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I have lived in my current region Grand Forks ND-East Grand Forks MN (about 300 miles northwest of Minneapolis or 150 south of Winnipeg Canada) since 1998. Before then I lived in Springfield Missouri where I had bought my first house.
Now when I bought a new home in a new subdivision in Springfield Missouri in 1997 I do not recal special assessments being assessed to the homeowner but the costs of putting in the street, street lights, storm sewer, etc.
Now when I moved to ND/MN it is very common for special assessments to be paid by the homeowners (usually in a 15-20 yr loan with equal increment payments each year) for new infrastructure. Even if the sidewalk needs replacing in the front of your house....the city will go in and repair it and give you the bill without asking if you want it repaired. The sidewalk is on what in our area is called the berm and the city can do whatever it wants there.
Now what is the common practice in other areas of the country?
We built a new house in 2003 when the road was a small dirt one and as more homes were built the developer petioned the city to put in concrete streets, street lights, storm sewers. Once this was done, the city gives you a notice that it will cost each homeowner along that street an xx amount of money. You can pay it in full or pay in in equal installments over a 15-20 yr period (length of time depends on amount). So in my case my property taxes run 2600/yr and my specials run about 1200/yr and that is all paid out of my loan escrow.
Nowadays with the cost of concrete up, it isnt uncommon to buy a home and then get a bill for 18k on top of the list price for the infrastructure put in.
Special assessments are a result of a community not setting aside enough in reserves to pay for planned/future or unexpected expenses. There is no common practice in any part of the country. In Florida, it comes up from time to time in various communities but not in any specific area.
what is the common practice in other areas of the country?
Common varies.
I've been hit both ways:
The cost of repaving of a common use and commonly owned alley after 50+ years of hard use
will be split among the properties that abut that alley vs being paid for through the general road fund.
That shows up on the property tax bill for 10-15 years.
Sidewalk repairs (one or two sections) are contracted privately and paid out of pocket.
Sometimes this requires a code enforcement order.
Complete rebuild of the common use but privately owned sidewalk along a whole street will be
contracted by the City/County with the costs split among the properties that abut ($X per LF).
This too shows up on the property tax bill.
Similar might apply to street lights or storm water work.
Thanks.... I never heard of it the last place I owned a home in Springfield Missouri... but up here it is very common throughout all the cities in ND and the ones I am familiar with in MN.
It is quite common for the city of Grand Forks to monitor sidewalk areas and see which are in condition of repair. Each spring they send out a bid for sidewalk repair in the city and then the company does the work. The company bills the city and the city bills the homeowner for how much frontage is their lot abuts up against the sidewalk. A certain amount per sq ft. Now where I live in East Grand Forks MN, the mayor doesnt like sidewalks, so in most residential areas we have none....but we do have a wider street....40 ft across so we bike, walk, etc along the sides of the roads..... we are a small town so it doesnt create too much of an issue.
Now I do recall that certain roads in Grand Forks are state maintained or called local collector roads,where the state will kick in some money for repair, thus lessening the assessments sent to the homeowner.
The cities of Grand Forks and East Grand Forks were severely damaged by the flood of 97 along the Red River... and we know have permanent flood protection in the form of levees and walls...basically moved homes or tore down homes close to the river to allow a wider path of non-obstruction for the water to flow. Now most of the money paid for this was state and federal, but the local portion was paid for by the city assessing each property owner in the city limits a certain amount of money in three installments...roughly 700 each....but depended on width of property.
anyhow interesting to see how we all do things. The assessments can be a killer for new homes....I know of many who buy a home for 260k and the specials on it run 18-20k so in addition to property tax each year (it runs 2.2 or so pct on your assessed value in Grand Forks ND) you may an installment of your specials.
Special assessments are a result of a community not setting aside enough in reserves to pay for planned/future or unexpected expenses. There is no common practice in any part of the country. In Florida, it comes up from time to time in various communities but not in any specific area.
