The purpose of the parks and recreation system development charge (PSDC) is to ensure that new development contributes to the cost of new parks and recreation facilities and any expansion of existing parks and recreation facilities required to accommodate additional demand generated by the development.
(Ord. 530 § 1, 2017)
The following definitions apply to this ordinance:
"Capital Improvements"
mean public facilities or assets, including real property, used for parks and recreation. Capital improvements do not include costs of the operation or routine maintenance of any facilities or assets.
"Capital Improvement Plan"
means the list of capital improvements adopted Section 3.05.070 that the city intends to finance, in whole or in part, using PSDCs.
"Council"
means the city council of the city of Happy Valley, Oregon.
"Construction Cost Index"
means that index published by the Engineering News Record (ENR) Northwest (Seattle, Washington) titled "Construction Cost Index."
"Department Director"
means the direction of the city's economic and community development department or person designated by the director.
"Development"
means any man-made change to improved or unimproved real estate including a building or other land construction, or making a physical change in the use of a structure or land that may have the effect of increasing demand for parks and recreation facilities or that may contribute to the need for additional or enlarged parks and recreation facilities as determined in this ordinance. Development includes redevelopment of property. Development includes improved open areas such as plazas and walkways but does not include natural geologic forms or unimproved lands.
"Finance Director"
means the finance director of the city of Happy Valley or the director's designee.
"Improvement Fee"
means a fee for costs associated with capital improvements to be constructed.
"Improvement Fee Credit"
means a credit granted for the construction of a qualified public improvement under the provisions of ORS 223.304(4).
"Minimum Standard Facility"
means facilities to meet the adopted standards for a neighborhood park.
"New Development"
means development that occurs on or after the effective date of the ordinance codified in this chapter.
"Owner"
means the owner or owners of record of real property as shown in the records of Clackamas County, or a person purchasing a piece of property under contract, or a public body or public agency with authority to exercise the power of eminent domain which has formally enacted a resolution of its intent to acquire the property described in the resolution.
"Parcel"
means a tract, partition parcel, subdivision lot, legal lot of record or other unit of land or interest in real property.
"Parks and Recreation System Development Charge" or "PSDC"
means a reimbursement fee, an improvement fee, or a combination thereof assessed or collected at the time of increased usage of capital improvements or issuance of a development permit or building permit. A PSDC does not include fees assessed or collected as part of a local improvement district or a charge in lieu of a local improvement district assessment, or the cost of complying with requirements or conditions imposed by a land use decision.
"Permittee"
means the person to whom a building permit, development permit, or other permit related to the use of a parcel is issued.
"Qualified Public Improvement"
means a capital improvement that is:
1. 
Required as a condition of development approval; and
2. 
Identified in the adopted Capital Improvement Plan; and is either:
a. 
Not located on or contiguous to a parcel of land that is the subject of the development approval, or
b. 
Located on or contiguous to property that is the subject of development approval and is required to be built larger or with greater capacity (overcapacity) than is necessary for the applicant's new development.
"Reimbursement Fee"
means a fee for costs associated with capital improvements that are:
1. 
Constructed or under construction on the date the fee is adopted pursuant to this chapter, and
2. 
For which the council determines that capacity for future users exists.
(Ord. 530 § 1, 2017; Ord. 548 § 2, 2019)
A. 
PSDCs may be established and revised by resolution of the council. The resolution shall set the amount of the charge, the type of permit to which the charge applies, and, if the charge applies to a geographic area smaller than the entire city, the geographic area subject to the charge.
B. 
PSDCs may be annually adjusted to account for changes in the costs of acquiring and constructing park and recreation facilities, based on the change in Construction Cost Index. The construction cost index shall be used to adjust the PSDCs unless they are otherwise adjusted by the council based on adoption of an updated methodology report or capital improvement project list.
(Ord. 530 § 1, 2017; Ord. 548 § 2, 2019)
A. 
The methodology used to establish or modify the reimbursement fee shall, where applicable, be based on the cost of then-existing facilities, including, without limitation, design, financing and construction costs, prior contributions by then-existing users, gifts or grants from federal or state government or private persons, the cost of the unused capacity of existing facilities, rate-making principals employed to finance publicly owned capital improvements, and other relevant factors identified by the council. The methodology shall promote the objective that future system users shall contribute no more than an equitable share of the cost of then-existing facilities.
