1     
DEDICATED INFRASTRUCTURE DISTRICT ACT

2     
2023 GENERAL SESSION

3     
STATE OF UTAH

4     
Chief Sponsor: Daniel McCay

5     
House Sponsor: ____________

6     

7     LONG TITLE
8     General Description:
9          This bill enacts the Dedicated Infrastructure District Act.
10     Highlighted Provisions:
11          This bill:
12          ▸     enacts the Dedicated Infrastructure District Act;
13          ▸     defines terms;
14          ▸     establishes objectives and requirements for the creation of a dedicated infrastructure
15     district to finance the costs of certain infrastructure and improvements;
16          ▸     provides for the membership of the board of trustees of a dedicated infrastructure
17     district;
18          ▸     establishes requirements for the charter governing a dedicated infrastructure district;
19          ▸     requires a dedicated infrastructure district to engage certain professional support;
20          ▸     allows a dedicated infrastructure district to issue bonds and levy taxes with certain
21     limitations;
22          ▸     allows an individual to contest a tax or fee imposed by a dedicated infrastructure
23     district or to contest the creation of a dedicated infrastructure district; and
24          ▸     makes technical changes.
25     Money Appropriated in this Bill:
26          None
27     Other Special Clauses:

28          None
29     Utah Code Sections Affected:
30     AMENDS:
31          17B-1-102, as last amended by Laws of Utah 2021, Chapter 314
32     ENACTS:
33          17D-4a-101, Utah Code Annotated 1953
34          17D-4a-102, Utah Code Annotated 1953
35          17D-4a-201, Utah Code Annotated 1953
36          17D-4a-202, Utah Code Annotated 1953
37          17D-4a-203, Utah Code Annotated 1953
38          17D-4a-204, Utah Code Annotated 1953
39          17D-4a-205, Utah Code Annotated 1953
40          17D-4a-206, Utah Code Annotated 1953
41          17D-4a-301, Utah Code Annotated 1953
42          17D-4a-302, Utah Code Annotated 1953
43          17D-4a-303, Utah Code Annotated 1953
44          17D-4a-304, Utah Code Annotated 1953
45          17D-4a-305, Utah Code Annotated 1953
46     

47     Be it enacted by the Legislature of the state of Utah:
48          Section 1. Section 17B-1-102 is amended to read:
49          17B-1-102. Definitions.
50          As used in this title:
51          (1) "Appointing authority" means the person or body authorized to make an
52     appointment to the board of trustees.
53          (2) "Basic local district":
54          (a) means a local district that is not a specialized local district; and
55          (b) includes an entity that was, under the law in effect before April 30, 2007, created
56     and operated as a local district, as defined under the law in effect before April 30, 2007.
57          (3) "Bond" means:
58          (a) a written obligation to repay borrowed money, whether denominated a bond, note,

59     warrant, certificate of indebtedness, or otherwise; and
60          (b) a lease agreement, installment purchase agreement, or other agreement that:
61          (i) includes an obligation by the district to pay money; and
62          (ii) the district's board of trustees, in its discretion, treats as a bond for purposes of Title
63     11, Chapter 14, Local Government Bonding Act, or Title 11, Chapter 27, Utah Refunding Bond
64     Act.
65          (4) "Cemetery maintenance district" means a local district that operates under and is
66     subject to the provisions of this chapter and Chapter 2a, Part 1, Cemetery Maintenance District
67     Act, including an entity that was created and operated as a cemetery maintenance district under
68     the law in effect before April 30, 2007.
69          (5) "Drainage district" means a local district that operates under and is subject to the
70     provisions of this chapter and Chapter 2a, Part 2, Drainage District Act, including an entity that
71     was created and operated as a drainage district under the law in effect before April 30, 2007.
72          (6) "Facility" or "facilities" includes any structure, building, system, land, water right,
73     water, or other real or personal property required to provide a service that a local district is
74     authorized to provide, including any related or appurtenant easement or right-of-way,
75     improvement, utility, landscaping, sidewalk, road, curb, gutter, equipment, or furnishing.
76          (7) "Fire protection district" means a local district that operates under and is subject to
77     the provisions of this chapter and Chapter 2a, Part 3, Fire Protection District Act, including an
78     entity that was created and operated as a fire protection district under the law in effect before
79     April 30, 2007.
80          (8) "General obligation bond":
81          (a) means a bond that is directly payable from and secured by ad valorem property
82     taxes that are:
83          (i) levied:
84          (A) by the district that issues the bond; and
85          (B) on taxable property within the district; and
86          (ii) in excess of the ad valorem property taxes of the district for the current fiscal year;
87     and
88          (b) does not include:
89          (i) a short-term bond;

