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ORDINANCE NO. 3151
AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF
HUNTINGTON BEACH AMENDING THE HUNTINGTON BEACH
MUNICIPAL CODE BY ADDING NEW CHAPTER 17 . 68
ENTITLED COST REIMBURSEMENT DISTRICTS
WHEREAS, in the course of the development of properties,
whether through the subdivision process or through the
development or redevelopment of previously subdivided
properties, it is frequently necessary or desirable to require a
developer to install and dedicate for public use certain public
improvements which exceed in size, capacity, number, or length
that which is normally required for their subdivision or
development, or which are located off-site of the development
and benefit property or properties not within the subdivision or
development; and
It is the purpose of this ordinance to establish
requirements and procedures for reimbursement to the developer
and/or the City by those property owners who subsequently
benefit from these improvements, to the extent of their benefit;
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and
It is the intent of the City Council that owners of all
properties benefited from the public improvement make the
appropriate reimbursements to the developer and/or City; and
It is the intent of the Council that this chapter shall be
in addition to, and supplemental to, the reimbursement
procedures set forth in the State Subdivision Map Act, the State
Streets and Highways Code, and any other provisions of state law
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or of this Municipal Code relating
g to the subject matter of this
chapter,
NOW, THEREFORE, the City Council of the City of Huntington
Beach does hereby ordain as follows :
SECTION 1. The Huntington Beach Municipal Code is hereby
amended to add new ,Chapter 17. 68 entitled Cost Reimbursement
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Districts, " to read as follows:
17 . 68 . 010 R uirement for Installation f eq ro Improvements . A
developer may be required to install and dedicate public
improvementsn i as a condition tion of approval for their subdivision or
v de elo meat which may contain supplemental size capacity,
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number, or length for the n f r e benefit o property not within heir, t II'
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subdivision or development. When such supplemental size,
capacity, number length is solely for the benefit of
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property not within the subdivision or development, the
developer may follow the procedures of this ordinance to
establish a cost reimbursement district prior to, or concurrent
with, the installation of the improvements, however, under
unique circumstances City Council may deviate from this
requirement. Provisions of this chapter may be invoked by the
City whenever the City installs improvements in advance of
development which benefits or serves property within the City or
within the City' s sphere of influence to allow the City to
receive reimbursement.
17. 68 . 020 Definitions .
a "Actual or estimated costs of improvements"
� public
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means the actual or estimated costs for construction, design is
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engineering, district formation, right-of-way appraisal and
acquisition costs, condemnation proceedings, environmental
impact mitigation; plan check and permit fees, construction
inspections , maintenance of improvements; or any other expenses
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attributable to the construction of improvements . If the scope
of the project is altered during construction in order to
respond to events or circumstances which are revealed during -
construction, the City Council may increase the estimated cost
by not more than ten percent without notice to the affected
property owners .
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(b) "Substantial completion of a facility" shall be
defined as that extent of construction of a facility which will
allow the facility to be used for the purpose for which it was is
intended.
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(c) "Benefited area" means the entire area which
receives a benefit from the public improvement . The "benefited
area" shall be that area which, in the opinion of the City
Council , upon the recommendation of the City Engineer, and after
a noticed public hearing, is determined to be the area benefited
by the construction of the public improvements .
(d) "Developer" means the person who is responsible
for constructing the public improvement.
(e) "Excess costs" means the costs attributable to
that p p
h portion of improvements which benefit areas outside the
development area . Benefit may be determined by any commonly
accepted method which fairly apportions the cost of the
improvements to the benefiting properties .
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(f) Public improvements means those improvements as
set forth herein including, but not limited to, streets
bridges, traffic signals, street lights, drainage, flood
control, water or sanitary sewer facilities, reclaimed water
facilities, landscaping, grading, soil remediation, abandonment
of oil facilities, relocation of utilities, other public
facilities such as parks, libraries, fire stations, police
stations, and any accessory improvements necessary for the
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functioning of the public improvements, but shall not include
any public improvements which will benefit only the development
in which they are located. "Public improvements" shall also
include any property or property interests reasonably necessary
for the construction of the improvement.
(g) "Reimbursement district" means the benefited area
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within which property shall be made subject to a reimbursement
charg
e for o the
e purpose of reimbursing the developer and/or City
for the excess costs of the public improvement .
