Automating assessment information for improvement districts: the City of Tempe's award-winning system.

• Author: Clifford, Craig

To keep track of capital improvement district financing and individual assessment information in Tempe, a fully automated, integrated system was developed that has significantly increased productivity in billing and collections.

Some capital improvements or services provided by local government are intended primarily to benefit a particular group of property owners rather than the general citizenry. These are undertaken at the property owners' initiative and authorized by special assessment petition. Typical special assessment capital improvements are streets, sidewalks, parking facilities, curbs, gutters, and water or sewer main construction.

The City of Tempe, Arizona, uses special assessments within designated improvement districts to help pay for certain infrastructure improvements which benefit the property owner and the community. Tempe currently services more than $40 million in improvement district debt by assessing 340 taxpayers on a semiannual basis for infrastructure improvements made on their behalf.

Arizona state improvement district statues set forth specific procedures for billing and payment application to protect citizen's rights. These statutes and improvement district debt dictate greater-than-ordinary accounts receivable requirements: assessment receivables track principal, interest, delinquency fees, title search fees and public advertisements fees for delinquency and auction notices. Receivable terms range from 10 to 20 years at fixed or variable rates of interest. Specific statutes govern assessment delinquencies to ensure that every opportunity is provided for payment and notification given prior to the assessment being sold at public auction.

Capital improvement special assessment projects have two distinct phases - the initial phase of financing and constructing the project and the second phase of collecting the assessment principal and interest levied against the benefitted properties and repaying the cost of financing.

To keep track of improvement district and individual assessment information for the purpose of billing and collecting the assessment principal and interest, the City of Temple developed an information system that provides the accounting division with a fully automated, menu driven, inter-active system.

A new system was needed to correct inadequacies of existing methods and ensure compliance with every methods and ensure compliance with every aspect of state statutes regarding the specific application of payments for principal, interest and other itemized charges and property auction process. The city's previous system had become woefully inadequate for accounting needs because of changes in the city's policies on accepting payments and follow-up procedures on collecting penalties, advertisements and title search fees. Excessive time was being spent fielding taxpayer inquires, reconciling accounts and posting payments. Many of these old system deficiencies, including the inadequacy of a receivable audit trail, were commented on by the city's external auditors in their letter of recommendations to management.

Temple's old system for tracking special assessment information, designed and developed in a technological environment that is outdated today, did not allow for efficient data access nor reliable and flexible editing and maintenance functions. User requirements had expanded far beyond the scope of the system's capabilities. Staff had to choose between using current technology and building a new system having true database files and block mode screen vs. modifying the old, technologically obsolete system. The decision was to build a new system. Research on a new system began in the fall of 1987, programming got underway in the spring of...