Special Improvement Districts

Special Improvement Districts (SID) may be formed by property owners to bring their neighborhoods up to City Standards by installing items such as:

• pavement
• curb and gutters
• sidewalks
• street lights
• water mains
• sewer mains
• fire hydrants
• and other miscellaneous improvements

Special Improvement Districts are formed in accordance to the Arizona Revised Statutes Sections 48-571 to 48-619 both inclusive and amendments thereto.

The Steps

At the request of a property owner, City Staff prepares a cost estimate and survey of interest. By State law, the City can initiate a Special Improvement District without a request from any of the property owners. However, to save time and money, a survey of interest is circulated around the neighborhood by one of the property owners to determine the overall interest.

This survey is only advisory, and indicates to the City the interest of the property owners in accepting the estimated assessments for the desired improvements. Upon receipt of the survey, if it appears there is an adequate amount of support, the survey along with the cost estimate, and all other pertinent data is presented to the City Council for their review and authorization to proceed with the design of the requested Special Improvement District.

After the design is completed, but before the construction can begin, the City Council passes the Resolution of Intention. This Resolution states the City's intention to form the Special Improvement District and describes the improvements and property to be assessed. The Resolution is published five (5) times in a daily newspaper. A "Notice of Proposed Improvements" is posted along the line of the proposed improvements at intervals not more than 300 feet apart.

After the publication and posting has been completed, property owners within the district boundary may, within 15 days, submit a written protest on the formation of the district or object to the extent of the assessment district in writing. If the written protest received is clearly less than a majority of the front footage, no hearing is required. If the protest received appears to represent a majority, a hearing must be held.

After the protest period has been completed, and assuming the district was approved by the Council, the Council will then pass a Resolution Ordering Work. Sealed bids are then received on the work in accordance with the approved plans. During construction, all work is inspected under the jurisdiction of the Superintendent of Streets, of the City of Mesa.

The actual costs of the improvements are assessed to the properties within the district boundary proportional to the benefits derived from the improvements. The method of distributing the costs may vary based upon the type of improvements and the property use. Assessments can be calculated on front footage, square footage, units, etc...

As a general policy, the City of Mesa will not assess more than the amount shown on the assessment estimate map that was included with the official survey. Estimates are usually guaranteed for a period of six months.

After the assessments have been recorded, a Notice of Special Assessment Due is sent to each of the believed property owners as shown on the Maricopa County tax rolls. At that time the following payment options are available:

(a)  Cash Payment: All, or any portion of the assessed amount may be paid in cash without interest or penalties within thirty (30) days from the Warrant Date.

(b) Installment Plan: After the thirty (30) day cash collection period ends, the remaining unpaid assessment balance will automatically be set up on the installment plan. It is then payable over a ten (10) year period in ten (10) equal annual installments. Interest will be added to all assessments that are paid on the installment plan. The interest rate is based upon the most current bond rate at the time the Resolution of Intention is passed. The principal payment is due annually on or before December 1st of each year. Interest on the assessment will begin from the warrant date and is due semiannually on or before June 1st and on or before December 1st of each year.

Statements are mailed thirty (30) day in advance to the last known address of the person believed to be interested in the property. Installment payments are made to the City of Mesa, Special Assessment Division, Finance Department, P.O. Box 1466, Mesa, Arizona, 85211-1466.

If the installment payments are not made on or before the due dates, penalties for delinquency are attached. If not paid thereafter, the property is subject to advertisement and sale.

Note: This installment plan is made possible by the sale or issuance of Special Improvement District Bonds that have a guaranteed return to the bondholder. Therefore, if a property owner decides to pay their assessment off early, they must pay the remaining principal balance due, together with all accrued interest thereon to the date of prepayment, and in addition they must pay a prepayment penalty of one eighth (1/8) of once percent (1%) per month on the entire principal balance being paid, for the period between the date of prepayment and date that last principal payment would have become due had no prepayment been made.

For additional information, contact Ron Lisonbee at (480) 644-2503.