The purpose and intent of this chapter is to provide qualified low-income owners with an alternative method for payment of special assessments levied against their real property. The Council finds and declares that state special assessment laws and City procedural ordinances providing for payment of assessments in lump sums and bonds in annual installments often results in financial hardship to low-income owners and, in the exercise of the Council's power to make suitable provision for the aid and support of the poor, it is in the public interest for the City to provide a method for the deferral of payment of special assessment levied against the real property of qualified low-income owners until such time as the property is transferred or refinanced, or the owners fail to qualify. The Council further finds and declares that all expenditures and investments made pursuant to this chapter are incidental to the accomplishment of the primary purpose of making suitable provision for the aid and support of the poor.
(Ord. 94-882 § 1)
This chapter is adopted pursuant to the City's legislative powers to make and enforce ordinances and regulations. To the extent of any inconsistencies between the provisions of this chapter and those of the 1911 Act, 1913 Act, or other state law, state law shall control.
(Ord. 94-882 § 1)
This chapter is limited to qualified low-income owners residing within the City and 1911 Act and 1913 Act proceedings providing for the issuance of bonds to represent unpaid assessments under the Improvement Act of 1911 (commencing with Section 5000 of the Streets and Highways Code).
There are no restrictions for qualified low-income owners. This chapter applies to pending and future special assessment proceedings.
(Ord. 94-882 § 1)
The meaning of the various terms, as used in this chapter, shall be as follows:
"Assessment bonds"
means an obligation to pay money at a definite time or times, issued or to be issued, to represent an unpaid assessment pursuant to the provisions of the Improvement Act of 1911 (commencing with Section 5000 of the California Streets and Highways Code).
"City Manager"
means the City Manager of Imperial Beach and any officer, department, or division of the City designated by the City Manager for the administration of this chapter.
"Income"
means all income of any nature from any source derived, including, but not limited to, salaries, wages, dividends, interest, capital gains, rents, income from the operation of a farm or business, income from the sale or exchange of property, gifts, inheritances, Social Security payments, other retirement benefits, welfare benefits, alimony and support payments and any other thing of economic value.
"Mortgage"
means a mortgage deed, a deed of trust, or any other instrument which constitutes a lien on real property.
"Net assets"
means all real and personal property of any character which a low-income owner owns or has an interest in, including stocks, bonds, and savings accounts but excluding the real property subject to assessment deferral.
"Owner"
means the person or persons owning and occupying real property in the City which is subject to special assessment pursuant to the 1911 Act or 1913 Act and successors in interest or the legally appointed representatives of such person or persons.
"Refinancing"
means any new indebtedness incurred by an owner after delivery to the City of a bond agreement or a mortgage pursuant to this chapter and any extension, modification, or additional advances made upon any indebtedness previously incurred by an owner, where such indebtednesses are secured by a mortgage on all or any part of the real property in which the City has a security interest.
"Transfer,"
when referring to real property, means any sale, exchange, gift, or lease of real property or any interest therein, whether made by the original owner, any successor in interest or legally appointed representative of the owner or made pursuant to the laws of inheritance and succession. "Transfer" shall also mean, under the terms of this chapter, any approval of a subdivision map, parcel map, site development plan, building permit for improvements valued greater than $15,000.00, or any similar change in character of the property, including the rezoning of the property pursuant to application by the property owner.
(Ord. 94-882 § 1)
An assessment deferral fund is hereby established in the City Treasury. All moneys appropriated by the Council for the purpose of this chapter shall be deposited to the credit of that fund. All income, losses, and expenditures resulting from the provisions of this chapter shall be credited or debited, as the case may be, to that fund.
(Ord. 94-882 § 1)
The resolution of intention may provide for the assessments and bonds upon the real property of qualified low-income owners to be classified into longer maturities than assessments and bonds upon other real property in the assessment district.
