Delaware General Assembly


CHAPTER 331

LEVY COURTS - AUTHORIZED TO ISSUE BONDS FOR PURPOSE OF INSTALLING FIRE HYDRANTS AND WATER MAINS IN CERTAIN SUBURBAN COMMUNITIES

AN ACT TO AUTHORIZE LEVY COURTS TO ISSUE BONDS FOR THE PURPOSE OF INSTALLING FIRE HYDRANTS TOGETHER WITH ADEQUATE WATER MAINS IN SUBURBAN COMMUNITIES UNDER CERTAIN CONDITIONS; PROVIDING FOR TIME AND MANNER OF ELECTIONS IN CONNECTION THEREWITH; DEFINING "SUBURBAN COMMUNITIES"; PROVIDING FOR PETITION REQUESTING FIRE HYDRANTS; DIRECTING LEVY COURTS AND COUNTY ENGINEERS TO PERFORM CERTAIN DUTIES IN CONNECTION WITH SURVEYS, PLOTS, HOLDING OF ELECTIONS; PROVIDING FOR ASSESSMENTS AGAINST PROPERTIES ENJOYING FIRE PROTECTION AS A RESULT OF INSTALLATION; THE MANNER OF DETERMINING THE AMOUNT THEREOF, AND COLLECTION OF SAME; PROVIDING FOR THE DETERMINATION OF COST OF THE IMPROVEMENTS; PROVIDING THE AMOUNT, MATURITY, INTEREST RATE AND FORMS OF BONDS TO BE ISSUED BY THE LEVY COURTS; PROVIDING FOR THE SALE OF BONDS AND THE DISPOSITION AND THE USE OF THE PROCEEDS THEREOF; PROVIDING FOR AWARDING OF CONTRACTS AND APPROVAL OF PAYMENTS THEREUNDER; PROVIDING FOR RECORD TO BE KEPT OF ASSESSMENTS; MAKING ASSESSMENTS SPECIAL LIENS, AND PROVIDING FOR NOTICE THEREOF; AUTHORIZING COLLECTOR OF TAXES TO COLLECT DELINQUENT ASSESSMENTS; PROVIDING FOR RETIREMENT OF BONDS AND PAYMENT OF INTEREST THEREON; PROVIDING FOR DISPOSITION OF SURPLUS FUNDS; AUTHORIZING LEVY COURTS TO ADOPT PROCEDURE IN RESPECT TO CANCELLING BONDS; PROVIDING THAT THE FULL FAITH AND CREDIT OF THE COUNTIES SHALL BE PLEDGED TO INSURE PAYMENT OF BONDS; AND PROVIDING. THAT ALL EXISTING ACTS IN CONFLICT WITH THIS ACT SHALL BE REPEALED.

Be it enacted by the Senate and House of Representatives of the State of Delaware in General Assembly met (two-thirds of all Members elected to each Branch concurring therein):

Section 1. LEVY COURT AUTHORIZED TO ISSUE BONDS; THE AMOUNT, TYPE AND MATURITY THEREOF; WHEN MAY BE REDEEMED:--In order to carry out the provisions of this Act, the Levy Court of any county of this State is hereby authorized and empowered to issue bonds in an amount or amounts, and under such terms and conditions, not inconsistent with this Act, as may be determined by said Court; said bonds shall mature not later than twenty years after the date of issue, shall not bear interest in excess of three per cent, and the income therefrom shall not be subject to State taxation. Said bonds shall be non-registered, coupon bonds; providing, however, that any holder thereof, within ten days of acquiring ownership may make written demand upon the branch of the Farmers' Bank of the State of Delaware in the county in which said bonds are issued that his bonds be registered as to principal and interest. Said bonds may, at the discretion of the said Levy Court, be redeemable at par plus accrued interest at any interest rate.

Section 2. "SUBURBAN COMMUNITY," MEANING THEREOF:--A suburban community within the meaning of this Act is any unincorporated community within the State of Delaware (a) containing at least ten dwelling houses, (b) whose streets aggregate a minimum of five hundred linear feet of road surfacing, (c) which, in the opinion of the Levy Court is so situated as to form a unit which is reasonably and economically capable of being improved by the installation of fire hydrants and if necessary adequate water mains to serve such hydrants.

