Another fine mess: are non-ad valorem special assessments for local government nuisance abatement charges legally defensible?

• Author: Coffey, Amanda S.
• Position: Florida

A residential lot on the west coast of Florida is covered in trash, debris, inoperable vehicles, thickets of weeds, and rotting wood; the home on the lot is falling apart. The code violations on the property are so numerous and longstanding that they have accumulated $2.5 million in fines and costs--an impossible sum. The property remains littered with refuse with no immediate remedy in sight. (1) On a property in a neighboring city, a tattered blue tarp waves in the breeze from the collapsed roof of a vacant foreclosure home, an eyesore boasting $100,000 in outstanding fines for code violations. (2)

Across the bay, a small home has nearly vanished behind tons of garbage, and the yard has become a swamp, swarming with vermin, mildew, and insects. The code violations on the property have persisted for 17 years, accruing fines up to $320,000. Local government code enforcement could remedy the problem, but only at an estimated cost to taxpayers of $90,000. (3)

Such neglected, misused, or abandoned nuisance properties (4) create problems for local governments and communities, including neighborhood blight, loss of tax revenue, and increased tax expenditures for cleanup. (5) Even if a local code enforcement department is authorized to clean up the mess, it has few reasonable options for recovering costs incurred. (6) This creates a conundrum. How does a city or county address public health and welfare concerns created by nuisance properties when presented with limitations on code enforcement and an uphill battle to collect fines and costs imposed on nuisance properties?

One remedy recently adopted or proposed by municipalities across the state is a non-ad valorem special assessment for reimbursement of costs expended in abating chronic nuisances. Such chronic nuisance property ordinances propose that abatement costs be recovered from the violating property owner through the annual property tax bill, using the uniform collection method (UCM) under F.S. [section]197.3632. (7) This appears to be a simple solution to a complex problem. However, there are significant concerns that any local government considering adoption of such a chronic nuisance property ordinance must consider.

This article discusses whether using the UCM to recover costs related to code enforcement--and particularly nuisance abatement--are legally defensible.

Special Assessments as Creative Solutions

A special assessment is a charge "assessed against the property of a particular locality because that property derives some special benefit" from a government service provided in that locale beyond the general benefit accruing to all citizens. (8) Counties and cities are authorized to collect special assessments by F.S. [section][section]125.01(r) and 170.01, and through their home rule powers. (9)

When collected through the UCM, special assessments are subject to the same collection procedures as ad valorem property taxes--including enforcement mechanisms, such as the sale of tax certificates and tax deeds. Thus, use of the tax bill is an attractive option for nuisance abatement cost recovery in that it is both efficient and effective when other attempts to collect on a bill have failed. (10)

A fairly standard chronic nuisance property ordinance, typical of many around the state reviewed for this article, defines a "nuisance" to include the violation of one or more municipal codes or state statutes. In one such ordinance, the City of Lake Worth seeks to use the UCM to recover costs expended to abate nuisances arising from violation of local ordinances on lot clearing, unsafe or vacant buildings, and noise control, as well as state criminal statutes. (11) Similarly, the City of Ft. Meade has an ordinance to recoup the cost of demolishing unsafe structures as special assessments on tax bills. (12)

Some chronic nuisance ordinances are drafted with a greater focus on criminal, rather than code, violations. For example, the City of St. Petersburg has adopted an ordinance that provides for use of the UCM to collect the cost of abating nuisances resulting primarily from statutory criminal violations--such as prostitution, trespass, loitering, breach of the peace, and disorderly intoxication. (13) The ordinance also allows for recovery of costs associated with violation of local codes governing noise pollution, dangerous dogs, and the sale of drugs. (14)

For these and similar ordinances, which seem to proliferate as local

governments struggle to manage code enforcement issues and attendant budgetary concerns, several questions arise. First, do the proposed assessments fit the definition of "special assessments," and meet the requisite special benefit and fair apportionment requirements? And, if they are special assessments, do they rise to the level of "non-ad valorem assessments" that can be levied using the UCM?

This article focuses on the provisions of chronic nuisance property ordinances that allow for the recoupment of nuisance abatement costs stemming solely from municipal code violations, which is possible under each ordinance referenced herein. (15)

Special Assessment or Service Charge?

There are unique benefits and limitations associated with the levy of a special assessment as compared to a tax or a user fee, the other major revenue sources in a local government's tool box. However, the distinction among the three is often ambiguous. (16) This ambiguity is particularly evident when evaluating nuisance abatement costs to determine whether they can be collected as special assessments or whether they must be treated as service fees.

Unlike a special assessment, which is mandatory and generally charged against all property in a particular locality for benefits provided, a service fee (also called a service charge or a user fee) is voluntary, paid in exchange for a government service provided to an individual person. (17) Service fees can never be collected on tax bills. (18)

There are several (nonexclusive) factors that courts have relied on to distinguish between a special assessment and a service fee. These include the name of the charge; the amount of the charge as compared to the value of the service or benefit; whether it is charged only to users of a service or all residents of a given area; whether the charge is recurring or one-time; whether it is charged to recover costs of improvements to a defined area or infrastructure or for routine service; whether the charge is for a traditional utility service; and whether the charge is voluntary. (19) The most substantive of these factors--to whom the charge is assessed, and whether it is voluntary--seem to weigh in favor of the proposed charges being service fees.

Most--if not all--chronic nuisance property...