Chapter 14.15

ALTERNATIVE PROCEDURES FOR MAINTENANCE DISTRICTS

Parts:

• 1 General

• 2 Definitions

• 3 Preliminary Formation Procedures

• 4 Public Notice, Hearing and Council Approval

• 5 Changes

• 6 Assessment and Operation

T14:27

SAN JOSÉ CODE

§ 14.15.010

Part 1

GENERAL

Sections:

acquisition of improvements pursuant to any other provision of this Code or pursuant to any law of the state of California, including the Municipal Improvement Act of 1913, the Landscaping and Lighting Act of 1972, the First and Second Alternative Public Improvement Procedures Act or any other state act of a similar nature under the California Streets and Highways Code or this Code. (Ord. 24808.)

Part 2

• A. The purpose of this chapter is to establish an alternative procedure for forming maintenance districts that provide a special benefit to properties within the maintenance district formed.

• B. Funding may be from any source available to the city, including special assessments upon the properties within the maintenance district. Maintenance costs assessed to the properties shall be in proportion to the benefits received.

• (Ord. 24808.)

This chapter is a complete alternative to other provisions of this Code and to the general laws of the state of California. When the city council elects to proceed under this chapter, no other provisions of this Code or of the general laws shall apply to the proceedings except as specifically stated in this chapter.

DEFINITIONS

Sections:

• 14.15.100 Annual aggregate assessment.

• 14.15.110 Annual budget report.

• 14.15.120 Annual adjustment.

• 14.15.130 Base assessment.

• 14.15.140 Costs or expenses.

• 14.15.150 Director.

• 14.15.160 Engineer's report.

14.15.170 Exempt owner.

• 14.15.180 Improvement.

• 14.15.190 Maintenance.

• 14.15.200 Maintenance district.

14.15.210 Maximum annual assessment.

• 14.15.220 Owner.

(Ord. 24808.)

This chapter shall be construed liberally to effectuate its purpose. All findings and decisions made by the city council pursuant to this chapter shall be final. (Ord. 24808.)

Procedures for the formation of a maintenance district pursuant to this chapter may be consolidated with procedures for the construction or

The definitions set forth in this part shall govern the application and interpretation of this chapter.

(Ords. 24808, 25352, 25353.)

"Annual aggregate assessment" means the amount required to be levied upon the properties in the maintenance district in order to pay costs for the ensuing year.

(Ords. 24808, 25352, 25353.)

T14:28

PUBLIC WORKS AND IMPROVEMENTS

§ 14.15.190

"Annual budget report" means the document prepared annually to provide for annual aggregate assessments which do not exceed the maximum annual assessments, and proposes no changes requiring public notice and hearing. (Ords. 24808, 25352, 25353.)

"Annual adjustment" means the maximum inflation adjustment that may be made to the base assessment, in a single fiscal year, without additional notice and hearing pursuant to Part 4 of this chapter. The annual adjustment may be based on any cost adjustment index approved by the property owners upon initial approval of the assessment, or any subsequent approval as provided in Part 4 of this chapter. (Ords. 25352, 25353.)

"Base assessment" means the amount of the assessment levied upon each property calculated to cover the costs of providing the initial full year of maintenance and operation services for the fully constructed improvement. (Ords. 25352, 25353.)

"Costs" or "expenses" means the cost of maintenance and operation of an improvement, including without limitation, direct costs, including reserves for contingencies and major periodic repairs, and all associated and incidental costs such as supervisory, administrative, engineering and legal services, and costs of assessment collection and enforcement performed by any agency or person on behalf of the city.

(Ords. 24808, 25352, 25353.)

"Director" means the director of public works. (Ords. 24808, 25352, 25353.)

"Engineer's report" means the document describing the maintenance district, the maintenance,

the budget and the maximum annual assessments therefor as more fully described in Section 14.15.320. (Ords. 24808, 25352, 25353.)

