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First Substitute H.B. 6

Representative David Ure proposes the following substitute bill:





Chief Sponsor: David Ure

Senate Sponsor: Beverly Ann Evans

             8      LONG TITLE
             9      General Description:
             10          This bill modifies provisions related to improvement districts for the conversion of
             11      overhead utilities to underground.
             12      Highlighted Provisions:
             13          This bill:
             14          .    modifies provisions related to how an assessment on property for the underground
             15      conversion of overhead utilities is to be calculated;
             16          .    modifies the requirements for notice of a proposed improvement district and
             17      assessment;
             18          .    modifies provisions relating to the underground conversion of overhead utilities to
             19      include:
             20              .    a requirement that the governing body provide notice to property owners that
             21      underground service is available and of the requirement to convert the owner's
             22      existing electric and communications facilities to underground;
             23              .    the consequence of an owner's failure to convert overhead facilities to
             24      underground; and
             25              .    the assessment of costs and expenses of the conversion against the property;

             26          .    modifies a provision relating to notice of the levy of an assessment for converting
             27      overhead utility facilities to underground;
             28          .    modifies the type of easement that is created upon the failure to convert overhead
             29      utility facilities with the required time;
             30          .    provides that a construction easement terminates once the conversion of overhead
             31      utility facilities to underground is completed; and
             32          .    makes technical changes.
             33      Monies Appropriated in this Bill:
             34          None
             35      Other Special Clauses:
             36          None
             37      Utah Code Sections Affected:
             38      AMENDS:
             39          54-8-5, as enacted by Chapter 157, Laws of Utah 1969
             40          54-8-6, as enacted by Chapter 157, Laws of Utah 1969
             41          54-8-9, as enacted by Chapter 157, Laws of Utah 1969
             42          54-8-11, as enacted by Chapter 157, Laws of Utah 1969
             43          54-8-19, as enacted by Chapter 157, Laws of Utah 1969
             44          54-8-26, as enacted by Chapter 157, Laws of Utah 1969
             46      Be it enacted by the Legislature of the state of Utah:
             47          Section 1. Section 54-8-5 is amended to read:
             48           54-8-5. Apportionment of costs -- Assessment against benefitted property --
             49      Public lands not subject to assessment.
             50          [Whenever any improvement authorized to be made by any governing body by the
             51      terms of this chapter is ordered, the governing body shall provide for the apportionment of the
             52      cost and expenses thereof as in their judgment may be fair and equitable in consideration of the
             53      benefits accruing to the abutting, adjoining, contiguous and adjacent lots and lands and to the
             54      lots and lands otherwise benefitted and included within the improvement district formed. Each
             55      lot and parcel of the land shall be separately assessed for the cost and expenses thereof in
             56      proportion to the number of square feet of such lands and lots abutting, adjoining, contiguous

             57      and adjacent thereto or included in the improvement district, and in proportion to the benefits
             58      derived to such property by said improvements.]
             59          (1) If an improvement district is created as provided in this chapter, the governing body
             60      of the county or municipality that created the improvement district may levy an assessment on
             61      property within the district.
             62          (2) (a) If an assessment is levied under this section, it shall be levied on all blocks, lots,
             63      parts of blocks, and lots, tracts, or parcels of property bounding, abutting upon, or adjacent to
             64      the improvements or affected or specially benefitted by the improvements to the extent of the
             65      benefits to the property because of the improvements.
             66          (b) The benefits to the property may be indirect and need not actually increase the fair
             67      market value of the property.
             68          (3) A governing body may levy an assessment under this section to the full depth of the
             69      property or to the depth determined by the governing body.
             70          (4) Assessments under this section shall be equal and uniform according to the benefits
             71      received.
             72          (5) (a) Assessments may be according to area, frontage, assessed value, taxable value,
             73      lot, number of connections, or any combination of these methods, as the governing body
             74      considers fair and equitable.
             75          (b) Different improvements in an improvement district may be assessed according to
             76      different methods.
             77          (c) The governing body shall make an allowance for corner lots so that they are not
             78      assessed at full rate on both sides adjacent to the street.
             79          (6) The entire cost of the improvement may be assessed against the benefitted property
             80      as [herein] provided in this section or, if money for paying part of such cost is available from
             81      any other source, the money so available may be so applied and the remaining cost so assessed
             82      against the benefitted property.
             83          (7) The cost and expenses to be assessed as [herein] provided [for] in this section shall
             84      include the contract price of the improvement, engineering and clerical services, advertising,
             85      cost of inspection, cost of collecting assessments, and interest upon bonds if issued, and for
             86      legal services for preparing proceedings and advising in regard thereto.
             87          (8) Fee lands and property of public entities such as the federal government, the state

