4. Procedure
The Corporation may need to take appropriate action based on nonpayment, lapse of insurance or other violations of terms and conditions of permits and leases. Following notice, the appropriate response will be determined including permit revocation, lease termination, site visits, emergency action, collection of delinquent accounts, removal of encroachments, etc.
4.1. Delinquent Accounts for Nonpayment
4.1.1. The Credit and Collections Unit will send annual invoices for permits to permittees one month prior to the permit payment date and periodic invoices for leases per the terms and conditions of the lease. The PERMIT AND LEASE INVOICE1 will state the consequences of late payment (e.g., applicable interest, collection fees and possible revocation of the permit or termination of the lease).
4.1.2. If payment is not received within 45 days from the date of the original invoice, the Credit and Collections Unit will send out a NONPAYMENT DELINQUENCY NOTICE2 to the owner of the delinquent account and copy the Division Permit Engineer (DPE) and the Office of Land Management (OLM).
4.1.3. If payment is not received within 15 days from the date of the delinquency notice, the Credit and Collections Unit will send a NONPAYMENT FINAL NOTICE3 to the owner of the delinquent account stating that the permit will be revoked or the lease terminated within 30 days unless full payment, interest and any additional charges assessed to the account are received. A copy of the final notice will be sent to the DPE and OLM.
4.1.4. If payment is not received within 30 days from the date of the final notice, the Credit and Collections Unit will contact OLM, the Bureau of Real Property Management (BRPM), and the Legal Department to identify the appropriate action as described in Section 4.4.
4.1.5. If a late payment is received anytime prior to revocation of a permit, see Section
4.4.6.
1 Exhibit 1 2 Exhibit 2 3 Exhibit 3 September 2006 900-1-02.9
4.2. Lapsed Insurance
For the protection of Corporation assets, it is critical that proper insurance coverage be maintained for all permits and leases. Once notified of lapsed insurance coverage, failure of the permittee/lessee to restore proper insurance coverage will result in the revocation of permits, and the possible termination of leases.
4.2.1. The Insurance Compliance Unit will identify accounts for which insurance has lapsed and where the permit or lease is still active and a LAPSED INSURANCE NOTICE1 will be sent to the account owner. Permittees will be sent a PERMIT REVOCATION NOTICE-LAPSED INSURANCE2 if proof of insurance is not provided within 30 days of notification. Lessees will be notified that failure to provide proof of insurance within 30 days may result in the termination of their lease per the terms of the lease. The Insurance Compliance Unit will send a copy of the REVOCATION NOTICE to the DPE and OLM.
4.2.2. If the permittee/lessee fails to provide documentation of insurance within 30 days of notification, the Insurance Compliance Unit will notify OLM and the Legal Department to determine the appropriate response as described in Section
4.4.
4.3. Other Permit or Lease Violations
4.3.1. Through periodic field inspections or other notice, the DPE or Division Canal Engineer (DCE) may identify conflicts between the permitted use of/work on the property and the CRP or Canal operations, or may identify that the permittee or lessee is not complying with the provisions of the permit or lease including Corporation employees/agents/contractors access to the property, exceeding the scope of the permit or lease, if the use and/or work obstructs the maintenance, operation or navigability of the Canal, or for other reasons.
4.3.2. OLM, in consultation with the Legal Department, will coordinate lease violation notices and actions in accordance with the terms and conditions of the lease.
1 Exhibit 4 2 Exhibit 5 September 2006 900-1-02.9
4.3.3. The DPE, in consultation with the DCE, will coordinate permit notices for violations. The DPE will send a VIOLATION NOTICE+ notifying the permittee of the violation of permit conditions and copy OLM. The letter will allow the permittee 10 days to respond, except if the violation is causing a health, safety, or environmental impact or other emergency conditions requiring immediate action. The Corporation may also take any required steps to address the emergency immediately.
4.3.4. If the permittee responds within the 10 days, the DPE, in consultation with the DCE, may attempt to resolve the issue. This may require the permittee to cure any defects (e.g., remove illegal structure or dock, etc.).
4.3.5. If the permittee fails to respond within 10 days (or less if an emergency), the DPE will contact OLM to determine the appropriate response as described in Section 4.4.
4.4. Determining the Appropriate Response
4.4.1. OLM will coordinate a review of the proposed permit revocation or lease termination in consultation with staff from the Legal Department, BRPM and Credit and Collections Unit to determine the appropriate action to be taken. This may include revocation of the permit, termination of the lease or referral of the account to collection agencies and/or the Attorney General’s Office. Collections of Delinquent Accounts will be handled as described in Section 4.5. As needed, OLM may request that the DCE or designee conduct a site inspection as described in Section 4.6. to assist in determining the appropriate response.
