4.b) City of Annandale Assessment Policy �
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City of Annandale
AS SES SMENT POLICY
Adopted: 1995
Revised: 8-25-OS
Interest on Nuisance Abatements 6C 12-3-07
Assessment Computations #2—Residential Equivalency 9-7-10
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CITY OF ANNANDALE POLICIES ON
LOCAL IMPROVEMENTS AND SPECIAL ASSESSMENTS
1. Purpose. The purpose of this assessment policy is to establish a fair and equitable
manner of recovery and distributing the cost of public improvements. The procedures used by
the City of Annandale ("City") for levying special assessments are those specified by Minnesota
Statutes Chapter 429 which provides that all or a part of the cost of improvements may be
assessed against benefiting properties.
Three basic criteria must be satisfied before a particular parcel can be assessed. The criteria are
as follows:
A. The land must have received special benefit from the improvement.
B. The amount of the assessment must not exceed the special benefit.
C. The assessment must be uniform in relation to the same class of property within the
assessment area.
It is important to recognize that the actual cost of extending an improvement past a particular
parcel is not the controlling factor in determining the amount to be assessed. However, in most
cases the method for determining the value of the benefit received by the improvement, and
therefore the amount to be assessed, shall be the cost of providing the improvement. This shall
be true provided the cost does not exceed the increase in the market value of the property being
assessed. The entire project shall be considered as a whole for the purpose of calculating and
computing an assessment rate. In the event city staff has doubt as to whether or not the costs of
the project may exceed the special benefits to the property, the City Council may obtain such
appraisals as may be necessary to support the proposed assessment.
The City must recover the expense of installing public improvements, while ensuring that each
parcel pays its fair share of the project cost in accordance with these assessment guidelines.
While there is no perfect assessment policy, it is important that assessments be implemented in a
reasonable, consistent and fair manner. There may be exceptions to the policy or unique
circumstances or situations which may require special consideration and discretion by City staff
and the City Council.
The assessment policy is intended to serve as a guide for a systematic assessment in the City of
Annandale.
2. Definition Of Improvements Eligible for Special Assessment. The public
improvements authorized by Minnesota Statutes 429, as it may be amended from time to time,
are eligible for special assessment within the City of Annandale.
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The City of Annandale also retains authority to recover, through special assessment, the
following maintenance costs:
A. Snow and ice removal from sidewalks.
B. Rubbish removal and litter pick-up from streets and sidewalks.
C. Weed elimination from street and private property.
D. Street lighting, sprinkling, dust treatment, surfacing and patching.
E. Care of trees and removal of diseased and/or unsound trees.
F. Removal of obstructions, signs, or vegetation within the sight triangles of
intersections.
3. Initiation of Public Improvement Projects. Initiation of public improvement projects
can be undertaken in any of the following ways:
A. Public improvement projects may be initiated by petition of at least 35% of the
affected property owners. Alley improvements require 50%of the affected property
owners signing the petition.
B. Public improvements also may be initiated by the City Council when, in its
judgement, such action is required. A resolution ordering any Council initiated
improvements requires an absolute majority (four affirmative votes) of the five
members of the Council.
C. At the request of a developer and as allowed by the Developer's Agreement with the
City of Annandale, a developer of the proposed subdivision may petition the City
Council to construct the improvements and assess them.
4. Public Improvement Procedure. The following is the general procedure which will be
followed by the City Council for all public improvement projects from initiation of such a
project through certification of the assessment role to the County Auditor. Formats for the
various reports and resolutions referenced in this section are made a part of the policies and
procedures of the City of Annandale.
A. Project is initiated by property owner petition, developer's request, or Council action.
B. Staff reviews petition for submission to Council.
C. Council accepts or rejects petition. If accepted, Council orders preparation of
feasibility report.
D. City Engineer prepares feasibility report. Staff reviews feasibility report. Council
could choose to send report to the Planning and Zoning Commission for comment.
E. Council accepts or rejects feasibility report. If accepted, Council orders public
hearing on the improvements.
F. Staff posts and publishes hearing notice and mails notices to affected property
owners.
