c 8061 '12 HVrWd SI83IBW •sojg pjoi^BO japuig ^unouiojOMd Muaicipal Review Vol. XI, No. 2 February, 1922 Total No. 68 Special Assessments PUBLISHED MO^^^HLY BY THE NATIONAL MUNICIPAL LEAGUE " RUMFORD BUILDING, CONCORD, N. H. EDITORIAL OFFICE, 261 BROADWAY, NEW YORK, N. Y. as second-class matter April 15, 1914, at the post-office at Concord, New Hampshire, under the Act of August 24, 1912. ice for mailing at special rate of postage provided for in Section 1103, Act of October 3, 1917, authorized December 24, 1920. NATIONAL , MUNICIPAL REVIEW PUBLISHED MONTHLY BY THE National Municipal League\ Harold W. Dodds, Editor I The NATIONAL MUNICIPAL REVIEW is sent to all members of the National Municipal League. Those who do not desire to become members of the League may subscribe to the REVIEW by paying five dollars a year in advance. Canada subscription rates $5.'^5 in advance; foreign $5.50. Checks should be made payable to the National Municipal League and mailed to 261 Broadway, New York, N. Y. CONTENTS I. Special Assessments. Committee on Sources of Revenue a. Introduction 43 b. Distribution of Costs and Methods of Assessment 44 Street Improvements 46 Sewers 50 Parks 53 Public Utilities 54 c. Administration 56 d. Bibliography 58 11. Notes and Events H.W. Dodds 59 GRIFFENHAGEN & ASSOCIATES, Ltd. Offer their services on problems of taxation and revenue, fiscal policy, accounting and auditing control, and related phases of governmental finance and administration. HEADQUARTERS OFFICES AT 116 SOUTH MICHIGAN AVE., CHICAGO .X NATIONAL MUNICIPAL REVIEW Vol. XI, No. 2 FEBRUARY. 1922 Total No. 68 SPECIAL ASSESSMENTS^ ASSESSMENTS FOR BENEFIT AS A MEANS OF FINANCING MUNICIPAL IMPROVEMENTS BY THE COMMITTEE ON SOURCES OF REVENUE, NATIONAL MUNICIPAL LEAGUE 2 I. INTRODUCTION In providing certain public improve- ments, especially in mimicipalities, benefit accrues to the land adjacent to or in the vicinity of the improve- ments. This benefit is usually reflected within a very short time in the en- hanced sale value of the property. Where improvements in the public in- terest result in increasing the value of adjacent land, it is becoming more and more the practice for the government to assess the property owners with the cost of such improvements, the levy being made in proportion to the bene- fit received. Such levies to defray the cost of public improvements are known as special assessments. Assessment for benefit as a ^This discussion of Special Assessments in American cities is published by the National Municipal League to meet the demand for in- formation on special assessment administration. It has been drawn by the chairman of the Com- mittee on Sources of Revenue with the aid and counsel of the committee and is based upon a series of manuscripts prepared for the committee by Mr. Clarence E. Ridley and Mr. William A. means of financing public improve- ments is not at all a practice of recent origin. The principle was applied in England as far back as 1427, when cer- tain acts provided for apportioning among the land owners benefited there- from the cost involved in the construc- tion and repair of walks, ditches, gut- ters, sewers, bridges, causeways and trenches which had been damaged by the inundation of the sea. The idea of special assessments was introduced in this country as early as 1691, when it appeared in the provisions of a province Bassett of the National Institute of Public Ad- ministration, and Mr. William C. Ormond, President of the New York City Board of As- sessors. 'Luther Gxjijck, Chairman, National Insti- tute of Public Administration, New York City; Robert M. Haig, Columbia University, New York City; Harris S. Keeler, Chicago Bureau of Public Efficiency, Chicago; Miss Mable Newcomer, Vassar College, Poughkeepsie, N. Y. ; A. C. Pletdell, New York Tax Reform Associ- ation, New York City; William A. Rawles,. Indiana University, Bloomington, Indiana. 43 483301 '44 ;- NATIONAL MUNICIPAL REVIEW [February law of New York. The important part of this statute was copied almost verbatim from the English Act passed in 1667 and re-enacted in 1670 to reg- ulate the rebuilding of London after the great fire. Special assessments, however, were not generally applied in New York for at least another cen- tury, and it was not until about 1813 that the courts recognized the prin- ciple of such assessments. By 1850 eleven states had followed New York in applying the principle of special assessments, and by 1875 fifteen ad- ditional states had used this principle. At the present time the principle of special assessments is accepted in every state and is applied in some form in a large majority of the cities in the United States. n. DISTRIBUTION OF COST AND METHODS OF ASSESSING IMPROVEMENTS DETERMINATION OF ASSESSMENT AREA As the principle underlying special assessments is that of distributing the cost of public improvements in accord- ance with the benefit conferred, the de- termination of the extent and amount of