Agenda Packets - 1986/11/03 - Laserfiche WebLink

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DS-6. Municipal Service Districts (R) Recent court decisions concerning special assessments have made it more difficult for cities to use special assessments to finance public services and improvements. The Minnesota Supreme Court has interpreted the state Constitution to tequire not only that a special assessment project "specially benefit" affected parcels of property, but also that the city be able to prove that the market value of a property will increase in direct relation to the arount of the special assessment applied to that property. This interpretation has created particular problems for several important city functions. First, it is more difficult to assess all (or even part) of a capital improvement project to repair or replace, as opposed to newly built improvements. This hinders cities from meeting the widely recognized need for maintenance of the existing public infrastructure. Second, cities' ability to finance annual operating and maintenance costs of some services to property through the use of special service charges is either unclear or non-existent under current law. The only current financing alternative to special assessments or service charges is the general property tax. But it may not be desirable to use the general property tax to finance some capital or operating expenses. For example, if a road is used almost exclusively by people living in one corner of a city, it may be bad public policy to require the cost of replacing that road to be borne by all the property in the city. This is especially true if the property in the rest of the city has already been assessed for similar improvements. - Or, if the central business district or mall of a city benefits from more frequent snowplowing or street cleaning, better lighting, etc. it may not be good policy to have all the city taxpayers share in those expenses. IM