90          (ii) a tax and revenue anticipation bond; or
91          (iii) a special assessment bond.
92          (9) "Improvement assurance" means a surety bond, letter of credit, cash, or other
93     security:
94          (a) to guarantee the proper completion of an improvement;
95          (b) that is required before a local district may provide a service requested by a service
96     applicant; and
97          (c) that is offered to a local district to induce the local district before construction of an
98     improvement begins to:
99          (i) provide the requested service; or
100          (ii) commit to provide the requested service.
101          (10) "Improvement assurance warranty" means a promise that the materials and
102     workmanship of an improvement:
103          (a) comply with standards adopted by a local district; and
104          (b) will not fail in any material respect within an agreed warranty period.
105          (11) "Improvement district" means a local district that operates under and is subject to
106     the provisions of this chapter and Chapter 2a, Part 4, Improvement District Act, including an
107     entity that was created and operated as a county improvement district under the law in effect
108     before April 30, 2007.
109          (12) "Irrigation district" means a local district that operates under and is subject to the
110     provisions of this chapter and Chapter 2a, Part 5, Irrigation District Act, including an entity that
111     was created and operated as an irrigation district under the law in effect before April 30, 2007.
112          (13) "Local district" means a limited purpose local government entity, as described in
113     Section 17B-1-103, that operates under, is subject to, and has the powers set forth in:
114          (a) this chapter; or
115          (b) (i) this chapter; and
116          (ii) (A) Chapter 2a, Part 1, Cemetery Maintenance District Act;
117          (B) Chapter 2a, Part 2, Drainage District Act;
118          (C) Chapter 2a, Part 3, Fire Protection District Act;
119          (D) Chapter 2a, Part 4, Improvement District Act;
120          (E) Chapter 2a, Part 5, Irrigation District Act;

121          (F) Chapter 2a, Part 6, Metropolitan Water District Act;
122          (G) Chapter 2a, Part 7, Mosquito Abatement District Act;
123          (H) Chapter 2a, Part 8, Public Transit District Act;
124          (I) Chapter 2a, Part 9, Service Area Act;
125          (J) Chapter 2a, Part 10, Water Conservancy District Act; or
126          (K) Chapter 2a, Part 11, Municipal Services District Act.
127          (14) "Metropolitan water district" means a local district that operates under and is
128     subject to the provisions of this chapter and Chapter 2a, Part 6, Metropolitan Water District
129     Act, including an entity that was created and operated as a metropolitan water district under the
130     law in effect before April 30, 2007.
131          (15) "Mosquito abatement district" means a local district that operates under and is
132     subject to the provisions of this chapter and Chapter 2a, Part 7, Mosquito Abatement District
133     Act, including an entity that was created and operated as a mosquito abatement district under
134     the law in effect before April 30, 2007.
135          (16) "Municipal" means of or relating to a municipality.
136          (17) "Municipality" means a city, town, or metro township.
137          (18) "Municipal services district" means a local district that operates under and is
138     subject to the provisions of this chapter and Chapter 2a, Part 11, Municipal Services District
139     Act.
140          (19) "Person" means an individual, corporation, partnership, organization, association,
141     trust, governmental agency, or other legal entity.
142          (20) "Political subdivision" means a county, city, town, metro township, local district
143     under this title, special service district under Title 17D, Chapter 1, Special Service District Act,
144     an entity created by interlocal cooperation agreement under Title 11, Chapter 13, Interlocal
145     Cooperation Act, or any other governmental entity designated in statute as a political
146     subdivision of the state.
147          (21) "Private," with respect to real property, means not owned by the United States or
148     any agency of the federal government, the state, a county, or a political subdivision.
149          (22) "Public entity" means:
150          (a) the United States or an agency of the United States;
151          (b) the state or an agency of the state;

152          (c) a political subdivision of the state or an agency of a political subdivision of the
153     state;
154          (d) another state or an agency of that state; or
155          (e) a political subdivision of another state or an agency of that political subdivision.
156          (23) "Public transit district" means a local district that operates under and is subject to
157     the provisions of this chapter and Chapter 2a, Part 8, Public Transit District Act, including an
158     entity that was created and operated as a public transit district under the law in effect before
159     April 30, 2007.
160          (24) "Revenue bond":
161          (a) means a bond payable from designated taxes or other revenues other than the local
162     district's ad valorem property taxes; and
163          (b) does not include:
164          (i) an obligation constituting an indebtedness within the meaning of an applicable
165     constitutional or statutory debt limit;
166          (ii) a tax and revenue anticipation bond; or
167          (iii) a special assessment bond.
168          (25) "Rules of order and procedure" means a set of rules that govern and prescribe in a
169     public meeting:
170          (a) parliamentary order and procedure;
171          (b) ethical behavior; and
172          (c) civil discourse.
173          (26) "Service applicant" means a person who requests that a local district provide a
174     service that the local district is authorized to provide.
175          (27) "Service area" means a local district that operates under and is subject to the
176     provisions of this chapter and Chapter 2a, Part 9, Service Area Act, including an entity that was
177     created and operated as a county service area or a regional service area under the law in effect
178     before April 30, 2007.
179          (28) "Short-term bond" means a bond that is required to be repaid during the fiscal year
180     in which the bond is issued.
181          (29) "Special assessment" means an assessment levied against property to pay all or a
182     portion of the costs of making improvements that benefit the property.

183          (30) "Special assessment bond" means a bond payable from special assessments.
184          (31) "Specialized local district" means a local district that is a cemetery maintenance
185     district, a drainage district, a fire protection district, an improvement district, an irrigation
186     district, a metropolitan water district, a mosquito abatement district, a public transit district, a
187     service area, a water conservancy district, a municipal services district, [or] a public
188     infrastructure district, or a dedicated infrastructure district.
189          (32) "Taxable value" means the taxable value of property as computed from the most
190     recent equalized assessment roll for county purposes.
191          (33) "Tax and revenue anticipation bond" means a bond:
192          (a) issued in anticipation of the collection of taxes or other revenues or a combination
193     of taxes and other revenues; and
194          (b) that matures within the same fiscal year as the fiscal year in which the bond is
195     issued.
196          (34) "Unincorporated" means not included within a municipality.
197          (35) "Water conservancy district" means a local district that operates under and is
198     subject to the provisions of this chapter and Chapter 2a, Part 10, Water Conservancy District
199     Act, including an entity that was created and operated as a water conservancy district under the
200     law in effect before April 30, 2007.
201          (36) "Works" includes a dam, reservoir, well, canal, conduit, pipeline, drain, tunnel,
202     power plant, and any facility, improvement, or property necessary or convenient for supplying
203     or treating water for any beneficial use, and for otherwise accomplishing the purposes of a local
204     district.
205          Section 2. Section 17D-4a-101 is enacted to read:
206     
CHAPTER 4a. DEDICATED INFRASTRUCTURE DISTRICT ACT

