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1997 SESSION


CHAPTER 363
An Act to amend and reenact §§ 15.1-1242, 15.1-1250.03 and 15.1-1257 of the Code of Virginia, relating to community development authorities.
[S 1171]
Approved March 15, 1997

Be it enacted by the General Assembly of Virginia:

1. That §§ 15.1-1242, 15.1-1250.03 and 15.1-1257 of the Code of Virginia are amended and reenacted as follows:

§ 15.1-1242. Ordinance, agreement or resolution creating authority to include articles of incorporation.

A. Each such ordinance, agreement or resolution shall include articles of incorporation which shall set forth:

(1) The name of the "authority" and address of its principal office.

(2) The name of each incorporating political subdivision, together with the names, addresses and terms of office of the first members of the board of said authority.

(3) The purpose or purposes for which the authority is to be created together with, insofar as the governing body of the political subdivision determines to be practicable, preliminary estimates of capital costs, proposals for any specific project or projects to be undertaken by the authority, and preliminary estimates of initial rates for services of such projects as certified by responsible engineers.

(4) If there is more than one incorporating political subdivision, the number of members who shall exercise the powers of the authority and the number from each incorporating political subdivision.

B. Any such ordinance, agreement or resolution that does not set forth the information required in subdivision A (3) above regarding capital cost estimates, project proposals and project service rate estimates shall also set forth a finding by the governing body that inclusion of such information is impracticable.

C. Any ordinance, agreement or resolution adopted pursuant to § 15.1-1241 B shall provide that any bonds issued by the community development authority shall be a debt of the authority, not the local government. Unless otherwise provided in the ordinance which establishes the authority, the local government shall not retire any part of the bonds or pay any debt service of an authority out of revenues or funds derived from sources other than those set out in § 15.1-1250.03, except that, where the authority finances improvements not contemplated by the original ordinance, the local government may, by ordinance or resolution, make such provisions for repayment as are otherwise permitted under general law. This subsection shall have no effect upon authorities formed pursuant to § 15.1-1241 A.

§ 15.1-1250.03. Additional powers of authority.

Each authority created under § 15.1-1241 B, in addition to the powers provided in § 15.1-1250, is hereby authorized and empowered:

1. Subject to any statutory or regulatory jurisdiction and permitting authority of all applicable governmental bodies and agencies having authority with respect to any area included therein, to finance, fund, plan, establish, acquire, construct or reconstruct, enlarge, extend, equip, operate, and maintain infrastructure improvements enumerated in the ordinance or resolution establishing the district necessary to meet the increased demands placed upon local government as a result of development within the district, including, but not limited to, the following:

a. Roads, bridges, parking facilities, curbs, gutters, sidewalks, traffic signals, storm water management and retention systems, gas and electric lines and street lights within the district, or serving the district, which shall meet or may exceed the specifications of the locality in which such authority's roads are located.

b. Parks and facilities for indoor and outdoor recreational, cultural and educational uses, entrance areas, security facilities, fencing and landscaping improvements throughout the district.

c. Fire prevention and control systems, including fire stations, water mains and plugs, fire trucks, rescue vehicles and other vehicles and equipment.

d. School buildings and related structures, which may be leased, sold or donated to the school district, for use in the educational system when authorized by the local governing body and the school board.

e. Infrastructure and recreational facilities for age-restricted active adult communities, and any other necessary infrastructure improvements as provided above, with a minimum population approved under local zoning laws of 1,000 residents. Such development may include security facilities and systems or measures which control or restrict access to such community and its improvements.

2. To issue revenue bonds of the development authority as provided in § 15.1-1252, including but not limited to refunding bonds, subject to such limitation in amount, and terms and conditions regarding capitalized interest, reserve funds, contingent funds, and investment restrictions, as may be established in the ordinance or resolution establishing the district, for all costs associated with the improvements enumerated in subdivision 1 of this section, such revenue bonds to be payable solely from revenues received by the development authority.