             88      [of Utah], or any county, city, or town [shall] may not be considered as lands or property
             89      benefitted by any improvement district, and, unless such public entity within the boundaries of
             90      an improvement district consents in writing, filed before the governing body adopts the
             91      resolution provided for in Section 54-8-8 , the lands and property of such public entity shall not
             92      be subject to assessment for the payment of any of the cost or expense of such improvement.
             93          Section 2. Section 54-8-6 is amended to read:
             94           54-8-6. Creation of improvement district -- Petition by property owners --
             95      Resolution of governing body -- Utilities to submit reports.
             96          [Any] (1) (a) A governing body may, upon a petition signed by two-thirds of the
             97      owners of the real property and the owners of not less than two-thirds in value of the real
             98      property, as shown by the last assessment rolls, of any proposed district requesting the creation
             99      of an improvement district as provided for in this chapter, pass a resolution at any regular or
             100      special meeting declaring that it finds that the improvement district proposed is in the public
             101      interest. [It must be determined]
             102          (b) In order to pass a resolution under Subsection (1)(a), the governing body shall
             103      determine that the formation of the local improvement district for the purposes set out in this
             104      chapter will promote the public convenience, necessity, and welfare. [The resolution must]
             105          (2) Each resolution adopted under Subsection (1) shall:
             106          (a) state that the costs and expenses will be levied and assessed upon the property
             107      benefitted [and further];
             108          (b) request that each public utility corporation serving such area by overhead electric or
             109      communication facilities shall, within 120 days after the receipt of the resolution, make a study
             110      of the cost of conversion of its facilities in such area to underground service[. The report of
             111      said study shall be provided to the governing body and made available in its office to all
             112      owners of land within the proposed improvement district. The resolution of the governing body
             113      shall]; and
             114          (c) require that the public utilities be provided with the name and address of the owner
             115      of each parcel or lot within the proposed improvement district, if known, and, if not known, the
             116      description of the property and [such] other matters [as may be] required by the public utility
             117      corporations in order to perform the work involved in the cost study. [The resolution shall
             118      further state the size and square feet of each lot or parcel within the proposed conversion

             119      service area.]
             120          (3) Each public service corporation serving [such] the improvement district area by
             121      overhead electric or communication facilities shall[,]:
             122          (a) within 120 days after receipt of the resolution, make a study of the costs of
             123      conversion of its facilities in [such] the district to underground service[,]; and [shall together]
             124          (b) provide the governing body and make available to its office a [joint] report,
             125      prepared jointly with each other public service corporation serving the improvement district
             126      area by overhead electric or communication facilities, as to the results of the study.
             127          (4) The governing body shall make each report under Subsection (3) available in its
             128      office to each owner of land within the improvement district.
             129          Section 3. Section 54-8-9 is amended to read:
             130           54-8-9. Public hearing -- Notice -- Contents.
             131          [Following] (1) After the passage of the resolution in Section 54-8-8 , the governing
             132      body shall cause notice of a public hearing on the proposed improvement to be given [in the
             133      manner] as provided in Section 54-8-10 . [Such]
             134          (2) The notice required under Subsection (1) shall:
             135          [(1)] (a) describe the boundaries or area of the district with sufficient particularity to
             136      permit each owner of real property [therein] in the proposed district to ascertain that [his] the
             137      owner's property lies in the district;
             138          [(2)] (b) describe in a general way the proposed improvement, specifying the streets or
             139      property along which it will be made and the nature of the benefits to the property within the
             140      district;
             141          [(3)] (c) state the estimated cost as determined from the costs and feasibility report and
             142      including the contract price of the improvement and the cost of engineering and clerical
             143      service, advertising, inspection, collection of assessments, interests upon bonds, if issued, and
             144      for legal services for preparing proceedings and advising in regard [thereto] to them;
             145          [(4)] (d) state that it is proposed to assess the real property in the district to pay all or a
             146      designated portion of the cost of the improvement according to the [square footage of and the
             147      benefits to be derived by each tract, block, lot and parcel of land within the district] method
             148      determined by the governing body under Section 54-8-5 ;
             149          [(5)] (e) state the date, time, and place [at which] that the governing body will conduct