207     
Part 1. General Provisions

208          17D-4a-101. Definitions.
209          As used in this chapter:
210          (1) "Board" means the board of trustees of a dedicated infrastructure district.
211          (2) "Charter" means the document governing a dedicated infrastructure district that is
212     filed with the lieutenant governor's office, as amended from time to time, and subject to the
213     limitations of Title 17B, Chapter 1, Provisions Applicable to All Local Districts, and this

214     chapter.
215          (3) "Dedicated infrastructure district" means a district created under this chapter.
216          (4) "Infrastructure and improvements" includes:
217          (a) facilities, lines, or systems that harness geothermal energy or provide water, chilled
218     water, steam, sewer, storm drainage, natural gas, electricity, or telecommunications;
219          (b) streets, roads, curbs, gutters, sidewalks, walkways, tunnels, solid waste facilities,
220     parking facilities, public transportation facilities, rail and transit improvements, and parks,
221     trails, community centers, courts, fields, and other recreational facilities; and
222          (c) the improvements, facilities, or property for which bonds are authorized under
223     Section 11-14-103.
224          (5) (a) "Limited tax bond" means a bond:
225          (i) that is directly payable from and secured by ad valorem property taxes that are
226     levied within the entire dedicated infrastructure district boundary or within one or more tax
227     areas within the dedicated infrastructure district:
228          (A) by a dedicated infrastructure district that issues the bond; and
229          (B) on taxable property within the district or tax areas;
230          (ii) that is a general obligation of the dedicated infrastructure district; and
231          (iii) for which the ad valorem property tax levy for repayment of the bond does not
232     exceed the property tax levy rate limit established under Section 17D-4a-303 for any fiscal
233     year, except as provided in Subsection 17D-4a-301(9).
234          (b) "Limited tax bond" does not include:
235          (i) a short-term bond;
236          (ii) a tax and revenue anticipation bond; or
237          (iii) a special assessment bond.
238          (6) "Surface property owner" means an owner of the surface rights of real property.
239          (7) "Tax area" means a tax area, as that term is defined in Section 59-2-102, that is
240     created within a dedicated infrastructure district.
241          Section 3. Section 17D-4a-102 is enacted to read:
242          17D-4a-102. Provisions applicable to dedicated infrastructure districts.
243          (1) Each dedicated infrastructure district is governed by and has the powers stated in:
244          (a) this chapter; and

245          (b) Title 17B, Chapter 1, Provisions Applicable to All Local Districts.
246          (2) This chapter applies only to a dedicated infrastructure district.
247          (3) A dedicated infrastructure district is:
248          (a) a body corporate and politic with perpetual succession;
249          (b) a quasi-municipal corporation; and
250          (c) a political subdivision of the state.
251          (4) A dedicated infrastructure district may sue and be sued.
252          (5) Except as modified or exempted by this chapter, a dedicated infrastructure district
253     is, to the same extent as if the dedicated infrastructure district were a local district, subject to
254     the provisions in:
255          (a) Title 17B, Chapter 1, Provisions Applicable to All Local Districts;
256          (b) Title 20A, Election Code; and
257          (c) Title 11, Chapter 42a, Commercial Property Assessed Clean Energy Act.
258          (6) If a provision of this chapter conflicts with any other statutory provision, the
259     provision of this chapter controls.
260          (7) The annexation of an unincorporated area by a municipality or the adjustment of a
261     boundary share by more than one municipality does not affect the boundaries of a dedicated
262     infrastructure district.
263          (8) A dedicated infrastructure district shall constitute a local entity and the board shall
264     constitute a governing body for purposes of Title 11, Chapter 42a, Commercial Property
265     Assessed Clean Energy Act.
266          Section 4. Section 17D-4a-201 is enacted to read:
267     
Part 2. Purposes, Creation, Governance, and Powers of a Dedicated Infrastructure

268     
District

269          17D-4a-201. Purposes.
270          A dedicated infrastructure district may be created in accordance with this chapter for
271     the following purposes:
272          (1) to finance the costs of infrastructure and improvements;
273          (2) to maintain and operate infrastructure and improvements if the infrastructure or
274     improvements are not transferred or dedicated to another political subdivision or public or
275     private utility because no political subdivision has agreed to provide the service in or near the