(h) "Supplemental improvements" means with respect to
a development project those improvements which are public
improvements and are: 1) required as a condition of approval of
the developmentr 'o project which have a size capacity, number, r
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length greater than necessary solely to benefit or mitigate the
impacts of the development project; and 2) improvements which
have been agreed upon between the City and developer.
(i) Administrative costs shall be defined as costs
for direct labor and employee benefits, outside consultants
- costs, direct materials, allied indirect costs, overhead costs,
overhead costs and fixed assets, or depreciation charges .
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17. 68. 030 Application for Cost Reimbursement District.
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Whenever a developer elects, or is required by the City, to
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install or replace supplemental improvements, or whenever the
City participates in the costs of supplemental improvements or
improvements in advance of development; and provided that the
costs of such improvements are not financed by an assessment
under a public improvements proceeding, the developer may submit
an application for formation of a cost reimbursement district,
or the City Council, on its own motion, may initiate the
formation of a cost reimbursement district. The application of
the developer shall be in writing and shall be submitted to the
office of the City Engineer with a nonrefundable application
fee. The City Engineer shall expeditiously process the request
to City Council .
17 . 6 4$. 0 0 Costs for Formation of the Cos Reimbursement t ea.mbursemen t
District . Prior to the City Council authorizing the initiation
of the formation of the cost reimbursement district, the
developer shall deposit with the City the following fees to
cover various administration costs :
(a) A nonrefundable application fee will be required
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from the developer prior to commencing any work on the cost
reimbursement district. The amount of the application fee will
be determined by a resolution of the City Council , The
application fee will be deposited in a general cost �-
reimbursement district administration fund established by the
City Treasurer.
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(b) District formation fees shall be deposited into a
specific project fund for each individual project to cover such
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expenses as the calculation of the reimbursement costs of the
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supplemental improvements, determination of the benefited area,
determination of the apportionment of the excess costs to the
benefiting parcels, and audit time. District formation fees
will also include publishing of all notices, mailings, County
Recorder fees, and City administrative costs . Once the fees -
have been deposited to the City by the developer, the City
Engineer will process the developer ' s request to City Council .
The City Engineer may request that special engineering services
be retained to prepare the documents and estimates . This
retained engineer shall have no business relationship with the
developer. The costs of any such engineering services shall be
aid b the developer; however,
e o ever the cost h p Y P s shall be considered an
incidental cost of the improvements to be recouped pursuant to
the provisions of this Ordinance.
17 . 68 . 050 Costs for Monitoring the Cost Reimbursement
District After Formation. Three weeks prior to the noticed
public hearing the Developer will be required to deposit fees
into a specific project monitoring fund. Project monitoring
fees for each district will be determined by a resolution of the
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City Council . If the district is formed by the City Council,
this fee will be expended to cover the administrative costs of
annually monitoring the District . If the fund becomes depleted,
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the developer will be required to replenish the fund in
accordance with the above mentioned resolution of the City
Council . If the developer does not replenish the monitoring
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fund within one month after written notice from the City, the
district may be abandoned.
17 . 68 -060 Report of the City Engineer . Pursuant to the
direction of the City Council, the City Engineer shall prepare
and file with the City Clerk a report- containing the following
information:
(a) A map indicating the boundaries of the district
which identifies all parcels within the district .
(b) The actual or total estimated cost of the
supplemental improvements.
(c) The proposed spread of the excess costs to the
benefiting property owners.
17 .68 .070 Notice and Hearing on Establishment of Cost
Re
imbursement District.
(a) Upon receiving the request from the City Engineer,
the City Clerk shall set a noticed public hearing before the
City Council. The City Clerk shall cause a notice of the
hearing, in substantially the following form, to be published
once in a newspaper of general circulation in the City of
Huntington Beach at least ten days prior to such hearing :
NOTICE OF HEARING
The City Council of the City of Huntington Beach will hold
a public hearing at on at the City
Council Chambers, 2000 Main Street, Huntington Beach, California
92648 to consider the establishment of a cost reimbursement
district for the financing of certain public facilities and
related improvements within the City, otherwise known as the
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Cost Reimbursement District
No.