G. Council conducts public hearing and adopts or rejects resolution ordering plans and
specifications. Bonds to finance project costs may be issued at any time after the
improvements are ordered.
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H. City Engineer prepares final plans. Upon Council approval of plans, Engineer
advertises for and opens bids, prepares bid tabulation, makes recommendation to City
Council for award.
I. Council awards contract based on the bids received.
J. Staff and Engineer supervise construction and prepare payments.
K. Final assessment roll is prepared.
L. Council reviews assessment schedule and orders assessment hearing.
M. Staff publishes hearing notice, mails notice of hearing date and proposed assessments
to the affected property owners.
N. Council conducts assessment hearing, adopts, revises, or rejects resolution adopting
the assessment roll. If adopted, Council authorizes certification of the assessment to
the County Auditor.
O. Staff certifies the assessment roll to the County Auditor.
5. Financing of Public Improvements. The City of Annandale encourages public
improvement projects as the area(s) benefiting and needing such improvements develop.
Examples of this policy can be seen through the subdivision regulations, zoning ordinance, and
building codes. New areas are required to provide the needed improvements and services before
development occurs, thereby not creating unexpected hardships on the property owners
purchasing such property nor on the general public. However, it is recognized that certain areas
of the City have developed without all needed public improvements (e.g. parks, water, sewer,
and street improvements) and that methods must be found to provide these improvements
without causing undue hardships on the general public or the individual property owner.
Special assessments are generally accepted as a means by which areas can obtain improvements
or services, however, the method of financing these is a critical factor to both the City and the
property owner. Full project costs spread over a very short term can cause an undue hardship on
the property owner and, likewise, City costs and systems costs spread over a long period of time
can produce an undue hardship on the general public of the City.
The City Council may elect to defer assessments on undeveloped lands for a specified length of
time or until the lands are developed. Terms and conditions of this deferral will be established in
the resolution adopting the assessments.
6. General Assessment Policies Applicable To All Types of Improvements. The cost of
any improvement shall be assessed upon property benefited by the improvements based upon
benefits received. The following general principles shall be used as a basis of the City's
assessment policy.
A. The "project cost" of an improvement includes the costs of all necessary construction
work required to accomplish the improvement, plus engineering, legal,
administrative, financing and other contingent costs, including acquisition of right-of-
way and other property. The finance charges include all costs of financing the
project. These costs include but are not limited to financial consultant's fees, bond
rating agency fee, bond attorney's fees, discount factors, and capitalized interest.
When the project is started and funds are expended prior to receiving the proceeds
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from a bond sale, the project will be charged interest on the funds expended from the
date of expenditure to the date the bond proceeds are received. The interest charged
to the project shall be included as financing charges.
B. The "assessable cost" of an improvement is equal to the "project cost" minus the
"City share".
C. The City of Annandale will charge interest on special assessments, including all
nuisance abatements over$250.00, at a rate specified in the resolution approving the
assessment roll. If bonds were sold to finance the improvement project, the interest
rate shall be more than the average interest rate of the bonds. If no bonds were sold,
the interest rate may be set at the rate allowed by state law.
D. Property owners may pay their assessments in full interest free for a period of 30 days
after the assessment hearing. After such period, interest shall be computed from the
date specified in the assessment resolution. The City will certify each year's
collection (principal and interest) to the County Auditor by November 30. Prior to
the first certification of principal and interest to the County Auditor, a property owner
may make a partial prepayment of the principal to the City of Annandale. Such
partial prepayment must be at least $100.00. If the partial prepayment is made after
the 30 day "interest free" period allowed by state law, interest will be charged on the
amount of the partial prepayment from the date specified in the resolution and paid
along the with partial prepayment. After the City of Annandale has made the first
certification of principal and interest to the County Auditor, prepayment will be
accepted only for the total amount still owing including interest. If a parcel has two
or more separate special assessments, prepayment of the remaining principal balance
may be made on one or more.
E. Where an improvement is designed by service of an area beyond that of direct
benefit, increased project costs due to such provisions for future service extensions
may be paid for by the City. The City will levy assessments to cover this cost when a
new improvement is installed as an extension of the existing improvement. As an
alternative, the City may assess these costs to the area of future benefit immediately.