276     dedicated infrastructure district, except for electricity distribution;
277          (3) to lower the cost of infrastructure and improvements and increase the supply of
278     available building lots;
279          (4) if development within the dedicated infrastructure district has housing, to
280     increasing the supply and achieving greater economies of scale to make some or all of the
281     housing units more affordable; and
282          (5) to encourage economic development, including commercial and industrial
283     development.
284          Section 5. Section 17D-4a-202 is enacted to read:
285          17D-4a-202. Creation -- Annexation or withdrawal of property.
286          (1) A dedicated infrastructure district may not be created unless:
287          (a) a petition is filed with the creating entity that contains the signatures of 100% of
288     surface property owners within the applicable area consenting to the creation of the dedicated
289     infrastructure district;
290          (b) the estimated cost for constructing the infrastructure and improvements is
291     $2,000,000 or more; and
292          (c) the proposal to create the dedicated infrastructure district includes:
293          (i) a minimum proposed development of 50,000 or more square feet of non-residential
294     development;
295          (ii) a minimum proposed development of 100 equivalent residential units or more; or
296          (iii) a minimum estimated appraised valuation of the proposed development upon
297     completion of $50,000,000 or more.
298          (2) The first board described in the charter shall file with the lieutenant governor:
299          (a) a copy of a notice of impending boundary action, as defined in Section 67-1a-6.5,
300     that meets the requirements of Subsection 67-1a-6.5(3);
301          (b) a copy of an approved final local entity plat, as defined in Section 67-1a-6.5;
302          (c) a copy of the petition required under Subsection (1)(a) together with a title report,
303     preliminary title report, or county record demonstrating property ownership; and
304          (d) a certificate of the first board described in the charter certifying that the petition
305     required under Subsection (1)(a) has been obtained and that the requirements of Subsections
306     (1)(b) and (c) are anticipated to be met with respect to the proposed development.

307          (3) The dedicated infrastructure district is created by the state upon the issuance of a
308     certificate of incorporation by the lieutenant governor's office under Section 67-1a-6.5.
309          (4) Title 17B does not apply to the creation of a dedicated infrastructure district or an
310     annexation or withdrawal of property from a dedicated infrastructure district.
311          (5) (a) An area outside of the boundaries of a dedicated infrastructure district may be
312     annexed into the dedicated infrastructure district if the following requirements are met:
313          (i) adoption of a resolution of the board approving of the annexation; and
314          (ii) written consent of 100% of the surface property owners within the area proposed
315     for annexation.
316          (b) Within 60 days of meeting the requirements of Subsection (5)(a), the board shall
317     file with the lieutenant governor:
318          (i) a copy of a notice of impending boundary action, as defined in Section 67-1a-6.5,
319     that meets the requirements of Subsection 67-1a-6.5(3); and
320          (ii) a copy of an approved final local entity plat, as defined in Section 67-1a-6.5.
321          (6) (a) Property may be withdrawn from a dedicated infrastructure district if the
322     following requirements are met:
323          (i) (A) adoption of a resolution of the board approving of the withdrawal; and
324          (B) written consent of 100% of the surface property owners within the area proposed to
325     be withdrawn; or
326          (ii) (A) adoption of a resolution of the board approving of the withdrawal; and
327          (B) the charter or documents authorizing bonds permit withdrawal or a property upon
328     payment of any fees or assessments that the dedicated infrastructure district imposes upon such
329     area proposed to be withdrawn in full.
330          (b) If any bonds that the dedicated infrastructure district issues are allocable to the area
331     to be withdrawn remain unpaid at the time of the proposed withdrawal, the property remains
332     subject to any taxes, fees, or assessments that the dedicated infrastructure district imposes until
333     the bonds or any associated refunding bonds are paid, unless other provisions are made within
334     the documents authorizing such bonds for the allocation of such indebtedness.
335          (c) Within 60 days of meeting the requirements of Subsection (6)(a), the board shall
336     file with the lieutenant governor:
337          (i) a copy of a notice of impending boundary action, as defined in Section 67-1a-6.5,

338     that meets the requirements of Subsection 67-1a-6.5(3); and
339          (ii) a copy of an approved final local entity plat, as defined in Section 67-1a-6.5.
340          (7) For purposes of certification under Section 67-1a-6.5, with respect to a dedicated
341     infrastructure district:
342          (a) prior to the lieutenant governor's issuance of a certificate of incorporation under
343     Section 67-1a-6.5, any requirement of signature or approval by the approving authority may be
344     approved or signed by members of the proposed board of the dedicated infrastructure district;
345     and
346          (b) after the issuance of a certificate of incorporation under Section 67-1a-6.5, the
347     dedicated infrastructure district constitutes the approving authority.
348          (8) The lieutenant governor's office may charge reasonable fees relating to the review
349     and issuance of a certificate under Section 67-1a-6.5 in relation to a dedicated infrastructure
350     district.
351          (9) The boundaries of a dedicated infrastructure district may not overlap with the
352     boundaries of another dedicated infrastructure district if doing so would allow a dedicated
353     infrastructure district to charge an aggregate property tax exceeding the limit described in
354     Subsection 17D-4a-303(1).
355          (10) (a) A dedicated infrastructure district is a separate and distinct political
356     subdivision, separate and distinct from the municipality and county within which the dedicated
357     infrastructure district is located.
358          (b) Any financial burden of a dedicated infrastructure district:
359          (i) is borne solely by the dedicated infrastructure district; and
360          (ii) is not borne by the state, or by any municipality, county, or other political
361     subdivision.
362          (c) Any liability, judgment, or claim against a dedicated infrastructure district:
363          (i) is the sole responsibility of the dedicated infrastructure district; and
364          (ii) does not constitute a liability, judgment, or claim against the state, or any
365     municipality, county, or other political subdivision.
366          (d) (i) Subject to Subsection (9)(d)(ii), a dedicated infrastructure district solely bears
367     the responsibility of any collection, enforcement, or foreclosure proceeding with regard to any
368     fee or assessment the dedicated infrastructure district imposes.

