County of Santa Clara Finance Agency Controller-Treasurer

Transcription

1 County of Santa Clara Finance Agency Controller-Treasurer County Government Center 70 West Hedding Street, East Wing 2nd floor San Jose, California (408) FAX June 21, 2017 To: Special Assessment Districts SUBJECT: Special Assessment Enrollment on the Secured Property Tax Roll The Controller-Treasurer's Department will begin accepting your agency's (County Department, City, Special District, School District, Joint Powers Authority) special assessment data files on July 17, To assist you with the process, we have outlined the forms and requirements necessary for enrollment of the special assessments on the Secured Property Tax Roll as indicated below. Please note that an agreement for the placement of the special assessment (assessment bond, parcel tax, special tax, and charges for services) on the Secured Property Tax Roll is now required and must be signed and submitted with the appropriate authorization prior to the transmission of the agency's data file(s). Please submit the following: 1. Signature Agreement Form to enroll the special assessments on the Secured Property Tax Roll and to acknowledge the County's cost reimbursement for enrollment, collection and apportionment services - 1 % of the assessment amount or as agreed. 2. A copy of the legal authority, (resolution, ordinance or statute) and supporting documentation authorizing the enrollment of the non-bonded assessment on the Secured Property Tax Roll. 3. A copy of bond assessment amortization schedule as applicable for new assessments. Please note the agency data file will not be processed until we receive all items detailed above. The agency's decision to use a third-party administrator for any of its special assessments is at the sole discretion of the agency. However the Signature Agreement Form must be signed by the agency's authorized administrator and not the third-party administrator. Also as part of the County's enrollment of the special assessment, the agency releases and forever discharges the County and its officers and employees from any and all claims, dema:11ds, liabilities, costs and expenses, damages, causes of action, and judgments, in any manner arising out of the enrollment of the special assessments. The agency shall defend, indemnify and hold harmless the County and its officers and employees ("indemnified parties") from any and all claims, demands, liabilities, costs and expenses, damages, causes of action, and judgments, in any manner arising out of the enrollment of the special assessment, including but not limited to the specific amount. If any judgment is entered against any indemnified party as a result of action taken to implement Board of Supervisors: Mike Wasserman, Cindy Chavez, Dave Cortese, Ken Yeager, S. Joseph Simitian County Executive: Jeffrey V. Smith

2 the agreement, by the County for the benefit of the agency, the Controller-Treasurer Department may offset the amount of any judgment paid by County or by any indemnified party from any monies collected by County on the agency's behalf, including property taxes, special taxes, fees, or assessments. The County may, but is not required to, notify the agency of its intent to implement any offset. New Special Assessment District If your agency has a new Special Assessmettt District to be added to the Secured Property Tax Roll, your written request for a SpeciaJ Assessment District number and the County's form: Request for Special Assessment number must be received by our office, 70 West Hedding, East Wing, 2nd Floor, San Jose, CA , no later than July 3 L A copy of the legal authority (resolution, ordinance or statute), description of the special assessment district, and supporting documentation authorizing the enrollment of the assessment on the Secured Property Tax Roll must be included with your written request. Please note, once the assessment district number is assigned in the County's property tax system, it cannot be changed. Property Assessed Clean Energy (PACE) Assessment District If your agency has a new PACE Assessment District to be added to the Secured Property Tax Roll, your written request for a Special Assessment District number must also include the forms: Request for Special Assessment number and an Indemnification and Insurance Agreement which provides a broad indemnification for the County, excepting out only damages caused by the sole negligence of willful misconduct of the County. Please note the indemnification remains in full force and effect in perpetuity. We require a copy of the recorded contract for each property with a PACE assessment levy on the annual tax bill for any new PACE assessment amount or an addendum to the existing PACE assessment. Special Assessments levied on SBE {State Board of Equalization) Utility Parcels If your agency intends to place a special assessment on a utility company property, please note that the utility company's parcel number will not be available on the Santa Clara County's property tax database until provided by the State Board of Equalization (around late July). Please ensure that the utility company's parcel number is valid. If the parcel number is not valid, the assessment amount will not be enrolled. Assessments levied for Solid Waste or Delinquent Charges Charges for Abatement, Utilities, Sewer, Water Drainage, etc. are a result of a services provided to customers. These utility and/or delinquent charges are not considered a special tax or special assessment and are not afforded super-priority lien status pursuant to Revenue and Taxation Code Please ensure that these utility or delinquent charges are separately listed on the Resolution for placing on the annual Secured Property Tax Roll.

