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House Research Department Updated: September 2008 <br />Special Assessments Page 2 <br /> <br /> <br />Special Assessments Defined <br />A special assessment is a charge imposed on real property to help pay for a local improvement <br />that benefits the property. <br /> <br />The state constitution allows the legislature to authorize local governments to use special <br />assessments to help pay for local improvements based on the benefit the improvement gives the <br />property.1 <br /> <br />The legislature has long authorized local governments to levy special assessments to pay for <br />specified local improvements. Since 1953, that authority has been primarily found in Minnesota <br />Statutes, chapter 429.2 Chapter 429 authorizes cities, towns, urban towns, and counties to make <br />specific improvements described on the next page.3 Chapter 429 does not apply to home rule <br />cities if their charters establish other procedures. To the extent a home rule charter city does not <br />specify other procedures, it may use chapter 429.4 <br /> <br />1 Minn. Const. art. X § 1, provides: “The legislature may authorize municipal corporations to levy and collect <br />assessments for local improvements upon property benefited thereby without regard to cash valuation.” <br />2 There are a number of other statutes that authorize local improvements paid for with special assessments or <br />other revenues that are not discussed in this information brief. See, e.g., Minn. Stat. ch. 365A (town subordinate <br />service districts); ch. 375B (county subordinate service districts); ch. 428A (special service districts, housing <br />improvement areas); § 435.44 (sidewalk improvement districts); § 444.075, subd. 1a (waterworks, sewers, and storm <br />sewers); §§ 444.16 to 444.21 (storm sewer improvement districts); and § 459.14 (parking facilities). <br />3 The purposes for which local governments are authorized to use special assessments depend on the applicable <br />definition of “municipality.” There are three definitions in Minnesota Statutes, section 429.011: <br />(1) Subd. 2 (“ ‘Municipality’ means any city of the second, third, or fourth class however organized, or any <br />statutory city or any town as defined in section 368.01”) (A town defined in section 368.01 is one with (a) platted <br />portions where at least 1,200 reside, (b) platted area within 20 miles of the city hall of Minneapolis or St. Paul, or (c) <br />a population of at least 1,000 that has determined to organize under chapter 368. It is commonly called “an urban <br />town.”); <br />(2) Subd. 2a (“ ‘Municipality’ also includes a county in the case of construction, reconstruction, or <br />improvement of a county state aid highway or county highway as defined in section 160.02 including curbs and <br />gutters and storm sewers; a county exercising its powers and duties under section 444.075, subdivision 1; and a <br />county for expenses not paid for under section 403.113, subdivision 3, paragraph (b), clause (3)”); and <br />(3) Subd. 2b (“ ‘Municipality’ also includes any town not having the powers granted herein pursuant to any <br />other law in the case of construction, reconstruction or improvement of a town road including curbs and gutters and <br />storm sewers and in the case of those improvements designated in section 429.021, subdivision 1, clauses (1), (2), <br />(4), (5), (6), (7), (8), and (10)”). <br />4 Minn. Stat. § 429.021, subd. 3 (“When any portion of the cost of an improvement is defrayed by special <br />assessments, the procedure prescribed in this chapter shall be followed unless the council determines to proceed <br />under charter provisions.”); Minn. Stat. § 429.111 (A home rule charter city “may proceed either under this chapter <br />or under its charter in making an improvement unless a home rule charter or amendment adopted after April 17, <br />1953, provides for making such improvement under this chapter or under the charter exclusively.”); Singer v. City of <br />Minneapolis, 586 N.W.2d 804, 805 (Minn. App. 1998) (“Absent a specific charter or ordinance provision governing <br />the assessment procedure, Minn. Stat. ch. 429 applies to special assessments made under [Minneapolis’s] home rule <br />charter. Gadey v. City of Minneapolis, 517 N.W.2d 344, 348 (Minn. App. 1994), review denied (Minn. Aug. 24, <br />1994)”). See page 7 regarding laws that apply even when following charter procedures.