Your property is located within the proposed boundaries of
the Cost Reimbursement Distric
t and may be subject to a lien to
pay s portion n of the cost of
providing Public facilities whic
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benefit your parcel of land except for the conditions listed
below. If within a 20-year period from the date of forming this
district, you either file a final map (subdivision, parcel, l
consolidation, etc. ) or apply for a building permit, the lien !I
and accumulated interest would become due and payable.
ceptions
Buil ' ng permits for:
1. building alterations for non-residential uses
which do not exceed a third of the value"of a
f��oo� a�slac[ti.. rur
bui` ding, as defined in the Uniform-'Building Code,
and whi' effect no change in,,occupancy;
2. building al ,erations or additions for residential
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use which add no residential units;
3 . fences and walls,`
4 . repair of construction defects or damage due to
fire, civil unrest, flood or'
ny other destructive
act'of nature which does not ino)eas:e the building
/farea by more than one third the nal area; or
Z5 . Tem orar uses as s ecified in the Ci� fTemporary P Y
/ Huntington Beach' s Mni�p- Code, Article 9 3 .
The proposed boundaries of the district are more
particularly described by Diagram No . which is on file
in the Office of the City clerk. All persons desiring to
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testify with respect to: the necessity of said public
improvements, the cost of said public improvements, the
benefited area or the amount of the costs eligible to be
recovered, may appear and be heard at said hearing .
(b) The City Engineer shall, at least 20 days prior to
the hearing, cause a copy of the above notice to be mailed to
each owner of real property within the benefited area as shown
on the last equalized tax roll. Such notice shall be
accompanied by a diagram of the proposed benefited area and a
statement by the City Engineer describing the following:
1. A description of the public improvements and that
portion considered to be in excess of the
developer' s requirements .
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2 . The estimated or actual costs necessary to pay for
the public improvements .
3 . The actual or estimated costs of public
improvements which are proposed to be liened
against the benefiting property when such property
is developed or redeveloped.
4 . A diagram indicating the boundaries of the
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district.
17. 68 . 080 Action by City Council.
(a) After the public hearing the City Council may, in
its sole discretion, approve a resolution establishing the cost
reimbursement district and may enter into a reimbursement
agreement with the developer to provide for the disbursements of
proceeds of the cost reimbursement district.
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(b) The resolution establishing the cost reimbursement
district shall indicate it is a resolution of lien. The
resolution shall reference an exhibit containing the following:
1. A list of the properties identified by assessor ' s
parcel numbers which are included within the
district boundaries .
2 . A diagram indicating the boundaries of the
district and identifying the properties to be
liened.
3 . An apportionment of the excess costs which
represent the actual or estimated amount to be
levied against each parcel within the district.
If the costs are estimated, the resolution will
indicate that the liens are subject to
recomputation by the City Engineer when the
construction and final audit have been completed.
4 . The time when such liened costs are due and
payable.
5 . A statement indicating that the liens are subject
to an interest charge, the terms of which shall be
defined.
(c) Once the cost reimbursement district has been
approved by a resolution of the City Council, it shall establish
a statement of charges due from the benefiting property owners
and their successors, heirs or assigns of the various parcels of
property as their benefited share of the public improvements .
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(d) The City Engineer shall record a copy of the
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Council resolution with the County Recorder. Upon payment of
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the amounts due, or upon the expiration of the district, the
City Engineer shall cause to be filed a release of lien upon the
affected property or properties .
17 . 68 . 090 Recomnutation of Lien. If the District is
formed based on estimated costs, then the City Engineer shall
reapportion the lien amounts after final costs have been
calculated and verified by the City Engineer or his designee,
and shall cause the lien roll to be appropriately modified. All
affected property owners shall be notified in writing of their
final lien amount .
17. 68 . 100 Administrative Audit, The Director of
Finance shall prepare a report indicating the administrative
costs incurred for each District on an annual basis . The report
shall be prepared each calendar year following the formation of
a Cost Reimbursement District and shall be completed by February
15 .
17. 68 . 110 Limitations on Reimbursement Agreement .
(a) The reimbursement agreement with the developer
shall contain provisions deemed necessary and appropriate to
specify the terms and conditions for reimbursing the developer
when lien payments are received.
(b) The reimbursement agreement shall indicate that
the liens are subject to an interest charge and shall be payable
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to the City during the term of the agreement. Lien payments
shall be placed by the City in the appropriate fund account
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established by Council for each district . These funds will be
established to reimburse the developer for costs incurred for
the construction of the improvements . All accrued interest in
this fund will be transferred to the project monitoring fund.
The term of any reimbursement agreement shall be established by
the City Council based upon the reasonable expectations of the
development of benefited properties or the utilization of the
public improvement by such benefited properties provided,
however, that the maximum term of any reimbursement agreement
shall be for a period of 20 years .