B. 
The methodology used to establish or modify the improvement fee shall demonstrate, where applicable, consideration of the estimated cost of projected capital improvements needed to increase the capacity of the parks and recreation system. The methodology shall be calculated to obtain the cost of capital improvements for the projected need for available system capacity for future system users.
C. 
The methodology used to establish or modify the improvement fee or the reimbursement fee, or both, shall be contained in a resolution adopted by the council.
(Ord. 530 § 1, 2017; Ord. 548 § 2, 2019)
A. 
Reimbursement fees shall be spent only on capital improvements that are included in the plan adopted by the council pursuant to Section 3.05.070, including expenditures relating to repayment of future debt for the improvements. However, expenditure of reimbursement fees is not limited to the portions of projects that create capacity for future system users.
B. 
Improvement fees shall be spent only on portions of capital improvements that create additional capacity for future users, including expenditures relating to repayment of future debt for the improvements. An increase in system capacity occurs if a capital improvement increases the level of performance or service provided by existing facilities or providing new facilities. The portion of the capital improvements funded by improvement fees must be related to demands created by new development. A capital improvement being funded wholly or in part from revenues derived from the improvement fee shall be included in the plan adopted by the council pursuant to Section 3.05.070.
C. 
Notwithstanding Section 3.05.060, PSDC revenue may be expended on the direct costs of complying with the provisions of this chapter, including the costs of developing PSDC methodologies and providing an annual accounting of PSDC expenditures.
(Ord. 530 § 1, 2017; Ord. 548 § 2, 2019)
PSDCs shall not be expended for costs associated with the construction of administrative facilities that are more than an incidental part of a capital improvement. PSDCs shall not be expended for costs of the operation or routine maintenance of capital improvements or other park and recreation facilities.
(Ord. 530 § 1, 2017)
A. 
Prior to establishing a PSDC, the council shall adopt a Capital Improvement Plan by resolution that includes a list and description of:
1. 
The capital improvements the council intends to fund in whole or in part with PSDC revenues;
2. 
The estimated cost and time of construction of each capital improvement and the percentage of the cost eligible to be funded with PSDC revenues; and
3. 
A description of the process to modify the plan.
B. 
In adopting the plan, the council may incorporate by reference all or a portion of any public facilities plan, master plan, capital improvements plan or similar plan that contains the information required by this section.
C. 
The council may modify the plan and list at any time. If a PSDC will be increased by a proposed modification to the list the council will:
1. 
At least 30 days prior to adoption of the proposed modification, provide written notice to persons who have requested notice pursuant to this chapter; and
2. 
Hold a public hearing if a written request for a hearing is received at least seven days prior to the date of the proposed modification.
D. 
A change in the amount of a reimbursement fee or an improvement fee is not a modification of the system development charge if the change in amount is based on the periodic application of a the Construction Cost Index.
(Ord. 530 § 1, 2017; Ord. 548 § 2, 2019)
A. 
The PSDC is due and payable at the time the city issues a building permit for any types of development. If a building or development permit is not required, the PSDC is payable at the time use of a capital improvement is increased based on changes in the use of the property that are unrelated to seasonal or ordinary fluctuations. A PSDC is imposed when a change of use of a parcel, lot or structure occurs, but the amount of the PSDC shall be reduced by an amount equal to the existing PSDC for the pre-existing type and level of the use. The reduction may not exceed the calculated PSDC. No refund or credit shall be on account of such reduction.
B. 
Notwithstanding issuance of a development, building, or occupancy permit without payment, the PSDC liability shall survive and become a personal obligation of the permittee.
C. 
Except as provided for installment payments under Section 3.05.090, failure to pay the charge within 60 days of the due date shall result in a penalty equal to 50% of the charge. After 60 days, interest on any unpaid balance shall accrue at the legal rate established by statute.
D. 
The finance director is authorized to take the following actions with respect to PSDCs, penalties, and interest:
1. 
Any action described in this section to collect and enforce the charge, penalties, and interest;
2. 
To initiate legal action or exercise any other statutory right to collect any delinquent charge, penalties and interest under this chapter upon approval of the city council, as applicable, or in accordance with any general city collection policy; and
3. 
If the finance director determines that the delinquent charges for any development are for any reason wholly uncollectible, the finance director may request, in writing, to the council, an order directing that the charges be cancelled. The council, when so requested, may in its discretion order and direct the finance director to cancel such uncollectible charges.
