Chapter 17.08 Local Improvement Procedure


- Note

(Chapter replaced by Ordinance No. 177124, effective January 10, 2003.)


17.08.010 Definitions and Scopes of Duties.

(Amended by Ordinance Nos. 182389 and 184957, effective November 25, 2011.)

 

A.  The “Responsible Bureau” for a local improvement is as follows:

 

1.  The Bureau of Transportation is the Responsible Bureau for street and other transportation improvements;

 

2.  The Bureau of Environmental Services is the Responsible Bureau for sanitary sewer, stormwater management and other environmental improvements;

 

3.  The Bureau of Water Works is the Responsible Bureau for water improvements; and

 

4.  City Council shall designate the Responsible Bureau for a local improvement that is not addressed by this section.

 

B.  “Local Improvement District Administrator” means the person designated by the Director of the Bureau of Transportation to administer the City’s local improvement district program.

 

C.  The Responsible Engineer as identified in Section 17.04.037 is responsible for:

 

1.  Preparing a preliminary engineer’s estimate;

 

2.  Preparing plans and specifications;

 

3.  Entering into a contract for improvement construction and/or engineering;

 

4.  Handling completion of construction and acceptance of work;

 

5.  Preparing a final engineer’s estimate; and

 

6.  Any other work related to engineering or construction.

 

D.  The Local Improvement District Administrator is responsible for:

 

1.  Preparing a petition for a local improvement district and determining the validity of a petition for a local improvement district as appropriate;

 

2.  Recommending an assessment methodology or assessment methodologies for a local improvement district to City Council;

 

3.  Analyzing financial feasibility of a local improvement district prior to formation;

 

4.  Preparing and filing a resolution of intent for formation of a local improvement district;

 

5.  Publishing and posting notices for the formation hearing of a local improvement district;

 

6.  Preparing and filing a formation ordinance for a local improvement district;

 

7.  Responding to remonstrances against formation of a local improvement district;

 

8.  Presenting significant changes to scope or cost of improvements to City Council after formation of a local improvement district;

 

9.  Recommending abandonment of a local improvement district;

 

10.  Determining the total cost of the local improvement;

 

11.  Publishing and posting notice of final assessment for a local improvement district;

 

12.  Preparing and filing the final assessment ordinance for a local improvement district;

 

13.  Responding to objections against final assessment of a local improvement district; and

 

14.  Any other work related to processing or completing local improvement districts.

 

E.  The City Auditor shall be responsible for:

 

1.  Mailing notices for the formation hearing of a local improvement district at the direction of the Local Improvement District Administrator;

 

2.  Receiving written remonstrances against the formation of a local improvement district, and forwarding such remonstrances to the Local Improvement District Administrator for a response;

 

3.  Maintaining records of preliminary estimates of assessments;

 

4.  Mailing notices for the final assessment hearing for a local improvement district at the direction of the Local Improvement District Administrator;

 

5.  Receiving written objections to the final assessment for a local improvement district, and forwarding such objections to the Local Improvement District Administrator for a response;

 

6.  Entering final assessments for a local improvement district into the docket of City Liens upon passage of an assessment ordinance for a local improvement district;

 

7.  Mailing of notices of final assessment to property owners after passage of the assessment ordinance and entry into the docket of City Liens;

 

8.  Determining the individual financial capacities of property owners, and whether to offer bonding, if requested; and

 

9.  Obtaining interim financing to pay for local improvement costs prior to bonding.


17.08.020 City Council Control.

Whenever the City Council deems it expedient, it may order an improvement; when the City Council determines that such improvement will afford a special benefit to property within a particular district, the City Council shall classify it as a local improvement, and provide for payment of all or a portion of the cost thereof by imposition and collection of local assessments on the property benefited.


17.08.030 Charter Provisions Applicable.

(Amended by Ordinance No. 184957, effective November 25, 2011.)  Charter provisions applicable to local improvements shall be followed by the City except where Charter provisions are contrary to state statute or the Oregon Constitution. In case of such conflict, legally applicable City Code shall apply.