F. Where an improvement is designed in part to service an area outside of the City
limits, the City will levy assessments for the improvements upon annexation of the
area to the City. The City will determine the value of the improvement to the
properties at the time of annexation.
G. Where the project cost of an improvement is not entirely attributed to the need for
service to the area served by said improvement, or where unusual conditions beyond
the control of the owners of the property in the area served by the improvement
would result in an equitable distribution of special assessments, the City, through the
use of other funds, may pay such "City cost" which, in the opinion of the City
Council, represents the excess cost not directly attributable to the area served.
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H. Because frontage roads along highways or other arterial streets are deemed to be of
benefit to commercial or industrial properties,the entire cost of any improvement on
such frontage roads shall be assessable to the benefited properties, even if only those
properties on one side of such frontage roads are benefited.
I. If financial assistance is received by the City from the Federal Government, the State
of Minnesota, the County of Wright, or from any other source to defray a portion of
the costs of a given improvement, such aid will be used first to reduce the "City cost"
of the improvement, if the financial assistance received is greater than the normal
"City cost". The remainder of the aid will be placed in the Capital Improvement Fund
to be applied towards other City projects.
J. City-owned properties, including municipal building sites, parks and playgrounds, but
not including public streets and alleys, shall be regarded as being assessable on the
same basis as if such property was privately owned.
K. Improvements specifically designed for or shown to be of direct benefit to one or
more properties must be designed and constructed by the City. The costs for these
improvements will be assessed directly to such properties, and not included in the
assessments for the remainder of the project. An example of this would be utility
service lines running from the main lines to the property.
L. Benefit Appraisals. In the event that City staff has doubt as to whether or not the
proposed assessments exceeded the special benefits to the property in question
(increased property value as defined by State Law), the City Council may order
benefit appraisals as deemed necessary to support the proposed assessments.
M. A property owner may elect to offset special assessments against condemnation
awards by executing a Net Assessment Agreement with the City Council.
7. Methods Of Assessment. There are different methods of assessment: per lot, adjusted
front foot, and area. For any particular project one of these methods will more adequately reflect
the true benefits received in the assessment area than the other methods. The City Engineer, in
the feasibility study to the Council, will recommend one or a combination of these methods for
each project, based upon which method would best reflect the benefit received for the area to be
assessed. The City Council will select the preferred method of calculating the assessments at
the time the project is ordered.
The following methods of assessment, as described and defined below, are hereby established as
the official methods of assessment in the City of Annandale.
A. Adjusted Front Footage Method of Assessment. The "cost per adjusted front
foot" shall be defined as the quotient of the "assessable cost" divided by the total
assessable frontage benefiting from the improvement. For the purpose of
determining the "assessable frontage," all properties, including governmental
agencies, shall have their frontages included in such calculation.
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The actual physical dimensions of a parcel abutting an improvement(i.e., street,
sewer, water, etc.) shall NOT be construed as the frontage utilized to calculate the
assessment for a particular parcel. Rather, an "adjusted front footage" will be
determined. The purpose of this method is to equalize assessment calculations for
lots of similar size. Individual parcels by their very nature differ considerably in
shape and area. The following procedures will apply when calculation adjusted
front footage. The selection of the appropriate procedure will be determined by
the specified configuration of the parcel. All measurements will be scaled from
available plat and section maps and will be rounded down to the nearest foot
dimension with any excess fraction deleted.
1. Standard Lots: In this instance, the adjusted front footage for rectangular lots
will be the actual frontage of the lot. The frontage measured shall be the lot
width at the front lot line.
Adj. Front Footage
MAIN AVENUE EXAMPLES
50' 90' Lot"A"-50'
Lot"B" -90'
A B
2. Rectangular Variation Lots: For a lot which is approximately rectangular and
uniform in shape, the adjusted front footage is computed by averaging the
front and back sides of the lot. This method is used only where the divergence
between front and rear lot lines are twenty feet (20') or less.
Adj.Front Footage
MAIN AVENUE EXAMPLES
_� Lot"A"-100'
90' 70' Lot"B"-75'
A B
110' 80'
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3. Corner Lot Adjustment. For street and trail assessments, the short side will be
assessed the actual front footage. The long side will be assessed for a
maximum of 1/3 of the long side footage. Street and trail assessments will
only be levied on the side where the actual improvement is completed.
