11-42-608 - Reducing assessments after issuance of refunding assessment bonds.
11-42-608. Reducing assessments after issuance of refunding assessment bonds.
(1) Each local entity that issues refunding assessment bonds shall adopt a resolution orordinance amending the assessment resolution or assessment ordinance previously adopted.
(2) Each amending resolution or ordinance under Subsection (1) shall:
(a) reduce, as determined by the local entity's governing body:
(i) the assessments levied under the previous resolution or ordinance;
(ii) the interest payable on the assessments levied under the previous resolution orordinance; or
(iii) both the assessments levied under the previous resolution or ordinance and theinterest payable on those assessments;
(b) allocate the reductions under Subsection (2)(a) so that the then unpaid assessmentslevied against benefitted property within the assessment area and the unpaid interest on thoseassessments receive a proportionate share of the reductions;
(c) (i) state the amounts of the reduced payment obligation for each property assessed inthe prior resolution or ordinance; or
(ii) incorporate by reference a revised assessment list approved by the governing bodycontaining the reduced payment obligations; and
(d) state the effective date of any reduction in the assessment levied in the priorresolution or ordinance.
(3) A resolution or ordinance under Subsection (2) is not required to describe each block,lot, part of block or lot, tract, or parcel of property assessed.
(4) Each reduction under Subsection (2)(a) shall be the amount by which the principal orinterest or both payable on the refunding assessment bonds, after accounting for incidentalrefunding costs associated with the refunding assessment bonds, is less than the amount ofprincipal or interest or both payable on the prior bonds.
(5) A reduction under Subsection (2)(a) does not apply to an assessment or interest paidbefore the reduction.
(6) A resolution or ordinance under Subsection (2) may not become effective before thedate when all principal, interest, any redemption premium on the prior bonds, and any advancesmade under Subsection 11-42-607(5)(a) are fully paid or legally considered to be paid.
(7) (a) At least 21 days before the first payment of a reduced assessment becomes due,each local entity shall provide notice of the reduced payment obligations resulting from adoptionof a resolution or ordinance under Subsection (2) by mailing, postage prepaid, a notice to eachowner of benefitted property within the assessment area at the owner's mailing address.
(b) Each notice under Subsection (7)(a) shall:
(i) identify the property subject to the assessment; and
(ii) state the amount of the reduced payment obligations that will be payable after theapplicable date stated in the resolution or ordinance under Subsection (1).
(c) A notice under Subsection (7)(a) may:
(i) contain other information that the governing body considers appropriate; and
(ii) be included with any other notice regarding the payment of an assessment andinterest that the local entity sends to property owners in the assessment area within the time andaddressed as required under Subsection (7)(a).
(d) The validity of a resolution or ordinance under Subsection (1) is not affected by:
(i) a local entity's failure to provide notice as required under this Subsection (7); or
(ii) a defect in the content of the notice or the manner or time in which the notice wasprovided.
(e) Whether or not notice under this Subsection (7) is properly given, no other notice isrequired to be given to owners of property within an assessment area in connection with theissuance of refunding assessment bonds.
(8) Except for the amount of reduction to a prior assessment or interest on a priorassessment, neither the issuance of refunding assessment bonds nor the adoption of a resolutionor ordinance under Subsection (1) affects:
(a) the validity or continued enforceability of a prior assessment or interest on theassessment; or
(b) the validity, enforceability, or priority of an assessment lien.
(9) Each reduction of a prior assessment and the interest on the assessment shall continueto exist in favor of the refunding assessment bonds.
(10) Even after payment in full of the prior bonds that are refunded by refundingassessment bonds, an assessment lien continues to exist to secure payment of the reducedpayment obligations, the penalties and costs of collection of those obligations, and the refundingassessment bonds in the same manner, to the same extent, and with the same priority as theassessment lien.
(11) A lien securing a reduced payment obligation from which refunding assessmentbonds are payable and by which the bonds are secured is subordinate to an assessment liensecuring the original or prior assessment and prior bonds until the prior bonds are paid in full orlegally considered to be paid in full.
(12) Unless prior bonds are paid in full simultaneously with the issuance of refundingassessment bonds, the local entity shall:
(a) irrevocably set aside the proceeds of the refunding assessment bonds in an escrow orother separate account; and
(b) pledge that account as security for the payment of the prior bonds, refundingassessment bonds, or both.
(13) This part applies to all refunding assessment bonds:
(a) whether already issued or yet to be issued; and
(b) even though the prior bonds they refunded were issued under prior law, whether ornot that law is currently in effect.
Enacted by Chapter 329, 2007 General Session