Notwithstanding any other law, the legislative body may determine, by resolution, to allow landowners to defer payment of their assessments pursuant to this chapter. This chapter may be used only if 80 percent or more of the area of the assessment district is developed for residential, commercial, or industrial use.
Chapter 8Deferral of Assessments
Section § 10700
This law allows a local government to decide if landowners can delay paying certain fees on their property. This option is only available if at least 80% of the land in the area is already being used for homes, businesses, or factories.
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Section § 10701
This law allows a legislative body to set the rules and requirements for property owners to qualify for a deferral, which means postponing a certain obligation, like payments. The legislative body can also create the steps needed to make sure these requirements are met.
The legislative body may determine criteria that property owners must meet to qualify for deferral, and may determine procedures to ensure that the criteria are satisfied.
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Section § 10702
This law states that if there is a default, no agreement to delay obligations can take away any of the bondholder's rights to remedies already given by the law.
No deferral arrangement may restrict, reduce, or eliminate any remedy of a bondholder provided by this division in the event of a default.
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Section § 10703
This law allows a city to enter into an agreement with a property owner to defer assessment payments. This means the city pays the property owner's assessment for one year at a time. However, the city is not obliged to continue this arrangement for more than one year, and this agreement does not count as city debt.
Deferral may be provided through a year-to-year agreement between the city and an eligible property owner, which provides that the city will make assessment payments on behalf of the property owner for that year. No agreement shall commit the city to make deferral payments beyond one year. No agreement of this type shall be construed as a debt of the city.
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Section § 10704
This section allows a city to set up a special fund specifically to cover costs for assessment districts temporarily, if needed. The city can put enough money in this fund to cover payments that are put off for a certain time. The money in this fund can be invested like other city funds or in a more controlled way if the city government decides so. However, any investments must follow federal rules about how investment returns are handled.
Alternatively, the city may create a deferral fund for the assessment district, and deposit into the deferral fund an amount sufficient to pay the asessments being deferred for a specified period of time. Funds in the deferral fund may be invested as other city funds are invested, or in more restricted ways as determined by the legislative body. Any investment of the funds in the deferral fund shall comply with federal arbitrage rules.
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Section § 10705
This law allows a city to increase the amount of bonds they can issue to fund a specific program. The money from these bonds must be put into a special deferral fund and can only be used to finance deferrals. The money from the bonds can be invested in federal government securities that mature before or at the same time as the bonds themselves. Any investments must follow specific federal tax laws regarding arbitrage.
A city may increase the principal amount of bonds issued under this division by an amount sufficient to fund a program pursuant to this chapter. The proceeds of bonds issued for this purpose shall be placed in the deferral fund created pursuant to Section 10704, and may be used for no other purpose than financing deferrals. The proceeds may be invested in interest-bearing securities of the federal government with maturities occurring on or before the maturity of the bonds issued pursuant to this section. Any investment of those bond proceeds shall comply with federal arbitrage rules (26 U.S.C. Sec. 103 and the rules adopted pursuant thereto).
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Section § 10706
This law states that any postponed payments for property assessments, along with interest, must be paid in full when the property changes ownership, when the last bond for the improvement of the property matures, or at other times decided by the governing body.
The amount of any deferred assessments, including interest at a rate determined by the legislative body, shall be due and payable whenever the parcel of property upon which the assessment was levied is transferred, or at the time of last maturity of the bonds issued for the improvement pursuant to this division, or at other times as determined by the legislative body.
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