17.08.040 Initiation of Local Improvement Proceedings.

A. City Council may, at its discretion, initiate a local improvement proceeding by adopting a resolution of intent to undertake a capital construction project, or part thereof, based on:

1. A valid petition of support per the criteria in Section 17.08.050, signed by property owners and filed with the Local Improvement District Administrator;

2. A recommendation from the Responsible Bureau; and/or

3. Its own initiative.

B. Where a sewer local improvement is ordered pursuant to an Environmental Quality Commission Order and a sewer plan has been developed and adopted by the City Council, preparation of the construction plans and specifications for that improvement may begin without action by the City Council.


17.08.050 Petition for a Local Improvement District .

A. A petition of support may be prepared by the Local Improvement District Administrator or by owners of property that may be specially benefited by the proposed improvement.

B. The petition shall include:

1. The name or designation of the improvement;

2. A map or clear description of the location of the improvement;

3. The general character and scope of the improvement; and

4. A proposed assessment methodology.

C. The Local Improvement District Administrator shall review a petition for the proposed local improvement district to determine if the petition is valid. A petition will be considered valid only when property owned by petition signers added to property covered by waivers of remonstrance and property owned by the City represents more than 50 percent of the property in the proposed district as measured by the proposed assessment methodology. Property owned by the City, including property owned through the Portland Development Commission, shall be counted in support of formation of a local improvement district.

D. The Local Improvement District Administrator will not consider a petition valid if a petition for a substantially similar local improvement district has been filed in the previous 6 months and City Council resolved not to proceed with the substantially similar district.

E. In reviewing the petition, the Local Improvement District Administrator shall also identify delinquencies in taxes or City liens in the proposed district and determine the bonding capacities of the properties within the proposed local improvement district. The Local Improvement District Administrator shall analyze project financial feasibility by determining whether the sums assessed together with all unpaid sums then outstanding as assessments against the properties would exceed one-half the real market valuation of the properties as shown on the latest county tax rolls.

F. A petition of support will not be disqualified as a result of a subsequent transfer in property ownership. However, the new property owner has a right to remonstrate against the proposed improvement as provided in Chapter 17.08.


17.08.060 Resolution of Intent.

A. The Local Improvement District Administrator shall prepare and file a resolution of intent for the City Council’s consideration if after the review specified in Section 17.08.050 the Local Improvement District Administrator determines a petition is valid; if a Responsible Bureau recommends initiation of a local improvement district; and/or if a member of City Council requests initiation of a local improvement district.

B. The resolution of intent shall include the following: the name or designation of the improvement; the location of the improvement; a map or clear description of the district boundary; the general character and scope of the improvement; a preliminary estimate of the total cost of the local improvement; the proposed assessment methodology; the proportion of funding to be borne by property owners and other sources, if applicable; the designated Responsible Bureau if the project scope is not addressed by Section 17.08.010; a statement of whether the City Council intends to construct the improvement; and direction to the Local Improvement District Administrator to do one of the following:

1. Initiate formation proceedings on the proposed local improvement district; or

2. Suspend proceedings on the proposed local improvement district; or

3. Terminate the process for forming the proposed local improvement district.

C. If City Council passes a resolution of intent to construct the improvements, City Council shall direct the Local Improvement District Administrator to initiate local improvement district formation proceedings as set forth in Section 17.08.070.

D. The City Council may direct that the engineering and construction work shall be done in whole or in part by the City, by a contract, by direct employment of labor, by another governmental agency, or by any combination thereof.

E. If a petition is not valid, but the City Council determines that an improvement should be constructed, it may initiate the proceedings by adopting a resolution of intent to construct the improvement.

F. If the City Council determines that some other construction, such as installation of water lines, sewer lines prior to a street improvement, installation of fire hydrants, utility lines or conduits, conduits for underground service for street lights, or any other underground construction should precede the particular proposed improvement, then the City Council may suspend the proceedings for the proposed improvement until such construction has been started or completed.

G. If the City Council passes a resolution to terminate the process for forming the local improvement district, no further action shall be taken by the Local Improvement District Administrator on the district for a period of 6 months, other than actions to close the project.


