AB 537

Under current law, a city, village, or town (municipality) may create a

neighborhood improvement district (NID), upon being petitioned to do so by an

owner of real property that is located in the proposed NID, if a number of steps are

taken. In general, a NID is an area within a municipality consisting of parcels that

are nearby to one another, but not necessarily contiguous, at least some of which are

used for residential purposes and are subject to general real estate taxes, and also

may include property that is acquired and owned by the NID board. If a NID is

created under an approved operating plan, the municipality may impose special

assessments on real property located within the NID to provide for the development,

redevelopment, maintenance, operation, and promotion of the NID, except that

special assessments may not be imposed on any parcel of real property that is used

exclusively for less than eight residential dwelling units and real property that is

exempted from general property taxes.

Under this bill, a municipality may create a NID only if the owners of real

property to be assessed under the proposed initial operating plan having a valuation

equal to more than 50 percent of the valuation of all property to be assessed under

the proposed initial operating plan have petitioned the municipality for creation of

the NID. In addition, these petitioners are responsible for the cost of providing

certain notices required during the NID creation process and a municipality may

delay the creation of a NID until these costs are paid.