(Ord. 94-882 § 1)
The City Manager shall establish rules and regulations for the administration of this chapter and shall set forth the form and contents of applications, information statements, bond agreements, notes, mortgages, and any other documents necessary for the administration of this chapter; provided, however, that any exception to the requirement that the low-income owner be an occupant of the real property for which the assessment deferral is sought shall be granted only upon the approval of the City Council.
(Ord. 94-882 § 1)
Property owners may apply for assessment deferral pursuant to this chapter, and upon approval the City Manager may pay the full amount of the assessment due or to become due upon the owner's property.
Alternatively, the City Manager may pay the annual bond debt obligation on behalf of the property owner as the payments become due, or in full at any time.
(Ord. 94-882 § 1)
An owner must meet the following eligibility requirements:
A. 
Owner's income must be within the guidelines for lower-income citizens and families set by the United States Department of Housing and Urban Development, Economic Marketing Analysis Division, as adjusted annually for the San Diego metropolitan statistical area.
B. 
The real property for which assessment deferral is sought must be owner-occupied unless otherwise excepted and approved by the City Council.
C. 
The value of owner's net assets cannot exceed $10,000.00, excluding the value of the property being assessed, and one vehicle.
D. 
If an owner does not meet the eligibility requirements under subsection A or C of this section, upon a showing of hardship, the City Manager may at his or her discretion present the matter to the City Council for special consideration.
(Ord. 94-882 § 1)
The failure of the Superintendent of Streets to distribute or mail written explanations of the assessment deferral program or the failure of any owner to receive the explanation shall not affect the validity of any proposed or pending special assessment proceedings or any assessment bonds issued pursuant thereto.
(Ord. 94-882 § 1)
All owners interested in obtaining an assessment deferral shall file an application with the City Manager. Among other things, the application shall contain:
A. 
Name and mailing address of all owners;
B. 
A description sufficient to identify the real property for which assessment deferral is sought;
C. 
A statement that the real property is located in the City, is owned by the applicants, and is or is not occupied by the applicants;
D. 
A statement that applicants believe they are eligible as qualified low-income owners and have furnished all pertinent information concerning eligibility, income and net assets;
E. 
Signature of applicant under penalty of perjury, attesting that the information provided is true and correct;
F. 
Applicant's income and sources of income, including pertinent data from the most recent income tax return;
G. 
List of applicant's net assets;
H. 
List of any and all encumbrances on the property, including names and addresses of encumbrancers;
I. 
An estimate of the value of the property.
(Ord. 94-882 § 1)
The City Manager shall promptly investigate and review all applications for assessment deferrals. The City Manager may require applicant to furnish such additional information as may be necessary to determine whether applicant is a qualified low-income owner. Upon completion of the investigation and review, the City Manager shall either deny or give preliminary approval to the application. Final approval of the application shall be given by the City Manager only upon applicants furnishing the City with the security required by Section 12.35.140.
(Ord. 94-882 § 1)
Before giving final approval to any application for assessment deferral, the City Manager shall obtain security for payment of all amounts then or thereafter to become due to the City. In the discretion of the City Manager, the security may consist of either of the following:
A. 
The purchase by the City of the assessment bond to be issued upon applicant's real property and the execution of a bond agreement between the City and the applicant pursuant to Section 12.35.150. The purchase price shall be paid from the assessment deferral fund to the contractor or his or her assignee, or to the bond-holder.
B. 
The payment by the City of the special assessment to become due upon applicant's real property and the execution and delivery by applicant to the City of a note and deed of trust pursuant to Section 12.35.170.
(Ord. 94-882 § 1)
Prior to final approval of any application for assessment deferral and to City's purchase of an assessment bond, the City Manager shall negotiate a bond agreement with the applicant. Among other things the bond agreement shall make provision concerning payments due or to become due upon the bond. This agreement may contain a payment plan to allow the applicant to pay off the assessment.
(Ord. 94-882 § 1)
Prior to final approval of any application for assessment deferral and to the City's payment of a special assessment or the redemption and prepayment of an assessment bond, the owner shall execute and deliver a note and mortgage to the City Manager.
