71st OREGON LEGISLATIVE ASSEMBLY--2001 Regular Session
NOTE: Matter within { + braces and plus signs + } in an
amended section is new. Matter within { - braces and minus
signs - } is existing law to be omitted. New sections are within
{ + braces and plus signs + } .
LC 1688
House Bill 2980
Sponsored by Representative MORGAN (at the request of Oregon
Building Industry Association)
SUMMARY
The following summary is not prepared by the sponsors of the
measure and is not a part of the body thereof subject to
consideration by the Legislative Assembly. It is an editor's
brief statement of the essential features of the measure as
introduced.
Requires reimbursement fee and improvement fee to be
proportionate to impact of new development. Requires local
government to refund double amount of system development charges
unlawfully collected.
Requires Housing and Community Services Department annually to
report current status of capital improvement plans, system
development charges, economic development and needed housing.
Revises definition of capital improvement.
A BILL FOR AN ACT
Relating to impact of new development on system development
charges; amending ORS 223.297, 223.299, 223.302, 223.304,
223.307, 223.309, 223.311 and 223.314.
Be It Enacted by the People of the State of Oregon:
SECTION 1. ORS 223.297 is amended to read:
223.297. The purpose of ORS 223.297 to 223.314 is to provide a
uniform framework for the imposition of system development
charges by governmental units for specified purposes and to
establish that the charges may be used only for capital
improvements { + reasonably necessary to address the impact of
new development + }.
SECTION 2. ORS 223.299 is amended to read:
223.299. As used in ORS 223.297 to 223.314:
(1)(a) 'Capital improvement' means facilities or assets used
for the following:
(A) Water supply, treatment and distribution;
(B) Waste water collection, transmission, treatment and
disposal;
(C) Drainage and flood control;
(D) { - Transportation - } { + Construction and improvement
of roads and streets + }; or
(E) Parks and recreation { + , when projected to be used
primarily by new development + }.
(b) 'Capital improvement' does not { - include - }
{ + mean + } costs of the operation or routine maintenance of
capital improvements.
(2) 'Improvement fee' means a fee for costs associated with
capital improvements to be constructed.
(3) 'Reimbursement fee' means a fee for costs associated with
capital improvements already constructed or under construction.
(4)(a) 'System development charge' { - means - }
{ + includes + } 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 permit or connection to the capital
improvement. 'System development charge' { + also + } 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.
(b) '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, expedited land division or limited land
use decision.
SECTION 3. ORS 223.302 is amended to read:
223.302. (1) Governmental units are authorized to establish
system development charges, but the revenues produced therefrom
shall be expended only in accordance with ORS 223.297 to 223.314.
If a governmental unit expends any such revenues in violation of
the limitations described in ORS 223.307, the governmental unit
shall replace the misspent amount with moneys derived from other
sources. Replacement moneys shall be deposited in a fund
designated for the system development charge revenues not later
than one year following a determination that the funds were
misspent.
(2) Governmental units shall adopt administrative review
procedures by which any citizen or other interested person may
challenge an expenditure of system development charge revenues.
Such procedures shall provide that such a challenge must be filed
within two years of the expenditure of the system development
charge revenues. The decision of the governmental unit shall be
reviewed only as provided in ORS 34.010 to 34.100 { - , and not
otherwise - } .
{ + (3) If a governmental unit is found to have unlawfully
collected system development charges, it shall refund from its
general fund double the amount of the system development charges
unlawfully collected. + }
SECTION 4. ORS 223.304 is amended to read:
223.304. (1) Reimbursement fees shall be established { + or
amended + } by ordinance or resolution setting forth a
methodology that { - considers - } { + incorporates + } the
cost { + actually incurred by local taxpayers for + }
{ - of - } the existing facility or facilities, prior
contributions by existing users { - , - } { + and + } the
value of unused capacity { - , - } { + and that considers + }
rate-making principles employed to finance publicly owned capital
improvements and other relevant factors identified by the local
government imposing the fee. { - The methodology shall promote
the objective of future system users contributing no more than an
equitable share to the cost of existing facilities. - } { + A
reimbursement fee shall not exceed the proportionate share of the
value of the excess capacity of the existing facilities used by
new development. + }The methodology for establishing { + or
amending + } such fees shall be available for public inspection.
(2) Improvement fees shall be established { + or amended + }
by ordinance or resolution setting forth a methodology that
considers the cost of projected capital improvements needed to
increase the capacity of the systems to which the fee is related.
{ + An improvement fee shall not exceed the proportionate share
of the cost of capital improvements reasonably necessary to
address the impact of new development. + } The methodology for
establishing { + or amending + } such fees shall be available
for public inspection.
{ + (3) Any combination of reimbursement fees and improvement
fees must be structured so that the combined charge does not
exceed the amount that could be assessed under either method
individually. + }
{ - (3) - } { + (4) + } The ordinance or resolution that
establishes { + or amends + } an improvement fee shall also
provide for a credit against such fee for the construction of a
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
ORS 223.309 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 and required to be
built larger or with greater capacity than is necessary for the
particular development project to which the improvement fee is
related.