369          (ii) A dedicated infrastructure district shall undertake any enforcement action under
370     Subsection (9)(d)(i) in accordance with Title 11, Chapter 42, Assessment Area Act.
371          Section 6. Section 17D-4a-203 is enacted to read:
372          17D-4a-203. Dedicated infrastructure district board -- Charter.
373          (1) The board of a dedicated infrastructure district shall consist of either three or five
374     members, as designated in the charter, and shall be appointed in accordance with the charter.
375          (2) (a) For the members of the initial board, two of the members in a three member
376     board and three members in a five member board shall serve an initial six-year term and the
377     other members of the initial board shall serve an initial four-year term.
378          (b) After the initial term, the term of each member of the board is four years.
379          (3) (a) Notwithstanding Subsection 17B-1-302(1)(b), a board member is not required
380     to be a resident within the boundaries of the dedicated infrastructure district if:
381          (i) 75% or less of any residential units planned for construction within the dedicated
382     infrastructure district are occupied;
383          (ii) no qualified candidate files to be considered for appointment to the board; or
384          (iii) no qualified individual files a declaration of candidacy for a board position in
385     accordance with Subsection 17B-1-306(5).
386          (b) Except under the circumstances described in Subsection (3)(a), the residency
387     requirement in Subsection 17B-1-302 is applicable to any board member elected for a board
388     position that has transitioned from an appointed to an elected board member in accordance with
389     this section.
390          (c) An individual who is not a resident within the boundaries of the dedicated
391     infrastructure district may not serve as a board member unless the individual is:
392          (i) a surface property owner or an agent or officer of a surface property owner within
393     the boundaries of the dedicated infrastructure district; and
394          (ii) a registered voter at the individual's primary residence.
395          (d) For a dedicated infrastructure district that is not anticipated to have permanent
396     residents or is anticipated to be composed primarily of nonresidential property, the charter may
397     allow for the board to continue to be appointed from owners of land or agents or officers of
398     land within the boundaries.
399          (e) A dedicated infrastructure district's charter may allow for a property owner to be

400     appointed as a board member, or the property owner's agent or officer, in proportion to the
401     property owner's ownership of taxable value within a dedicated infrastructure district.
402          (4) (a) A charter may provide for a transition from appointment under Subsection (1) to
403     a method of election by registered voters based upon milestones or events that the charter
404     identifies, including a milestone for each individual board position providing that when the
405     milestone is reached, the registered voters of the dedicated infrastructure district elect a
406     member of the board in place of an appointed member at the next municipal general election
407     for the board position.
408          (b) Regardless of whether a board member is elected under Subsection (4)(a), the
409     position of each remaining board member shall continue to be appointed under Subsection (1)
410     until the member's board position surpasses the density milestone described in the charter.
411          (5) A dedicated infrastructure district may not compensate a board member for the
412     member's service on the board under Section 17B-1-307 unless the board member is a resident
413     within the boundaries of the dedicated infrastructure district.
414          (6) A charter shall:
415          (a) include a boundary description and a map of the dedicated infrastructure district;
416          (b) state the number of board members of the dedicated infrastructure district;
417          (c) establish any applicable property tax levy rate limit for the dedicated infrastructure
418     district;
419          (d) establish any applicable limitation on the principal amount of indebtedness for the
420     dedicated infrastructure district; and
421          (e) include other information that the dedicated infrastructure district or the property
422     owner determines to be necessary or advisable.
423          (7) (a) Except as provided in Subsection (7)(b), the board may amend a charter by
424     adopting a resolution that approves the amended charter.
425          (b) Notwithstanding Subsection (7)(a), any amendment to a property tax levy rate
426     limitation requires the consent of:
427          (i) 100% of the surface property owners within the boundaries of the dedicated
428     infrastructure district; and
429          (ii) 100% of the registered voters, if any, within the boundaries of the dedicated
430     infrastructure district.

431          (8) A board member is not in violation of Section 67-16-9 if the board member:
432          (a) discloses a business relationship in accordance with Sections 67-16-7 and 67-16-8
433     and files the disclosure with the dedicated infrastructure district:
434          (i) before any appointment or election; and
435          (ii) upon any significant change in the business relationship; and
436          (b) conducts the affairs of the dedicated infrastructure district in accordance with this
437     title and any parameters described in the charter.
438          (9) Notwithstanding any other provision of law, the charter governs the number,
439     appointment, and terms of board members of a dedicated infrastructure district.
440          Section 7. Section 17D-4a-204 is enacted to read:
441          17D-4a-204. Dedicated infrastructure district powers.
442          A dedicated infrastructure district shall have all of the authority conferred upon a local
443     district under Section 17B-1-103, and in addition a dedicated infrastructure district may:
444          (1) issue negotiable bonds or other debt instruments to pay all or part of the costs of
445     acquiring, acquiring an interest in, improving, or extending any infrastructure and
446     improvements, including:
447          (a) all or part of the costs of infrastructure and improvements in one or more
448     assessment areas created by the dedicated infrastructure district, as governed by Title 11,
449     Chapter 42, Assessment Area Act, and Title 11, Chapter 42a, Commercial Property Assessed
450     Clean Energy Act, and other related costs;
451          (b) all or part of the costs of infrastructure and improvements in one or more tax areas
452     created by the dedicated infrastructure district, as provided in this chapter;
453          (c) infrastructure and improvements related to the provision of housing, particularly in
454     an effort to increase the supply of housing; and
455          (d) capital costs related to public transportation;
456          (2) enter into an interlocal agreement in accordance with Title 11, Chapter 13,
457     Interlocal Cooperation Act, provided that the interlocal agreement may not expand the powers
458     of the dedicated infrastructure district, within the limitations of Title 11, Chapter 13, Interlocal
459     Cooperation Act;
460          (3) acquire completed or partially completed improvements for fair market value as
461     reasonably determined by:

462          (a) the board; or
463          (b) an engineer that a dedicated infrastructure district employs to provide the value;
464          (4) operate and maintain public infrastructure and improvements the district acquires or
465     finances and use fees, assessments, or taxes to pay for the operation and maintenance of those
466     public infrastructure and improvements; and
467          (5) dedicate infrastructure and improvements to another public entity if that public
468     entity maintains the infrastructure and improvements.
469          Section 8. Section 17D-4a-205 is enacted to read:
470          17D-4a-205. Relation to other entities.
471          (1) Notwithstanding the creation of a dedicated infrastructure district, any public entity,
472     as applicable, retains all of the entity's authority over all zoning, planning, design specifications
473     and approvals, and permitting within the dedicated infrastructure district.
474          (2) The inclusion of property within the boundaries of a dedicated infrastructure district
475     does not preclude the inclusion of the property within any other local district.
476          (3) (a) All infrastructure that is connected to another public entity's system:
477          (i) shall be dedicated to the public entity and belongs to that public entity, regardless of
478     inclusion within the boundaries of a dedicated infrastructure district, unless the dedicated
479     infrastructure district and the public entity otherwise agree; and
480          (ii) shall comply with the design, inspection requirements, and other standards of the
481     public entity.
482          (b) A dedicated infrastructure district shall convey or transfer the infrastructure
483     described in Subsection (3)(a) free of liens or financial encumbrances to the public entity at no
484     cost to the public entity.
485          (4) (a) A land use authority under Title 10, Chapter 9a, Municipal Land Use,
486     Development, and Management Act, or Title 17, Chapter 27a, County Land Use, Development,
487     and Management Act, may not discriminate against or use the existence of a dedicated
488     infrastructure district in any evaluation or decisions regarding any land use application or land
489     use applicant.
490          (b) The existence of a dedicated infrastructure district is irrelevant to any land use
491     decision under Title 10, Chapter 9a, Municipal Land Use, Development, and Management Act,
492     or Title 17, Chapter 27a, County Land Use, Development, and Management Act.

493          (c) A municipality, county, or other political subdivision may not discriminate against
494     or use the existence of a dedicated infrastructure district in accepting any public infrastructure
495     or improvement financed by a dedicated infrastructure district so long as the infrastructure or
496     improvement meets the legal standards that are applicable to any other infrastructure or
497     improvement the municipality, county, or other political subdivision accepts from
498     developments that are not financed by a dedicated infrastructure district.
499          (d) A municipality, county, or other political subdivision may not discriminate against
500     a municipal financial advisor, counsel, underwriter, or other professional who assists a
501     dedicated infrastructure district when the dedicated infrastructure district decides on who to use
502     for such services.
503          (e) An individual's assistance to a dedicated infrastructure district under Section
504     17D-4a-206 is irrelevant to the dedicated infrastructure district's decision as to who to use for
505     those services.
506          Section 9. Section 17D-4a-206 is enacted to read:
507          17D-4a-206. Professional support and transparency.
508          (1) Prior to issuance of any bonds, as set forth in this chapter, the board shall engage:
509          (a) a municipal advisor registered with the United States Securities and Exchange
510     Commission;
511          (b) a nationally-recognized bond counsel; and
512          (c) an attorney licensed in Utah to act as issuer's counsel who has familiarity with the
513     laws that govern the operations of political subdivisions, including:
514          (i) Title 52, Chapter 4, Open and Public Meetings Act;
515          (ii) Title 63G, Chapter 2, Government Records Access and Management Act; and
516          (iii) Title 67, Chapter 16, Utah Public Officers' and Employees' Ethics Act.
517          (2) A municipal advisor engaged in connection with the issuance of bonds shall deliver
518     a certificate that the interest rate borne by such bonds reflects a reasonable market rate as of the
519     date of issuance.
520          (3) A dedicated infrastructure district may not pay:
521          (a) an amount in excess of five percent for services relating to construction
522     management of the infrastructure and improvements; and
523          (b) a development fee amount in excess of five percent for infrastructure and

524     improvements.
525          Section 10. Section 17D-4a-301 is enacted to read:
526     
Part 3. Bond Issuance, Fee Collection, and Property Tax Levy Authority for a Dedicated

527     
Infrastructure District

528          17D-4a-301. Dedicated infrastructure district bonds.
529          (1) Subject to the provisions of this section, a dedicated infrastructure district may
530     issue negotiable bonds or other debt instruments for the purposes described in Section
531     17D-4a-203, as provided in, as applicable:
532          (a) Title 11, Chapter 14, Local Government Bonding Act;
533          (b) Title 11, Chapter 27, Utah Refunding Bond Act;
534          (c) Title 11, Chapter 42, Assessment Area Act;
535          (d) Title 11, Chapter 42a, Commercial Property Assessed Clean Energy Act; and
536          (e) this section.
537          (2) For any financing obtained pursuant to Title 11, Chapter 42, Assessment Area Act,
538     for infrastructure and improvements in an assessment area that contains single-family
539     dwellings or lots intended to be sold to individuals, the assessments applicable to the
540     single-family dwelling or lot shall be paid in full prior to the issuance of a certificate of
541     occupancy for that lot.
542          (3) A dedicated infrastructure district bond:
543          (a) shall mature within 40 years of the date of issuance; and
544          (b) except for bonds issued under Title 11, Chapter 42a, Commercial Property
545     Assessed Clean Energy Act, may not be secured by any infrastructure and improvement paid
546     for by the dedicated infrastructure district.
547          (4) (a) A dedicated infrastructure district may issue a limited tax bond, in the same
548     manner as a general obligation bond:
549          (i) with the consent of 100% of surface property owners within the boundaries of the
550     dedicated infrastructure district, if the property tax is levied on the entire dedicated
551     infrastructure district, or a tax area, if the tax is only levied in the tax area and 100% of the
552     registered voters, if any, within the boundaries of the proposed dedicated infrastructure district;
553     or
554          (ii) upon approval of a majority of the registered voters within the boundaries of the