that benefit becomes the heart of the problem. As a practical matter, the computation of the benefit con- ferred by a particular improvement on each piece of property is greatly facil- itated by following certain general rules for determining the extent and the distribution of benefit. So far, such general rules have not been uni- formly adopted over the country. In many places, the area and the amount of the benefit have been determined for each individual improvement by local legislative bodies in an unneces- sarily arbitrary manner often to meet political expediency rather than to conform to the economic facts. Sound practice with reference to the deter- mination of the assessment area is discussed in this report under each class of improvement. GENERAL METHODS OF ASSESSMENT In the different states varying stat- utory limitations are placed upon the plan of distributing the cost as well as on the various methods of assessment, yet there is substantial agreement in respect to the principles underlying the methods of measuring the degree of benefit. The following four general methods of levying assessments are recognized in law: 1. Frontage. — ^Under this method the assessment is spread on the abut- ting land in proportion to the front- age of each piece of land abut- ting on the improvement. The most serious objections to using it alone is its inelasticity and also the fact that frontage is not al- ways an accurate criterion of the benefit, as it favors deep lots at the expense of shallow lots. 2. Superficial Area. — Under this method the assessment is spread on the abutting property in pro- portion to the area of the land fronting on the improvement in- stead of in proportion to the foot frontage. The inelasticity of this plan also makes it unsatisfactory for use alone. Another objection is its obvious failure as a proper index to the benefit as it favors shallow lots at the expense of deep lots. 3. Valuation. — ^Under this method the assessment is distributed in 1922] SPECIAL ASSESSMENTS 45 proportion to the assessed valua- tion of the land at the time the improvement is made. It favors cheap land at the expense of dear land and fails to recognize that the present value of land is due to con- ditions existing before the im- provement is contemplated or completed and that those con- ditions may be completely altered by the improvement. 4. Proximity. — ^Under this method the assessment is distributed on the basis of proximity to the im- provement, the nearer land paying more in proportion to its super- ficial area than the more distant land according to certain estab- lished ratios, which will be dis- cussed in connection with the vari- ous improvements. While this may be considered a variation of the superficial area method, its recogni- tion of proximity as well as area, dis- tinguishes it. The proximity plan overcomes the chief difiiculties of the other methods. It places deep and shallow lots, cheap or dear lots, on a thoroughly equitable basis. It has the further great ad- vantage that it is applicable to extensive improvements, the effect of which reaches beyond the immediately contiguous land. EXEMPTION FROM ASSESSMENTS One of the most perplexing questions with which municipal authorities have to deal in the distribution of special assessments is that of providing for exemptions granted by statute or or- dinance or permitted by general policy. In many cases, particularly where the state or national government is con- cerned, cities, although not inhibited by law from levying assessments against property owned by those govern- mental units or by private institu- tions, are unable to collect the assess- ments when levied. When exemptions from assessment are granted, the bal- ance of the assessable projjerty must either bear the additional financial burden or else it must be distributed over the city at large. In either case, the situation is complicated and does not readily admit of an equitable solution. It would seem that any exemption of property from special assessment, whether such property is in govern- ment or private ownership, is unsound. The benefit resulting from a public improvement inheres in the property affected, and the distribution of the cost in terms of benefit conferred should be made in that way. When national, state or city property is affected by any particular improve- ment, it may be necessary to meet their share of the cost out of the general fund; in any event, the adjustment necessary should be a matter of public record showing that a regular assess- ment had been made against the prop- erty in accordance with the benefit conferred. In the case of private schools, churches, charitable and other institutions, there should be no ex- emptions from assessment. PUBLIC IMPROVEMENTS FOR WHICH SPECIAL ASSESSMENTS ARE MADE Public improvements which have been generally recognized as work for which special assessments may be levied are as follows: (1) the acquisi- tion of land