “Responsible Bureau” means the City agency, office, organization, division or bureau which is responsible for calculating and maintaining records regarding system development charges.

17.14.030 Application, Consent to Assessment.

(Amended by Ordinance No. 183447, effective July 1, 2010.)  Any owner of real property subject to a systems development charge may apply to defer the payment of system development charges, or to pay the charge in installments in a manner similar to that provided for local improvement district assessments.  As a condition to such application, the owner shall waive any right to challenge the validity or applicability of the charge and shall consent to the assessment of the property subject to the charge.

17.14.040 Terms and Conditions of Deferred Payment and Installment Payment Agreements.

(Amended by Ordinance Nos. 183447, 185326 and 189506, effective June 21, 2019.)

A.  Deferred Payments.

1.  The City shall authorize the deferred payment of system development charges for periods not to exceed 6 months for projects valued less than or equal to $750,000, 9 months for projects valued greater than $750,000 and less than or equal to $7 million, and 12 months for projects that are valued greater than $7 million.

2.  For purposes of this Section, the City shall rely on the value assigned to projects by the City when calculating building permit fees.

3.  The City shall charge simple interest during the deferral period at the interim interest rate established by ordinance pursuant to Chapter 17.12 of this Code.

4.  The City shall collect fees and charges for the processing and administration of deferred payment agreements as set by general ordinance.

B.  Installment Payment Agreements.  Payment of principal and interest shall be made in installments as set forth in the signed installment payment contract.

17.14.050 Assessment.

(Amended by Ordinance No. 189413, effective March 6, 2019.)  The Revenue Division shall report to the Council from time to time the contracts to pay system development charges pursuant to this Chapter.  If the Council finds that the contracts are in order and that subject property has been permitted to connect to City facilities and has thereby benefited, it shall approve the contracts by ordinance direct the billing for the charges upon the land benefited plus a financing fee.  The financing fee shall be calculated as set forth in PCC 17.12 Assessments.  All such assessments may be combined in one assessment roll and shall be entered upon the Docket of City Liens and collected in the same manner as other local improvement assessments. 

17.14.060 Cancellation.

(Amended by Ordinance Nos. 183447 and 189413, effective March 6, 2019.)

A.  Upon written request of the responsible City bureau, the Revenue Division is authorized to cancel assessments of system development charges, without further Council action, where the property is not physically connected to the public improvement of where the new development approved by the building permit is not constructed and the building permit is cancelled.  The Revenue Division shall establish administrative guidelines and fees or charges relating to the cancellation of assessments.  The Revenue Division shall maintain on file for public inspection a current copy administrative guidelines and fees or charges.

B.  For property which has been subject to a cancellation of assessment of system development charges, a new installment payment contract shall be subject to the code provisions applicable to system development charges and installment payment contracts on file on the date the new contract is received by the City.

17.14.070 System Development Charge Exemptions.

(Added by Ordinance No. 189050; amended by Ordinance No. 189323, effective December 19, 2018.)

A.  Affordable housing developments are exempt from all system development charges as provided by Section 30.01.095 of this Code.

B.  Certain developments and uses are exempt from parks and recreation system development charges as provided by Section 17.13.060 of this Code.

C.  Certain developments and uses are exempt from transportation system development charges as provided by Section 17.15.050 of this Code.

D.  Temporary uses are exempt from sanitary sewer system development charges as provided by Section 17.36.040 of this Code.

E.  Certain developments and uses are exempt from water service system development charges as provided by Section 21.16.170 of this Code.

F.  An accessory dwelling unit, as that term is defined in Chapter 33.910 of this Code, is exempt from all system development charges under the following conditions:

1.  The building permit application for the accessory dwelling unit must have an intake date of August 1, 2018 or later.

2.  Prior to issuance of a building permit for the accessory dwelling unit, the applicant must submit a recorded covenant on a form provided by the Revenue Division of the Bureau of Revenue and Financial Services.  The covenant will prohibit the use of the accessory dwelling unit or any other structure on the property as an accessory short-term rental, as that term is defined in Chapter 33.207 of this Code, for a period of 10 years from the date of permit final inspection.  The covenant must be recorded in the deed records for the property before the City will issue the building permit.

3.  The Revenue Division will enforce the requirements of this Section and may:

a.  Adopt, amend, and repeal administrative rules, establish procedures, and prepare forms for the implementation, administration, and enforcement thereof;

b.  In the event of a violation, use any reasonable means to collect debt, including but not limited to private collection agencies, liens, or lawsuits;

c.  Delegate functions under this Section as deemed appropriate by the Revenue Division;

d.  Impose a civil penalty of up to $500 for failure to pay an application fee within 60 days of the approval of an SDC fee waiver;

e.  Impose a civil penalty of up to $500 per violation for failure to provide requested information to the Division; and

f.  Waive or reduce for good cause any civil penalty assessed under this Section.

4.   If an applicant for an exemption under this section or a successor-in-interest thereof violates the covenant for an accessory dwelling unit or any requirement of this section, or if the covenant is terminated according to its terms:

a.  The exemption will be terminated and all previously exempt portions of system development charges will become immediately due and payable by the then-owner of the property.  The amount owing will be 150 percent of the rates in effect at the time the violation is identified or the covenant is terminated, whichever is later. 

b.  For the purpose of applying any previous use credits, SDC Bureaus will use the timeframe of the ADU building permit intake date.  If credits are applicable, SDC Bureaus will apply credits using the rates in effect at the time the violation is identified, or the covenant terminated, whichever is later.

c.  A processing fee of $400 per waiver application shall apply from August 1, 2018 through June 30, 2019.  Thereafter the Revenue Division Director shall publish a fee schedule based on cost recovery.

d.  The City may collect reinstated system development charges, processing fees, carrying charges, and the actual costs of collections by recording a property lien pursuant to Title 22 of this Code.

G.  Mass shelters and short-term housing are exempt from all system development charges as provided by Section 30.01.096 of this Code.