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House Research Department Updated: September 2008 <br />Special Assessments Page 13 <br /> <br /> <br />Table 1: Comparison of City Special Assessments <br />from Department of Revenue and State Auditor <br />1970-2006 <br />(amounts in 000s) <br />Year <br />Special Assessments <br />Dept. of Revenue40 <br />Special Assessments <br />State Auditor41 <br />1970 $34,959 $53,929 <br />1975 56,388 88,553 <br />1980 76,742 175,168 <br />1985 117,520 164,336 <br />1990 126,636 186,148 <br />1995 118,868 197,534 <br />2000 129,778 238,101 <br />2005 161,028 291,499 <br />2006 176,500 280,287 <br /> <br /> <br />State Auditor data is probably higher than DOR’s data in part because it includes prepayments <br />and special assessments imposed on tax-exempt property. There may also be other unidentified <br />reasons for differences in the data. However, it is impossible to quantify how much <br />prepayments, special assessments on tax-exempt property, and any other unknown reasons <br />account for differences in the data. <br /> <br />• Prepayments <br />Property owners. Property owners may prepay special assessments under the <br />statutes. If not prepaid, the special assessments are included on the property tax <br />statement and collected along with property taxes. Some people suggest that the <br />smaller assessment amounts (such as for certain street repair) are more frequently <br />prepaid by the taxpayer than the larger ones. <br />Developers. A developer may prepay the special assessments imposed by the local <br />government on the land being developed and then include each property’s share of <br />the prepaid special assessments in the price of the house. <br />Property sellers. A person selling real property may prepay outstanding special <br />assessments on the property because the buyer’s loan agreement requires it or because <br />of other agreements made between the buyer and the seller. <br /> <br />40 Minnesota Department of Revenue, Property Taxes Levied in Minnesota, the Abstract of Tax Lists. <br />41 Office of the State Auditor, Minnesota City Finances: 2005 Revenues, Expenditures, and Debt. Defines <br />“special assessment” on page 181 as revenues that “refer to levies made against certain properties to defray all or <br />part of the costs of a specific improvement, such as new sewer and water mains, deemed to benefit primarily those <br />properties. The amount includes the penalties and interest paid on the assessments.” The 2006 amount was <br />obtained by phone from state auditor staff.