"Exempt owner" means the owner of land, within a maintenance district or proposed maintenance district as shown on the last equalized assessment roll for taxes of the county or the state board of equalization's roll, that receives no special benefit from the maintenance and operation of the improvement and therefore is excluded from assessment by state law and the engineer's report. (Ords. 24808, 25352, 25353.)

"Improvement" means any public capital improvement of a local nature, including without limitation any improvement described in the Improvement Act of 1911 or the Municipal Improvement Act of 1913 of the state of California or pursuant to the First and Second Alternative Improvement Procedures Act or any other act of similar nature in this Code or pursuant to state law. (Ords. 24808, 25352, 25353.)

"Maintenance" means the operation of an improvement including the servicing, repair, replacement or construction of additional facilities as may be appropriate to continue safe and proper operation. Maintenance includes, without limitation, the furnishing of power, water, other utilities, equipment and supplies as may be required. Maintenance may also include direct and indirect city administrative and inspection costs, assessment collection expenses and periodic patrols or surveillance by security personnel to protect the improvement and insure safe and proper operation. (Ords. 24808, 25352, 25353.)

T14:29

SAN JOSÉ CODE

§ 14.15.200

"Maintenance district" means a district formed pursuant to this chapter to provide funding for the maintenance of public improvements that provide a special benefit to the properties assessed. (Ords. 24808, 25352, 25353.)

"Maximum annual assessment" means, in any fiscal year, the base assessment plus the cumulative annual adjustment as specified in the engineer's report and approved pursuant to Part 3 of this chapter.

(Ords. 24808, 25352, 25353.)

"Owner" means the record owner of land proposed to be assessed within a maintenance district as shown on the last equalized assessment roll for taxes of the county.

(Ords. 24808, 25352, 25353.)

Part 3

PRELIMINARY FORMATION PROCEDURES

Sections:

Whenever the city council intends to form a maintenance district pursuant to this chapter, it shall adopt a resolution which:

• A. States that it is the intention of the city council to form a maintenance district pursuant to this chapter and assigns a distinctive name and number to the proposed maintenance district.

• B. Describes generally the improvements to be maintained and the maintenance to be provided.

  • C. Describes the proposed boundaries of the maintenance district. The boundaries may be described by reference to a map or diagram on file with the city clerk. The boundaries need not be contiguous and areas may be excluded by lines of special benefit.

• D. Directs the director to prepare and file the engineer's report described in this part.

• (Ords. 24808, 25352, 25353.)

• A. The director shall prepare an engineer's report as directed in the resolution of intention adopted pursuant to Section 14.15.310.

• B. The city council may make changes to any engineer's report pursuant to Section 14.15.510.

• C. The engineer's report shall include the following:

  1. A description in words of the general boundaries of the maintenance district.

  2. A description of the improvements to be maintained and the maintenance to be provided. The description may include by reference plans included in the engineer's report or filed with the engineer's report although separately bound.

  3. A budget for the first fiscal year after approval of the engineer's report. The budget shall include:

     • a. The sources and uses of funds within the maintenance district and an estimate of the total cost of maintenance, including but not limited to labor, equipment, supplies, utilities, administration, reserves for contingencies and major periodic repairs, and any assessment collection charges, during the first fiscal year after approval of the engineer's report.

     • b. The amount of any surplus or deficit in the maintenance district's ac-

T14:30

PUBLIC WORKS AND IMPROVEMENTS

§ 14.15.320

count at the end of the prior fiscal year that shall be carried over to the fiscal year shown in the budget.

• c. An estimate of the initial annual aggregate assessment and the proposed annual adjustment together with an explanation of the proposed adjustment formula.

4. A formula showing the method by which the director proposes to apportion the cost of maintenance among the parcels to be specially assessed. The cost may be apportioned by any method which fairly distributes the cost on the basis of special benefits to be received by each parcel, or portions thereof, as the result of the maintenance. For this purpose the maintenance district may be divided into zones of benefit, the boundaries of which shall then be shown on the diagram. Parcels of property, or parts thereof, not benefiting from the maintenance shall be excluded by the formula.

