Agenda - Council - 03/28/1983 - Special

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I I I I I I i I I I I I I I I I I I -2- PUBLIC IMPROVEMENTS SPECIAL ASSESSMENTS GENERAL Minnesota State Law, Chapter 429, provides that a Municipality has the power to make public improvements such as sanitary sewer, storm drainage, water source, storage and distribution facilities, street improvements including grading, curb and gutter and surfacing, sidewalks, street lighting, recreational facilities, etc. THE THEORY OF SPECIAL ASSESSMENTS Special assessments are an indirect form of taxation. They are a compulsory charge on selected properties for a particular improvements or service which presumably benefit the owners of the selected property and are also undertaken in the interest of the public. Special assessments have three (3) distinct characteristics: 1. They are a compulsory levy used to finance a particular public improvements program. 2. The levy is charged only against those particular parcels of property deemed to receive some special benefit from the program. 3. The amount o'f the charg~ does not exceed the value of the benefits received. Special assessments are imposed only on real estate. They are never levied against personal or movable property. In theory, special assessments are frequently regarded as more equitable than property taxes because those who pay them obtain some direct benefits from the improvements undertaken. SPECIAL ASSESSMENT USES Special assessments have three important applications. The first and most popular use is for financing new improvements, particularly when new tracts of land are being converted to urban use. In this application, they are frequently used to pay for sanitary sewer, storm drainage, water source, storage and distribution facilities, street improvements including grading, curb and gutter and surfacing, sidewalks, street lighting, recreational facilities, etc. Special assessments may also be used to underwrite the cost of major maintenance programs. Large-scale repairs and maintenance operations on streets, sidewalks, watermains, sanitary sewers, storm drainage and similar facilities can and often should be financed with special assessments.