Sanitary sewer and water main replacement will only be assessed on the side
of the lot where the sanitary sewer and water service connect to the main line.
Adj. Front Footage
MAIN AVENUE EXAMPLES
Main Ave= 100'
100' Main Street=50'
M
A
1
N
S 150'
T
R
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4. Irregular Lot: Add total lot area and divide by 12,000 (average lot size) and
multiply by 75 (average lot width)
Adj. Front Footage
MAIN AVENUE EXAMPLES
200' 40,000 Divided
by 12,000
times 75 = 250'
200'
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5. Triangular Lots: For a triangular shaped lot, the adjusted front footage is
computed by averaging the front and back lot lines. The measurement at the
back lot width shall not exceed a maximum distance in depth of one hundred
and fifty feet(150')
Adj. Front Footage
MAIN AVENUE EXAMPLES
100' 40' 120' Lot"A" -70'
Lot "B„ -85'
Lot"C" -60'
150' A B C
� 40' ' 130' �'� 0'
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6. Cul-de-sac Lots: The adjusted front footage for those lots that exist on cul-de-
sacs will be calculated at the midsection of the lot at the most reasonably
defined and determinable position. This line will be computed by connecting
the midpoints of the two side lot lines. Or, if the lots are similar in nature and
configuration, a common lot width may be assigned based upon an evaluation
of typical lots within the subdivision.
.4df Fro�Footq�e
L.ct A-75'
, LotB - 110'
. Lot C-80'
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7. Curved Lots: In certain situations such as those where lots are located along
meandering trail system streets, road patterns create curvilinear frontages. In
such instances, the adjusted front footage will be the width of the lot measured
at the midpoint of the shortest side lot line.
, � Adf. Fso�t Footaga
r•Y.��PIF.S
C
$ 150' Loc A-70'
...�:... .............. Lot B -90'
,4 Lot C- 1 SO'
70'
8. Irregularly Shaped Lots (unplatted): In many cases, unplatted parcels that are
legally described by a metes and bounds description, are irregular and odd
shaped. The adjusted front footage will be calculated by measuring the lot
width at thirty(30') foot building setback line.
.ldj. F,+ont Foor�r
�dMP,L:;
Lot A- l t 5'
Lot B - 140'
Lot C- 125'
MAIN AYENUE
30' i 1S' 1�0' 125'
A B C
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9. Future Developable Land: The adjusted front footage shall be computed by
dividing the area of the lot by 12,000 square feet to determine the equivalent
number of front footage units in the parcel. The number of units multiplied by
75 feet will give the adjusted front footage. The area of the lot may be
reduced to account for wetlands and unbuildable terrain.
B. "Area" Method of Assessment. When it has been determined to assess by the
"area" method, the area shall be defined as the number of square feet or acres
within the boundaries of the appropriate property lines of the areas benefiting
from the project. The assessment rate (i.e., cost per square foot) shall be
calculated by dividing the total assessable cost by the total assessable area. On
large lots,the City Engineer may determine that only a portion of the lots receives
the benefit and may select a lot depth for the calculations equal to the benefit
received.
For the purposes of defining assessable areas, all properties included in the
benefited area, including other governmental areas, churches, etc., shall be
included in the assessable areas. The following items may not be included in area
calculations: public right-of-ways, natural waterway, swamps and lakes and other
Wetlands designated by the MN/DNR or City. The City Engineer will make the
recommendation on the benefited area in the feasibility report.
C. Per Lot Method. When it has been determined to assess by the "per lot" method,
all lots within the benefited area shall be assessed equally for the improvements.
The "cost per lot" shall be defined as the quotient of the "assessable cost" divided
by the total assessable lots or parcels benefiting from the improvement. For the
purpose of determining the "lots" or "parcels" all parcels, including governmental
agencies, shall be included in such calculations.
8. Standards For Public Improvement Projects. The following standards are hereby
established by the City of Annandale to provide a uniform guide for improvements within the
City and also to be used by the City Engineer in establishing "system costs" as differentiated
from "assessable costs" and "City costs."