5. An assessment roll containing the assessment number of each parcel to be specially assessed, the amount of each proposed assessment for the first fiscal year after approval of the engineer's report based on the budget prepared and the formula derived under this subsection. If the county assessor's parcel number is not used as the assessment number, the assessment roll shall also contain the corresponding county assessor's parcel number.

6. A list of the names and addresses of all owners of parcels shown on the diagram described in Section 14.15.320.C.7. and on the assessment roll, as shown on the last equalized assessment roll for county taxes or as known to the city clerk.

7. A diagram on one or more sheets showing the boundaries of the maintenance district and each parcel of land to be specifically assessed for the cost of the

maintenance. The diagram may either be included in the engineer's report or separately bound and filed with the engineer's report.

• a. The diagram shall be legibly drawn by a process that provides a permanent record. Each sheet of paper or other material used for the permanent record map shall be eighteen inches high by twenty-six inches wide (four hundred fifty by six hundred sixty millimeters), shall clearly show the particular number of the sheet, the total number of sheets comprising the diagram, its relation to each adjoining sheet, and shall have encompassing its border a line that leaves a blank margin one inch (twenty-five millimeters) in width.

• b. The lines and dimensions of each parcel shall conform to the county assessor's parcel maps; or the diagram may consist of a copy of the county assessor's parcel maps. Each parcel shall be labeled with a distinctive assessment number, which may be the county assessor's parcel number.

• c. The diagram shall be titled substantially as follows:

ASSESSMENT DIAGRAM MAINTENANCE DISTRICT

(here insert number and name of district)

FISCAL YEAR (insert fiscal year)

• d. The diagram shall also have certifications reading substantially as follows:

FILED IN THE OFFICE OF THE DIRECTOR OF PUBLIC WORKS

THIS (Day) DAY OF (Month) , (Year).

T14:31

SAN JOSÉ CODE

§ 14.15.320

DIRECTOR OF PUBLIC WORKS

FILED IN THE OFFICE OF THE CITY CLERK THIS (Day) DAY OF (Month) , (Year).

CITY CLERK

AN ASSESSMENT WAS LEVIED BY THE CITY COUNCIL ON THE LOTS, PIECES, AND PARCELS OF LAND SHOWN ON THIS DIAGRAM BY RESOLUTION NUMBER _________ ON THE (Day) DAY OF (Month) , (Year). THE APPROVED ASSESSMENT DIAGRAM AND THE ASSESSMENT ROLL FILED IN THE OFFICE OF THE DIRECTOR OF PUBLIC WORKS CONTAINS THE EXACT AMOUNT OF EACH ASSESSMENT LEVIED AGAINST EACH PARCEL OF LAND SHOWN ON THIS ASSESSMENT DIAGRAM.

neer's report and accept the engineer's report as modified, or may reject the engineer's report.

• B. If the engineer's report is accepted, the city council shall by resolution preliminarily approve the engineer's report and set the dates, times and places for the public meeting and public hearing and tabulation of the property owner ballots, and shall direct that notice be given in the manner required by Part 4 below unless such notice and balloting procedure is waived by one hundred percent of the owners in the proposed maintenance district pursuant to the procedure set forth in Section 14.15.470.

• (Ords. 24808, 25352, 25353.)

Part 4

PUBLIC NOTICE, HEARING AND COUNCIL APPROVAL

Sections:

CITY CLERK

FILED IN THE OFFICE OF THE COUNTY RECORDER OF THE COUNTY OF SANTA CLARA, STATE OF CALIFORNIA THIS (Day) DAY OF (Month) , (Year) AT THE HOUR OF (Hour) O'CLOCK (a/p) M IN BOOK _________ OF MAPS OF ASSESSMENT AND COMMUNITY FACILITIES DISTRICTS AT PAGE . FILE NUMBER _________ FEE $

COUNTY RECORDER OF COUNTY OF SANTA CLARA (Ords. 24808, 25352, 25353.)

