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SENATE BILL NO. 269
INTRODUCED BY D. TOEWS, S. KITZENBERG
AN ACT REVISING AND CLARIFYING THE LAWS RELATING TO THE FINANCE OF COUNTY WATER AND SEWER DISTRICTS; AUTHORIZING THE LEVYING OF SPECIAL ASSESSMENTS TO PAY COSTS OF IMPROVEMENTS; AMENDING SECTIONS 7-13-2221 AND 7-13-2301, MCA; AND PROVIDING AN IMMEDIATE EFFECTIVE DATE.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MONTANA:
Section 1. Section 7-13-2221, MCA, is amended to read:
"7-13-2221. Powers related to district finances. Any district incorporated as provided in this part
shall have power to
(1) accept funds and property or other assistance, financial or otherwise, from federal, state, and other public or private sources for the purposes of aiding the construction or maintenance of water or sewer development projects;
(2) cooperate and contract with the state or federal government or any department or agency
thereof of the state or
federal government in furnishing assurances for and meeting local cooperation requirements of any project involving
control, conservation, and use of water;
(3) borrow money and incur indebtedness and issue bonds or other evidence of
such indebtedness ; also and refund or
retire any indebtedness or lien that may exist against the district or property thereof of the district;
(4) cause taxes to be levied in the manner provided for in
this part and part 23 and this part for the purpose of paying
any obligation of the district and to accomplish the purposes of this part and part 23 and this part in the manner provided in
this part and part 23 and this part .;
(5) levy special assessments against property located in the district and benefited by any of its improvements, as provided in [sections 2 through 11], and pledge the collections of the special assessments in whole or in part, with any other revenue of the district, to the payment of bonds issued pursuant to part 23; and
(6) enter into covenants and agreements as to the establishment and maintenance of reasonable rates and charges for the use of its systems or improvements or any part of the systems or improvements as required, in the judgment of the board of directors, for the favorable sale of bonds issued pursuant to part 23, including, without limitation, a covenant to establish and maintain rates and charges sufficient, with the collection of any special assessments, to pay debt service and operating, maintenance, and replacement costs of the system or improvement and to fund necessary reserves or a covenant to establish and maintain rates and charges sufficient, with the collection of any special assessments, to pay operating and maintenance costs of the system or improvement, fund necessary reserves for the system or improvement, and pay debt service on bonds and to provide additional funds necessary for the purposes of the system or improvement or to provide assurance to the holders of bonds as to the sufficiency of the revenue."
Section 2. Levy of special assessments. (1) In lieu of imposing rates and charges to pay the capital costs of any improvement provided for in this part, a district may levy special assessments to defray the costs against property within the district and benefited by the improvement. The costs of the improvement may include the costs of issuance of any bonds issued to finance the improvement and any reserve securing payment of the bonds.
(2) The board of directors shall by resolution levy and assess upon all property in the district benefited by the improvement, by using for a basis for the assessment the method or methods provided for in 7-12-2151.
(3) The resolution must contain a description of each lot or parcel of land, with the name of the owner if known, and the amount of each assessment and the day when the assessment becomes delinquent.
(4) The resolution, signed by the presiding officer of the board of directors, must be kept on file in the office of the secretary.
Section 3. Notice of resolution for levy of assessment hearing. (1) A notice, signed by the secretary and stating that the resolution levying a special assessment to defray the cost of making the improvements is on file in the office of the secretary and is subject to inspection, must be:
(a) published as provided in 7-1-2121;
(b) mailed to the owner of each lot, tract, or parcel of land to be assessed (the lands must be identified and the mailing address determined from the last-completed assessment roll for state, county, and school district taxes); and
(c) mailed to any other persons known to the secretary to have an ownership interest in the property.
(2) The notice must state the time and place in which objections to the final adoption of the resolution will be heard by the board of directors. The time for the hearing may not be less than 5 days after the second publication or less than 10 days after the mailing of the notice.
Section 4. Hearing on assessment -- who considered owner -- sufficient protest to bar proceedings. (1) At the time fixed, the board of directors shall meet and hear all objections and for that purpose may adjourn from day to day.
(2) The board of directors may by resolution modify the assessment in whole or in part. A copy of the resolution, certified by the secretary, must be delivered to the county clerk and recorder of the county in which the lot, tract, or parcel is located within 2 days after passage of the resolution and not later than the July 15 preceding the county's next fiscal year.