17.08.070 Local Improvement District Formation and Remonstrances.

A. Notice of Public Hearing

1. Publication Notice: Except as otherwise provided by Charter for changes to street grades, the Local Improvement District Administrator shall publish 2 notices of the City’s intent to form a local improvement district by publication in a paper of general circulation in the City at least 14 calendar days before the formation hearing. The notices shall include the following information:

a. The time, date and place of the formation hearing before City Council;

b. The name of the proposed district;

c. A description of the type and scope of improvements to be made;

d. A map or description of the area proposed for inclusion in the district for which a legal description is not required;

e. A preliminary estimate of the total cost of the local improvement based on the preliminary engineer’s estimate;

f. The methodology or methodologies by which properties will be assessed;

g. A statement that the proposal could be modified as a result of the testimony at the formation hearing and that property owners should attend the hearing to have an opportunity to testify on proposed changes;

h. A statement mentioning the right to remonstrate, who may remonstrate, how remonstrances can be made, the deadline for filing remonstrances; and where remonstrances must be filed; and

i. Contact information for the Local Improvement District Administrator.

2. Posting Notice: At least 14 calendar days before the local improvement district formation hearing, the Local Improvement District Administrator shall cause to be posted conspicuously within the proposed assessment district, at least two notices headed "Notice of Proposed Improvement" in letters not less than 1 inch in height, and the notices shall contain in legible characters the information required in Section 17.08.070.A.1. The Local Improvement District Administrator shall place an affidavit of the posting of such notices within the project file, stating therein the date when and places where the notices have been posted.

3. Mail Notice: At least 21 calendar days before the local improvement district formation hearing on the proposed improvement, the City Auditor, at the direction of the Local Improvement District Administrator, shall mail to the owner of each property within the proposed assessment district, a notice containing the following:

a. The information required in Section 17.08.070.A.1;

b. A description of the property; and

c. A preliminary estimate of the assessment for the property.

4. A record shall be kept of the mailing, posting and publication of any notice required by this Ordinance. Any mistake, error, omission or failure with respect to publication, posting or mailing notice shall not affect City Council’s jurisdiction to proceed or otherwise invalidate the local improvement proceedings when notice is provided by at least one of the methods in this Section.

B. Remonstrances

1. If property owners choose to remonstrate against the proposed improvement such remonstrances must be received by the City Auditor by 5:00 PM seven (7) calendar days prior to the local improvement district formation hearing. A remonstrance must be in writing and must be delivered in person or by first class U.S. mail to the City Auditor. The City Auditor is not responsible for remonstrances sent via facsimile or via e-mail. The remonstrance shall state the reasons for the objection. Any person acting as agent or Attorney with power to act in signing the remonstrance shall, in addition to describing the property affected, file with the remonstrance a copy in writing of the authority to represent the owner or owners of property. The City Auditor will forward the remonstrance to the Local Improvement District Administrator for a response. A written remonstrance may be withdrawn at any time before the close of the City Council hearing on the formation of the District.

2. Owners of property covered by waivers of remonstrance may submit an objection; however such an objection shall not be considered for purposes of determining Council jurisdiction as provided by Chapter 9 of the City Charter for the particular type of improvement.

3. The number of remonstrances that will defeat formation of a proposed local improvement district shall be as provided by Chapter 9 of the City Charter for the particular type of improvement.

C. Formation Ordinance

1. The local improvement district formation ordinance shall contain at least the following findings:

a. Name of the proposed local improvement district;

b. A general description of the project scope as may also be shown on a typical section;

c. A description of the proposed local improvement district with a reference to specific district boundaries, or a map showing the area proposed for inclusion in the local improvement district;

d. A preliminary estimate of the total cost of the local improvement, including design, construction, engineering, project management and financing;

e. The assessment methodology or methodologies by which benefit within the local improvement district will be assigned;

f. A preliminary estimate of assessments for each property owner within the local improvement district based on the proposed assessment methodology or methodologies;

g. A statement as to the financial feasibility of the district, based on the preliminary estimate of assessments and outstanding past assessments and taxes; and

h. An exhibit containing findings addressing each remonstrance received, and number of remonstrances received.

