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HomeMy WebLinkAbout2734 Repealing and Replacing System Development Charge Deferrals for Low Income Housing ORDINANCE NO. '~ 7 ~ ~/ AN ORDINANCE OF THE CITY OF PORT TOWNSEND REPEALING AND REPLACING SECTION 13.03.110, SYSTEM DEVELOPMENT CHARGE DEFERRALS FOR LOW INCOME HOUSING. WHEREAS, the City Council desires to update the accounting for system development charges by changing which City Fund is used to account for system development charges to reduce unnecessary accounting transactions; and WHEREAS, the City Council desires to account for the system development charges in each separate utility as a segregated account, rather than a special accounting fimd; and WHEREAS, the City Council desires to account for any system development charge deferrals granted in a segregated account in the applicable utility fund, rather than an account in the System Development Charge Fund; and WHEREAS, the City Council desires to change the manner in which system development charges are funded from contributions from the General Fund, to real property lien receivables in the applicable utility fund; and WHEREAS, the City Council desires to require any system development charge deferrals be repaid upon sale of the benefiting real property, or mortgage payoff; and NOW, THEREFORE, the City Council of the City of Port Townsend does ordain as follows: Section 1. Section 13.03.110, System Development Charge Deferrals for Low Income Housing is repealed and a new section (of the same number and title) is enacted as follows: Ao Program Established. In accordance with policy direction from the Port Townsend comprehensive plan, the city may allow deferral of payment of system development charges (SDCs) for low-income single-family or multi-family residential applicants, as defined in this section. SDC deferrals shall be available on a first-come, first- served basis, funded by ~.~,~. precess a real property lien receivable recorded in the applicable utility records. B. Definitions. The following definitions shall apply to the administration of this section: 1. "Low-income" means ;..~;..;.~..n~ ^~ c~;~; .... ~,~. ...... income ~ than 50 the dwelling shall be owned and occupied by a person or persons who meet any of the following qualifications: (a) the applicant receives Supplemental Security Income pursuant to 42 USC Sections 1381 through 1383, as now or hereafter amended; or (b) the applicant receives Supplemental Security Disability Income pursuant to federal law, and is able to establish that current annualized household income from all sources does not exceed the sum of $18,000 per year; or (c) the applicant is eligible for and receives a federal, state or private disability pension, and is able to establish that current annualized income from all sources does not exceed the sum of $18,000 per year; or (d) the applicant has a total current annualized income from all sources of 100 percent or less of poverty level based upon total household size using poverty level calculations established by the state of Washington for Jefferson County or by the federal government if state calculations are not available. To establish qualifications under this section, the applicant shall provide the city finance director with a current statement of eligibility for SSI, SSDI, or such disability pension or proof of disability, which proof shall not be more than three months old. Applicants shall, under oath or penalty of periury, verify such information and provide such other information or data as deemed appropriate, on forms and in the manner determined by the city finance director. 2. "Private or public nonprofit organizations" means nonprofit corporations, municipal corporations, and other organizations formally established for the charitable purpose of providing low-income or affordable housing, recognized under the United States Internal Revenue Code as qualified recipients of tax deductible charitable contributions, including but not limited to organizations having received approval from the Internal Revenue Service of such status upon the filing of all forms as required for recognition as a 501(c)(3) corporation. For an entity to qualify as a private or public nonprofit organization under the provisions of this section, upon making a written request for SDC deferral, the entity shall provide sufficient proof of such status, including such documentation as the city council may deem necessary. To qualify for SDC deferrals, all private or public nonprofit organizations shall assure that the project development includes "sweat equity," defined as labor contributed by the prospective homeowner and/or volunteer labor contributed through community donation. For purposes of this section, municipal public housing authorities established pursuant to Washington law shall be considered public nonprofit organizations. C. SDC Deferral Requests - Qualified Applicants. Upon the approval of the city the City Manager, collection of system development charges under the provisions of this chapter to serve single-family or multi-family residences may be deferred at the request of a private or public nonprofit organization which is developing or constructing low- income single-family housing units for low-income individuals or families. Except as provided in Section 3 of Ordinance No. 2667 (enabling the retroactive application of this section to January 1, 1998), to qualify for such deferral, SDC deferral requests shall be made in writing *" *~'" ":* ........ :~ ~. ~..~. an ~ ...... :^' *" ~'~ ?.7 ..c ,h.~ ct~t- ~ +1~ ~;+., k .... +~kllM-,~,-1 ,-.~,-1 .~,flA~A n~ ~l~tTM .,1~-~'~1 -~,.~,4 ,~o ,--1~,,,~,.;1~,~A ;~ +I,,~ ~,',ti,~,.~ ~:" ....... :~ -~'~-~ to the City ana er. c~. ~ ........ ~ ~,.a .......... All SDC defe~als ~r~ted shall be re~orded a~ a real prope~ lien receivable in the applicable utility ~d records ~til such time as the SDC defe~al has been repaid to the city. E. Repayment of SDC Deferrals. All SDC amounts deferred for low-income single- family or multi-family housing applicants pursuant to this section shall be reimbursed to the city's SDC deferral 5'~ or account in the applicable utility upon the sale of the rty ............... -~u .... ~--e,.:"' Repayment of deferred SDCs shall be secured with a real estate security instrument as approved by the city attorney. Such instrument shall be senior to all other security instruments securing loans on the property, unless the city council determines that the city receives adequate security for repayment from a junior security instrument. All such security instruments shall contain a "due on sale" clause, requiring reimbursement of deferred SDCs to the city upon the sale of the property to any purchaser -:.'ho :'g net a quaEfie~ !ow :.:'.come per:c:'. ........ / r ........ public Deferred SDCs shall likewise be repaid to the city upon first mortgage payoff or any refinancing of loans secured by senior real property security instruments. F. Amount of Reimbursement to the City. Upon the sale of the property to any purchaser + .... ~-~. ^~, ,~. ...... ..,.. +^ +u ...... r. .... the seller shall reimburse the city in the full amount of deferred SDCs, plus simple interest thereon at a rate commensurate with the annual one year U.S. Treasury notes and bonds, adjusted for constant maturities, as published in the Federal Reserve Bulletin or otherwise available from the Federal Reserve Bank, from the year connection is made to the city water and wastewater systems, computed annually on unpaid balances. Interest calculated pursuant to this section shall not be compounded. Alternatively, at the option of the seller, the reimbursement to the city may be at the then-existing SDC rates for comparable development on properties within Port Townsend for connection to the city's water and wastewater systems; provided, that if at such time the city has repealed its SDC program, reimbursement shall be made to the city in the original amount of the deferred SDC, plus interest thereon as described in this subsection; provided further, that in no circumstances shall the reimbursement to the city be less than the amount of the SDC originally deferred. (Ord. 2667 § 2, 1998). G. Annual maximum SDC deferrals. The maximum amount of SDC deferrals that may be granted per year is limited to $15,000 in total. Section 2. Severability. If any provision of this Ordinance or its application to any person or circumstance is held invalid, the remainder of the Ordinance, or the application of the provision to other persons or circumstances is not affected. Section 3. This ordinance shall take effect upon its passage, approval and publication in the form and manner provided by law. Read for the first, second and third times and passed by the City Council of the City of Port Townsend, Washington, at a regular meeting thereof, held this ~ day of , 2000. offM asci, Mayor Attest: Pamela Kolacy, City Clerk (.J /" ,/ ., City Attorney ?'