4.4.2. If an emergency situation exists which endangers life or the Canal System, the Legal Department will be notified immediately for guidance on the appropriate actions such as seizure of lands, equipment or supplies necessary to avert such endangerment. The Legal Department may forward these issues to the Attorney General’s Office or take other action as permitted by statute and regulations.
+ Exhibit 6
September 2006 900-1-02.9
4.4.3. If the permit is to be revoked or the lease terminated for nonpayment, the Credit and Collections Unit will send a CANCELLATION NOTICE+ notifying the permittee that the permit is revoked and that a site inspection will be conducted within 21 days. A copy of the notice will be sent to OLM and the DPE. The DPE will send a CANCELLATION NOTICE for other types of violations resulting in revocation of the permit or termination of the lease and copy OLM and the Credit and Collections Unit. For work permits, the revocation will be effective immediately. For occupancy permits, the permit will be revoked upon the lapse of the 30 day notice period. The Legal Department will coordinate the termination of any lease including termination notices. The Canal Board will be notified of the proposed lease termination.
4.4.4. The DPE or DCE will conduct a site inspection in accordance with Section 4.6.
4.4.5. No refunds will be given for revoked permits or terminated leases unless the permit conditions or lease terms require otherwise.
4.4.6. If a late payment is received anytime prior to revocation of a permit, the Credit and Collections Unit will take the account out of delinquency and notify OLM, the DPE, and the Legal Department. OLM, based on input from the Legal Department, BRPM, and the Credit and Collections Unit, may (a) continue the permit revocation; (b) stop the permit revocation; or (c) take other action as needed. A record of late payment will be maintained by the Credit and Collections Unit in the account file.
4.4.7. If permit account payment has been received after the permit has been revoked or the account closed, the Credit and Collections Unit will notify BRPM. BRPM, in consultation with OLM, the Legal Department, and the Credit and Collections Unit as needed, may direct that a new permit be issued or the old permit reinstated. BRPM will notify OLM and the DPE of its decision.
4.4.8. In the event that delinquent lease amounts are paid in full (including any interest and fines) prior to lease termination, OLM, in consultation with the Legal Department, BRPM, and the Credit and Collections Unit may (a) continue the lease termination process; (b) stop the lease termination process; or (c) take other action as needed. A record of late payment will be maintained by the Credit and Collections Unit in the account file.
+ Exhibit 7 September 2006 900-1-02.9
4.5. Collections of Delinquent Accounts
4.5.1. When it has been determined by OLM, the Legal Department, and the Credit and Collections Unit that an account should be referred for collection, the Credit and Collections Unit will prepare a collection file. The Credit and Collections Unit will coordinate the collection of the delinquent account with the contracted collection agency, or forward the collection file to the Legal Department for forwarding to the Attorney General’s office for action. At a minimum, the file should contain:
- Copy of the terminated lease or revoked permit
- Total amount of the delinquency (rents/fees, interest, additional fines, restoration costs, etc.)
- Current contact information (name, address, phone number)
- Copy of invoices and letters sent
- Copy of DIVISION INSPECTION CHECKLIST+
- Documentation of any other attempts or information regarding collection
- Other information pertinent to the permit/lease, such as environmental issues, encroachments or other structures, noncompliance or issues.
4.5.2. The Legal Department will receive reports from collection agencies and the Attorney General’s Office regarding accounts that have been turned over to them for collection.
4.5.3. The Credit and Collections Unit will receive checks collected by collection agencies and the Attorney General’s Office, and may also receive payment directly from delinquent account holders after the accounts have been turned over for collection. The Credit and Collections Unit will notify the Legal Department and OLM of any checks received. The Legal Department will review the individual case and approve the check, and provide notification that the check has been approved for deposit.
+ Exhibit 8 September 2006 900-1-02.9
4.5.4. If the matter is deemed uncollectible by a collection agency or the Attorney General’s Office, the matter will be referred to the Legal Department for determination of further appropriate action.
4.6. Division Inspections
The DPE or DCE will conduct site inspections on a periodic basis and when necessary, such as following permit revocation or lease termination.
4.6.1. The DPE or DCE will conduct a site visit using the DIVISION INSPECTION CHECKLIST to verify the address and inspect the site to ensure that the property has been vacated, no actions are required to rectify a potential environmental or navigation problem, and that the property has been restored to the same or better condition as existed prior to issuance of the permit/lease.
4.6.2. If the property has not been restored, the DPE or DCE will identify any work that is required or structures that should be removed. In the event the property has not been restored, and a structure remains on the property, follow Section
4.7. for encroachments.
4.6.3. The DPE or DCE will provide BRPM with a completed CHECKLIST documenting the site visit and noting any required follow-up action. This checklist will become part of the permit and lease project file and will be used by BRPM, OLM, the Credit and Collections Unit and the Legal Department to determine any restoration costs to be included in appropriate collection responses and other required actions.