Wherever in this Act the words "Levy Court" are used, they shall be construed to mean the Levy Court of the county in which said suburban community is situated.

Wherever in the Act the words "Clerk of the Levy Court" are used, they shall be so construed to mean the Clerk of the Peace of the county in which said suburban community is situated.

Section 3. PETITION TO LEVY COURT, CONTENTS THEREOF:--The freeholders of a suburban community owning fifty per cent or more of the front footage of property to be protected by the contemplated installation of fire hydrants and necessary water mains may present a petition to the Levy Court which said petition shall set forth (a) that in the opinion of the signers of said petition, said suburban community shall be improved by the installation of fire hydrants with adequate water mains; and (b) requesting the Levy Court to proceed in accordance with the provisions of this Act to issue bonds to provide the money for said improvements. Each and every such petition when and as presented as hereinabove provided shall have attached thereto as a part thereof a drawing showing the street layout, placement of fire hydrants and water mains and boundaries of the area to be protected by the installation thereof; a list of the names and post office addresses of all freeholders in said suburban community, as they appear on the records of the Board of Assessment of the county in which said suburban community is located and the street frontage in feet owned by each said freeholder; a proposal or suggested contract or contracts, including plans, specifications and estimates of cost of the contemplated improvements and a provision for service charges, if any, to the residents of such suburban community as tentatively accepted, approved or agreed to by the petitioners and the owners or operators of the local water distribution system chosen to install' said improvements or their agents.

Section 4. LEVY COURT TO DETERMINE IF COMMUNITY IS "SUBURBAN COMMUNITY"; TIME FOR DETERMINATION:--Within fifteen days after receipt by the Levy Court of the petition provided in Section 3 hereof the Levy Court shall meet and determine whether said community is a suburban community as provided by this Act.

Section 5. COUNTY ENGINEER TO REVIEW AND APPROVE PLANS AND PROPOSALS OF PETITIONERS:--Immediately after the determination by the Levy Court that the community in question complies with all the requirements set out in Paragraphs (a), (b) and (c) of Section 2 hereof, the Levy Court shall notify the County Engineer; who, upon receipt of such information, shall promptly review the plans and proposals submitted by the petitioners and the owners or operators of the local water distribution system chosen to install said improvements, and notify the Levy Court of his approval or disapproval thereof.

Section 6. ELECTION TO AUTHORIZE BOND ISSUE; FREEHOLDERS ENTITLED TO VOTE THEREAT; TIME FOR HOLDING AND PREPARATION OF LIST OF QUALIFIED VOTERS; BONDS TO COVER COST OF IMPROVEMENTS; NOTICE OF ELECTION:--Upon receipt of approval from the County Engineer, as provided in Section 5 hereof, said Levy Court shall proceed to set a date for an election at which all freeholders of said community may vote, on the question whether the Levy Court should proceed to issue bonds in the manner hereinafter provided, in an amount sufficient to finance the cost of the improvements contemplated. Said election shall be held no less than twenty days and no more than thirty days after receipt of said approval from the County Engineer. The Clerk of said Levy Court shall prepare from the books and records of the Board of Assessment of the county in which said suburban community is situated, a list of the names and addresses of all freeholders of said suburban community. Opposite the name of each freeholder the Clerk shall put the number of votes each such freeholder may cast, which shall be on the basis of one vote for each front foot of property owned by each freeholder to be protected by said contemplated improvement or improvements. In determining the number of votes to be cast by each freeholder as set forth above, the fractions of feet shall be disregarded. Such list, except as hereinafter provided, shall constitute the voting list for said election.