(Ord. 530 § 1, 2017; Ord. 548 § 2, 2019)
A. 
When a PSDC is due and payable, the permittee may apply to the city for payment in 20 semiannual installments, secured by a lien on the property upon which the development is to occur, to include interest on the unpaid balance, if an option for installment payments is required to be made available by ORS 223.205, 223.210 to 223.295.
B. 
The city shall provide an application form for installment payments, which shall include a waiver of all rights to contest the validity of the lien, except for the correction of computational errors. The application fee shall be set by the council by resolution.
C. 
If the principal amount owed is less than $25,000, interest shall accrue at the current prime lending rate plus three percentage points. Otherwise, interest shall accrue at the current prime lending rate plus two percentage points.
D. 
An applicant requesting installment payments has the burden of demonstrating that the applicant has authority to assent to the imposition of a lien on the property and that the applicant's interest in the property is adequate to secure payment of the lien. The finance director may order the imposition of the lien as directed by the department.
E. 
Upon the finance director's order, the finance department shall cause the lien to be recorded on the city's lien docket. From that time the city shall have a lien upon the described parcel for the amount of the PSDC, together with interest on the unpaid balance at the rate established by the finance director. The lien shall be enforceable in the manner provided in ORS Chapter 223 and shall be superior to all other liens pursuant to ORS 223.230. Upon satisfaction of the obligation the finance director shall direct the finance department to release the lien.
(Ord. 530 § 1, 2017; Ord. 548 § 2, 2019)
The uses listed and described in this subsection are exempt, either partially or fully, from payment of the PSDC. Any applicant seeking an exemption under this section shall request that exemption, in writing, no later than the time of application for the building permit. Where development consists of only part of one or more of the uses described in this section, only that/those portion(s) of the development that qualify under this section are eligible for an exemption:
A. 
Remodeling or replacing an existing structure (including mobile homes) except to the extent that the remodeling or replacement creates demands on the parks and recreation system greater than those of the existing use of the property;
B. 
A structure or use established and legally existing on or before the effective date of the ordinance codified in this chapter is exempt from a system development charge to the extent of the structure or use then existing and to the extent of the parcel of land, as constituted on that date;
C. 
An addition to a single-family dwelling that does not add a dwelling unit, as defined by the State Uniform Building Code;
D. 
Temporary uses that do not exceed 90 days in a calendar year; and
E. 
Temporary construction facilities as determined by the finance director.
The balance of the development that does not qualify for any exemption under this section shall be subject to the full PSDC.
(Ord. 530 § 1, 2017; Ord. 548 § 2, 2019)
A permittee may be entitled to a credit against the PSDC for constructing a Qualified Public Improvement or payment of a fee-in-lieu of construction. The value of the PSDC credit will be determined as described in this section. The permittee has the burden of demonstrating that an improvement qualifies as a Qualified Public Improvement.
A. 
The city shall provide credit for the documented, reasonable cost of construction (whether paid via fee-in-lieu or as constructed) for all or part of a Qualified Public Improvement listing the Capital Improvement Plan and based on the following criteria:
1. 
Park improvements that are not located on or contiguous to the property that is the subject of development approval shall be considered for credit at 100% of the cost of the Qualified Public Improvement.
2. 
A park improvement that is located on or contiguous to the property that is the subject of development approval and that is required to be built larger or with greater capacity than is necessary for the particular development project shall be considered for credit. Credit for the improvement may be granted only for the cost of that portion of the improvement that exceeds the capacity needed to serve the development project. In addition, the city may grant greater credit (up to the total cost of the improvement) to a permittee in limited circumstances where doing so serves the public interest as determined by the city in its sole discretion based on impact analysis documents that show the impact of the project is incidental to the overall improvement. To grant the additional credits, the city must enter into a development agreement with the permittee that identifies the permittee's commitments to completing the improvements, including the timing and delivery of same and that establishes the conditions for the city's issuance of credits.
3. 
The value of an interest in real property shall be based on the written appraisal of fair market value by a qualified, professional appraiser:
a. 
The appraisal shall determine the value of the property on the date of the city's land use or other permit decision that requires the permittee to provide the park improvement(s).
b. 