4.7. Encroachments
4.7.1. Encroachments exist in two scenarios: A building, structure, or other personal property or parts of these erected, placed, maintained, or otherwise occupying Canal property as a result of (1) a revoked permit or terminated lease, or (2) an illegal occupation not covered by a permit or lease.
4.7.2. If environmental degradation is noticed or potentially could occur, then the Division Environmental Specialist or the DPE or DCE conducting the inspection will contact OLM for guidance on other appropriate actions. Code Compliance personnel may be contacted by the DPE or DCE to identify structural issues that may exist.
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4.7.3. The DCE or designee will deliver, in person, an ENCROACHMENT NOTICE+ to the encroacher at the encroacher’s address as listed on the tax roll and/or in the County Clerk’s office. The notice will indicate that, unless the encroacher contacts the Corporation and proper authorization can be obtained, the property must be vacated and the encroaching building or structure removed within 30 days of service. The Legal Department will prepare an affidavit of service to be signed by the DCE or designee upon service. In the event the party cannot be located, the DCE or designee will securely affix the notice to the encroaching building or structure, using tacks, tape, etc. The DCE will send OLM and the Legal Department a copy of the notice and the affidavit of service.
4.7.4. If the encroacher responds within 30 days, the DCE will attempt to resolve the encroachment using one of the following methods:
- Have the encroacher apply for an occupancy permit or lease, as applicable, if removal is not, in the judgment of the DCE, necessary for the improvement, use, maintenance, control, management, repair or operation of the Canal System; or
- Seek enforcement action against the encroacher if at the end of the 30 day period, in the judgment of the DCE, noncompliance will continue.
4.7.5. If in the event of noncompliance at the end of the 30 day period, the DCE will refer the matter to the Legal Department for commencement of a special proceeding pursuant to Article 7 of the Real Property Actions and Proceedings Law or to take other actions as deemed appropriate by the Legal Department.
+ Exhibit 9
September 2006 900-1-02.9
5. Responsibilities
The Credit and Collections Unit is responsible for invoicing permittees and lessees and sending delinquency, final, and cancellation notices. The Unit will maintain the account files and prepare collection files for delinquent account and work with contract collection agencies.
The Bureau of Real Property Management will review Division site inspections and assist in determining the appropriate action when a permit has been revoked or a lease terminated or when other violations exist.
The Insurance Compliance Unit will determine if permittees and lessees have proper
insurance coverage and notify applicants that do not have insurance coverage.
The DCE may conduct site inspections and coordinate resolution of permit violations, and oversee the encroachment notice and service.
The Division Code and Compliance personnel may assist in identifying structural or other issues affecting an encroachment.
The Division Environmental Specialist will assist in identifying environmental issues associated with encroachments.
The DPE may conduct site inspections and coordinate resolution of permit violations.
OLM will coordinate with the Legal Department and others, as necessary, to determine the appropriate response to lease and permit violations.
The Legal Department will assist OLM in determining the appropriate response to permit and lease violations and coordinate Attorney General Office assistance and the collections process.
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6. Flowcharts
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EXHIBIT 1 SAMPLE PERMIT AND LEASE INVOICE
This form will be used by the Credit and Collections Unit for annual permit and lease invoices.
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EXHIBIT 2
NONPAYMENT DELINQUENCY NOTICE
The notice will be sent by the Credit and Collections Unit to a permittee/lessee when payment has not been received within 45 days from the date of the original invoice.
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EXHIBIT 3
NONPAYMENT FINAL NOTICE
The final notice will be sent by the Credit and Collections Unit to a permittee/lessee within 15 days of the nonpayment delinquency notice if payment has not been received.
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EXHIBIT 4
LAPSED INSURANCE NOTICE
The Insurance Compliance Unit will use this notice to notify account owners when insurance has lapsed.
Content under development
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EXHIBIT 5 PERMIT REVOCATION NOTICE – LAPSED INSURANCE
If a permittee has not provided documentation of insurance within 30 days of the lapsed insurance notification, the Insurance Compliance Unit will send the permit revocation notice for lapsed insurance.
Content under development
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EXHIBIT 6 SAMPLE VIOLATION NOTICE Page 1 of 2
The letter will be used to notify a permittee or lessee of violations (other than for nonpayment or lapsed insurance) using this form.
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SAMPLE VIOLATION NOTICE Page 2 of 2
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EXHIBIT 7
CANCELLATION NOTICE
Upon a determination to revoke a permit or terminate a lease, a cancellation notice will be sent.
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EXHIBIT 8
DIVISION INSPECTION CHECKLIST
This checklist will be used to document a site inspection by Division personnel.
Content under development
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EXHIBIT 9 ENCROACHMENT NOTICE
This notice is used to notify an encroacher of an encroachment.