Section 7. NOTICE OF ELECTION; WHAT NOTICE SHALL CONTAIN:--Thereafter and in no event less than twelve days prior to the date set for said election, the Clerk of the Levy Court shall cause to be mailed to each person on said voting list, at the address on said list, a printed notice of the time and place of said election. Said notice shall state that the purpose of said election is to determine whether a majority of the residents of said community is in favor of the issuance of bonds by the Levy Court to cover the cost of the improvement or improvements contemplated. The notice shall also set forth the total cost of the improvement or improvements as determined by Section 11 hereof; said notice shall also state the total amount of such bond issue and a clear and concise description of the improvements contemplated, together with the estimated cost of the improvements.

Section 8. PLACE AND TIME OF HOLDING ELECTION; MANNER OF VOTING; EXCEPTION TO VOTING RIGHTS; RULES IN RESPECT TO VOTING BY CERTAIN OWNERS:--The election shall be held in the Levy Court Room in the county in which said suburban community is situated, and the polls shall be open from nine o'clock A.M. to six o'clock P.M. of the day of said election. The voting shall be by printed ballot, which shall give the voter an opportunity clearly to indicate his consent or objection to the issuance of bonds for the improvements contemplated. The Clerk of the Levy Court shall act as Judge of the election, and the voting list theretofore prepared by him shall be evidence of the right of a person to vote and the number of votes to which each freeholder is entitled, except as hereinafter provided.

A. Any freeholder who has sold his property or properties in said community subsequent to the preparation of the survey and plot made by said County Engineer shall not be permitted to vote but the then owner of said property or properties shall be entitled to vote in his place and stead upon furnishing the Judge of Election with the original or a certified copy of the deed to said property or properties, which said deed shall clearly evidence that it was duly recorded.

B. Any person claiming the right to vote at said election as an heir of any freeholder in said community who has died since the preparation of said voting list, or as trustee or guardian under the terms of the last will and testament of any such freeholder (who has died in said community since the preparation of said voting list) shall furnish the Judge of Election with the original or certified copy of the will or other document evidencing his ownership of, or interest in, the property of any such freeholder, and shall thereupon be entitled to vote in the place and stead of such deceased freeholder.

C. Wherever the property of such deceased freeholder in said suburban community is left to joint tenants or tenants in common, the following rules shall prevail:

1. The vote of any one joint tenant or tenant in common shall be received where no other such tenant appears claiming the right to vote.

2. Where one joint tenant or tenant in common votes in opposition to another, the vote shall be cancelled.

3. A majority of the votes of any such joint tenants or tenants in common shall determine the manner in which the vote shall be cast.

4. The vote of any life tenant shall be accepted over the person having a reversionary interest in said property in said suburban community.

Section 9. TABULATING VOTES; CERTIFICATE SHOWING RESULTS; TIME FOR RETAINING BALLOTS:--Promptly after the holding of the election, the Judge of Election shall tabulate the ballots and certify the results to the Levy Court under his hand and seal. The ballots shall be retained in the safekeeping of said Levy Court for one year before being destroyed.

Section 10. COUNTY ENGINEER TO BE NOTIFIED OF IMPROVEMENTS AUTHORIZED:--If the certificate of the Judge of Election reveals that a majority of the votes cast at said election is in favor of the issuance of bonds by the Levy Court to cover the cost of improvement or improvements contemplated, the Levy Court shall promptly notify, in writing, the County Engineer.

Section U. ISSUANCE OF BONDS BY THE LEVY COURT; TERMS AND CONDITIONS THEREOF; USE OF GENERAL FUNDS OF LEVY COURT:--Provided the vote of the community is in the affirmative, the Levy Court shall promptly meet and by resolution authorize the issuance of bonds, except as hereinafter specifically provided, to defray the expenses of the improvement or improvements favored by the freeholders of said community. Said resolution shall also state the total amount of said bond issue which said amount shall be determined from an estimate submitted to the Levy Court by the County Engineer and said amount may be in the amount of said estimate and up to ten per cent thereover, the purposes for the issue, the date of maturity, or that the bonds shall mature serially or be retired by lot, as the case may be, and all other terms and conditions under which said bonds are to be issued. Said Levy Court, before deciding upon the terms and conditions of said bond issue, shall seek the advice of at least two substantial bankers or brokers in Delaware accustomed to deal in municipal, county or state bond issues. In the event that the estimate or estimates from the County Engineer, as hereinabove provided, after making provision for ten per cent over and above estimated costs is or are less than Twenty Thousand Dollars, the Levy Court may use monies in its own general fund to defray costs of the improvements.