The appraisal shall assume the value of the real property as approved by land or other permit decision but not including any public improvements required by the decision or permit. Constrained lands, such as conservation slope areas, riparian areas, wetlands, habitat conservation areas and any associated buffers shall be valued with the constraints. For example, steep slopes and natural resource areas may not exceed a residential density of two dwelling units per acre.
c. 
The valuation date shall be within 60 days of the date of the city's final decision approving the development. Appraisals and appraisal reviews shall be completed in accordance with the most current Uniform Appraisal Standards for Federal Land Acquisition.
4. 
The city in its sole discretion may accept other documents or evidence to determine the value of dedicated real property.
B. 
A request for PSDC credit shall be filed in writing no later than 90 days after dedication of the subject real property or acceptance of the improvement by the city, if earlier.
C. 
The amount of the credit, if any, shall be determined by the city based on the subject improvement contract documents and other appropriate information provided by the permittee.
D. 
The permittee shall also document, with creditable evidence, the value of the improvement(s) for which credit is sought. If the city, in its sole discretion, determines that the improvement(s) meets the requirements of this section and agrees with the proposed value of the improvement(s), the city may issue a credit for the eligible amount.
E. 
The value of the credits under this section shall be determined by the city at its sole discretion based on the actual or projected cost of construction of any land valuation as verified by receipts and other credible evidence submitted by the permittee. Where a discrepancy exists in the evidence submitted by the permittee, the city may supplement the record upon which the value of the PSDC credit is determined.
F. 
The city shall respond to the permittee's request in writing within 45 days of receipt of a technically complete request. The city shall provide a written explanation of the decision on the credit request.
G. 
Upon approval, the city shall provide the permittee with a credit voucher signed by the department director. The credit voucher shall state a dollar amount that may be applied against any PSDC imposed against the subject property. In no event shall a subject property be entitled to redeem credit vouchers exceeding the PSDC imposed on the subject property, except as provided for in subsection J of this section.
H. 
A PSDC credit has no cash or monetary value and a remaining balance on a voucher shall not be a basis for any refund. A credit shall only apply against the PSDC and its only value is to be used to reduce the PSDC otherwise due, subject to all conditions, limitations, and requirements of this chapter.
I. 
Prior to issuing a building other permit that requires payment of the PSDC, and upon written request to the city by the permittee, a credit may be applied to the PSDC due on the permit for development of the lot(s) or parcel(s).
1. 
In the case of multi-phase development, excess credit generated in one phase may be applied to reduce the PSDC in subsequent phases of the original development project.
J. 
A credit may be reassigned from the permittee to another person for use on a new development or property if all the following conditions are met:
1. 
A request for reassignment of a credit voucher must be made in writing with a notarized letter to the department signed by the person who owns the credit. The request for reassignment of a credit voucher shall contain all the information necessary to establish that such a reassignment is allowable under this subsection. The burden of proof that a reassignment is allowable is the responsibility of the permittee. The city shall respond in writing to the permittee's request for reassignment within 30 days of receipt of the request.
2. 
Credits may be reassigned if the city determines that either:
a. 
The lot or parcel that is to receive the credit is adjacent to and served by the park improvements that generated the credits; or
b. 
The park improvements that generated the original credits are located within the city limits of the city of Happy Valley.
3. 
When a credit voucher or portion of a credit voucher is reassigned, a notarized assignment of PSDC credits notice shall be sent from the city to both parties clarifying the reassignment. The amount reassigned shall be deducted from the transferor's credit voucher balance and reassigned to the transferee:
a. 
The assignment shall reference the original credit voucher number, which is associated with the property to which the initial credit was assigned.
b. 
The assignment shall have the same expiration date as the initial credit voucher.
c. 
The credit shall be applied to the PSDC on a permit for development on a lot or parcel within the confines of the property eligible for assignment as described in subsection I of this section.
4. 
A reassigned credit voucher shall follow all rules regarding redemption of credits.
5. 
The city may charge a fee, as set by resolution, for administering the reassignment of credits.
K. 
The permittee is responsible for presenting a PSDC credit to the city prior to the issuance of the building permit or other development permit that requires payment of the PSDC. Except as provided in Section 3.05.140 (Refunds), under no circumstances shall any credit redemption be considered after issuance of building or development permit.
L. 
Credit vouchers shall expire on the date 10 years after the date the PSDC credit voucher was issued by the city. The expiration date may not be extended.
