TO: Mayor and Commission AGENDA DATE: 6/6/2022
FROM: John A. Peters, III, PE, Acting City Manager AGENDA ITEM: 8 - B
SUBJECT:
Title
Code Violation - non-ad valorem tax roll assessment to address City costs relating to a nuisance abatement at 941 Shorecrest Av. - Ron A. Paradise, Community Services Director (386) 878-8610.
Strategic Goal: Community Development and Redevelopment
Body
LOCATION:
941 Shorecrest 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 941 Shorecrest Av. is a homesteaded property and has been owned by Joseph Esquibel and Juan A. Esquivel since 2009. Under the current ownership this property has had an extensive code compliance history including 97 investigations resulting in 14 cases being brought before the Special Magistrate. As part of the code actions, there have been 15 abatements and 11 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 several liens imposed totaling $42,910.00 which may never be recovered.
On December 8, 2020, the City opened a series of cases as to debris, structures without permits, and lack of home maintenance at the 941 Shorecrest property. On April 28, 2021, the Special Magistrate found the property to be in violation on all cases. The owner was given 30 days to comply before a fine would be imposed. On July 28, 2021, the cases were brought back to the Special Magistrate because the property had not come into compliance. At a subsequent Special Magistrate meeting on October 27, 2021 to update a fine, and to address public health, safety and welfare City staff stated for the record debris on the property would be abated.
With proper notice, the City conducted an abatement at 941 Shorecrest Av. The abatement included the removal of debris including wood fencing material, tires, mechanical parts, appliances, scrap metal, etc. The abatement activity occurred on November 15, 2021 through November 16, 2021. The cost of the abatement (no administrative fees) totaled $9,600.00. For more information on the condition of the property before and after the 941 Shorecrest Av. abatement see the attached photos. Currently, there has been no resolution regarding unpermitted structures and lack of appropriate property maintenance. The property is still in violation regarding those matters. In addition, the house is occupied but there is currently no water and electric service to the dwelling. Since the abatement, the owners have accumulated more debris and the City is prepared to abate the property yet again.
On May 11, 2022, the owners of 941 Shorecrest Av. (Joseph Esquibel and Juan A. Esquivel) 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 not objected to the tax levy request.
Therefore, since the owners have not objected, are still in non-compliance, and have already accumulated more debris necessitating yet another abatement, staff suggest the following:
1) The City levy the entire amount of $9,600.00.
The Acting City Manager has the authority to make corrections of scrivener’s errors and the like.
OPTIONS:
1. Include the amount of $9,600.00 as a non-ad valorem tax levy for 941 Shorecrest Av. as part of the upcoming June 20, 2022 tax role certification.
Advantages:
a. There is a high degree of certainty the City will recoup all 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 941 Shorecrest Av. property may be more likely.
Disadvantages:
a. There could be displacement of the owners if they do not pay the non-ad valorem tax levy.
2. Do not include the amount of $9,600.00 as a non-ad valorem tax levy for 941 Shorecrest Av. as part of the upcoming June 20, 2022 tax role certification.
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 or if 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 homesteaded 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 $9,600.00 as a non-ad valorem tax levy for 941 Shorecrest Av. as part of the upcoming June 20, 2022 tax role certification.
POTENTIAL MOTION:
Recommendation
“I hereby recommend the City include the amount of $9,600.00 as a non-ad valorem tax levy for 941 Shorecrest Av. as part of the upcoming June 20, 2022 tax role certification. The Acting City Manager has the authority to make corrections of scrivener’s errors and the like.”
END