2. The local improvement district formation ordinance shall contain at a minimum directives that:

a. Create the district;

b. Include benefited properties in the district as shown on an attached exhibit;

c. State the property owners’ share of the costs that the benefited properties will be assessed, and any other entities’ shares, as applicable;

d. State the assessment formula or assessment formulas;

e. Direct the Responsible Engineer to arrange for the preparation of plans and specifications;

f. Direct the Responsible Engineer to arrange for construction of the improvement;

g. Direct the City Auditor to obtain interim financing to pay for local improvement costs prior to bonding; and

h. Sustain or overrule any remonstrances received.

D. Local Improvement District Formation Hearing

1. The City Council shall hold a public hearing on the proposed improvement. As provided by Section 17.08.070 A.3, the hearing shall be held at least 21 calendar days after the date notice was deposited in the mail. The City Council may continue or discontinue the proceedings; may direct a modification of its resolution of intent; or may direct formation of the district and override any remonstrances, provided the City Council retains jurisdiction as provided by Chapter 9 of the City Charter for the particular type of improvement. The City Council may direct a modification to the location or scope of the improvement, and/or to the assessment district which it deems will be benefited by the improvement; or make such other modifications in the proceedings as it finds reasonable.

2. Modification of Scope of Improvements: If the City Council significantly modifies the scope of the improvement within the adopted formation ordinance so that an assessment is likely to be significantly increased upon one or more properties, or if the City Council enlarges the assessment district within the adopted formation ordinance, then a new preliminary estimate of assessments will be made and new notices shall be sent to the property owners within the proposed district, and another hearing shall be held. The notice shall advise property owners who still wish to remonstrate that their remonstrance must be resubmitted. However, no new publication or posting shall be required. In the event of modification that meets the objection of any remonstrance, such remonstrance shall not be counted as such unless renewed following such modification.

3. Decision to Form District: Upon completion of the hearing process, the City Council may approve or decline formation of a district by ordinance. As provided in Section 17.08.070 C.1, a decision to approve formation of a district shall be supported by findings supporting a conclusion of special benefit and addressing the remonstrances, and shall direct the Local Improvement District Administrator to arrange for construction of the local improvement.

4. If the City Council approves formation of the local improvement district, the Responsible Engineer shall arrange for the preparation of plans and specifications. Upon completion, approved plans will be available for inspection at the Responsible Bureau for at least the minimum time period specified in its Records Retention and Disposition Schedule. The local improvement may be constructed and/or engineered in whole or in part by the City or by another government agency, or the City may seek bids for any portion of the local improvement.

5. The City Council shall have final determination of the kind and character of the local improvement, its location and extent, materials to be used, and all matters contained in the plans and specifications.

6. The City Council shall also have final determination of the assessment formula and boundaries of the district that is to be assessed for the costs of the improvement. The possibility or likelihood that some property contained in the property description of the proposed assessment district may not be benefited by the proposed improvement shall not invalidate the district description.

7. Upon City Council’s passage of an ordinance forming a local improvement district, the assessment formula may not be changed notwithstanding concurrence among the property owner(s), nor can the assessment obligation be transferred to a property not included in the local improvement district. No release of obligation shall be made by the City Auditor until after final assessment is made.


17.08.080 Changes to Scope or Cost of Improvements and Notice to Proceed.

(Amended by Ordinance No. 182760, effective June 5, 2009.)

 

A.  After formation of a local improvement district, City Council shall hold a public hearing to consider significant and material changes to the proposed scope or to the estimate of the total cost of the local improvement that may arise during the course of final engineering.

 

B.  For such a hearing, notice shall be in the manner provided by Section 17.08.070.  In addition to meeting the provisions of Section 17.08.070, the notice shall also state the nature of the proposed modifications to the scope of improvements or to the preliminary estimate of the total cost of the local improvement previously approved at the Local Improvement District formation hearing. Property owners shall have the opportunity to remonstrate against the significant changes in the manner provided by Section 17.08.070. If the improvement district was initiated by petition, no new petition will be required.

 

C.  The Responsible Engineer may issue a Notice to Proceed to begin construction provided that:

 

1.  There are no significant changes to the scope of the local improvements; or

 

2.  There are no significant changes to the preliminary estimate of assessments for the benefiting properties in the local improvement district; or

 

3.  The City Council has approved significant changes to scope and/or cost of the improvements as provided in this section.