M. 
The department director can delegate signature authority for credit vouchers to a designee.
N. 
The city does not recognize and will not accept PSDC credit vouchers issued by another jurisdiction.
(Ord. 530 § 1, 2017; Ord. 548 § 2, 2019)
The city shall maintain a list of persons who have made a written request for notification prior to adoption or modification of a methodology for any PSDC. Written notice will be mailed to persons on the list at least 90 days prior to the first hearing to establish or modify a PSDC. The methodology supporting the PSDC shall be available at least 60 days prior to the first hearing to adopt or amend a PSDC. The failure of a person on the list to receive a notice that was mailed does not invalidate the action of the city.
The city may periodically delete names from the list, but at least 30 days prior to removing a name from the list, the city must notify the person whose name is to be deleted that a new written request for notification is required if the person wishes to remain on the notification list.
(Ord. 530 § 1, 2017)
All funds derived from the PSDC described in this chapter are to be segregated from all other funds of the city using standard accounting practices. PSDCs collected under this chapter will not be used for any purpose other than set forth in Section 3.05.050.
The finance director shall provide the council with an annual accounting as provided in ORS 223.311.
(Ord. 530 § 1, 2017)
A refund may be given by the finance director upon finding that there was an error in calculating a PSDC.
A refund is not allowed due to a failure to timely claim credit or to timely seek an alternative method of system development charge calculation at the time of submission of an application for a development or building permit.
The city may charge a fee (set by resolution) to refund a PSDC that was paid for development that did not commence. The fee may be paid in cash or the applicant can opt to reduce the amount of the refund to cover the cost of the fee.
(Ord. 530 § 1, 2017)
A. 
A person may challenge the propriety of an expenditure of PSDC revenue by filing a written appeal with the finance director. An appeal of an expenditure must be filed within two years of the date of the alleged improper expenditure. Upon receipt of an appeal, the director shall refer the matter to the city hearings officer.
1. 
The city hearings officer shall provide an opportunity for the appellant and the city to provide written evidence, testimony and argument regarding the expenditure. Within 30 days of the date the appeal is referred by the director, the hearings officer shall issue a written decision whether the expenditure is in accordance with this chapter and the provisions of ORS 223.297 to 223.214. The hearings officer shall provide a copy of the decision to the appellant and the city. If the hearings officer determines that there has been an improper expenditure of PSDC revenues, the hearings officer shall direct that a sum equal to the misspent amount shall be deposited within one year to the credit of the account or fund from which it was spent.
B. 
A person may challenge any other decision required or permitted to be made by the city under this chapter by filing a written request and paying the appeals fee with the city manager within 14 days of the city's decision, or payment of the assessment, whichever comes first. The city manager shall refer the appeal to the city hearings officer.
1. 
The city hearings officer shall provide an opportunity for the appellant and the city to provide written evidence, testimony and argument regarding the decision. Within 30 days of the date the appeal is referred by the city manager, the hearings officer shall issue a written decision whether the decision is in accordance with this chapter and the provisions of ORS 223.297 to 223.214 and may affirm, modify, or reverse the decision.
C. 
The council may set an appeal fee by resolution.
D. 
The hearings officer's decision under this section is subject to review solely under ORS 34.010 through 34.100 and not otherwise. The appellant shall be notified of the right to seek review of the decision.
E. 
Any legal claim or action challenging the methodology adopted by the council pursuant to Section 3.05.040 may not be filed more than 60 days after the date the methodology is adopted. A person may seek review of a decision to adopt the methodology only as provided in ORS 34.010 to ORS 34.100 and not otherwise.
(Ord. 530 § 1, 2017)
The provisions of this chapter are severable, and it is the intention to confer the whole or any part of the powers herein provided for. If any clause, section or provision of this chapter shall be declared unconstitutional or invalid for any reason or cause, the remaining portion of this chapter shall be in full force and effect and be valid as if such invalid portion thereof had not been incorporated herein. It is hereby declared to be the council's intent that this chapter would have been adopted had such an unconstitutional provision not been included herein.
(Ord. 530 § 1, 2017)
The council determines that any fee, rates or charges imposed by this chapter are not a tax subject to the property tax limitations of Article XI, Section 11(b) of the Oregon Constitution.
(Ord. 530 § 1, 2017)