55 Pages Posted: 6 Oct 2008 Last revised: 9 Feb 2009
Date Written: October 2, 2008
In the face of voter-imposed tax limitations, local governments have adopted ever-more complex financial mechanisms to balance their budgets. Increasingly, municipalities in California have made use of special assessments to finance local infrastructure improvements and other vital government services. These assessments bill property owners for public goods and services in proportion to the "special benefits" that they receive. Because benefit assessments are constitutionally distinct from taxes, the growth in assessment financing has come partly as a direct response to increased constraints on the ability of local governments to raise general taxes. Our contention is that this growth should prove cause for concern due to the unusual combination of social choice pathologies to which special assessments fall vulnerable. Field interviews with public officials and the consultants they call on to help create these assessments suggest that special assessments can indeed pose special democratic problems.
Keywords: Special benefit assessments, municipal finance, Proposition 13, agenda control, gerrymandering
JEL Classification: H00, H10, H11, H20, H21, H23, H40, H41, H70, H71, H72, H73
Suggested Citation: Suggested Citation
Kogan, Vladimir and McCubbins, Mathew D., The Problem with Being Special: Democratic Values and Special Assessments (October 2, 2008). Available at SSRN: https://ssrn.com/abstract=1277522 or http://dx.doi.org/10.2139/ssrn.1277522