Section 12. PREPARATION OF BONDS; FORM THEREOF; SIGNATURES AND SEAL REQUIRED THEREON:--The said Levy Court shall direct and effect the preparation and printing of the bonds authorized by this Act, and shall prescribe the form of said bonds and the coupons for the payment of interest thereto attached. Said bonds shall state the conditions under which they are issued. The coupons and face amount thereof shall be payable at the branch of the Farmers' Bank of Delaware in the county where said bonds are issued. Said bonds shall be signed by the presiding officer of the Levy Court, countersigned by the Clerk of the Peace, and sealed with the official seal of said Levy Court.

Section 13. SALE OF BONDS; BY WHOM; ADVERTISING REQUIRED:--The Levy Court shall negotiate the sale and delivery of said bonds, and the proceeds of the sale of said bonds shall be paid into the treasury of said Levy Court, to be used for the purposes provided in this Act; provided, however, any excess received from the sale of said bonds beyond the cost of the project shall immediately be transferred to the Special Sinking Fund created in Section 26 hereof. The Levy Court is hereby required and directed to advertise said bonds for sale in at least two issues each of two newspapers, one of which shall be published in a newspaper of general circulation in the City of Wilmington, Delaware, and one of which shall be published in the City of New York, inviting bids for the same, which advertisements shall state the total amount of the proposed issue, the denominations of said bonds, the place of payment of said bonds and interest, the place and date of opening said bids, and the conditions under which said bonds are to be sold. Said Levy Court may give notice of the sale of said bonds in such other manner as it may decide.

Section 14. REQUIREMENTS FOR BIDDING ON BONDS: --The Levy Court shall have the power to require each bid for said bonds to be accompanied by a certified check in the amount of ten per cent (10%) of the bid, and after the bonds are awarded or sold to the successful bidder or bidders therefor, the Levy Court shall return to the unsuccessful bidder or bidders the certified check or checks submitted with the bid or bids.

Section 15. REJECTION OF BIDS; OPINION REQUIRED: --The said Levy Court shall have the right to reject any and all bids, but in awarding the sale of said bonds, or any of them, they shall be sold to the person, persons, firm or corporation which, in the judgment of the said Levy Court, offers the most advantageous terms. Said bonds shall not be offered for sale until the Attorney for said Levy Court has submitted his opinion in writing that the bonds were validly issued in accordance with the provisions of this Act.

Section 16. CONTRACTS FOR IMPROVEMENTS; PRACTICE TO BE FOLLOWED:--Immediately upon consummation of the sale of said bond issue, the Levy Court shall proceed to enter into a contract or contracts for the required improvements with the owners or operators of the local water distribution system chosen to install said improvements or their agents, which contract or contracts shall be substantially in accordance with the proposal or suggested contracts originally submitted by the petitioners in accordance with Section 3 hereof, and which contract or contracts need not be let upon a competitive bid basis. The Levy Court may, at its discretion, request a statement of financial condition or such other evidence of financial responsibility as it shall deem appropriate, from the owners or operators of said local water distribution system or their agents.

Section 17. PAYMENT; APPROVAL BY COUNTY ENGINEER; UPON COMPLETION, IMPROVEMENTS TO BECOME PART OF THE WATER SYSTEM SERVING THE COMMUNITY; RESPONSIBILITY FOR MAINTENANCE THEREOF: --The Levy Court shall withhold ten per cent of all payments made under the terms of said contracts until final certification by the County Engineer that the work has been satisfactorily completed, in compliance with the terms of the contract.

Upon the certification by the County Engineer that the improvement or improvements have been satisfactorily completed, said improvement or improvements shall be incorporated into the water system serving the community, in accordance with the terms of the contract or contracts which shall provide that the owners or operators of said water system shall be responsible for the operation and maintenance of said improvement or improvements and that the Levy Court shall in no way be responsible for the operation or maintenance of said improvement or improvements.