3 Proposition 218 Proposition 218 was approved by the voters on November 5, 1996 and affects the ability of special districts and other local governments to levy and collect existing and future taxes, assessments, and property-related fees and charges. It sets requirements and procedures for assessments, charges, and fees on top of any authorizing legislation requirements or specifically enabling legislation requirements. ~ Only "special benefits" are assessable. A special benefit represents particular and distinct benefits over and above general benefits conferred on real property located in the district or to the public at large. ~ General enhancement of property value does not constitute "special benefit." ~ An assessment shall not exceed the reasonable cost of the proportional special benefit conferred on that parcel. ~ Local agency and State properties are not exempt from special assessment if these properties are proportionally benefited. Proposition 218 added Articles XIIIC and XIIID to the Constitution and significantly altered local government and special district finances in California. Special assessments existing prior to July 1, 1997 are considered to be "grandfathered" as long as no changes are made to the methodology used to calculate the levy. Public Agency-Owned Property Public agency-owned property is typically non-taxable for ad valorem tax if it is used for public purposes and is located within the jurisdictional boundaries of the public agency. If the agency needs to place a special assement levy on publicly-owned property, it must do so via its own direct billing. Please refer to Proposition 218 legal requirements in conjunction with billing of public agencies (California State Constitution, Article XIIID, Section 4(a)). Parcel Number with Pre-fix "9" A Parcel Number that starts with the prefix "984" denotes possessory interest property. A taxable possessory interest exists whenever there is a private, beneficial use of publicly-owned, nontaxable real property. Such interests are typically found where private individuals, companies or corporations lease, rent, or use federal, state or local government owned facilities and/or land for their own beneficial use. Generally, the County does not advise placement of special assessments on the possessory interest property, unless research specific to the property and the assessment indicates authorization to impose the special assessment. If your agency intends to levy the agency's special assessment on possessory interest property, please provide the County with the necessary supporting documentation.

4 Submission of data file(s) It is the agency's responsibility to submit its data file or re-submit the corrected file prior to the August 23 deadline in order to ensure the enrollment of its special assessment on the tax roll. Please note the following time-lines: Agency's data file can be submitted during the period of July 17, 2017 to August 23, Your agency should expedite corrections and sign-off for the resubmission of data file, if resubmission is needed. No corrections to the annual submission will be made after August 23, Please refer to the enclosed instructions that outline specifications required for formatting the special assessment data. Enrollment of the assessment roll It remains your responsibility to confirm and certify the final special assessment to the County's Controller-Treasurer Department for enrollment on the County annual tax roll. Please note the following time-lines: Report of final assessment roll that is being enrolled on the County annual tax roll will be ed to your agency during the period of August 17 tlirougli August 25, Certification of final assessment roll must be received by the Controller-Treasurer Department before or by close of business August 28, The Controller-Treasurer Department cannot enroll the agencies' assessment roll without the agency's certification of their assessment roll. Correction - Removal of the special assessment amount Request for corrections or removal of the agency's assessment amount after the issuance of annual secured tax bills must be in writing (Special Assessment Request for Correction Form). The County will recover its cost for each special assessment change or deletion. Payment for cost reimbursement shall be included with the Request for Correction Form that is submitted to the Controller-Treasurer Department. Cancellation or proration of the special assessment amount The Controller-Treasurer Department will not notify agencies for any of the following events: 1. If a tax bill's amount of ad valorem taxes and direct charges is less than $20, the County may cancel these tax bills under the provisions of Revenue and Taxation Code The Controller-Treasurer Department will also cancel the entire tax bill when the Office of the Assessor indicates that the Assessor's Parcel Number should not be on the roll. 3. If a public agency acquires a property within its boundary, the Controller-Treasurer Department will prorate or not prorate the special assessment amount in accordance to the special assessment district's notation of Proration or Non-proration on the Signature Agreement Form.