(3) At any time within 30 days after the date of the first publication of the notice of proposed assessments, any owner of property to be assessed for the costs of making the improvements may make written protest against the levy of assessments. The protest must be in writing, identify the property in the district owned by the protestor, and be signed by all owners of the property. The protest must be delivered to the secretary of the district not later than 5 p.m. of the last day of the 30-day period provided for in this subsection. The secretary shall endorse the date and hour of receipt on the protest.
(4) If the board of directors finds that a protest with respect to the method or methods of assessment described in the resolution of intention is made by the owners of property in the district to be assessed for more than 50% of the cost of improvements, the board of directors may not use the method or methods of assessment described in the resolution of intention.
Section 5. Collection of assessments by county treasurer -- delinquencies. (1) When any resolution of assessment has been certified by the secretary and the county clerk and recorder, it is the duty of the county treasurer in the county in which the lot, tract, or parcel is located, in accordance with the provisions of this title, to collect the assessment in the same manner and at the same time as taxes for general and municipal purposes are collected.
(2) When the payment of an installment of a special assessment becomes delinquent, all payments of subsequent installments of the special assessment may, at the option of the board of directors and upon adoption of the appropriate resolutions, become delinquent. Upon delinquency in one or all installments, the whole property must be sold the same as other property is sold for taxes. The enforcement of the lien of any installment of a special assessment by any method authorized by law does not prevent the enforcement of the lien of any subsequent installment when it becomes delinquent.
Section 6. Payment of assessment under protest -- action to recover. (1) When any special assessment levied and assessed under any of the provisions of this part is considered unlawful by the party whose property is assessed, the person may pay the assessment or any part of the assessment considered unlawful under protest to the county treasurer.
(2) After the payment, the party or the party's legal representative may bring an action in any court of competent jurisdiction against the officer to whom the assessment was paid or against the district on whose behalf the assessment was collected to recover the assessment or any portion of the assessment paid under protest. Any action instituted to recover the assessment paid under protest must be commenced within 60 days after the date of payment.
(3) The assessment paid under protest must be held by the county treasurer until the determination of any action brought for the recovery of the assessment.
Section 7. Procedure to correct assessment and to relevy. (1) Whenever, by reason of any alleged nonconformity to law or by reason of any omission or irregularity, any special assessment is either invalid or its validity is questioned, the board of directors may make all necessary orders and may take all necessary steps to correct, reassess, and relevy the assessment, including the ordering of the improvement, with the same force and effect as if made at the time provided by the law or resolution relating to the assessment. The board may reassess and relevy the assessment or tax with the same force and effect as an original levy.
(2) Any special assessment, upon reassessment or relevy, must, so far as practicable, be levied and collected the same as it would have been if the first levy had been enforced. Any provision of any law specifying a time when or order in which acts must be done in a proceeding that may result in a special assessment is subject to the qualifications of this part.
(3) Whenever any assessment is made and any property is assessed too little or too much, the assessment may be corrected and reassessed for the additional amount that is proper or the assessment may be reduced, even to the extent of refunding the assessment collected.
Section 8. Certain errors not to invalidate assessments or liens. (1) When, under any of the provisions of this part, special assessments are assessed against any lot or parcel of land as the property of a particular person, a misnomer of the owner or supposed owner or other mistake relating to the ownership of the land may not affect the assessment or render it void or voidable.
(2) Any mistake in the description of property or the name of the owner may not vitiate any liens created by this part unless it is impossible to identify the property from the description.
Section 9. Term of payment of assessments. (1) The payment of the assessment to defray the cost of constructing any improvement may be spread over a term not to exceed 40 years.
(2) The assessments are payable in equal semiannual installments of principal, with interest on the unpaid installments, or, if the board of directors prescribes in the resolution levying the assessments, in equal semiannual installments of principal and interest, each in the amount required to pay the principal over the term of payment, with interest at the rate then borne by the assessment.
(3) Any assessment that is not delinquent may be prepaid, in whole but not in part, at any time after the assessment is levied, by the payment of the assessment, with interest accrued and to accrue on the assessment through the next date on which an installment of the assessment is otherwise payable.