(c) If, during the established period, not to exceed
20 years, following the formation of the district, any person
records a final map (subdivision, parcel, consolidation, etc. )
or applies for a building permit on a parcel for which a lien
for supplemental improvements has been established in accordance
with this chapter, and such person or their predecessor in
interest has not paid such lien to the City, the established
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lien shall be paid prior to the recording of the final map or
the issuance of the building permit; provided, however, such
payment shall not be required in connection with building
permits described below:
1. Building alterations for non-residential uses
which do not exceed a third of the value of a
building, as defined in the Uniform Building Code,
and which effect no change in occupancy.
2 . Building alterations or additions for residential
use which add no residential units .
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3 . Fences and walls .
4 . Repair of construction defects or damage due to
fire, civil unrest, flood or any other destructive
act of nature which does not increase the building
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area by more than one third the original area.
5 . Temporary uses as specified in the City of
Huntington Beach' s Municipal Code, Article 973 .
(d) All liens shall include a principal charge plus an
interest charge calculated from the date of establishment of
lien. The date of establishment shall be the date of acceptance
of the public improvements by the City, or City Council approval
of the District, whichever occurs later.
17 . 68 . 120 Obligation of Developer or Subdivider to
Claim Monies . All monies collected under the provisions of this
chapter shall be deposited by the. City Treasurer into the
appropriate fund established for the collection of funds and the
monitoring of the district. The City Treasurer shall refund
annually to the person or persons who paid for the Supplemental
Improvements for which the liens were collected, or to their
assignees, all monies so collected. The City shall notify the
developer of the existence of monies deposited in said fund. No
funds will be reimbursed to the developer until all costs
included in the district have been verified by the City
Engineer. The notice shall be mailed to the address contained
in the reimbursement agreement and no further inquiries shall be
required by the City. If any such money remains on deposit with
the City without being claimed by the party rightfully entitled
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to it within three years after notice has been made as provided
herein, such money shall be forfeited to the City and then it
shall be transferred to the general fund of the City.
17 . 68 . 130 Delegation of Duties . Whenever a duty is
delegated or reposed in a city official or employee, except the
City Council, that official or employee may delegate all or a
portion of these duties to an assistant, deputy, or other
employee of the City.
17. 68 . 140 Time Limit for Challenge to District. Any
action proceeding to challenge, attack, set aside, avoid, or
review the decision of the City Council to establish a cost
reimbursement district or a reimbursement charge, fee, or
requirement, or to decline to establish a district shall be
brought by an interested person within 30 days of the date of
the recordation of the resolution of the City Council decision
with the County recorder or within 90 days of the date of the
decision, whichever is sooner.
SECTION 2 . This ordinance shall take effect and be in
force on the 30th day from and after its passage.
Mayor
ATTEST: APPROVED AS TO M:
City Clerk City Ato"rney
REVIEWED AND APPR TED: INITIATED AND APPROVED:
City-Adm`Yni* sY--rator Director of Public Works
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Ord. No. 3151
STATE OF CALIFORNIA )
COUNTY OF ORANGE ss:
CITY OF HUNTINGTON BEACH
I, CONNIE BROCKWAY, the duly elected, qualified City
Clerk of the City of Huntington Beach and ex-officio Clerk of the
City Council of the said City, do hereby certify that the whole number
of members of the City Council of the City of Huntington Beach is seven;
that the foregoing ordinance was read to said City Council at a regular
meeting therof held on the 6th day of July
19 92 and was again read to said City Council at a regular
meeting therof held on the 20th day of july 19 92 and
was passed and adopted by the affirmative vote of at least a majority of
all the members of said City Council .
AYES: Councilmembers:
Robitaille, winchell, Silva, Green, mac, , list, r,,_KQ]i„ �,•___•.�_,
NOES: Councilmembers:
None
ABSENT: Councilmembers:
Moulton-Patterson
!,fr"S &Ockway CITY CLERK of the City Qf
Huntington ftach and off'a* C1e*of the City ale
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Council,do hereby 1h:ai a W-00s of this ,
Ordinance r:ysber:r�;;. r w,..r_ in the Oa y Pilot on City Clerk and ex-offi ci o erk
of the City Council of the City
!n ecccrdatice, .H . :. ;;(Ty. of Huntington Beach, California
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