What was interesting to me when I moved from Springfield MO the property tax on my 105k value home was around 800/yr when I moved to Grand Forks ND the property tax on a 124k house was around 2100k....and Springfield at the time didnt do special assessments to my house there that was built with new streets versus we have them up here.
Now granted in Grand Forks we get many more city services than in Springfield (comparing 1997-98 when I moved). The city has a large budget for snow removal of streets and city owned property and schools, and also has many more parks, ice skating rinks, and various multi-sheet city owned hockey rinks. So you get what you pay.
I am not complaining at all, just didnt quite understand how it works in other areas. Our entire region is in a midst of a housing shortage for the past 1-2 years (we are not in oil country where it is way worse) so lots of new construction (at least by our standards). For a time in the late spring MLS listings for our city of 55K was down to 40-45 for listings for single family homes/townhomes. We have had 7 homes in my immediate sold in the last 2 years....and the longest any house was on the market (at least via web/MLS listings) was 5 days. Most sold within 48 hrs.
"Are special assessments common where you live?"
No, and I would be stunned if one happened.
In Denver, we issue bonds for improvements and our taxes pay for those bonds.
For example, most alleys in Denver (and most houses have them) are concrete. But, a few years someone noticed that we had a bunch that were dirt. Varied reasons as to why, but the Mayor said: "I am ashamed that we have dirt alleys". Slowly, but surely, these alleys are being paved. Even the private ones that they city does not own. I pay for this, not the people living off these alleys.
A number of communities in my area of Michigan levy special assessments to pay for improvements such as roads, sidewalks, streetlights, water and sewer lines. Counties also levy special assessments for drains.
The logic behind special assessments is that they are to pay for improvements which benefit particular properties as opposed to the general public. Unfortunately, with tight budgets and statutory limitations on general property tax increases, some communities are looking to utilize special assessments in a highly inappropriate fashion, IMO.
"Are special assessments common where you live?"
No, and I would be stunned if one happened.
In Denver, we issue bonds for improvements and our taxes pay for those bonds.
For example, most alleys in Denver (and most houses have them) are concrete. But, a few years someone noticed that we had a bunch that were dirt. Varied reasons as to why, but the Mayor said: "I am ashamed that we have dirt alleys". Slowly, but surely, these alleys are being paved. Even the private ones that they city does not own. I pay for this, not the people living off these alleys.
thanks.. yeah in our town most of the alleys in the older parts of town (both Grand Forks and East Grand Forks are gravel/dirt and if the locals who live up against that alley want it paved they can request the city get a proposal for cost....but all cost would be the responsibility of the homeowners.
Bonds are issued here but for very large projects such as new schools, libraries, etc....
Now what is the common practice in other areas of the country?
That's a bit of a trick questions. "Special Assessment", "Bond Payment", Tax Levy", "Public Works District", "Over-Ride Assessment", Property tax increase, etc., can all mean the same thing in different municipalities. Here, special assessments are only levied through private actions such as a HOA or CDA and such. However, whenever the government is doing any infrastructure improvements it’s funded through the Public Works Districts and they assess amounts through the property tax system. This can be district wide such as a road improvement, or it can be street wide such as sidewalk replacement. So to me, Special Assessments never happen, but I do pay like you but under a different name.
That's a bit of a trick questions. "Special Assessment", "Bond Payment", Tax Levy", "Public Works District", "Over-Ride Assessment", Property tax increase, etc., can all mean the same thing in different municipalities. Here, special assessments are only levied through private actions such as a HOA or CDA and such. However, whenever the government is doing any infrastructure improvements it’s funded through the Public Works Districts and they assess amounts through the property tax system. This can be district wide such as a road improvement, or it can be street wide such as sidewalk replacement. So to me, Special Assessments never happen, but I do pay like you but under a different name.
Thanks yes I have found out it is called different names in other places in the country.
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