             150      a public hearing upon the proposed improvement and on the question of benefits to be derived
             151      by the real property in the district;
             152          [(6)] (f) state that all interested persons will be heard and that any property owner will
             153      be heard on the question of whether his property will be benefitted by the proposed
             154      improvement[.]; and
             155          (g) designate the date, time, and place of a public hearing at which the governing body
             156      will consider objections to the creation of the proposed district and the making of the proposed
             157      improvements.
             158          Section 4. Section 54-8-11 is amended to read:
             159           54-8-11. Protests -- Hearings -- Representatives of utilities to be present --
             160      Changes in proposal -- Adoption or abandonment of project.
             161          (1) (a) On the date and at the time and place specified in the [aforesaid] notice under
             162      Section 54-8-9 , the governing body shall in open and public session hear all objections to the
             163      creation of the proposed district, the making of the proposed improvements, and the benefits
             164      accruing to any tract, block, lot, or parcel of land [therein] in the proposed district.
             165          (b) Representatives of the public utilities concerned shall be present at [all such
             166      hearings. Such hearings] each hearing under Subsection (1)(a).
             167          (c) A hearing under Subsection (1)(a) may be adjourned from time to time to a fixed
             168      future time and place.
             169          (d) If at any time during [the hearings] a hearing under Subsection (1)(a), it [shall
             170      appear] appears to the governing body that changes in the proposed improvements or the
             171      proposed district should be made, which, after consultation with the public utilities concerned,
             172      appear to affect either the cost or feasibility of the improvements, the hearing shall be
             173      adjourned to a fixed future time and place and a new costs and feasibility report prepared on
             174      the basis of the contemplated changes.
             175          (2) After the hearing has been concluded and after all persons desiring to be heard have
             176      been heard, the governing body:
             177          (a) shall consider the arguments put forth [and];
             178          (b) may make [such] changes in the area to be included in the district as it [may
             179      consider] considers desirable or necessary[. However, no such changes shall be made unless], if
             180      a costs and feasibility report has been prepared on the basis of [such] those changes[. After

             181      such consideration and determination, the board]; and
             182          (c) shall adopt a resolution either abandoning the district and project or determining to
             183      proceed with the district and project, either as described in the notice or with changes made as
             184      [above] authorized in this section.
             185          Section 5. Section 54-8-19 is amended to read:
             186           54-8-19. Assessments -- Right to levy against property -- Due date -- Notice --
             187      Payment in annual installments.
             188          (1) The governing body may levy the assessments under the assessment list in whole or
             189      in part at any time after the adoption of the assessment resolution, but if not levied as a whole,
             190      any partial levies shall be made on the basis of completed improvements and the property
             191      benefited [thereby] by the improvements.
             192          (2) The amount of the assessment will become due and collectible immediately upon
             193      the levying of the assessment and, if it is not paid within [thirty] 30 days from the date of
             194      [such] the levy, it shall, at the expiration of [such thirty] the 30 days, commence to bear interest
             195      at a rate fixed by the governing body but not to exceed 7% per annum.
             196          (3) (a) Notice shall be given in the same manner as provided in Section 54-8-16 [and
             197      shall];
             198          (b) The notice under Subsection (3)(a) shall:
             199          (i) specify the date and amount of the levy affecting each tract, block, lot, or parcel, the
             200      date when interest will commence, the amount of such interest, and the period of years over
             201      which installment payments may be made[. If];
             202          (ii) identify the easement that may be acquired by Subsection 54-8-26 (2); and
             203          (iii) be recorded in the office of the recorder of the county in which the tract, block, lot,
             204      or parcel is located.
             205          (4) (a) If the assessment is not paid within the [thirty] 30 days allowed, [it will be
             206      presumed that] each owner [exercises] shall be presumed to exercise the right and option to pay
             207      the amount due in equal annual installments bearing interest at the rate specified in the notice
             208      and extending over the period of years, not exceeding [twenty] 20 specified in the notice.
             209          (b) The first installment shall become due one year from the date when interest
             210      commenced, and one installment shall become due on the same day of the same month
             211      annually thereafter.

