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1993-45715-Ordinance No. 93-051 Recorded 12/16/199393-45'715 BEFORE THE BOARD OF COUNTY COMMISSIONERS OF An Ordinance Adding Chapter 15.12, "System Development Charges," to the Deschutes County Code and Declaring Emergency. * * REVIEWED 3 w4 LERAL COUNSEL DESCHUTES f:, an C81101 ORDINANCE NO. 93-051 WHEREAS, ORS Chapter 223 allows local governments to charge system development charges on new development to account for the impacts on such development on existing and planned capital improvements; and WHEREAS the Board of County Commissioners has determined that it would be in the public interest to impose system development charges on new development; now, therefore, THE BOARD OF COUNTY COMMISSIONERS OF DESCHUTES COUNTY, OREGON, ORDAINS as follows: Section 1. Adoption. A new Chapter 15.12, System Development Charges, is added to the Deschutes County Code as set forth in Exhibit A, attached hereto and by this reference incorporated herein. Section 2. Severability. The invalidity of a section or subsection of this ordinance or any part thereof shall not affect the validity of the remaining sections, subsections or parts thereof. Section 3. Emergency. This Ordinance being necessary for the immediate preservation of the public peace, health and safety, an emergency is declared to exist, and this Ordinance takes effect on its passage. DATED this 15 day of December, 1993. E T: Recording Secretary BOARD 01 COUNTY COMMISSIONERS O=r\ S COUNTY, OREGON d T04 THROOP 1hair 7 NANCY POP SC , Commi Toner BARRY H. SZAUGHTER,Cqfimissioner 1 - ORDINANCE NO. 93-051 (12/15/93) KV @E ;;�,11993 01.28-1102 Chapter 15.12 System Development Charges 15.12.010 Definitions A. Capital improvement. 1. "Capital improvement" means facilities or assets used for the following: i. Water supply, treatment and distribution; ii. Wastewater collection, transmission, treatment and disposal; iii. Drainage and flood control; iv. Transportation; or V. Parks and recreation. 2. "Capital improvement" does not include costs of the operation or routine maintenance of capital improvements. B. "Improvement fee" means a fee for costs associated with capital improvements to be constructed. C. "Reimbursement fee" means a fee for costs associated with capital improvements already constructed or under construction. D. "Other governmental unit" refers to any other governmental unit, as defined in ORS Chapter 223 for whose benefit Deschutes County collects a system development charge. E. Qualified public improvement. A "qualified public improvement" means a capital improvement that is required as a condition of development approval, identified in the plan adopted pursuant to section 15.12.050, and either: (a) Not located on or contiguous to property that is the subject of development approval; or (b) Located in whole or in part on or contiguous to property that is the subject of development approval required to be built larger or with greater capacity than is necessary for the particular development project to which the improvement fee is related. F. System development charge. 1. "System development charge" means a reimbursement fee, an improvement fee or a combination thereof assessed or collected at the time of increased usage of a capital improvement or issuance of a development permit, building 2 - EXHIBIT A TO ORDINANCE 93-051 (12/15/93) 0128--1103 permit or connection to the capital improvement. System development charge includes that portion of a sewer or water system connection charge that is greater than the amount necessary to reimburse the governmental unit for its average cost of inspecting and installing connections with water and sewer facilities. 2. "System development charge" does not include any fees assessed or collected as part of a local improvement district or a charge in lieu of a local improvement district assessment, or the cost of complying with requirements or conditions imposed upon a land use decision or limited land use decision. 15.12.020 Adoption of system development charges. (A) System development charges, the collection of which are authorized by ORS 223.297 through 223.314, are to be collected from developers of real property and users or prospective users of capital improvements and may be established and revised by the Board of County Commissioners by resolution. (B) Each system development charge resolution shall include the following: (i) The amount of the fee to be charged, (ii) The purpose of the charge, (iii) The methodology used to establish the charge, (iv) When such fees are to be paid, (v) For improvement fees, provide for a credit when a qualified public improvement is constructed by the developer or user who is being required to pay a system development charge. 15.12.030 Crediting Qualified Public Improvements. Developers shall be credited for qualified public improvements as provided for in this section. Such credits shall be only for the improvement fee charged for the type of improvement being constructed, and credit for qualified public improvements under Section 15.12.010(E)(b) may be granted only for the cost of that portion of such improvement that exceeds the government unit's minimum standard facility size or capacity needed to serve the particular development project or property. The applicant shall have the burden of demonstrating that a particular improvement qualifies for credit under Section 15.12.010(E)(b). 15.12.040 Authorized Expenditures. (A) Reimbursement fees shall be applied only to capital improvements associated with the systems for which the fees are assessed, including repayment of indebtedness. 3 - EXHIBIT A TO ORDINANCE 93-051 (12/15/93) 0128-1104 (B) Improvement fees shall be spent only on capacity increasing capital improvements, including expenditures relating to the repayment of debt for such improvements. An increase in system capacity occurs if a capital improvement increases the level of performance or service provided by existing facilities or provided new facilities. The portion of the improvements funded by improvement fees must be related to demands created by development. A capital improvement being funded wholly or in part from revenues derived from the improvement fee shall be included in the plan adopted under section 15.12.060. (C) Notwithstanding subsections (A) and (B) of this section, system development charge revenue may be expended on the direct costs of complying with the provisions of this Ordinance; including the costs of developing system development charge methodologies and providing an accounting of system development charge expenditures. 