Bulletin: UT000013

Dear Associates:

In recent years most statutes within the state of Utah have changed relative to Special Taxing Districts. These districts provide municipal type services of various types and are granted special privileges and rights to levy charges, assessments and special assessments that, either are liens, or can become liens upon the land.

Charges are typically defined as periodic fees for utilization of services provided by these districts. An example might include water and sewer fees. Some of these fees an be quite significant, particularly when fees known as "tap fees" are charged. Some districts do not obtain financing through the use of this vehicle. Each district needs to be researched as to the type of fee structure, charges, or assessment arrangement that is utilized. The districts able to utilize fees, charges and assessments are typically certified to the County Treasurer upon delinquency for collection with general property taxes.

Assessments are generally equalized annual or other periodic fees that are charged in connection with the long term debt financing of public improvement projects for which the district exits. Persons who are benefited by reason of such services upon such assessment are typically given an opportunity to pay the assessment upon levy or to make periodic payments over an extended length of time generally tied to the term of the long term financing provided to the district. These assessments in some cases may be certified for collection with general property taxes or specific foreclosure sought based upon statutory rights granted to each type of district.

Special Assessments are typically described as term assessments where the annual or periodic fees run for a specific length of time, i.e., 5 years or 10 years. Typically, these fees address special benefits provided to limited areas within such districts.

When searching and examining title to land within the state of Utah, consideration must be given for effect of charges that may become liens and assessments that become liens upon passage of an ordinance. Typically, many of these districts are indexed in the real property records found in the County Recorder's Office. Just as typically, many are not. Research at the office of the Board of County Commissioners and the City Recorder should reveal all districts that may have been created by those legislative bodies at the county and city level. Each district created must then be researched as to precisely what charges, assessments and special assessments have been created affecting lands included within their district.

Caution should be taken when considering the boundaries of these districts. Although in many cases, the ordinance creating the district establishes a boundary, informally, other lands may have petitioned for inclusion or, by agreement between districts, transferred from one district to another.

The following types of Special Taxing Districts are of particular interest when searching and examining title:

County Weed Control Board, U.C.A. §4-17-8

ounty Improvement Districts for Water, Sewerage, Flood Control, Electric and Gas, U.C.A. §17A-2-310

County Services Areas, U.C.A. §17A-2-416

Drainage Districts, U.C.A. §17A-2-553

Irrigation Districts

Water Conservancy Districts

Below, you will find requirements and exceptions to be used in common circumstances when dealing with charges, assessments and special assessments.

If you have special circumstances or situations that arise, please contact the appropriate underwriting personnel.

Requirements and Exception for Special Taxing Districts

Requirements by reason of inclusion within a Special Taxing District:

Payment of all outstanding assessments, special assessments and charges by reason of the land being including within the boundaries of any special taxing district as provided by statute. The public record discloses inclusion of the land within the following special taxing districts that may levy such assessments, special assessments and charges:

[All such special taxing districts should be enumerated]

NOTE: This requirement is used whenever the land is situate with the boundaries of County Improvement Districts, Municipal Improvement Districts, Road Districts, County Service Areas, Drainage Districts, Water, Sewerage, Flood Control, Electrification and Gas Districts, Irrigation Districts, Metropolitan Water Districts, Special Service Districts and Water Conservancy Districts and County Week Control Boards.

Exceptions by reason of inclusions within a Special Taxing District:

Charges, assessments and special assessments levied subsequent to the date hereof by any special taxing district provided by statute. The public record discloses inclusion of the land within the following special taxing districts that may levy such assessments, special assessments and charges:

[All such special taxing districts should be enumerated]

NOTE: This requirement is used whenever the land is situate with the boundaries of County Improvement Districts, Municipal Improvement Districts, Road Districts, County Service Areas, Drainage Districts, Water, Sewerage, Flood Control, Electrification and Gas Districts, Irrigation Districts, Metropolitan Water Districts, Special Service Districts and Water Conservancy Districts and County Week Control Boards.

Requirements when a specific special assessment exists:

Payment in full of the special assessment created by __________________ through an ordinance, dated ________________, [recorded ____________________] providing for a long term special assessment in the original amount of $__________________, payable in annual installments due on ______________________ of each year. The balance owing on the land herein is $___________________ with interest calculated to _______________ 19______.

NOTE: This requirement is used whenever a special taxing district has created a long term special assessment that is payable over several years in periodic payments and it is anticipated that payment will be tendered on the outstanding balance owing.

Exceptions when a specific special assessment exists and is not being paid off:

Special assessment created by ______________________________ through an ordinance, dated _____________________, [recorded ________________________________________] providing for a long term special assessment in the original amount of $____________, payable in annual installments.

NOTE: This exception is used whenever a special taxing district has created a long term special assessment that is payable over several years in periodic payments.