• 14.15.430 Public meeting and hearing.

• 14.15.440 Ballot procedure.

• 14.15.450 Tabulation of ballots.

• 14.15.460 Council approval.

Any notice required to be given under this chapter shall be accomplished in compliance with the Ralph M. Brown Act (Gov. Code Sections 54950 et seq.) and Article XIIID of the Constitution of the State of California, both as may be amended from time to time.

(Ords. 24808, 25352, 25353.)

• A. Upon completion of the engineer's report, the director shall file the engineer's report with the city clerk for presentation to the city council. The city council may accept the engineer's report as submitted, may modify the engi-

• A. The notice shall be executed by the city clerk and include:

  1. A statement that the city council intends to create a maintenance district, or to change an existing maintenance district, as applicable.

T14:32

PUBLIC WORKS AND IMPROVEMENTS

§ 14.15.440

2. A general description of the location and boundaries of the maintenance district.

3. A general description of the improvements to be maintained.

4. A statement that the city council intends to levy an annual special assessment on each parcel of land within the maintenance district to pay the cost of maintenance and operation of the improvements, that such assessment, plus an amount that may not exceed the annual adjustment shown in the engineer's report, will be levied annually for the life of the improvement.

5. The amount of the annual aggregate assessment and the annual adjustment formula for the proposed maintenance district.

6. The amount of the base assessment for the parcel.

7. A statement that the maintenance and operation may be performed by city forces and/or by one or more contractors retained by the city.

8. A statement that the engineer's report is on file with the city clerk and is open to public inspection.

9. The name and telephone number of a city office, employee, or other authorized representative where questions about the maintenance district will be received.

10. A summary of procedures applicable to the completion, return and tabulation of ballots required pursuant to this section.

11. A ballot to be filled out by the property owner and returned to the city containing the following information:

• a. The county assessor's parcel number of the parcel to be assessed.

• b. The name of the owner of the parcel to be assessed.

• c. The amount of the proposed base assessment and the proposed annual adjustment for the parcel to be assessed.

  • d. A place in which the owner may indicate support or opposition to the proposed assessment.

  • e. City's address for receipt of the completed ballot.

12. A statement that any owner or other interested person may be heard by the city council at the public hearings.

13. A statement of the times and places of the public meeting and hearing.

• B. The notice shall be clearly legible and in at least ten-point type.

• (Ords. 24808, 25352, 25353.)

• A. The city council shall conduct at least one public meeting and one public hearing on the engineer's report in compliance with the Ralph M. Brown Act (Gov. Code Sections 54950 et seq.), as may be amended from time to time.

• B. At the public meeting and public hearing, the city council shall hear and consider all testimony by any interested person. Any irregularity of documentation or procedure not specified in the protests may be deemed waived.

• C. During the public hearing, the city council may change any of the items open to public hearing. However, any changes which would increase any base assessment or the annual adjustment, or substantially change the formula apportioning the assessment, or substantially change the proposed level of maintenance, shall be made only upon additional notice and hearing as provided in this part.

• (Ords. 24808, 25352, 25353.)

• A. At the conclusion of all testimony and discussion on the issue of the proposed maintenance district, the city clerk shall tabulate the ballots pursuant to Section 14.15.450.

• B. No ballots will be accepted by the city clerk after the tally of the ballots has begun.

T14:33

SAN JOSÉ CODE

§ 14.15.440

• C. At any time before the tally of the ballots has begun, a ballot may be changed at the request of the owner.

(Ords. 24808, 25352, 25353.)

• A. Ballots shall be tabulated at the public hearing, and the results of the tabulation shall be announced to the city council.

• B. If, upon conclusion of the public hearing, ballots submitted in opposition of the assessment exceed the ballots submitted in favor of the assessment, the city council shall not impose the assessment.