{ - (4)(a) - } { + (5)(a) + } The credit provided for in
subsection { - (3) - } { + (4) + } of this section shall be
only for the improvement fee charged for the type of improvement
being constructed, and credit for qualified public improvements
under subsection { - (3)(b) - } { + (4)(b) + } of this
section may be granted only for the cost of that portion of such
improvement that exceeds the government units 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 subsection { - (3)(b) - } { + (4)(b) + } of
this section.
(b) When the construction of a qualified public improvement
gives rise to a credit amount greater than the improvement fee
that would otherwise be levied against the project receiving
development approval, the excess credit may be applied against
improvement fees that accrue in subsequent phases of the original
development project. This subsection shall not prohibit a unit of
government from providing a greater credit, or from establishing
a system providing for the transferability of credits, or from
providing a credit for a capital improvement not identified in
the plan adopted pursuant to ORS 223.309, or from providing a
share of the cost of such improvement by other means, if a unit
of government so chooses.
(c) Credits shall be used in the time specified in the
ordinance but not later than 10 years from the date the credit is
given.
{ - (5) - } { + (6)(a) + } Any unit of local government
that proposes to adopt { + or amend + } a system development
charge shall maintain a list of persons who have made a written
request for notification prior to adoption or amendment of a
methodology for any system development charge. Written notice
shall be mailed to persons on the list at least 45 days prior to
the first hearing to adopt or amend a system development charge,
and the methodology supporting the adoption or amendment shall be
available at least 30 days prior to the first hearing to adopt or
amend. The failure of a person on the list to receive a notice
that was mailed shall not invalidate the action of the local
government. The unit of local government may periodically delete
names from the list, but at least 30 days prior to removing a
name from the list must notify the person whose name is to be
deleted that a new written request for notification is required
if the person wishes to remain on the notification list.
{ + (b) + } { - No - } { + A + } legal action intended to
contest the methodology used for calculating a system development
charge shall be filed
{ - after - } { + not later than + } 60 days following
adoption or
{ - modification - } { + amendment + } of the system
development charge ordinance or resolution by the local
government. A person shall contest the methodology used for
calculating a system development charge only as provided in ORS
34.010 to 34.100 { - , and not otherwise - } .
{ + (c) Nothing in this subsection shall be construed to
prevent a person from filing an action in circuit court to
contest the application of the methodology to any particular
development application or to contest the methodology for
calculating a system development charge. + }
SECTION 5. ORS 223.307 is amended to read:
223.307. (1) Reimbursement fees shall be spent only on capital
improvements associated with the systems for which the fees are
assessed including expenditures relating to repayment of
indebtedness.
(2) Improvement fees shall be spent only on capacity increasing
capital improvements, including expenditures relating to
repayment of debt for such improvements. An increase in system
capacity may be established if a capital improvement increases
the level of performance or service provided by existing
facilities or provides new facilities. The portion of such
improvements funded by improvement fees { + , including those
related to increases in the level of performance or service, + }
must be { - related to current or projected development - }
{ + proportionate to the impact of new development + }.
(3) System development charges 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.
(4) Any capital improvement being funded wholly or in part with
system development charge revenues shall be included in the plan
adopted by a governmental unit pursuant to ORS 223.309.
(5) Notwithstanding subsections (1) and (2) of this section,
system development charge revenues may be expended on the direct
costs of complying with the provisions of ORS 223.297 to 223.314,
including the costs of developing system development charge
methodologies and providing an annual accounting of system
development charge expenditures.
SECTION 6. ORS 223.309 is amended to read:
223.309. (1) { + Prior to the adoption of a + } { - Any
governmental unit which has adopted a - } system development
charge by ordinance or resolution { + , a governmental unit + }
shall prepare a capital improvement plan, public facilities plan,
master plan or comparable plan which lists the capital
improvements that { - may be funded - } { + + } { + the
governmental unit intends to fund + } with improvement fee
revenues and the estimated cost and timing for each improvement.
(2) A governmental unit that has prepared a plan described in
subsection (1) of this section may modify such plan at any time.
SECTION 7. ORS 223.311 is amended to read:
223.311. { + (1) + } System development charge revenues shall
be deposited in accounts designated for such moneys. The
governmental unit shall provide an annual accounting for system
development charges { + to the Housing and Community Services
Department + }showing the total amount of system development
charge revenues collected for each system and the projects that
were funded.
{ + (2) Upon receipt of the annual accounting, the Housing
and Community Services Department shall prepare a report
analyzing the expenditures reported by the governmental unit, the
relationship of the expenditures to the projects set forth in the
capital improvement plan and the likely effect of the system
development charges on economic development and needed housing as
defined in ORS 197.303. A copy of the report shall be provided to
the Department of Land Conservation and Development and the
Economic and Community Development Department. + }
SECTION 8. ORS 223.314 is amended to read:
223.314. The adoption { + , amendment or implementation + } of
a system development charge, or a plan as provided for in ORS
223.309, or any modification thereto, is not a land use decision
pursuant to ORS chapters 195 and 197.
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