A. Surface Improvements. Surface improvements shall normally be interpreted to
include all improvements visible on or above the ground within the right-of-way,
and includes, but is not limited to trees, lighting, sidewalks, signing; street and
accessory improvements such as surfacing, curb and gutter, drainage facilities,
grading, signalization; and other public improvements such as drainage ponds and
facilities, parking lots, parks and playgrounds.
B. Policy Statement. In all streets, prior to street construction and surfacing, or
prior to resurfacing, all utilities an utility service lines, (including sanitary sewers,
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storm sewers, water lines, gas and electric service) shall be installed to serve each
known or assumed building location when practicable.
When practicable, no surface improvements to less than both sides of a full block
of street shall be approved except as necessary to complete the improvement of a
block which has previously been partially completed. Concrete curbing or curb
and gutter shall be installed at the same time as street surfacing.
C. Subsurface Improvements. Subsurface improvements shall normally include
such items as water distribution, sanitary sewer and storm sewer lines and electric
and gas utilities.
For purposes of definition, main lines are defined as the publicly owned and
maintained lines such as trunk lines, interceptors, mains, laterals, etc. The service
lines are those privately owned service lines going from the main line to the
property line.
D. Policy Statement. Subsurface improvements shall be made to serve current and
projected land use. All installations shall conform to city standards as established
by those state and/or federal agencies having jurisdiction over the proposed
installations. Service lines from the lateral or trunk to the property line for each
known or assumed building location shall be installed in conjunction with the
construction of the mains.
9. Assessment Computations
A. Street and Curb and Gutter Improvements. �
1. New Constructions. All new streets will be assessed 100%to the
abutting benefited properties. New curb and gutter shall be 100%
assessed, in like manner with the streets. Street and curb and gutter
improvements will normally be assessed by the adjusted front foot
method, however other methods may be utilized if conditions
warrant. Cost of construction of streets shall be assessed based on
the minimum design of 7-ton axle load in residential areas and 9-ton
axle load in commercial and industrial areas. Oversizing costs which
are incurred in excess of the above may be paid by: (1) State Funds,
(2) larger assessment rates to other benefited properties, (3) general
obligation funds, or(4) any other method or combination or methods
authorized by the City Council.
2. Reconstruction and Overlays. All street reconstructions and
overlays shall be 35% assessed at a maximum of 32 feet (Residential
Equivalent). Street reconstructions and overlays will be assessed on
either an adjusted front foot or on a per lot basis. The City Council
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reserves the right to amend this street reconstruction assessment for
specific projects, due to extenuating circumstances.
3. Gravel Streets. Upgrading an existing gravel street by adding
pavement, curb and gutter shall be considered new construction and
all costs assessed 100%.
4. Seal Coats. Seal coats within the City of Annandale will not be
assessed.
5. Alleys. Upgrading existing gravel alleys by adding pavement will be
assessed 100%to the block being improved. Reconstructing existing
paved alleys will be 100% assessed also, except in the Central
Business District(CBD). For CBD alleys, the City Council will
determine the amount assessed at the public hearing considering the
improvements.
B. Sidewalks and Trails. Sidewalks and trails will be assessed 100%to the
abutting property for new construction and 50%to the abutting property
for reconstruction (and overlays on bituminous trails). The City Council
reserves the right to amend this assessment for specific projects, due to
extenuating circumstances.
C. Storm Sewer Improvements. Storm sewers can be assessed on a project-
by-project basis. Storm sewers in new subdivisions are considered a
100% assessable improvement on an area basis. If the property benefits
from a larger watershed or drainage area improvement, user charges
and/or area charges shall be levied to all unplatted property at the time of
development in an amount established by the Council from time to time.
D. Sanitary Sewer Assessments. Assessments for sanitary sewer in
residential areas shall be based upon the cost of construction of 8 inch
mains, which is the smallest size installed in residential areas of the City.
Assessments for sanitary sewers in commercial and industrial areas will
be based upon a standard size of 12 inch mains.