15.12.050 Expenditure Restrictions. (A) A system development charge shall not be expended for costs associated with the construction of administrative office facilities that are more than an incidental part of other capital improvements. (B) A system development charge shall not be expended for costs of the operation or routine maintenance of capital improvements. 15.12.060 Improvement Plan. Capital improvements for which a system development charge has been imposed shall be included on a capital improvement or public facilities plan or a similar master plan that lists (1) the capital improvements to be funded by improvement fee revenues, (2) the estimated cost of those improvements, and (3) sets forth a timetable for completion of such improvements. 15.12.070 Segregation and Use of Revenue (A) All funds derived from a system development charge shall be segregated by accounting practices from all other funds of the County. The system development charge shall be used for no other purposes than those set forth in the section 15.12.040 and the resolution adopting the charge. (B) Except for those funds for which the County serves as the collection agent for another governmental unit, the County shall provide an annual accounting for system development charges showing the total amount of system development charge revenues collected for each system and the projects that were funded. 4 - EXHIBIT A TO ORDINANCE 93-051 (12/15/93) 0128-11o5 (C) System development charge funds collected on behalf of other governmental units may be transferred to such other governmental units consistent with the requirements of Section 15.12.075 of this Chapter. 15.12.075 Collection on Behalf of Other Governmental Units In those instances in which a systems development charge has been adopted by and/or collected by the County on behalf of another governmental unit, such as Bend Metro Parks and Recreation, for transfer to such other governmental unit, the other governmental unit shall agree through an intergovernmental agreement to the following: (1) To segregate all system development charge funds transferred by the County from other funds of that governmental unit; (2) To expend such funds only in accordance with adopted capital improvement plans complying with the provisions of ORS Chapter 223; (3) To establish accounting systems that will enable the district to track the expenditure of said funds; (4) To provide an annual accounting of the expenditure of said funds; (5) To establish a procedure for handling challenges to the expenditure of transferred system development charges no later than one year after the date of adoption of the system development charge; (6) To participate as a party in any challenge proceeding administered by the County in which the expenditure by the other governmental unit of transferred system development charge funds is an issue; (7) To be the source of funds required to be paid if through a hearing process administered by the County it is determined that any system development funds have been spent other than as authorized by law; and (8) To otherwise indemnify, hold harmless and defend the County against and from any claims, losses, damages or any other expenses that the County may incur by reason of a claim that transferred system development charge funds have been spent by the other governmental unit in an unauthorized manner. 5 - EXHIBIT A TO ORDINANCE 93-051 (12/15/93) O'1ti8-1106 15.12.080 Challenge of expenditures. (A) Any citizen or interested person may challenge an expenditure of system development charge revenues based upon an alleged failure of the County to follow the requirements of ORS 223.307 by filing a written challenge with the Board of County Commissioners describing, with particularity, the expenditure which the person is challenging and the reason that the challenge is alleged to be unlawful. All such challenges must be brought within two years of the date of the expenditure challenged. (B) In those instances in which a systems development charge is adopted and/or collected by the County on behalf of another governmental unit, such as Bend Metro Parks and Recreation, any challenge regarding alleged unauthorized expenditures shall be directed to that other governmental unit if such other governmental unit has adopted by ordinance or resolution a procedure consistent with the requirements of ORS 223.307 to accept and respond to challenges to system development charge expenditures. If the other governmental unit has not adopted such procedures of its own to accept and respond to challenges, challenges shall be directed to the County under Sections 15.12.080(A) and 15.12.090 of this chapter. 15.12.090 Hearing of challenge to expenditures. Challenges that may properly be heard before the County to an expenditure of system development charges shall be set for an administrative hearing before a hearings officer. Such hearings shall be tape recorded. The person conducting the hearing must not be one of the persons who authorized the challenged expenditure of funds. The hearings officer shall provide notice to the person challenging the expenditure and the public employees or officials who made the expenditure, of the hearing date, time and place. The person conducting the hearing shall also provide said persons an opportunity to present evidence and legal arguments concerning the matter. If the hearings officer determines that system development charges were misspent, he or she shall forward a report to the Board detailing the hearings officer's findings and indicating the amount of funds misspent and from where said funds were spent. The Board shall review the hearings officer's report and replace any funds it determines have been misspent with funds derived from other sources. 15.12.100 Prohibited Construction (A) No person, firm or corporation shall construct a structure to which a system development charge applies unless the applicable system development charge has been paid. (B) Violation of this provision shall be a Class A infraction. 6 - EXHIBIT A TO ORDINANCE 93-051 (12/15/93)