555     dedicated infrastructure district voting in an election held for that purpose under Title 11,
556     Chapter 14, Local Government Bonding Act.
557          (b) A limited tax bond described in Subsection (4)(a) is subject to a limitation, if any,
558     on the principal amount of indebtedness as described in the charter.
559          (c) Unless limited tax bonds are initially purchased exclusively by one or more
560     qualified institutional buyers as defined in Rule 144A, 17 C.F.R. Sec. 230.144A, the dedicated
561     infrastructure district may only issue limited tax bonds in denominations of not less than
562     $500,000, and in integral multiples above $500,000 of not less than $1,000 each.
563          (d) (i) Without any further election or consent of property owners or registered voters,
564     a dedicated infrastructure district may convert a limited tax bond described in Subsection (4)(a)
565     to a general obligation bond if the principal amount of the related limited tax bond together
566     with the principal amount of other related outstanding general obligation bonds of the
567     dedicated infrastructure district does not exceed 15% of the fair market value of taxable
568     property in the dedicated infrastructure district securing the general obligation bonds,
569     determined by:
570          (A) an appraisal from an appraiser who is a member of the Appraisal Institute that is
571     addressed to the dedicated infrastructure district or a financial institution; or
572          (B) the most recent market value of the property from the assessor of the county in
573     which the property is located.
574          (ii) The consent to the issuance of a limited tax bond described in Subsection (4)(a):
575          (A) is sufficient to meet any statutory or constitutional election requirement necessary
576     for the issuance of the limited tax bond upon meeting the requirements of this Subsection
577     (4)(d);
578          (B) is considered valid for a period of 10 years if the board adopts a resolution or
579     ordinance finding that the consent has been obtained and records a notice of the consent and
580     the amount of bonds which may be issued on property within the dedicated infrastructure
581     district; and
582          (C) is subject to the tolling provisions of Section 11-14-301.
583          (e) A dedicated infrastructure district that levies a property tax for payment of debt
584     service on a limited tax bond and related administrative expenses issued under this section is
585     not required to comply with the notice and hearing requirements of Section 59-2-919 unless the

586     rate exceeds the rate established in:
587          (i) Section 17D-4a-303, except as provided in Subsection (9);
588          (ii) the charter; or
589          (iii) the documents relating to the issuance of the limited tax bond.
590          (5) (a) Subject to Subsection (5)(b), a mill levy may not be imposed for the repayment
591     of a series of bonds after a period that exceeds:
592          (i) for a dedicated infrastructure district anticipated to contain residential property, 40
593     years from the first date of imposition of the mill levy for such bond; and
594          (ii) for a dedicated infrastructure district not anticipated to contain residential property,
595     50 years from the first date of imposition of the mill levy for such bond.
596          (b) A charter may further decrease, but not increase, the time limits described in
597     Subsection (5)(a).
598          (6) A dedicated infrastructure district is not a municipal corporation for purposes of the
599     debt limitation of Utah Constitution, Article XIV, Section 4.
600          (7) The board may, by resolution, delegate to one or more officers of the dedicated
601     infrastructure district the authority to:
602          (a) in accordance and within the parameters set forth in a resolution adopted in
603     accordance with Section 11-14-302, approve the final interest rate, price, principal amount,
604     maturity, redemption features, and other terms of the bond;
605          (b) approve and execute any document relating to the issuance of a bond; and
606          (c) approve any contract related to the acquisition and construction of the
607     improvements, facilities, or property to be financed with a bond.
608          (8) (a) Any person may contest the legality of the issuance of a dedicated infrastructure
609     district bond or any provisions for the security and payment of the bond for a period of 30 days
610     after:
611          (i) publication of the resolution authorizing the bond; or
612          (ii) publication of a notice of bond containing substantially the items required under
613     Subsection 11-14-316(2).
614          (b) After the 30-day period described in Subsection (8)(a), no person may bring a
615     lawsuit or other proceeding contesting the regularity, formality, or legality of the bond for any
616     reason.

