TO: Mayor and Commission AGENDA DATE: 6/6/2022
FROM: John A. Peters, III, PE, Acting City Manager AGENDA ITEM: 8 - A
SUBJECT:
Title
Code Violation - non-ad valorem tax roll assessment to address City costs relating to a nuisance abatement at 179 Citation Av. - Ron A. Paradise, Community Services Director (386) 878-8610.
Strategic Goal: Community Development and Redevelopment
Body
LOCATION:
179 Citation Av.
BACKGROUND:
Background
On February 27, 2018 the City adopted Ordinance No. 02-2018 and Resolution No. 2018-11. Ordinance No. 02-2018 amended Chapter 38 Code of City Ordinances to allow the City to address, clean up, and otherwise abate nuisances and threats to public health, safety and welfare occurring on private property. Resolution No. 2018-11 provided the ability for the City to recoup the costs associated with the abatement of private property through the levy of a non-ad valorem tax assessment.
Non-ad valorem tax assessment is a process where a local government can levy to recover or impose costs and fees as part of the tax bill for a specific property. Examples of non-ad valorem tax assessments include stormwater, trash collection and other governmental fees. Adopted Resolution No. 2018-11 expands the non-ad valorem assessment ability to include reimbursement for nuisance abatement activities undertaken through the code compliance process.
In the past, the City relied on a traditional method to recapture the costs of abatement which includes levying a lien on a property. In some cases, liens do compel code compliance. Liens are especially effective when placed on property that is considered non-homesteaded. Non-homesteaded property incudes commercial uses, vacant property, rental dwellings, etc. If a lien is not satisfied on a non-homesteaded
property, the City has the ability to foreclose on the property to compel repayment.
Foreclosure can also result in a change of ownership.
Homesteaded property is considered the primary domicile of the individuals residing within the home. As per Florida law, homesteaded property enjoys a higher level of protection with regard to foreclosure actions. In the case of a code compliance lien, the options for a local government to foreclose on a homestead property are extremely limited to none. There are cases within in the City where a homesteaded property can have a code compliance lien(s) for years or decades if the house is never sold. City code liens expire after 20 years. The City liens also do not have priority over taxes
and the mortgage. If a property changes hands often the City lien is not satisfied. In addition, it is not uncommon for homesteaded properties associated with longstanding liens to be the subject of continued code compliance violations and abatements.
The benefit of the non-ad valorem tax assessment is the City can recover the costs of abatement through the property tax payment process. Basically, the cost of abatement appears on the tax bill for the owner to pay. If an owner does not pay, the amount owed will be subject to the annual County tax certificate auction. At the auction, the taxes will be paid by an investor and the City will be reimbursed for the abatement (and probably other taxes and fees). Eventually, a failure to pay taxes owned could result in the loss of title to the home notwithstanding a homesteaded status.
The dwelling at 179 Citation Av. is a homesteaded property and has been owned by Vivian and Rafael Colon since 2007. Under the current ownership this property has had an extensive code compliance history including 90 investigations resulting in 12 cases being brought before the Special Magistrate. As part of the code actions, there have been seven (7) abatements and five (5) citations. These code cases and citations range from accumulation of debris, inoperative vehicles, parking, construction without permits and lack of property maintenance. The property currently has a lien imposed in the amount of $26,100.00 which may never be recovered.
On May 17, 2021, the City opened a series of cases as to debris, inoperable vehicles and structures without permits cases on the 179 Citation property. On June 23, 2021, the Special Magistrate found the property to be in violation on all three cases. The owner was given 30 days to comply before a fine would be imposed. At the June 23, 2021 meeting, City staff offered to have a dumpster delivered to the 179 Citation site, at City expense, to aid in the clean up of the property. The owner did not accept the offer for the dumpster. On August 25, 2021, the cases were brought back to the Special
Magistrate because the property had not come into compliance. At this meeting the owner (Mr. Colon) was informed the City was going to move forward with an abatement of the property for public health and safety reasons.
With proper notice, the City conducted an abatement at 179 Citation Av. The abatement included the removal of debris including many old tires, automotive parts, appliances, scrap metal, etc. The abatement activity occurred on September 8, 2021 through September 9, 2021. The cost of the abatement (no administrative fees) totaled $15,273.03. For more information on the condition of the property before and after the 179 Citation Av. abatement see the attached photos. Currently, there has been no resolution regarding the unpermitted structures and the property is still in violation
regarding that matter. However, since the abatement, the owners have not accumulated any more debris and have not been cited or noticed for any other violations.
On May 2, 2022, the owners of 179 Citation Av. (Vivian and Rafael Colon) received notice that the City was going to place a non-ad valorem tax levy on the property as part of the City of Deltona tax roll certification proposed to occur on June 20, 2022. As per City Code Sec. 38-124A(6) the owners of the property have objected to the tax levy request on the 179 Citation property. The written objection from the owners is attached.
As part of the owner’s written appeal there is a financial hardship described. The owners also indicate they would like to work with the City to resolve the matter. Therefore, since the owners have not accumulated any debris and have not received any other code citations since the September 2021 abatement, staff suggest the following:
1) The City levy in the amount of $15,273.03.
2) The payment of $15,273.03 be spread over three tax years. The City for the current tax role period will levy the amount of $5,091.01. Then $5,091.01 for the next two tax years. This will give the two owners at least a year to pay each of the three instalments.
The tracking regarding the payments about the non-ad valorem tax roll assessment will be addressed by the City Finance Department.
The Acting City Manager has the authority to make corrections of scrivener’s errors and the like.
OPTIONS:
1. Include the amount of $5,091.01 as a non-ad valorem tax levy for 179 Citation Av. as part of the upcoming June 20, 2022 tax role certification and add the same amount for two consecutive years after.
Advantages:
a. There is a high degree of certainty the City will recoup some of the public abatement
investment in the property;
b. The non-ad valorem tax levy approach will serve as a viable method to
achieve/maintain code compliance Citywide; and
c. Long term compliance at the 179 Citation property will be more likely.
Disadvantages:
a. There could be displacement of the owners if they do not pay the non-ad valorem tax
levy and;
b. If the property sells, the City will probably not get paid for following years.
2. Do not include the amount of $5,091.01 as a non-ad valorem tax levy for 179 Citation Av. As part of the upcoming June 20, 2022 tax role certification and add the same amount for two consecutive years after.
Advantages:
a. Displacement of the owners will be less likely.
Disadvantages:
a. The City will have to lien the property to recoup the abatement costs with little certainty of when the money will be recovered; and
b. The non-ad valorem tax levy approach will not serve as a viable method to
achieve/maintain code compliance Citywide. This approach is the only way the City has to recoup abatement costs on homestead property.
End
COST:
N/A
SOURCE OF FUNDS:
N/A
ORIGINATING DEPARTMENT:
Community Services
STAFF RECOMMENDATION PRESENTED BY:
Ron A. Paradise - Staff recommends the City include the amount of $5,091.01 as a non-ad valorem tax levy for 179 Citation Av. as part of the upcoming June 20, 2022 tax role certification and add the same amount for two consecutive years after.
POTENTIAL MOTION:
Recommendation
“I hereby recommend the City include the amount of $5,091.01 as a non-ad valorem tax levy for 179 Citation Av. as part of the upcoming June 20, 2022 tax role certification and add the same amount for two consecutive years after. The Acting City Manager has the authority to make corrections of scrivener’s errors and the like.”
END