SENATE BILL REPORT

SHB 980

BYHouse Committee on Agriculture & Rural Development (originally sponsored by Representative Rayburn)

Revising provisions on irrigation districts.

House Committe on Agriculture & Rural Development

Senate Committee on Agriculture

Senate Hearing Date(s):March 31, 1987

Majority Report:     Do pass as amended.

     Signed by Senators Hansen, Chairman; Bauer, Vice Chairman; Bailey, Barr, Gaspard.

Senate Staff:Tom McDonald (786-7404)

                April 1, 1987

AS REPORTED BY COMMITTEE ON AGRICULTURE, MARCH 31, 1987

BACKGROUND:

In 1984 the Washington State Supreme Court held that the statutory procedure for irrigation assessment foreclosures was constitutionally defective because it failed to provide notice and an opportunity for a hearing.  Before any action can be taken against an interest in property, due process requires there to be notice reasonably calculated to apprise parties who have an interest in the property and afford them an opportunity to present their objections.  Notice of a foreclosure proceeding must:  (1) be sent to interested parties by personal service or first class mail, (2) describe the subject property with sufficient specificity, and (3) set forth the time and place at which the property will be sold.  The irrigation district's foreclosure statute failed to require personal service or notice by mail and failed to require notice of the specific time and place of the sale.  Further, the foreclosure procedure failed to allow the interested parties an opportunity to object or contest the foreclosure at a hearing.

The members of an irrigation district's board of directors and the district's secretary are required to obtain a $1,000 surety bond for the faithful performance of their duties.  The irrigation district laws contain numerous provisions establishing accounting rules and fiscal controls.

SUMMARY:

On December 15 of each year, an initial delinquency notice will be published and posted.  The notice must contain the name of the owner, a description of the property, the amount of the delinquency, the costs accruing on the delinquent amount, and the total amount due.  The delinquency notice must advise the owner that the district has a lien on the property and must also specify: (1) the time and place the property will be sold; (2) the right of the owner to protest at a hearing; (3) the time and date of the hearing; (4) the right of interested parties to redeem the property; and (5) that if payment is made within ten days of the last publication, the owner will not have to pay the costs of a title search.

The initial delinquency notice must be posted in the county courthouse and in the irrigating district's office, and published for three consecutive weeks in a local newspaper.

If an owner has not paid the delinquent assessment within ten days of the last publication, a final delinquency notice is published and sent by mail to the owner and to all those persons having a recorded interest discovered through a title search.  The final delinquency notice contains the information as stated on the initial notice, and further states that the owner will be liable for the cost of a title search.  The final notice must be mailed at least 14 days before the protest hearing date.

Procedures are set forth for the protest hearing where an owner can contest the foreclosure.  After the hearing, the board of directors must take such action as it determines to be just.  An owner may appeal any adverse ruling to the county superior court.

The members of an irrigation district's board of directors and the district's secretary are required to obtain a $10,000 surety bond for the faithful performance of their duties.  In addition, the secretary and any person authorized by the board to "handle" deposited funds are required to obtain a bond for the greater of $10,000 or the expense fund's average monthly balance. Various accounting rules and fiscal controls on the depositing and disbursing of district funds are established.

SUMMARY OF PROPOSED SENATE AMENDMENT:

The initial delinquency notice will only include:  (1) the name of the assessed owner, instead of the owner of record; (2) the amount of any delinquent assessments, instead of one delinquent assessment; (3) a statement that costs will be due and the amount will be available at the treasurer's office; and (4) a statement that if payment is not made, the owner will be liable for the costs of a title search, treasurer's costs and reasonable attorney's fees.  The publication of the initial notice will only be once.

The final notice will still contain all of the constitutional requirements for notice and an opportunity for a hearing.  The date of the foreclosure sale must not occur within 120 days from the date notice was first given.

Fiscal Note:    none requested

Senate Committee - Testified:   Jim Trull, Sunnyside Valley Irrigation District; Jeanne Dickman, Washington State Water Resources Association; Bob Ashcraft, Consolidated Irrigation District; Fred Saeger, Washington Association of County Officials