• C. In tabulating the ballots, the ballots shall be weighted according to the amount of the proposed assessment on the affected property.

• (Ords. 24808, 25352, 25353.)

If, upon tabulation of the ballots as provided in Section 14.15.450, the assessment has been approved by the owners, the city council may, by resolution, approve the engineer's report, the base assessment, and the annual adjustment and impose the maximum annual assessments for the ensuing fiscal year, as proposed or as modified by the city council, but in no event for a greater amount than as approved by the owners. (Ords. 24808, 25352, 25353.)

• A. Any notice requirement or any requirement pertaining to the conduct of the balloting procedure specified by this chapter may be waived with the unanimous written consent of the owners within the proposed maintenance district.

• B. Such written waiver of notice and/or balloting procedures must be received by the city clerk prior to the preliminary acceptance by the city council of the engineer's report pursuant to Part 2 of this chapter, and shall be presented to the city council along with the engineer's report.

(Ords. 24808, 25352, 25353.)

Part 5

CHANGES

Sections:

• A. From time to time the city council may make changes to any maintenance district formed under this chapter. The changes permitted under this subsection shall be made only after the director has prepared an engineer's report pursuant to Section 14.15.320 clearly showing the unchanged items and the proposed changes, the council has preliminarily approved the engineer's report as provided for in Section 14.15.330, and the affected owners have been given notice, and the balloting and public hearing procedures have been conducted in the manner provided in Part 4:

  1. The conversion of maintenance districts formed under state statutes, other parts of this Code, or other ordinances, to the procedures of this chapter.

  2. The annexation of land to the maintenance district without written consent of the owners of the annexed land.

  3. A material change in the scope of improvements to be maintained or in the maintenance to be provided.

  4. A change in the method by which the costs are distributed among the parcels of land in the maintenance district.

  5. An increase in the annual aggregate assessment which would result in the maximum annual assessment on any parcel being exceeded.

  6. An increase in the base assessment or the annual adjustment.

• B. All other changes, including without limitation the dissolution of the maintenance district, annexation to the maintenance district with the consent of the owners of the annexed

T14:34

PUBLIC WORKS AND IMPROVEMENTS

§ 14.15.610

land or consolidation of two or more maintenance districts, may be made by resolution of city council without public notice, balloting, or public hearing.

(Ords. 24808, 25352, 25353.)

• A. During the budget preparation process for each fiscal year, the director shall file an annual budget report with the city clerk for consideration by the city council.

• B. The annual budget report shall contain any changes for the ensuing fiscal year and the proposed budget, annual levy, assessment roll and assessment diagram. The levy shall not exceed the maximum annual assessment for any parcel of land as determined by the city council. The proposed assessment roll and diagram shall include any changes made necessary by changes in the configuration of parcels within the maintenance district.

• C. The city council, without further notice or public hearing, may by resolution modify, or approve the annual budget report without change, and thereby establish and levy the annual aggregate assessment on the land within the maintenance district in an amount not exceeding the maximum annual assessment for any parcel of land as determined by the city council.

• D. The city council may approve the maintenance district annual budget report, including the annual aggregate assessment and the assessment roll for the next succeeding fiscal year as a part of the regular annual operating budget and budget approval process conducted for the city as a whole.

(Ords. 24808, 25352, 25353.)

Part 6

ASSESSMENT AND OPERATION

Sections:

• A. Upon city council approval of formation of the maintenance district, and any changes thereto, the city clerk shall file a copy of the assessment diagram or amended assessment diagram in the office of the county recorder to be endorsed with the time and date of filing and included in the "Book of Maps of Assessment and Community Facilities Districts."

• B. After the confirmation by the city of any assessment and the filing of the assessments and diagram in the office of the director of public works, the clerk shall execute and record a notice of assessment in the office of the county recorder of Santa Clara County.