3. To request annually that the locality levy and collect a special tax on taxable real property within the development authority's jurisdiction to finance the services and facilities provided by the development authority. Notwithstanding the provisions of Article 4 (§ 58.1-3229 et seq.) of Chapter 32 of Title 58.1, any such special tax imposed by the locality shall be levied upon the assessed fair market value of the taxable real property. Unless requested by every property owner within the proposed district, the rate of the special tax shall not be more than twenty-five cents per $100 of the assessed fair market value of any taxable real estate or the assessable value of taxable leasehold property as specified by § 58.1-3203. Such special taxes shall be collected at the same time and in the same manner as the locality's taxes are collected, and the proceeds shall be kept in a separate account, and shall be used only for the purposes contemplated herein. All revenues received by the locality pursuant to any such taxes which the locality elects to impose upon request of the development authority shall be paid over to the development authority for its use pursuant to this chapter subject to annual appropriation. No other funds of the locality shall be loaned or paid over to the development authority without the prior approval of the local governing body.

4. To provide special services, including: garbage and trash removal and disposal, street cleaning, snow removal, extra security personnel and equipment, recreational management and supervision, and grounds keeping.

5. To request that the local governing body impose a special assessment upon the abutting property within the district to finance the services and facilities provided by the development authority. All assessments pursuant to this section shall be subject to the laws pertaining to assessments under Article 2 (§ 15.1-239 et seq.) of Chapter 7 of Title 15.1; provided that any other provision of law notwithstanding, (i) the taxes or assessments permitted may equal but shall not exceed the full cost of the improvements, including without limitation the legal, financial and other directly attributable costs of creating the district; and the planning, designing, operating and financing of the improvements which include administration of the collection and payment of the assessments and reserve funds permitted by applicable law; (ii) the taxes or assessments may be imposed upon abutting land which is later subdivided in accordance with the terms of the ordinance forming the district, in amounts which do not exceed the peculiar benefits of the improvements to the abutting land as subdivided; and (iii) the taxes or assessments may be made subject to installment payments for up to forty years in an amount calculated to cover principal, interest and administrative costs in connection with any financing by any authority, without a penalty for prepayment. Notwithstanding any other provision of law, any assessments made pursuant to this section may be made effective as a lien upon a specified date, by ordinance, but such assessments may not thereafter be modified in a manner inconsistent with the terms of the debt instruments financing the improvements. All assessments pursuant to this section may also be made subject to installment payments and other provisions allowed for local assessments under this section or under such Article 2. All revenues received by the locality pursuant to any such special assessments which the locality elects to impose upon request of the development authority shall be paid over to the development authority for its use under the Act, subject to annual appropriation, and may be used for no other purposes.

6. Nothing contained in this chapter shall relieve the local governing body of its general obligations to provide services and facilities to the district to the same extent as would otherwise be provided were the district not formed.

§ 15.1-1257. Bonds not debts of Commonwealth or participating political subdivision.

A. Revenue bonds issued under the provisions of this chapter shall not be deemed to constitute a pledge of the faith and credit of the Commonwealth or of any political subdivision thereof. All such bonds shall contain a statement on their face substantially to the effect that neither the faith and credit of the Commonwealth nor the faith and credit of any county, city, town or other subdivision of the Commonwealth are pledged to the payment of the principal of or the interest on such bonds. The issuance of revenue bonds under the provisions of this chapter shall not directly or indirectly or contingently obligate the Commonwealth or any county, city, town or other subdivision of the Commonwealth to levy any taxes whatever therefor or to make any appropriation for their payment except from the funds pledged under the provisions of this chapter.

B. Unless otherwise provided in the ordinance which forms the authority or in a subsequent ordinance or resolution authorizing additional improvements, neither the Commonwealth nor any county, city or town shall pay any part of the principal or interest of any bonds issued by a community development authority formed pursuant to § 15.1-1241 B, nor shall any county, city or town carry any part of such bonds on its financial statements as a contingent obligation; except that if a community development authority fails to pay such bonds, to the extent that a county, city or town has imposed a real property tax surcharge or a special assessment at the request of a community development authority pursuant to subdivision 3 or 5 of § 15.1-1250.03, funds collected from such sources may be paid against such debt.

C. Debt issued by a community development authority formed pursuant to § 15.1-1241 B shall not be considered in determining the debt limit of any county, city or town.