             212          (c) Any assessment may be prepaid on any annual installment date without interest
             213      penalty provided the total balance of the assessment, including accrued interest, costs and
             214      penalties, be paid.
             215          Section 6. Section 54-8-26 is amended to read:
             216           54-8-26. Notice that service from underground facilities is available --
             217      Consequences of failure to convert overhead facilities.
             218          [The public utility performing the conversion shall, at the expense of the owner, convert
             219      to underground all electric and communication service facilities located upon any lot or parcel
             220      of land within the improvement district and not within the easement for distribution. This shall
             221      include the digging and the back filling of a trench upon such lot or parcel unless the owner
             222      shall execute a written objection thereto and file the same with the clerk of the governing body
             223      not later than the date set for hearing objections to the improvement district as provided by law.
             224      Failure to file such written objection shall be taken]
             225          (1) (a) If service from the underground utility is available to all or part of an
             226      improvement district area, the governing body of the county or municipality that created the
             227      district shall mail a notice to each owner of real property served from existing overhead
             228      facilities stating that:
             229          (i) service from the underground facilities is available; and
             230          (ii) each owner shall perform the necessary construction to convert the owner's existing
             231      overhead electric and communications to underground from the utility-provided service point
             232      to the service point on the owner's property.
             233          (b) Each owner that converts overhead facilities to underground facilities shall comply
             234      with all applicable state and local laws, ordinances, rules, and regulations, and with all tariffs
             235      of the applicable utility.
             236          (2) (a) Failure to convert the overhead facilities to underground facilities within 60
             237      days after the date of mailing the notice shall be considered as a consent to and grant of a
             238      construction easement to the [utility] county or municipality and [shall be construed] as express
             239      authority to the [public utility corporations] county or municipality and [their respective] its
             240      officers, agents, and employees to enter upon [such] the lot or parcel for [such] the purpose[,
             241      and through failure to object, any right of protest or objection in respect of the doing of such
             242      work and the inclusion of the costs thereof in said assessment shall be waived. If an owner does

             243      file such written objection, he shall then be responsible for providing a trench which is in
             244      accordance with applicable rules, regulations or tariffs from the owner's service entrance to a
             245      point designated by the public utility and for back filling the trench following installation of the
             246      underground service by the public utility involved] of making the conversion.
             247          [The costs of any work done by the public utility corporation shall be included in the
             248      assessment to be levied upon such lot or parcel unless the owner shall file a written objection
             249      thereto with the clerk of the governing body not later than the date set for hearing objections to
             250      the improvement district as provided by law. Should such an objection be filed, the owner
             251      involved shall be billed by the public utility involved for such work as it accomplishes upon the
             252      owner's property.]
             253          (b) A construction easement under Subsection (2)(a) terminates upon completion of the
             254      conversion of overhead facilities to underground.
             255          (3) If the county or municipality converts the overhead facilities to underground
             256      facilities, all costs and expenses of the conversion, including the engineering, legal, advertising,
             257      and incidental expenses, shall be assessed against the property benefitted and become a lien
             258      upon the property.
             259          (4) The owner shall, at [his] the owner's expense, make all necessary changes in the
             260      service entrance equipment to accept underground service.

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