Section 18. ASSESSMENT ON REAL PROPERTY IN SUBURBAN COMMUNITY; TIME FOR MAKING THEREOF; BASIS FOR MAKING; PURPOSE OF ASSESSMENT:--Not later than 30 days after the date of receipt of the final contract costs from the County Engineer by the Levy Court, but in no event more than eight months after the sale of said bond issue, the Levy Court shall make a special assessment or levy upon all real property of every freeholder in said suburban community which is now assessable and taxable. Such assessment shall be made in such a manner that the real property of each freeholder of said community upon the basis of all front footage within the area to be protected by the improvements, shall equitably bear its pro rata share of the costs of said improvement or improvements. In cases of irregular corner properties the County Engineer shall determine the footage in the area to be protected that shall be considered as front footage. The sum total of all assessments, or levies, so made, shall equal the total amount of the final contract cost, together with all interest accruing on the full amount of the bond issue until maturity. In the event that final contract costs are not determined within the aforementioned eight month period, the Levy Court shall make a temporary special assessment or levy upon the basis of the contract bid, together with all interest accruing on the full amount of the bond issue until maturity, said temporary special assessment to be adjusted when final contract costs are known.

In the event that monies from the general fund of the Levy Court are used as heretofore provided in Section 11, the special assessment shall be determined on the basis of final contract costs plus interest. The interest rate shall be the average rate of all interest on bonds issued for similar purposes during the previous calendar year. All interest collected from such special assessments shall be deposited in the Special Sinking Fund account as hereinafter provided for in Section 26.

Section 19. LEVY COURT TO OBTAIN ADVICE AS TO APPORTIONING TOTAL ASSESSMENT; ASSESSMENT TO BE A LIEN; PAYMENT THEREOF; TO WHOM:--Promptly thereafter, said Levy Court shall seek the advice of at least two responsible brokers or bankers in the State of Delaware accustomed to dealing in municipal, school or county bond issues as to what proportion of his total assessment, or levy, shall be paid annually by each freeholder in said suburban community until the maturity of the bond issue, bearing in mind the terms and conditions of the particular issue, and whether all the bonds mature on the same day or are to be retired serially or by lot, as the case may be.

Having determined upon such proportionate annual amount of payment as will adequately insure the payment of the principal and interest upon said bonds, said Levy Court shall meet, and by resolution, declare the amount of the assessment, or levy, against the property of each freeholder a lien and fix the proportionate amount of the assessment, or levy, against each such property or properties to be paid annually by each freeholder. Any freeholder may at any time pay to the Receiver of Taxes of the county in which said suburban community is located, the full principal amount of the special lien placed against the property or properties together with accrued interest thereon to the next succeeding interest date.

Section 20. PREPARATION OF LIEN BOOK; BY WHOM; WHAT SAME SHALL INCLUDE:--Within thirty days after the passage of said resolution, said Levy Court shall prepare in triplicate books, a list of the names of each freeholder in said suburban community, the amount of foot frontage of each said freeholder abutting on the improvement or improvements so contemplated, the total amount of the special assessment, or levy, in dollars against the property of each said freeholder, and the proportionate annual amount of payment of said special assessment, or levy, in dollars. Said books shall be entitled "Suburban Community Lien Book," specifying the name of the suburban community. One of the said books shall be retained by the Levy Court, one shall be placed in the office of the Prothonotary of the county in which said suburban community is situated, and another shall be placed in the office of the Receiver of Taxes in said county.

Section 21. NOTICE TO FREEHOLDERS OF ASSESSMENT; WHAT NOTICE SHALL INCLUDE; TIME FOR GIVING:--Within twenty days after the completion of the triplicate books mentioned in the preceding Section, the Receiver of Taxes shall send, by registered mail directed to each freeholder in said suburban community, a notice which shall contain the total amount of the special assessment, or levy, in dollars, against each such freeholder and the proportionate annual amount of the payment, in dollars, which each such freeholder will be required to make until the maturity of said bond issue. Said notice shall also specify that the total amount of such special assessment, or levy, constitutes a lien upon the property or properties of each such freeholder, which lien, unless sooner paid, shall attach against the property of such freeholder until the maturity of said bond issue. Said notice shall further state that if each freeholder in said suburban community does not pay to the Receiver of Taxes of the county in which said suburban community is situated the proportionate annual amount of said special assessment, or levy, within sixty days from the date of the mailing of said notice, interest at six per cent per annum shall be charged upon said proportionate annual amount of said special assessment or levy beginning sixty days after mailing of said notice and continuing until said assessment is fully paid.