Section 10. Interest rate on unpaid assessments. The installments of assessments remaining unpaid bear simple interest at an annual rate equal to:
(1) the sum of:
(a) the average interest rate payable on the outstanding bonds issued to finance the improvement in respect of which the special assessments are levied; plus
(b) additional interest at a rate to be determined by the board of directors, not exceeding 2% a year; or
(2) if bonds are not issued to finance the improvements, at an interest rate to be determined by the board of directors, but not to exceed 10% a year.
Section 11. Assessments and certain other charges as liens. Any special assessment made and levied to defray the cost and expenses of any improvement, together with any amounts imposed for delinquency and for cost of collection, constitutes a lien upon and against the property upon which the assessment is made and levied from and after the date of the passage of the resolution levying the assessment. This lien can be extinguished only by payment of the assessment, with all penalties, costs, and interest.
Section 12. Section 7-13-2301, MCA, is amended to read:
"7-13-2301. Establishment of charges for services -- payment of charges. (1) The board of directors shall fix all water and sewer rates and shall, through the general manager, collect the sewer charges and the charges for the sale and distribution of water to all users.
(2) The board, in furnishing water, sewer service, other services, and facilities, shall review, at least once every 2 years, and from time to time fix the rate, fee, toll, rent, or other charge for the services, facilities, and benefits directly afforded by the facilities, taking into account services provided and direct benefits received, that will be sufficient in each year to provide income and revenue adequate, with the collections of any special assessments levied pursuant to [sections 2 through 11] and appropriated, for:
(a) the payment of the reasonable expense of operation and maintenance of the facilities;
(b) administration of the district;
(c) the payment of principal and interest on any bonded or other indebtedness of the district; and
(d) the establishment or maintenance of any required reserves, including reserves needed for expenditures for depreciation and replacement of facilities, as may be determined necessary from time to time by the board or as covenanted in the ordinance or resolution authorizing the outstanding bonds of the district.
(3) A person or entity may not use any facility without paying the rate established for the facility. In the event of nonpayment, the board may order the discontinuance of water or sewer service, or both, to the property and may require that all delinquent charges, interest, penalties, and deposits be paid before restoration of the service.
(4) (a) If the board has ordered discontinuance of service as provided in subsection (3) and the person or entity who received the service has not made full payment of all delinquent charges, interest, penalties, and deposits, then a district may elect to have its delinquent charges for water or sewer services collected as a tax against the property by following the procedures of this subsection (4). If a charge for services is due and payable in a fiscal year and is not paid by the end of the fiscal year, the general manager shall, by July 15 of the succeeding fiscal year, give notice to the owners of the property to which the service was provided. The notice must be in writing and:
(i) must specify the charges owed, including any interest and penalty;
(ii) must specify that the amount due must be paid by August 15 or it will be levied as a tax against the property;
(iii) must state that the district may institute suit in any court of competent jurisdiction to recover the amount due; and
(iv) may be served on the owner personally or by letter addressed to the post-office address of the owner as recorded in the county assessor's office.
(b) On September 1 of each year, the general manager shall certify and file with the county assessor a list of all property, including legal descriptions, on which arrearages remain unpaid. The list must include the amount of each arrearage, including interest and penalty. The county assessor shall assess the amount owed as a tax against each lot or parcel with an arrearage. If the property on which arrearages remain unpaid contains a mobile home, the amount owed must be assessed as a tax against the owner of the mobile home. If the mobile home for which arrearages remain unpaid is no longer on the property, the amount owed must be assessed as a tax against the property.
(5) In addition to collecting delinquent charges in the same manner as a tax, a district may bring suit in any court of competent jurisdiction to collect amounts due as a debt owed to the district.
(6) Notwithstanding any other section of part 22 or this part or any limitation imposed in part 22 or this part, when the board has applied for and received from the federal government any money for the construction, operation, and maintenance of facilities, the board may adopt a system of charges and rates to require that each recipient of facility services pays its proportionate share of the costs of operation, maintenance, and replacement and may require industrial users of facilities to pay the portion of the cost of construction of the facilities that is allocable to the treatment of that industrial user's wastes."
Section 13. Codification instruction. [Sections 2 through 11] are intended to be codified as an integral part of Title 7, chapter 13, part 22, and the provisions of Title 7, chapter 13, part 22, apply to [sections 2 through 11].
Section 14. Effective date. [This act] is effective on passage and approval.
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Latest Version of SB 269 (SB0269.ENR)
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