Topic 18.3 Special Assessments

Learning Objective

After successfully completing this topic, you will be able to calculate the cost of a special assessment, given the conditions and amounts involved.

State Exam Tip

Review street paving assessment; remember to calculate only the owner’s half of the paving assessment, so this would require the candidate to divide the total share of the cost in half.

Purpose of Special Assessments

A special assessment is a one-time tax levied on properties which have been improved by the government. They are second in priority to property taxes. Special assessments are not “ad valorem” taxes. They are based on the cost of the improvement divided by the owners who have benefitted.

Computation of Special Assessment Rate

Special assessments are often levied on a front foot or on a square foot basis. If you are calculating a special assessment, remember to divide the running foot price by 2 in order to get the front foot price on one side of the street.

Example of street paving special assessment
A city plans to pave a dirt road fronted by 16 houses (eight on each side). The cost of the paving is contracted at $32 per running foot. There are 1,100 running feet on the road. Some of the owners have 80 feet frontage on the road, and some have 125 feet frontage.   

Harold has a house on the street that has 80 feet. What will he have to pay if the city is not paying any of the cost?   

Remember, the people on both sides of the street have to pay their share, so you’ll have to divide the running foot price by 2. The front foot price is $16 ($32 ÷ 2). Harold has 80 front feet, so his share will be $1,280 (80 x $16).  

But what if the city agrees to pay 40% of the assessment? In that case, Harold’s cost would be $768 ($1,280 x .60).  

Special Assessment Liens

Special assessment liens are specific, superior liens, taking priority over all other liens except ad valorem tax liens.