5 Accelerated Judicial Foreclosures Some agencies have a covenant with bondholders that delinquent accounts will be judicially foreclosed upon rather than follow the County Tax Collector's tax defaulted sale process. If your agency's special assessment requires judicial foreclosure, you must notify us at the time your agency's Signature of Agreement Form is submitted. As part of this process, the agency's Board of Directors must adopt a standing resolution stipulating that your agency will pursue the removal of the delinquent levies from the delinquent secured tax bill as specified by the bond covenant. Please provide us with a copy of this standing resolution. After June 30 of each year, for the life of the assessment bond, your agency shall identify the delinquent assessment in your recorded "Notice of Intent to Remove Delinquent Special Tax Installment from the Tax Roll" (notice) per Government Code Section and Streets and Highways Code Section The notice must be recorded and submitted to the Controller Treasurer Department. Once the Controller-Treasurer Department receives a copy of the recorded notice, the identified special assessment amounts will be removed from the delinquent tax bills. By this process, your agency will relieve the County of Santa Clara of any further responsibility for the collection of these delinquent special assessment amounts. Foreclosure on special assessment amounts pursued outside of the Tax Collector's process will require a substantial processing cost and payment of all penalties and interest which would otherwise accrue to the remainder of the tax bill. The County will recover its cost for each special assessment removal. Payment shall be submitted to the Controller-Treasurer Department with the Request for Removal Form. Transaction Reporting Requirements - AB 2109, chapter 781, enacted September 29, 2014 Effective with the Fiscal Year and thereafter, your agency (as applicable) is required to include the following information for the amount reported under the Special Assessments portion of the Local Government Annual Financial Reports (LGAFR): 1. Type and rate of parcel tax imposed 2. Number of parcels subject to the parcel tax 3. Number of parcels exempt from the parcel tax 4. Sunset date of parcel tax, if any 5. Amount ofrevenue received from the parcel tax 6. Manner in which the revenue received from the parcel tax is being used The definition of "Parcel Tax" per State Controller's Office is as follows: 1. Non ad-valorem tax imposed as an incident of property ownership and collected on the annual tax bill. 2. The tax is charged on a parcel of property based on: a. a flat per parcel rate, or b. a variable rate depending on the size, use and/or number of units on the parcel. 3. A parcel tax includes, but is not limited to, all types of Mello-Roos taxes and special taxes for governmental purposes.

6 Decision Tree for Determining "Parcel Taxes" Subject to Reporting Source: State Controller's Office Is it "property related" (i.e. i mposed as an "incident of property ownership")? It i s non-property related (i.e. personal property such as cars and boats) Is it a non-ad valorem (not based on the value)? It is ad valorem (based on value) (e.g. General Obligation Bonds) Is it a tax? It is a fee, assessment, fine, penalty, abatement, etc. Is it levied by a city, county, or special dist.-ict that isn~t a K-12 school or community college distr-ict? It is levied by a State agency or a K-12 school or a community college district Is it collected on the annual property tax bill? It is collected in another manner outside of the annual property tax bill Reporting is required Collections and Apportionments For all special assessments billed on the annual secured tax roll, 1st installment payments are due by November 1st and are delinquent if not pay by December 10 and 2nd installment payments are due by February 1st and are delinquent if not pay by April 10. Beginning with the Fiscal Year , the County is accepting partial payments on secured property taxes (penalty assessed on amounts due is calculated on the balance due as of the payment due date). Payments received will be apportioned to you as follows: Coll ection Date July 1 - December 10 December 11 - April 10 April 11 - June 30 Approximate Appo1t ionment Month Middle of January Middle of June Middle of July If your agency's funds are part of the County Treasury, the apportionment will be made directly to the agency's fund. If your agency's funds are not part of the County Treasury, the distribution will be made to your agency early in the month following the apportionment by check or electronic transfer (ACH). In addition, if your agency's special assessment amount is for a lien, we recommend that you do not release the lien until the special assessment amount is fully paid and received.