• C. The notice of assessment shall be in substantially the following form:

NOTICE OF ASSESSMENT

Pursuant to the requirements of San José Municipal Code Section 14.15.610, the undersigned Clerk of the City of San José, State of California, hereby gives notice that a diagram was recorded in the Office of the Santa Clara County Recorder as provided for in San José Municipal Code Section 14.15.610, and relating to the following described real property:

(The real property in the Maintenance District may be described by:(a) stating its exterior boundaries; or (b) describing the property according to any official or recorded map; or (c) referring to the assessment diagram filed in accordance with Section 14.15.610 and the book and page number in the Office of the County Recorder of the filed diagram.)

Notice is further given that upon the recording of this notice in the Office of the County Recorder, the several assessments included herein assessed on the lots, pieces, and parcels shown on the filed assessment diagram shall become a lien upon the lots or portions of lots assessed, respectively and be col-

T14:35

SAN JOSÉ CODE

§ 14.15.610

lected in the (tax year) tax year either by posting upon the county roll for general property taxes or by filing with the City's Director of Finance. Assessments in subsequent fiscal years are subject to increases in an amount not to exceed (annual adjustment formula) per year.

Reference is made to the assessment roll and diagram filed in the Office of the City Clerk.

Dated:_________

City Clerk

(Ords. 24808, 25352, 25353.)

• A. The director shall make any amendments to the annual assessment roll arising out of changes in property boundaries by apportioning the assessment in a manner consistent with the formula described in the engineer's report.

• B. The director shall file the annual assessments with the county, with a request that the assessments be posted on the county roll for general property taxes.

• C. The annual assessments shall be filed on or before the final date of acceptance of special assessments for posting to the county rolls for the fiscal year in which the assessments are to be collected. The assessments shall be collected at the same time and in the same manner as general property taxes and shall bear the same proportionate penalties for delinquency in payment. After deduction of any collection charges of the county, the net amount of assessments collected shall be remitted to the city for the account of the district.

• D. The director may, as an alternative to filing annual assessments with the county for collection, collect any or all assessments through the city's normal billing processes. The assessments shall be due at the same time as payments of general property taxes. Any unpaid assessments shall be delinquent on the date that unpaid general property taxes become

delinquent and shall be subject to penalties at the same rate as delinquent general property taxes.

(Ords. 24808, 25352, 25353.)

• A. The city shall establish a separate fund for each maintenance district bearing a distinctive identifying name and number.

• B. The moneys deposited in, and accrued to, the fund, and all payments therefrom, shall be expressly for maintenance of maintenance district facilities.

• C. A surplus or deficit in the maintenance district's account at the end of each fiscal year shall be carried over to the following fiscal year.

• D. If necessary to separate moneys between zones of benefit, within a maintenance district, a separate fund shall be established for each zone. Interest earned on fund balances shall be credited to the account of each separate fund.

• E. The city may make a contribution or advance to the maintenance district's account at any time from other lawfully available funds of the city. Any such advance shall be repaid in the manner determined by the city council at the time the advance is approved.

• F. Upon dissolution of a maintenance district, any amount remaining in the maintenance district fund may be expended for maintenance district purposes until exhausted, or may be refunded to the owners proportionate to the most recent annual assessments, at the discretion of the city council. An amount remaining that is the lesser of one thousand dollars or five percent of the maintenance district's annual budget may be transferred to the general fund.

(Ords. 24808, 25352, 25353.)

• A. The maintenance within any maintenance district may be performed by city forces and/or by one or more contractors retained by the city.

T14:36

PUBLIC WORKS AND IMPROVEMENTS

§ 14.16.010

• B. The letting of contracts for maintenance may be by negotiation or through public bidding in accordance with the city charter and this Code.

• C. The account of the maintenance district shall be charged for all related costs in accordance with normal and reasonable cost accounting standards and procedures for such maintenance whether performed by city and/or by a contractor.

• (Ords. 24808, 25352, 25353.)