 

Construction of the local improvement shall be in substantial accordance with the plans and specifications adopted by the Responsible Engineer.


17.08.090 Abandonment of Local Improvement District.

The City Council shall have full power and authority to abandon and rescind proceedings for local improvements at any time prior to the final completion of the improvements.


17.08.100 Completion of Construction.

(Amended by Ordinance No. 182760, effective June 5, 2009.)

 

A.  After the work financed by the local improvement district has been completed satisfactorily, the Responsible Engineer shall prepare a certificate of completion.  The Responsible Engineer shall also prepare a final engineer’s estimate showing the costs of all engineering and construction work performed.  The certificate of completion shall be deemed acceptance by the City of the local improvement work.

 

B.  Authorization for final payment will be made as provided by Chapter 5.33 of City Code.

 

C.  The Local Improvement District Administrator will include the final engineer’s estimate and a copy of the certificate of completion with the filing of the final assessment ordinance as set forth in Section 17.08.130.

 

D.  Notice of completion of the work need not be provided except as may be required  elsewhere in City Code.

 

E.  If a local improvement is substantially complete except for contract closeout, or if a scope of improvement included in the construction contract but not included in the local improvement is incomplete, the Responsible Engineer at the discretion of the Responsible Bureau may file a written report attesting that the local improvements are complete in lieu of a certificate of completion.  The provisions set forth in Section 17.08.100.A apply, except that the written report substitutes for the certificate of completion. Any further project or financing costs incurred subsequent to final assessment will be the responsibility of the Responsible Bureau, not of the property owners.


17.08.110 Total Cost of Local Improvement.

A. After the work financed by a local improvement district has been accepted as complete, the Local Improvement District Administrator shall determine the total cost of the local improvement, including costs identified in the final engineer’s estimate and any pending costs.

B. The total cost of the local improvement that may be assessed against the properties specially benefited by the improvement shall include, but not be limited to the following:

1. Direct or indirect costs incurred in order to undertake the capital construction project such as the costs of labor, materials, supplies, equipment, permits, survey, engineering, administration, supervision, inspection, insurance, advertising and notification, administration, accounting, depreciation, amortization, operation, maintenance, repair, replacement, contracts, debt service and assessment;

2. Financing costs, including interest charges; the costs of any necessary property, right-of-way or easement acquisition and condemnation proceedings; and

3. Attorneys’ fees and any other actual expense as allowed by state law.

C. Engineering and project management performed by the City in connection with local improvements shall be charged at the rate of 100 percent of the direct cost of services performed computed in accordance with the provisions of Section 5.48.030. The Responsible Engineer shall prepare a final engineer’s estimate of the engineering and construction costs. A final estimate of the total project costs, including costs reflected in the final engineer’s estimate, shall be prepared by the Local Improvement District Administrator.

D. The City Auditor shall maintain a fee schedule that shall be used for determining the charge to be made by the City Auditor for City Auditor’s Office administrative services and general City administrative services in connection with local improvements. These charges will include a Superintendency fee; a recording fee which shall be fixed regardless of the amount of the assessment; and a monthly billing fee if the property owner does not pay the full assessment at the time it is levied.


17.08.120 Alternative Financing Methods.

Nothing contained in this Chapter shall preclude the City Council from using any other available means of financing portions of local improvements, including but not limited to city funds, federal or state grants, user charges or fees, revenue bonds, general obligation bonds, or any other legal means of finance. In the event that such other means of financing improvements are used, the City Council may make assessments to pay any remaining part of the total costs of the local improvement.


17.08.130 Final Assessment and Objections.

(Amended by Ordinance Nos. 182760 and 184957, effective November 25, 2011.)

 

A.  Apportionment of Proposed Final Assessments

 

1.  Whenever any local improvement, any part of the cost of which is to be assessed upon the property specially benefited thereby, is completed in whole, or in such part that the cost of the whole can be determined, the Local Improvement District Administrator shall file the final estimate of the total cost of the local improvement and prepare a proposed final assessment according to the assessment formula approved by City Council upon the properties in the district, including upon any land owned by the City.

