Special Assessments

Special assessments are levied by various political entities, primarily sanitary improvement districts  (SID), cities, or the county. They are generally levied to pay for some type of improvement such as a street or a sewer. Almost all housing areas outside our cities have been created as SIDs. The following should not be considered legal advice and virtually each political entity has its' own set of laws governing their actions, so these specifics may be different than your particular case.

The political entity levying the special assessment is required to provide notice to the public that a hearing will be held to discuss and possibly levy a special assessment. This notice is provided by regular mail and by notice in the newspaper. This is the only notice generally provided by the entity. Some send follow up letters after the hearing and some do not. It seems presumed that the meeting is obviously being held to levy the assessment and therefore you should not assume otherwise. It is not the responsibility of this office to notify people of their assessments, although we do send out courtesy notices on the initial and subsequent annual payments.

The specifics of the levy, are included in the resolution creating the levy, however, normally, the taxpayer has 50 days to pay the entire levy in full without any interest. All specials not paid within the first 50 days, will accrue interest until paid on the total unpaid balance. Usually these specials are levied to recoup part of the original cost of putting in the infrastructure in the SID, such as sewer, water, electrical, and etc. A number of the cities also levy weed assessments when property owners fail to maintain their property.

Delinquent Payments

If the special is not paid in full within 50 days, the first payment becomes due on the 51st day and they shall become delinquent in ten annual installments. Upon delinquency the interest rate normally increases to 2% more than the original levy until paid. Interest rates vary from approximately 6 to 14%.

For example, SID 333 levies a $10,000 special assessment on January 1,xx.

Payment Schedule

The total or any part may be paid without interest through February 19th. On February 20th, the 51st day, all unpaid specials will accrue interest at the stipulated rate. At a designated time the first payment becomes delinquent. This payment will normally accrue interest at the original interest rate plus 2% more until paid. A typical payment schedule follows:

  • January 1, xx $10,000 in specials assessed
  • 51 days later: interest accrues back to levy date and
    • January 1, xx+1 Payment Number 1 $1,000 becomes delinquent
    • January 1, xx+2 Payment Number 2 $1,000 becomes delinquent
    • January 1, xx+3 Payment Number 3 $1,000 becomes delinquent
    • January 1, xx+4 Payment Number 4 $1,000 becomes delinquent
  • So on through payment Number 10, the last $1,000

Interest

When making payment on your specials after the first 50 days, all accrued interest on the unpaid balance must be paid in addition to making the principle payment(s). This is similar to your credit card, where the interest is paid before any principle. The next time you make a payment, interest will accrue from this date, to the next time you make a payment.

Since interest accrues until the date the specials are paid there is no one specific amount to quote on a special assessment without a specific payment date. However, earlier payments will be higher than later payments because the interest accrues on a higher unpaid balance. For example, if no payment was made in the previous example, until January 1 of the following year. Your payment would be approximately $1,852. This includes $1,000 in principle, and $852 in interest plus delinquent interest on payment one. Also note it's a year later so payment two just became delinquent. 

Delinquent Interest Rates

These examples are based on typical interest rates, but are subject to change and are directed by the entity taxing you. Normally, the primary interest rate is about 8%, and the delinquent is 10%. Also, not all specials work exactly this way, but are very similar. 

If you waited an additional year to pay payment two, you would have one year of interest on payment two at the delinquent rate, and one year of interest on the other eight unpaid specials, so you would owe approximately, $1,780, $1,000 in principle and $780 in interest.

Reminder Notices

We send out reminder notices every year if you do not pay off the total special assessment. This is only a courtesy. Non-receipt does not excuse any late fees or delinquent interest.

Further Information

If you have any additional questions please call the office at 402-593-2143.