The note shall be in a principal amount equal to the special assessment paid by the City upon owner's real property or, if there is an outstanding bond on the real property, the amount required to be paid by the City for the redemption and prepayment of the bond.
The principal amount of the note shall bear simple annual interest determined as follows:
A. 
Until the maturity date of the bond issued or which otherwise would have been issued on owner's property, the interest rate on the note shall be the same as the interest rate specified in the bond.
B. 
After the maturity date of the bond, the interest rate shall be the average annual interest rate thereafter earned by the City on its long-term investments.
The entire unpaid principal amount of the note, together with all interest due thereon, shall become immediately due and payable to the City upon and before any transfer or refinancing affecting the real property described in the mortgage securing the note.
The deed of trust securing the note shall secure the entire unpaid principal of the note, together with all interest due thereon, and shall be such as to constitute an enforceable lien against the real property described therein. The deed of trust shall provide that failure to pay the City the entire amount due upon the note constitutes an event of default, upon the occurrence of which the City may enforce the deed of trust by the sale or foreclosure of the property described therein. The deed of trust shall further require the owner to give prompt written notice to the City Manager of any proposed transfer of or refinancing pertaining to the real property.
(Ord. 94-882 § 1)
Where an owner has executed a bond agreement pursuant to Section 12.35.150 or a note pursuant to Section 12.35.160, the owner may at any time pay the City Manager all or any part of the amounts due the City upon the bond agreement or the note. All payments received by the City Manager shall be deposited in the assessment deferral fund.
The City Manager shall deliver to the owner a receipted statement showing the full amount of principal, interest and other amounts due the City on the date of payment, the amount of the payment made, and the balance, if any, remaining unpaid on the date of payment. Where a partial payment is made, the payment shall first be applied to reduce the interest then due the City and any remainder applied to reduce the principal and any other amounts then due the City.
Upon full payment to the City of a bond agreement or note, the City Manager shall execute and deliver to the owner a notice of satisfaction of the agreement or note and, in the case of a note, a release of the deed of trust.
(Ord. 94-882 § 1)
Upon delivery of a deed of trust to the City, the City shall have all of the rights and liens specified in the deed of trust. A bond purchase by the City shall not constitute the redemption and prepayment of the bond by the City. Upon the purchase of a bond, the City shall become the owner of the bond and shall succeed to all of the rights and liens of the bondholder to enforce all payments upon the bond.
(Ord. 94-882 § 1)
At least once each year, the City Manager shall review all finally approved applications, the security furnished the City pursuant thereto, and the financial condition of the owner. For that purpose, the City Manager may require the owner, either orally or in writing, to furnish information given under penalty of perjury concerning:
A. 
Any proposed, pending, or completed transfers or refinancing affecting the real property in which the City has a security interest, including any approval of a rezoning, subdivision map, parcel map, site development plan, building permit for improvements in excess of $15,000.00, or any similar change in character of the property;
B. 
Owner's continuing eligibility as a qualified low-income owner.
The failure or refusal of the owner to furnish such information shall be deemed an event of default, upon the occurrence of which the City may enforce its security interest.
(Ord. 94-882 § 1)
If an owner ceases to be a qualified low-income owner or fails to make payments to the City when due, or if, in the opinion of the City Manager, it appears probable that such payments will not be made when due, the City Manager shall report such matters to the Council, together with his or her recommendations. Thereupon the Council may instruct the City Manager to make further efforts to collect amounts due, authorize the City Manager to compromise or writeoff all or any part of the amounts due, or order the City Manager to refer the matters to the City Attorney for enforcement of the City's security.
(Ord. 94-882 § 1)
Qualifying applications under this chapter will be subject to an administrative fee equal to one and one-half percent of the value of the face amount of the assessment bond due or to become due upon the property.
(Ord. 94-882 § 1)