Section 22. ENTRY TO BE MADE IN BOOKS OF BOARD

OF ASSESSMENT; PURPOSE THEREOF:--Said Levy Court shall direct the Board of Assessment for the county in which said suburban community is situated to cause the words "Special Community Lien" to be placed beside the name of each freeholder in said suburban community as the same appears on the books of the Board of Assessment for said county in order that persons such as prospective buyers of, or attorneys making title searches upon said properties, making inquiry at the office of the Board of Assessment in such county concerning county taxes may be informed that special liens exist against said properties in said suburban community.

Section 23. RECEIVER OF TAXES TO RECEIVE PAYMENTS; DISPOSITION THEREOF; BOND REQUIRED; BOOKS TO BE KEPT BY THE COUNTY TAX COLLECTOR:-- It shall be the duty of the Receiver of Taxes for the county in which said suburban community is situated to receive payment of the proportionate annual amount of said special assessment or levy, and to turn over to said Levy Court all said moneys when received. Said Levy Court shall confer with said Receiver of Taxes and determine upon a satisfactory method for the setting up of books of account to be kept by said Receiver of Taxes concerning his collections of the proportionate annual amounts of said special assessment, or levy. Said Levy Court may require the Receiver of Taxes to enter into a bond conditioned upon the faithful performance of his duties in the making of said collections of the special assessments, or levies.

Section 24. STATEMENT OF ASSESSMENT; BY WHOM SENT:--Said Receiver of Taxes annually on the date of the sending of said written notice by said Levy Court as prescribed by Section 22 hereof shall mail to each freeholder in said suburban community a bill for the proportionate annual amount of said special assessment, or levy.

Section 25. COLLECTION OF ASSESSMENT IN DEFAULT; BY WHOM; PROCEDURE FOR:--If a freeholder in said suburban community fails to pay the full amount of his proportionate annual amount of said special assessment, or levy, within one year from the time within which same shall become payable, together with interest at six per cent thereon, the entire amount of said special assessment, or levy, shall immediately become due and payable, and said Collector of Taxes shall proceed to collect the full amount of said special assessment, or levy, by any legal process available to him by statute for the collection of state, county or school taxes; providing, further, that if any property encumbered by the special lien herein provided for shall be sold by foreclosure or execution process and the proceeds from such sale should be insufficient to pay in full the amount of said special lien together with all interest and penalties thereon, then the unpaid portion of said special lien shall not be discharged by virtue of said sale.

Section 26. SPECIAL SINKING FUND; PURPOSE OF: --The Levy Court shall promptly deposit all funds received from said Receiver of Taxes from the collection of the special assessment, or levy, in a Special Sinking Fund account, which shall be used for no other purpose than the retiring of the bonds and interest accruing thereon.

Section 27. CANCELLATION OF BONDS:--The Levy Court may adopt such procedure as it deems proper in cancelling said bonds when paid.

Section 28. PAYMENT AND RETIREMENT OF BONDS: --Prior to the time of the retirement of the bonds, or any of them, or the time when interest shall become payable thereon, the Levy Court shall make available sufficient funds in the branch of the Farmers' Bank where the principal and interest are payable, to cover the retirement of such bonds or the payment of interest thereon.

Section 29. CREDIT OF COUNTY PLEDGED TO PAYMENT OF BONDS:--The full faith and credit of said county is pledged to insure the payment of any bond issue, and all interest thereon, created and sold under this Act.

Section 30. Any and all provisions of existing or prior laws inconsistent with the provisions of this Act are hereby repealed to the extent of such inconsistency.

Approved June 5, 1951.