7 Teeter Plan Under the Teeter Plan, the County has the option to distribute the levy amounts of all special assessment districts under the alternative method of distribution of property tax levies and special assessments (Revenue and Taxation Code 4701 et. seq.), but has chosen to exclude the special assessment districts formed under Mello-Roos or 1911/1915 Bond Acts. The agency of the 'non-teeter' special assessment districts will receive the apportionment for the delinquency upon payment from the taxpayers. Taxpayers have the option to pay the redemption account in full or in installments. Collection of the agency's delinquent special assessment may take up to nine or more years if a tax sale is necessary. If the property is sold at a tax sale, the sale amount may be for less than the tax bill amount, in which case the agency's delinquent special assessment will not be fully recovered. Agency Responsibilities It is the agency's responsibility to determine the validity and accuracy of the agency's special assessment for both Assessor's Parcel Numbers (APN) and amount. The County is not responsible for the validity or the computation of the special assessment. If the agency needs to place its special assessment on a parcel that doesn't have a valid and billable APN for the applicable tax roll year, it is the agency's responsibility to directly bill and collect from the party that is liable. If an agency uses the Office of the Assessor's use code or property characteristic to assist in determining the application of the agency's special assessment, it does so at its own risk. Please note that the Office of the Assessor maintains its database for the purpose of ad-valorem taxation as required by Revenue and Taxation Code and not the purpose of billing special assessments. To improve customer service to taxpayers, the Controller-Treasurer Department requests that: 1. The agency agrees that its officers, agents and employees will cooperate with the County by answering inquiries made to the agency by any person concerning the agency's special assessment amount levied on a tax bill in a timely and efficient manner. 2. The agency agrees that its officers, agents and employees will not refer such individuals making inquiries to County officers or employees for a response. 3. The agency agrees that its officers, agents and employees will not refer taxpayers to the County staff regarding removal or correction of the agency's special assessment. 4. The agency agrees that its officers, agents and employees will not refer financial consultants making request for parcel count within the agency's boundary to the Tax Collector's Office or Controller-Treasurer Department for a response. 5. The agency refrains from instructing taxpayers to "not pay their bill". If this happens, the agency may potentially be liable for 10% penalties, delinquent cost, redemption penalties, etc. for the entire bill. The agency does NOT have authority to waive penalties for a

8 taxpayer's bill. However, the agency may refund any penalties paid directly to a taxpayer using agency funds. Research - Compilation of data Request for research or compilation of agency's special assessment data must be in writing. The County will recover its cost associated with the research or compilation. Payment shall be included with the request for submission to the Controller-Treasurer Department. Cost Reimbursements 1. Annual placement of the special assessment roll 2. Correction of special assessment amount 3. Removal of special assessment amount 4. Addition of special assessment 5. Research- compilation of data 1 % of the assessment amount $75 for each correction $75 for each removal $75 for each addition Time spent x hourly rate If you have any questions, please contact us via at SA_ Mail@tax.sccgov.org or call Kim Le at ( 408) s~~ Alan Minato Controller-Treasurer

9 County of Santa Clara Finance Agency Controller-Treasurer SPECIAL ASSESSMENTS DATA REQUIREMENTS 1. The Special Assessment data MUST be submitted in non-delimited ASCII text format and should not have headers or footers. ASCII text can be produced by using a simple text editor such as MS Notepad or Wordpad. DO NOT SEND THE DATA IN A SPREADSHEET; IT WILL BE RETURNED TO THE SENDER FOR PROPER FORMATTING. 2. Use the following Filename Convention: SA_yyyymmdd_SA# Where: yyyymmdd = Four Digit Year, Two Digit Month, Two Digit Date SA# = the three digit Special Assessment Number. 3. The data can be delivered to the Tax Collector s Office on compact disk or as an attachment via Each record should be formatted as shown below: a. DATA LAYOUT: Non-SBE Parcels Only (Record Length = 19) Data Description Length Position ASSESSOR S PARCEL NUMBER 8 numbers 1-8 SPECIAL ASSESSMENT CODE 3 characters 9-11 SPECIAL ASSESSMENT AMOUNT 8 numbers (w/leading zeros) - The amount must be even cents (.02,.28, etc.) A sample of properly formatted Non-SBE data is shown below. The arrows define the beginning and end of each data field: APN S/A S/A Code Amount In this example the parcel number is , the special assessment code is 111, and the special assessment amount is $

10 b. DATA LAYOUT: SBE Parcels Only (Record Length = 20) Data Description Length Position A. SBE "ASSESSEE NUMBER" 4 numbers 1-4 (w/leading zero) B. Tax Rate Area (last 5 digits only) 5 numbers 5-9 C. PUBLIC IMPROVEMENT CODE 3 characters D. PUBLIC IMPROVEMENT AMOUNT 8 numbers (w/leading zeros) A sample of properly formatted SBE data is shown below. The arrows define the beginning and end of each data field: A. B. C. D In this example the "assessee number" from SBE is 336, the TRA is , the special assessment code is 111, and the special assessment amount is $ If data needs to be compressed to fit a CD, use only standard zip compression. Files with improperly formatted data will be returned to sending Agency for correction. 6. The following information must appear on the CD label or in the to which the file is attached: Agency Name Special Assessment Number # of parcels listed Total $ Amount Date created Name, address, telephone and fax number of the responsible contact person in your organization 7. Submitting corrected data: If the initial data file is to be corrected, please Make corrections and then resubmit the entire file with ALL parcels. Do NOT send partial data file which contains just the corrected parcels.