Oversizing costs due to larger mains and larger appurtenances will be paid
for by a combination of availability charges, user charges and/or trunk
area charges. Trunk area sewer charges shall be levied to all unplatted
property at the time of development. The sewer area rate shall be
established by the City Council from time to time. Services installed to
individual properties shall be fully assessed to the benefiting property.
In addition, sewer hook-up charges (availability charges) will be charged
to all new connections to the City sewer system. Hook-up charges shall be
set by the City Council and may be amended from time to time.
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Lateral benefit from major trunk sewers or interceptors will be assessed to
the properties benefited by the sewer. Lateral benefit from sewers will be
determined based on an equivalent 8" diameter sewer at a depth of 14 to
16 feet. Any oversizing costs will be assessed as described above.
The replacement of existing sewers will be assessed 30% with the
remaining costs paid for by other funding sources identified by the City
Council (i.e. user rates).
Any existing service lines found to be defective as part of a street
reconstruction shall be replaced as part of the project and assessed directly
to the property.
E. Watermain Assessments. Assessments for watermains in residential
areas shall be based upon the cost of construction of 8 inch mains, which
is the smallest size installed in residential areas of the City. Assessments
for watermains in commercial and industrial areas will be based upon the
standard size of 12 inch mains.
Oversizing costs due to larger mains and larger appurtenances will be paid
for by a combination of availability charges (hook-up charges), user
charges, and trunk area charges. Trunk area water charges shall be levied
against all unplatted property at the time of development. The water area
rate shall be established by the City Council from time to time. Services
installed to individual properties shall be fully assessed to the benefiting
property.
In addition, water hook-up charges (availability charges) will be charged
to all new connections to the City water system. Water hook-up charges
shall be set by the City Council and may be amended from time to time.
The replacement of existing watermains will be assessed 30%.
Lateral benefit from major trunk watermains will be assessed to properties
benefited by the watermain. Lateral watermain assessments will be based
on the costs for an equivalent 8" diameter watermain for residential
properties and for an equivalent 12" diameter watermain for
commercial/industrial properties.
Any existing service lines found to be defective as part of the project will
be assessed directly to the property.
F. Street Boulevard Trees. All street boulevard trees installed as part of
new street constructions or in reconstructing existing streets shall be
included as part of the overall project costs included in the assessment
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calculations. The property owner is responsible for maintenance of such
boulevard plantings and all costs associated therewith.
G. Street Lights. All costs for new street lights installed as part of
constructing new streets or street lights relocated as part of reconstructing
streets will be included in the overall project costs and included in the
assessment calculations.
H. Other Improvements. Based on the City Council determination, all other
improvements may be fully assessed or assessed in part.
10. Deferral of Assessments.
A. Eligibility. The City Council may defer the payment of special
assessments against homestead properties if the owner of the property is a
person 65 years of age or older or retired by virtue of a permanent and
total disability for whom it would be a hardship to make the payments.
In order to be eligible for the deferment, the owner shall show that
annual principal and interest due on the assessment is in excess of 3%of
the property owner's annual income and, therefore, is a hardship. The
property owner must make application for the deferment within 60 days
after the assessment is adopted by the City Council.
B. Deferment Period. The deferment shall be granted for a maximum period
of ten years. The property owner shall immediately notify the City of any
change in status which may affect eligibility for the defertnent. The
deferment shall terminate and all amounts accumulated plus interest shall
become due upon the occurrence of any one of the following:
i. the death of the owner, provided that the spouse is otherwise not
eligible for the benefits hereunder;
ii. the sale, transfer or subdivision of the property or any part thereof;
iii. if the property should, for any reason, lose its homestead status; or
iv. if for any reason the City determines that there would be no hardship
to require immediate or partial payment.
In the event of sale, the deferred assessment, together with any accrued
interest shall be paid it its entirety prior to completion of the sale. In all
other circumstances, the deferred assessment, together with accrued interest
shall be paid within 60 days after loss of eligibility. If the special
assessment is not paid within the sixty day period, the City shall add interest
at the assessment rate and the total amount of principal and interest shall be
certified to the County Auditor for collection with taxes the following year.
The City Council may extend the deferment beyond the initial ten years or
may enter into a repayment plan upon a showing of continued hardship by
the property owner.
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