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Home My WebLink About2012/05/22 Item 13CITY COUNCIL AGENDA STATEMENT ~~~ CITY OF CHULA VISTA MAY 22, 2012, Item f~ ITEM TITLE: PUBLIC HEARING TO CONSIDER THE PROPOSED ASSESSMENT OF CERTAIN DELINQUENT SEWER SERVICE CHARGES AS RECORDED LIENS UPON THE RESPECTIVE OWNER OCCUPIED PARCELS OF LAND AND PLACEMENT OF DELINQUENT CHARGES ON THE NEXT REGULAR TAX BILL FOR COLLECTION RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CHULA VISTA ASSESSING CERTAIN DELINQUENT SEWER SERVICE CHARGES AS RECORDED LIENS UPON THE RESPECTIVE OWNER OCCUPIED PARCELS OF LAND AND APPROVING THE PLACEMENT OF DELINQUENT CHARGES ON THE NEXT REGULAR TAX BILL FOR COLLECTION ~ 1 SUBMITTED BY: DIRECTOR OF FINANCE/ TREASURER %~ REVIEWED BY: CITY MANAGER .~~~ S ASSISTANT CITY MANAGEI~~ 4/STHS VOTE: YES ~ NO ~X SUMMARY In order to adequately protect the City's interest in delinquent sewer service charges and ensure that collection efforts are directed toward the responsible property owner in the event of a change of ownership, staff is recommending approval of liens against affected properties as a preliminary action to placing the delinquencies on the property tax rolls if they remain unpaid. Adoption of this resolution will enhance the collection process for delinquent sewer service charges by ensuring that the correct property owners are chazged and that the payments will be received on a timely basis. This is the identical process approved by the City Council since August 1998. ENVIRONMENTAL REVIEW The Environmental Review Coordinator has reviewed the proposed activity for compliance with the California Environmental Quality Act (CEQA) and has determined that the activity is not a "Project" as defined under Section 15378(b)(4) of the State CEQA Guidelines; therefore, pursuant to Section 15060(c)(3) of the State CEQA 13-1 MAY 22, 2012, Item /3 Page 2 of 3 Guidelines the activity is not subject to CEQA. Thus, no environmental review is necessary. RECOMMENDATION That Council conduct the public hearing and adopt the resolution. BOARDS/COMMISSION RECOMMENDATION Not applicable. DISCUSSION Section 13.14.150 of the Chula Vista Municipal Code allows delinquent sewer service charges to be assessed as recorded liens upon the affected properties, and ultimately placed on the property tax bills for collection. The ordinance states that upon notification of the property owners, a public hearing is set for sewer service accounts which are over sixty days delinquent. At the hearing, the City Council considers the delinquent accounts together with any objections or protests by interested parties. At the conclusion of the hearing, the City Council may either approve the delinquency and amount owed on the accounts as submitted, or as modified or corrected by the City Council. Lastly, the City Council adopts a resolution assessing such amounts as recorded liens upon the respective parcels of land, and the amounts are charged to the property owners on the next regular property tax bill. Because charges can only be submitted for placement on the property tax bills once each year in August, staff is recommending assessing liens on the affected properties midyear to better ensure the City's chances for collection. If the City were to address these delinquent charges only once each year in August, the effectiveness of using the property tax bill as a means of collection would be significantly reduced as the owners of record in August would not necessarily be the people responsible for the delinquent charges. In cases where the properties are sold or transferred, assessing liens midyear holds the correct parties responsible for the delinquent charges. In cases where the property owners choose to refinance their mortgages, the midyear liens ensure the City's receipt of payment in a timely manner, as the delinquent charges are paid through escrow during the refinancing process. In December 2011, the City Council approved 416 delinquent accounts valued at $221,455 to be placed on property tax bills for collection. Since the December 2011 Council action, staff has identified 618 accounts totaling $315,620 as being over 60 days delinquent. Of these 618 accounts, 216 accounts have either been resolved through preliminary collection efforts or removed from the list because they were approved for placement on the tax roll via the December 2011 Council action. The remaining 402 newly delinquent accounts valued at $270,330 are now being submitted (listing available at the Finance Department). While many of these property owners have gone through this lien process previously, as they continue to leave their sewer service accounts mipaid, the total value of the delinquent accounts being submitted for the lien process continues to climb. 