We have had several cases recently addressing the proper considerations for calculating special assessments (case summaries can be found here and here and here). HF 2178 if passed, will change/clarify the calculation of special assessments by cities, counties and sanitary districts in a number of ways. The major elements of the bill include:
Prior to the adoption of a preliminary resolution related to a public improvement, a city must adopt an ordinance setting forth the method to be used in determining the amount of “individual benefit,” “district benefit,” and “community benefit” projected to result from the public improvement and a description of the manner in which the cost of the public improvement will be allocated to each category of benefit.
The bill requires that 30 days’ notice be published prior to adoption of the preliminary resolution related to a public improvement, and requires the preliminary resolution to contain a detailed description of the method laid out in the ordinance, an estimate of the amount of individual benefit, district benefit, and community benefit that will be conferred as a result of the public improvement, and the proportion of the total cost of the public improvement which the council proposes to assess against property within the special assessment district.
The bill adds definitions for “community benefit”, “district benefit”, and “individual benefit”, and adds storm water management intakes, sewers, and facilities and traffic-control devices, fixtures, connections, and facilities to the definition of “street improvement.”
All of the following public improvements are presumed to confer an individual benefit on a lot within a district:
a. A public improvement that benefits, serves, or that is intended for use by only one lot, unless such public improvement is replacing an existing public improvement of acceptable or working quality and is required as a result of work on or repair of another public improvement that does not benefit, serve, or that is not intended for use by only that lot.
b. A sidewalk upon a lot that is single-family residential property located along the frontage of the lot not to exceed four feet in width at a standard thickness.
c. A sidewalk on a lot that is commercial property or multifamily residential property located along the street frontage of the lot not to exceed six feet in width at a standard thickness.
d. Underground gas, water, heating, sanitary sewer, storm sewer, and electrical connections and accessories located in a public street right-of-way and that serve only the lot.
All of the following public improvements are presumed to confer a community benefit:
a. A public improvement or part of a public improvement that is intended for use by or intended to serve lots outside the district.
b. A sidewalk or recreational trail, or part thereof, that is part of a community-wide public recreational trail system.
c. The portion of a sidewalk that exceeds the portion of the sidewalk presumed to be an individual benefit
d. The planning, legal, administrative, and inspection costs, including city employee salary costs, associated with a public improvement that is paid for in part by special assessments.
The bill amends the definition of “district” to mean “the lots or parts of lots within boundaries of a geographic area established by the council for the purpose of the assessment of all or part of the cost of a public improvement that is intended in whole or in part to provide an individual benefit to such lots or parts of lots.”
The bill specifies that the total cost of a public improvement, except for certain paving near railroad tracks or improvements to be otherwise paid, may be assessed against all lots within the assessment district to the extent of the individual benefits conferred upon the property, and states that the portion of the total cost of a public improvement that is not assessed to individual lots as the result of individual benefits is attributable to the community benefit and shall be paid by the city. The bill allows a property owner to divide property that is subject to a special assessment into two or more lots for the purpose of separating improved portions of the land from those portions of the land which are unimproved or used for agricultural purposes.
The bill designates certain public improvements that are
presumed to confer an individual benefit and designates certain
public improvements that are presumed to confer a community
benefit. Under the bill, the planning, legal, administrative,
and inspection costs, including city employee salary costs,
associated with a public improvement that is paid for in part
by special assessments may not be assessed to individual lots
within a district and shall instead be paid by the city as a
The bill requires each city undertaking a street
improvement paid for in whole or in
part by a special assessment to complete a vehicle traffic analysis and forecast for the location of the proposed street improvement. The traffic study must estimate future traffic generated by the lots in the district, and traffic generated by sources other than the lots within the
district, based on the type of street being analyzed, completion of the public improvement, full development of the district, and
future planned land use within the district. The individual benefit accruing to each lot
within the district as the result of the street improvement shall not exceed the percentage of the total benefit from
the street improvement that is proportionate to the lot’s
forecasted amount of traffic generated