617          (9) (a) In the event of any statutory change in the methodology of assessment or
618     collection of property taxes in a manner that reduces the amounts which are devoted or pledged
619     to the repayment of limited tax bonds, a dedicated infrastructure district may charge a rate
620     sufficient to receive the amount of property taxes or assessment the dedicated infrastructure
621     district would have received before the statutory change in order to pay the debt service on
622     outstanding limited tax bonds.
623          (b) The rate increase described in Subsection (9)(a) may exceed the limit described in
624     Section 17D-4a-303.
625          (c) The dedicated infrastructure district may charge the rate increase described in
626     Subsection (9)(a) until the bonds, including any associated refunding bonds, or other securities,
627     together with applicable interest, are fully met and discharged.
628          (10) As part of the issuance of bonds, the board shall provide a notice recorded on all
629     property in the dedicated infrastructure district that is subject to a property tax or assessment
630     imposed by the dedicated infrastructure district, identifying:
631          (a) the dedicated infrastructure district name and contact information;
632          (b) the property tax, if any; and
633          (c) the assessment, if any.
634          Section 11. Section 17D-4a-302 is enacted to read:
635          17D-4a-302. Fees.
636          In addition to the fees permitted under Title 17B, Chapter 1, Provisions Applicable to
637     All Local Districts, a dedicated infrastructure district may charge a fee or other charge for an
638     administrative service that the dedicated infrastructure district provides, to pay some or all of
639     the dedicated infrastructure district's:
640          (1) costs of acquiring, improving, or extending infrastructure and improvements; or
641          (2) costs associated with the enforcement of a legal remedy.
642          Section 12. Section 17D-4a-303 is enacted to read:
643          17D-4a-303. Limits on dedicated infrastructure district property tax levy -- Notice
644     requirements.
645          (1) (a) The property tax levy of a dedicated infrastructure district, for all purposes other
646     than operations and maintenance of infrastructure and improvements retained by the
647     specialized infrastructure district, including payment of debt service on limited tax bonds and

648     administrative expenses, may not exceed .006 per dollar of taxable value of taxable property in
649     the district.
650          (b) The property tax levy of a dedicated infrastructure district, for operations and
651     maintenance of infrastructure and improvements may not exceed .001 per dollar of taxable
652     value of taxable property in the district, provided that such levy shall be based on actual,
653     reasonable costs of such operations and maintenance.
654          (2) The limitations described in Subsection (1) do not apply to the levy by the
655     dedicated infrastructure district to pay principal of and interest on a general obligation bond
656     that the dedicated infrastructure district issues.
657          (3) (a) Within 30 days after the day on which the lieutenant governor issues a
658     certificate of incorporation under Section 67-1a-6.5, the board shall record a notice with the
659     recorder of the county in which property within the dedicated infrastructure district is located.
660          (b) The notice described in Subsection (3)(a) shall:
661          (i) contain a description of the boundaries of the dedicated infrastructure district;
662          (ii) state that a copy of the charter is on file with the dedicated infrastructure district;
663          (iii) state that the dedicated infrastructure district may finance and repay infrastructure
664     and other improvements through the levy of a property tax; and
665          (iv) state the maximum rate that the dedicated infrastructure district may levy.
666          (c) If the board fails to comply with the requirements of Subsection (3)(a):
667          (i) the failure does not invalidate the creation of the dedicated infrastructure district or
668     any bonds issued; and
669          (ii) the dedicated infrastructure district may not levy taxes or collect assessments until
670     the requirements of Subsection (3)(a) are met.
671          Section 13. Section 17D-4a-304 is enacted to read:
672          17D-4a-304. Property tax penalty for nonpayment.
673          In the event of nonpayment of any tax, fee, or charge that a dedicated infrastructure
674     district imposes, the dedicated infrastructure district may impose a property tax penalty at an
675     annual rate of .07, in addition to any other lawful penalty for nonpayment of property tax.
676          Section 14. Section 17D-4a-305 is enacted to read:
677          17D-4a-305. Action to context tax, fee, or proceeding -- Requirements -- Exclusive
678     remedy -- Bonds, taxes, and fees incontestable.

679          (1) A person who contests a tax or fee or any proceeding to create a dedicated
680     infrastructure district, levy a tax, or impose a fee may bring a civil action against the dedicated
681     infrastructure district or the lieutenant governor's office to:
682          (a) set aside the proceeding; or
683          (b) enjoin the levy, imposition, or collection of a tax or fee.
684          (2) The person bringing an action described in Subsection (1):
685          (a) shall bring the action in the district court with jurisdiction in the county in which
686     the dedicated infrastructure district is located; and
687          (b) may not bring the action against or serve a summons relating to the action on the
688     dedicated infrastructure district more than 30 days after the effective date of:
689          (i) the creation of the dedicated infrastructure district, if the challenge is to the creation
690     of the dedicated infrastructure district; or
691          (ii) the tax or fee, if the challenge is to a tax or fee.
692          (3) An action under Subsection (1) is the exclusive remedy of a person who:
693          (a) claims an error or irregularity in a tax or fee or in any proceeding to create a
694     dedicated infrastructure district, levy a tax, or impose a fee; or
695          (b) challenges a bondholder's right to repayment.
696          (4) After the expiration of the 30-day period described in Subsection (2)(b):
697          (a) a bond issued or to be issued with respect to a dedicated infrastructure district and
698     any tax levied or fee imposed becomes incontestable against any person who has not brought
699     an action and served a summons in accordance with this section;
700          (b) a person may not bring a suit to:
701          (i) enjoin the issuance or payment of a bond or the levy, imposition, collection, or
702     enforcement of a tax or fee; or
703          (ii) attack or question in any way the legality of a bond, tax, or fee; and
704          (c) a court may not inquire into the matters described in Subsection (4)(b).
705          (5) (a) This section does not insulate a dedicated infrastructure district from a claim of
706     misuse of funds after the expiration of the 30-day period described in Subsection (2)(b).
707          (b) (i) Except as provided in Subsection (5)(b)(ii), an action in the nature of mandamus
708     is the sole form of relief available to a party challenging the misuse of funds.
709          (ii) The limitation in Subsection (5)(b)(i) does not prohibit the filing of criminal

710     charges against or the prosecution of a party for the misuse of funds.