13-2 MAY 22, 2012, Item ~,3 Page 3 of 3 These property owners have been notified of their delinquencies within the last 60 days, and two weeks ago, they were notified of the public hearing and were again asked to pay their delinquent sewer service charges to avoid a lien being placed on their property. Payment arrangements will be set up as needed, and staff will continue to update this list as payments are received and accounts are cleared. A final list will be submitted to the City Council for consideration on the day of the public hearing in order to reflect the most current payment postings. Staff is recommending that the City Council approve the final list of delinquent sewer accounts as submitted, and that these charges be forwarded to the County and assessed as recorded liens on the respective owner occupied parcels of land and ultimately placed on the next regular tax bill for collection. DECISION MAKER CONFLICT Staff has reviewed the property holdings of the City Council and has found no property holdings within 500 feet of the boundaries of the properties which are the subject of this action. CURRENT YEAR FISCAL IMPACT Approval of the resolution supports collection of delinquent sewer service charges totaling $270,330. All expenses associated with this action are borne by the City's sewer funds; all sewer service charges collected as a result of this action will be deposited into the City's sewer funds. ONGOING FISCAL IMPACT No ongoing fiscal impact. ATTACHMENTS None. Prepared by.' Tiffany Allen, Treasury Manager, Finance Department 13-3 RESOLUTION NO. RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CHULA VISTA ASSESSING CERTAIN DELINQUENT SEWER SERVICE CHARGES AS RECORDED LIENS UPON THE RESPECTIVE OWNER OCCUPIED PARCELS OF LAND AND APPROVING PLACEMENT OF DELINQUENT CHARGES ON THE NEXT REGULAR TAX BILL FOR COLLECTION WHEREAS, Chula Vista Municipal Code Section 13.14.150 allows delinquent sewer service charges to be assessed as recorded liens upon the affected properties and ultimately placed on the property tax bills for collection; and WHEREAS, the ordinance states that upon notification of the property owners, a public hearing is set for sewer service accounts which are over sixty days delinquent; and WHEREAS, at the hearing, the City Council considers the delinquent accounts together with any objections or protests by interested parties; and WHEREAS, at the conclusion of the hearing, the City Council may either approve the delinquency and amount owed on the accounts as submitted or as modified or corrected by the City Council; and WHEREAS, many of these property owners have gone through this lien process previously as they continue to leave their sewer service accounts unpaid; and WHEREAS, these property owners have been notified of their delinquencies within the last sixty days, were notified of the public hearing and were again asked to pay their delinquent sewer service charges to avoid a lien being placed on their property; and WHEREAS, staff is recommending that the City Council approve the final list of delinquent sewer service accounts as submitted, and that these charges be forwarded to the County and assessed as recorded liens on the respective owner occupied parcels of land and ultimately placed on the next regular tax bill for collection. NOW, THEREFORE, BE IT RESOLVED that the City Council of the City of Chula Vista does hereby: (1) conduct the public hearing to consider assessing certain delinquent sewer service charges as recorded liens on the affected properties; (2) overrule any and all protests or objections presented at the public hearing; and (3) approve, with respect to the delinquent account list submitted to the City Council and on file in the City Finance Department, assessing delinquent sewer service charges as recorded liens upon the respective parcels of land and the placement of such delinquent charges as special assessments on the next corresponding regular tax bills, unless cleared prior to transmittal of the delinquent account list to the County. 13-4 Resolution No. 2012- Page 2 Presented by Maria Kachadoorian Finance Director/Treasurer 13-5 Anproved as to form by