HomeMy WebLinkAboutItem 07 - Impact FeesITEM I L ---
MEMO TO: HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL
FROM: ROGER NELSON, CITY MANAGER,
MEETING DATE: DECEMBER 18, 2001
SUBJECT: ORDINANCE AMENDING THE CODE OF ORDINANCES BY
AMENDING SECTION 25-25 OF CHAPTER 25 UTILITIES AND
SERVICES RELATIVE TO PAYMENT OF IMPACT FEES
RECOMMENDATION:
City Council to approve an ordinance amending the Code of Ordinances by amending
Section 25-25 of Chapter 25 Utilities and Services relative to payment of impact fees;
providing a severability clause; declaring an emergency and providing an effective date.
BACKGROUND:
This item is placed on the agenda in order to simplify the administration of section 25-
25(b)(1)b of the Municipal Code. This relates to the interest rate that the City is allowed
to charge individuals who choose the time payment option for paying impact fees. The
current rate varies as to the Treasury note yield at the time of assessment of the payment
and requires a recalculation each time a payment is due (see copy of relevant code section
attached).
This provision is very difficult to administer and to explain to customers. In addition, State
law defines any rate in excess of 10% per annum as usurious. Depending on the T -Bill
yield each year, we could have a violation if the rate exceeds 10%. (See copy of relevant
Vernon's Texas Statutes attached.)
The proposed ordinance will set the rate at 10% as allowed by law. This is consistent with
other code sections which specify interest rates to be charged. It is easy to understand
and straightforward to calculate the payments to be made by customers.
Staff recommends approval.
WAG/cjc
H: AmendCodelmpactFees
December 12, 2001 (10:27AM)
Sec. 25-25. Same --Capital impact fee.
(b) Payment of and accounting for capital impact fee.
(1) The capital impact fee shall be paid as follows:
a. Cash payment in full prior to the issuance of any building permit for the development; or
b. Equal installment payments paid over a five-year period from the date a building permit
is issued, with each annual payment being due and payable on the anniversary date of the
issuance of the building permit. The annual payment shall include monthly interest on the unpaid
balance calculated at a rate of one percent above the one year treasury note yield as stated in the
Wall Street Journal on October first of that year, thereafter, on October first of each subsequent
year, the interest rate shall be adjusted and shall be calculated at a rate of one percent above the
one year treasury note yield as stated in the Wall Street Journal on October first of that year. The
city shall be entitled to pursue all available legal remedies, including, but not limited to, the right
to terminate and cancel or withhold the issuance of a certificate of occupancy upon the failure to
pay any installment payment when due. The office of the city attorney shall prepare a standard
form contract for all installment accounts which must be executed by the property owner and
which shall be filed and recorded with the office of the county clerk in the county in which the
property is situated.
TX CONST Art. 16, s 11 Page I
Vernon's Ann.Texas Const, Art. 16, § 11
VERNON'S TEXAS STATUTES AND CODES ANNOTATED
CONSTITIMON OF THE STATE OF TEXAS 1876
ARTICLE Xvl. GENERAL PROVISIONS
Copr. C Went Group 1998- All rights reserved.
Current through End of 1997 Reg. Sess.
§ 11. Usury; rate of interest in absence of legislation
Sec. 11. The Legislature shall have authority to classify loans and lenders, license and regulate lenders, defuse
interest and fix maximum rates of interest; provided, however, in the absence of legislation fixing maximum rates
of interest all contracts for it greater rate of interest than ten per centum 1 )per annum shall be deemed
usurious; provided, further, that in contracts where no rata of interest is agreed upon, the rate shall not exceed
six per centum (6`) per annum. Should any regulatory agency, acting under the provisions of this Section,
cancel or refuse to grant any permit under any law passed by the Legislature; then such applicant or holder shall
have the right of appeal to the courts and granted a trial de novo as that term is used in appealing from the justice
of peace court to the county court.
CREDIT(S)
1993 Main Volume
Amended Aug. 11, 1891, proclamation Sept. 22, 1891; Nov. 8, 1960.
HISTORICAL NOTES
1993 Main Volume
The 1891 amendment proposed by Acts 1891, 22nd Leg., H.J.R. No. 1, reduced the prescribed rates and rewrote
the provisions of the section which prior thereto read:
"Thc legal rate of interest shall not exceed eight per cent. per annum, in the absence: of any contract as to the rate
of interest; and by contract parties may agree upon any rate not to exceed twelve per cent. per annum. All
interest charged above this last named rate, shall be deemed usurious, and the Legislature shall, at its first session,
provide appropriate pains and penalties to prevent and punish usury."
The 1960 arncnde11e11t proposed by Acts 1959, 56th Lcg„ H.J.R. No. 6, gave the Legislature authority to classify
loans and lenders, license and regulate lenders, define interest, fix maximum rates of interest, and provide for a
maximum rate of interest of ten per centum (10%) per annum in the absence of legislation setting maximum rates
of interest; provided that the rate of interest shall not exceed six per cent ( o) per annum to eontxacts where no
interest rate is agreed upon; providceJ for the right of appeal and trial de novo ut the event any regulatory agency
canes or re:lusCs to grant any permit; provided for the necessary election and the form of the ballot; and
provided for the necessary proclamation and publication.
Earlier Constitution:
Const.1869, Art. 12, § 44.
Vernon's Ann. Texas Const, Art. 16, § 11
TX CONST An. 16, § 11
Copr. C West 1999 No Clain to Orig. U.S. Govt. Works
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AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF
GRAPEVINE, TEXAS AMENDING THE CODE OF
ORDINANCES BY AMENDING CHAPTER 25 UTILITIES AND
SERVICES, ARTICLE 11 WATER AND SEWERS, SECTION
25-25, RELATIVE TO PAYMENT OF IMPACT FEES;
PROVIDING A SEVERABILITY CLAUSE; DECLARING AN
EMERGENCY AND PROVIDING AN EFFECTIVE DATE
BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF GRAPEVINE,
TEXAS:
Section 1. That Chapter 25 Utilities and Services, Article 11, Water and Sewers
is amended by amending and replacing Section 25-25(b)(1)b in its entirety as follows:
"b. Equal installment payments paid over a five year period from the date a
building permit is issued, with each annual payment being due and payable
on the anniversary date of the issuance of the building permit. The annual
payment shall include monthly interest on the unpaid balance at an annual
rate of ten percent (10%). The City shall be entitled to pursue all available
legal remedies, including but not limited to, the right to terminate and cancel
or withhold the issuance of a certificate of occupancy upon the failure to pay
any installment when due. The office of the city attorney shall prepare a
standard form contract for all installment accounts which must be executed
by the property owner and which shall be filed and recorded with the office
of the county clerk in the county in which the property is situated."
Section 2. If any section, article, paragraph, sentence, clause, phase or word in
this ordinance, or application thereto, any person or circumstances is held invalid or
unconstitutional by a Court of competent jurisdiction, such holding shall not affect the
validity of the remaining portions of this ordinance; and the City Council hereby declares
it would have passed such remaining portions of the ordinance despite such invalidity,
which remaining portions shall remain in full force and effect.
Section 3. The fact that the present ordinances and regulations of the City of
Grapevine, Texas, are inadequate to properly safeguard the health, safety, morals,
peace, and general welfare of the public creates an emergency which requires that this
ordinance become effective from and after the date of its passage, and it is accordingly
so ordinance.
PASSED AND APPROVED BY THE CITY COUNCIL OF THE CITY OF
GRAPEVINE, TEXAS on this the 18th day of December 2001.
M jW2061TA: I
ATTEST:
IMM
ORD. NO. 2