Story updated to reflect that citizens along Thompson Street were facing a $150 per linear foot assessment on street frontage if a Local Improvement District had formed in 2012, not $1.50
The Dalles City Council was chastised Monday for driving citizens to seek help from the legislature to lower the “unfair” cost of partitioning a lot.
“There would have been no sense in us going to the House to get clarification if the city had listened,” said John Pereira, an East 10th Street landowner facing an assessment of $100,000 to 150,000 to divide his property.
He said residents had been left with no recourse but to request assistance from a higher level of government when the council failed to take corrective action during a February discussion of the issue.
“I’m looking forward not back — let’s come to some great conclusion,” said Pereira. “People can’t afford this fee.”
The townhall meeting at the Mid-Columbia Senior Center was intended to cover several issues related to infill residential development. However, speakers from the 30-member audience primarily centered their comments on the cost of carving out a second lot on a larger tract of land.
“Eighty two thousand and six hundred dollars is $30,000 more than I paid for my house when I bought it 25 years ago,” said Steve Stroud, a 12th Street landowner. “One of my neighbors has been assessed $152,000 — something has to give here, it’s too much money.”
He said it was inequitable of the city to foist the burden of street, stormwater collection, curb and sidewalk improvements on property owners when the government had the ability to recoup its costs by raising utility rates, something denied private citizens. To make matters worse, said Stroud, the financial burden put on landowners by the city often exceeded the value of their lot and made it difficult to sell or develop the property. And there was the possibility, he said, that the city would never get around to doing the improvements the landowner had to pay for in advance.
“Maybe if I have to pay for the street, I’ll put a toll booth up because I’m going to own it,” said Stroud.
The assessment of $351 per linear foot of street frontage levied by The Dalles has been challenged by the Oregon House of Representatives. The house approved a bill last week to lower the maximum allowable charge to no more than $5,000 and the measure is now under consideration by the Senate.
House Bill 3479-4 was sponsored by Rep. John Huffman, R-The Dalles, and written by Dave Hunnicutt, executive director of Oregonians in Action, a private property rights advocacy group. He consulted with officials from the League of Oregon Cities and municipalities around the state to craft the measure that he says will restore “common sense” to the way The Dalles does business.
City officials contend the assessment for lot partitions is pre-payment for future infrastructure improvements tied to development that brings an increase in traffic and population growth. In February, the city council decided to tie payment of the fee to development of a new lot instead of staying with the requirement that the assessment be paid when the property sold or after a 10-year period had passed.
That “compromise” plan failed to appease a group of landowners who could not afford the charge of $40,000 to more than $150,000 in order to carve a new lot out of larger properties on the eastern edge of town.
In a follow-up interview, Nolan Young, city manager, said the council is unlikely to make a decision on the lot partition issue until the fate of HB 3749-4 is known.
“That way the council is not making a decision and then finding out that state law has changed,” he said.
A public hearing on the change in the way assessments are handled was tentatively planned to take place in June.
Councilor Carolyn Wood told the town hall audience May 6 that the city had to factor state mandates into its planning process for street maintenance and utility upgrades. She said the custom had been to have property owners pay for the initial construction of roadways and the city take on responsibility for maintaining infrastructure.
Resident Randy Hager disagreed with Wood’s comments. He said Goal 12 of the state’s planning rules allowed transportation issues to be addressed in a way that minimized “adverse social, economic or environmental impacts and costs.”
He said city officials needed to spend more time talking with community members because then they would understand the depth of opposition there was to the existing capital improvement funding mechanisms.
“I’ve never found one person who says they can justify or afford the expenses that have to be paid,” he said.
He was facing an assessment of about $80,000 to create a new lot and joined a group of citizens who traveled to Salem in April to testify in favor of HB 3479-4. He said the city had been at odds with citizens over issues related to infill development for the past seven years. He said the council needed to consult with an attorney who specialized in land-use before making decisions that might not be legally defensible.
“I want you to recognize that an insidious plan has been laid out that’s not really necessary,” said Hager.
April Moore, a local real estate agent, said the assessment for partitioning a lot was impeding the ability of the town to grow and thrive.
“In this economic downturn we don’t need this, we need a plan that’s beneficial to everyone; we need something that’s unique to The Dalles,” she said.
The council was challenged for handing citizens a bill to cover the cost of street improvements that was much higher than a private party would charge. Because engineering work required by the city for landowners to undertake the work themselves was too expensive, they said there was little choice but to pay the city if they wanted to develop a property.
Under consideration by the city is formation of Reimbursement Districts that allow landowners to recoup costs for engineering work once a Local Improvement District is formed to pay for their street improvements.
Young said government contracts had to factor in prevailing wage – the standard amount paid to laborers within the state — and that drove up costs for the work.
Dave Anderson, public works director, said the linear assessment amount was intended to cover the cost of labor and materials involved in street improvements but had not been updated since 2007 due to a downturn in the economy.
Hunnicutt asserted when HB 3478-4 was introduced that The Dalles needed to go through the process to form a Local Improvement District to levy assessments for infrastructure upgrades. He said even though the fee tied to these districts often met with strong opposition, property owners were provided with the opportunity to vote the issue.
If more than 50 percent of the ownership along a street that would be incorporated into the district indicated they wanted a new project delayed, it will automatically be pushed out for one to five years. That 50 percent is based on the linear feet of property, not the number of landowners.
Young was asked by one resident how many LIDs had formed due to a request by property owners. He replied that no districts had been created in residential areas of the city within the past 16 years.
In early 2012, the city tabled formation of a LID to cover the cost of $1.1 million in improvements along Thompson Street. Citizens mobilized in opposition to the cost of a one-time $150 per linear foot assessment on the street frontage of the properties. When the largest landowner, North Wasco County School District 21, vetoed the proposal, the city was forced to put the plan on hold for several years.
Hunnicutt said HB 3479-4 was written so that landowners in The Dalles cannot be required to sign an agreement when seeking a development right that they will not oppose formation of an LID. He said those agreements are often held for years and the cost of infrastructure improvements might have risen dramatically before work begins. He said an alternate scenario is that landowners pay the assessment and it sits in the future improvement fund for years without being used.
Gene Parker, city attorney, said in a recent interview that the proposed bill, itself, sets the stage for the city to ask that a nonremonstrance agreement be signed. He said the language of the measure allows the landowner to agree to the $5,000 charge up front, do the improvements themselves or voluntarily sign away their rights to oppose a LID.
Pereira and Hager challenged city officials Monday to notify citizens about the LID priority plan that was put together in 2007 and involved streets in all sectors of town. They said anyone who was facing payment of a large assessment for infrastructure upgrades should be made aware of the potential charge as early as possible.
A list of streets included in the LID plan under the May 6 agenda, and a recording of the meeting discussion, can be found at www.ci.the-dalles.or.us.