North Dakota law allows inclusion of property outside city limits in city special assessment district

by Melanie Thwing

Hector v. City of Fargo
(North Dakota Supreme Court, August 31, 2010)

The Fargo Board of City Commissioners created four improvement districts for the construction of a sewer system, water mains and storm sewers. Fred Hector owns property in these districts, and was assessed for the improvements. Through the Special Assessment Commission he voiced objections to these assessments, but the Commission approved the assessments.

He then appealed to the district court, which ultimately affirmed the assessments. In appealing to the Supreme Court of North Dakota, Hector argues that the creation of these districts and the assessment for his property in these special districts is unlawful because the land is outside the city limits of the City of Fargo. 

 N.D.C.C. § 40-23-19, states:
Any property that was outside the corporate limits of the municipality at the time of contracting for an improvement, which is benefited by the improvement and is subsequently annexed to the municipality, may be assessed for the improvement subject to the same conditions … the governing body may create one or more improvement districts comprising all or part of the annexed territory….”

Also, § 40-23-25 states that when contracting for improvements, the commission must first prepare and file a list of any foreseeable future improvements on land outside of the city limits. This acts as a safe guard for any buyers looking to purchase within these zones, giving them notice to future projects.

Finally § 40-23-17 allows for the municipalities to create these improvement districts and then, “allows for the city to put the money up front but then to recapture it when the property is annexed or when there are actual benefits to that resident.”

All statutes point the Supreme Court to the conclusion that the special improvement districts were created lawfully, and the evidence reflected that the special assessments had not yet been implemented or levied on Hector’s property located outside city limits at the time of the litigation.  The law also allows for the city to levy not only property within city limits, but also the annexed property. For these reasons, the Supreme Court affirms the district court’s decision.





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