SPECIAL ASSESSMENTS
Special assessments are levied for the cost of a public improvements or services such as streets, sewers,
irrigation, and drainage. Special assessments may be due periodically to improvement districts or be levied only
once by the city or county for a particular work or improvement. These assessments are not based on the value
of the property.
The liens created by special assessments are usually equal in priority to general tax liens.
Self-governing districts may be the source of special assessments. Activated under state law by the local city or
county or by vote of the residents, the district becomes a separate legal entity governed by a board of directors.
A district issues bonds to finance particular improvements such as water distribution systems, drainage
structures, irrigation works, or parking facilities. To pay off the bonds, the district has the power to assess all
lands included in the district on an ad valorem basis. This assessment is a lien on the land until paid. The lien
has priority over private property interests and can be foreclosed by sale similar to a tax sale.
Benefit Assessments
Rather than establishing a separate district for the purpose of constructing an improvement, the city or county
may establish an “improvement area” and assess the lands contained therein on the basis of benefits to be
received from the proposed improvement. A benefit assessment is often included on the property tax bill.
Benefit assessments are distinguished from special assessments chiefly by the differences in the assessment
base. However, there are other distinguishing characteristics. Benefit assessments are generally not considered
to be deductible as a tax on either California or federal income tax returns. There is a distinction made in federal
tax regulations between an assessment to finance improvements and an assessment to finance maintenance.
Only the latter is deductible.
The purposes for which benefit assessments are levied include lighting, flood control, transit, police protection,
fire protection, county service areas and paramedics.