 

2.  If the City Council has determined that a portion of the total cost of the local improvement is to be paid from public funds, other than the benefit assessment to be imposed upon land owned by the City and lying within the assessment district fixed by the City Council, the Local Improvement District Administrator shall deduct from the total cost of the local improvement such allocation of costs to public funds provided by the City Council and shall apportion the remainder of such total cost on the properties within the assessment district.

 

3.  When the Local Improvement District Administrator has calculated the assessment for each property, the Local Improvement District Administrator shall file the proposed final assessment roll with the City Council through the Commissioner-in-Charge of the Responsible Bureau.

 

B.  Notice of Proposed Final Assessments

 

1.  At least 21 calendar days before the public hearing on the proposed final assessment, the City Auditor at the direction of the Local Improvement District Administrator shall provide notice to the owner of each property or to the owner's agent as shown in the County tax record either by mail or by personal delivery. The notice shall state:

 

a.  The property description;

 

b.  The amount of the proposed final assessment against the property;

 

c.  A statement that this amount could be modified as a result of objections filed by other property owners in the district unless the cost to property owners is fixed;

 

d.  The date, time and place of the final assessment hearing;

 

e.  The deadline and manner for filing objections to the proposed final assessment; and

 

f.  Contact information for the Local Improvement District Administrator.

 

2.  The Local Improvement District Administrator shall publish 2 notices  of the proposed final assessment in a newspaper of general circulation in the City at least 14 calendar days prior to the final assessment hearing.

 

C.  Final Assessment Hearing and Objections

 

1.  Any owner of property proposed to be assessed a share of the cost of a local improvement may file an objection to the proposed final assessment in writing with the City Auditor. The objection must be received by the City Auditor no later than 5:00 PM seven (7) calendar days prior to the hearing by City Council on the proposed final assessment. The City Auditor will forward the objection to the Local Improvement District Administrator for a response.  The objection shall be filed in the same manner as set forth in Section 17.08.070.B and shall state the reasons for the objection.  However, objections received to final assessment shall not affect Council jurisdiction over final assessment proceedings.

 

2.  The City Council shall hold a hearing on any objections on the date set forth in the notice, and at that time shall consider objections made by the owners of property at the hearing. The hearing may be continued as the City Council may find appropriate.

 

3.  At the hearing, the City Council at its discretion shall determine and approve the amount to be assessed upon each property within the assessment district, which amount does not exceed the special benefits accruing to such property from the improvement and the sum of which amount and other amounts assessed against properties within the assessment district do not exceed the total cost of the local improvement.  The amount of each assessment as determined by City Council shall be based on the City Council’s finding of special benefit to the property.

 

D.  Final Assessment Ordinance

 

1.  The City Council shall pass an assessing ordinance that shall set forth the assessments against the respective properties within the assessment district.

 

2.  The ordinance shall:

 

a.  Include an exhibit containing findings addressing each objection received, and number of objections received

 

b.  State the total cost and assessment formula used

 

c.  Include a statement that each property is specifically benefited in the amount shown in the assessment roll;

 

d.  Include a statement that the project has been constructed as provided in the adopted plans and specifications, and, if the provisions set forth in Subsection 17.08.100 E. have been invoked, a copy of the written report from the Responsible Engineer attesting that the local improvements are complete in-lieu of a certificate of completion; and

 

e.  Contain a directive to sustain or overrule the objections.

 

3.  Upon passage of the assessing ordinance, the City Auditor shall enter the assessments in the docket of City liens and follow the assessment procedure set forth in Chapter 17.12.  As provided by City Charter, the assessment ordinance shall take effect immediately upon passage or on any date fewer than 30 days after passage that is specified in the final assessment ordinance.

 

4.  Claimed mistakes in the calculation of assessments shall be brought to the attention of the Local Improvement District Administrator, who shall determine whether there has been a mistake.  If the Local Improvement District Administrator finds that there has been a mistake, he or she shall recommend to the City Council an amendment to the assessment ordinance to correct the error.  On enactment of an amendment, the City Auditor shall cause the necessary correction to be made in the City lien docket.  Such correction shall not change assessments against any other property within the district.

 

E.  Formation of a new local improvement district:  In the event a court of law holds that the formation of a local improvement district was invalid or improper procedures were used, property owners may be assessed after the new district is formed if the properties are again included.