for street or park purposes and the subsequent opening of streets and development of park property; (2) execution of city-planning projects involving the widening and straight- ening of streets; (3) the improvement of streets, including grading, paving, and repaving; (4) the construction of sewer systems and sewage disposal 46 NATIONAL MUNICIPAL REVIEW [February plants; (5) the construction of water- front improvements, including levees and other shore protection. The cost of bridges, when forming an integral part of a street improvement, should be included in the assessment for that improvement. Paying, to some extent at least, the cost of rapid transit lines by assessment on property ,has recently received consideration. Although no application of this idea has been made up to the present time, two cities. New York and Philadelphia, have included this method of financing I in plans for the future. In addition to assessing for the public improvements noted above, the prac- tice is followed to a limited extent by some cities of assessing the cost of cer- tain public services rendered. Among these are included: sprinkling and oil- ing of streets, removing snow from side- walks, cleaning roadways, cleaning sidewalks, repairing sidewalks, care of street parking, planting shade trees, care of shade trees, cutting weeds, fill- ing in lots, park maintenance and even moth extermination. The universal application of special assessments to meet such services is undesirable from an administrative standpoint. In most cases they would seem to fall more ap- propriately in the group of municipal services financed from taxation. The particular problems arising in levying assessments for each of the major types of public improvements are discussed below. 1. Street Improvements opening and widening streets The plan of distributing the cost of street improvement varies with each kind of improvement. In case of street widening or of opening a new trimk street, the total cost should or- dinarily not be assessed against the abutting property, for the nature of the improvement is evidence that it is called into being by traffic demands outside the immediate vicinity and therefore has assumed more than local importance. Of course, if the owners of the property on either side of the proposed opening or widening petition for the improvement as being necessary for their convenience or to accommo- date their expansion of business, or if the improvement is a local service street, rather than a trunk street there is no question but what the locality should pay part of the cost. If traffic in a particular locality becomes con- gested to such an extent that it is ex- pedient to widen, extend or open up a new street, then the cost of such im- provement should be distributed be- tween the district so benefited and the abutting property owners. It is not uncommon for such an improvement, by reason of its strategic location, to be of very important general and of comparatively little local benefit. The equitable distribution of the cost be- tween these immediately contiguous and outlying areas depends so much upon local conditions and the circumstances calling for the improvement that no suggestion of value can be made here as to the proper allocation of the cost. The plan of distributing the cost must be determined in each separate case only after a very careful investi- gation. It is well to add here that in the application of a distribution plan to an improvement of this kind, as well as to any other, local conditions must govern to a large degree, and while the application of the method, when once the plan is determined, is not extremely difficult, yet common sense and a thorough understanding of the method to be used are necessary. While no definite plan can be given to govern the distribution of the cost between the parties benefited, that is 1922] SPECIAL ASSESSMENTS 47 the degree to which the benefit is general, district or local, it is possible to outline a method to follow in spread- ing the amount of assessment to each lot or parcel of land once the plan of distribution of the cost is determined. It is safe to say, however, that in no case should the entire cost of acquiring a street in excess of sixty feet in width, which is the generally accepted width for a local street, be assessed against the local property, except perhaps in the business district. It is true that property fronting on a wider street is more valuable, yet only within certain limitations, for after a street has reached a certain maximum, additional width does not necessarily involve additional benefit and it may if too wide detract from property values. In cases where it would be equitable to assess locally the whole cost of a sixty-foot street, it would seem satisfactory to assess locally 25 per cent of a greater width up to about 125 feet. Some years ago in a paper presented before the Fomlh National Conference on City Planning, Nelson P. Lewis, Chief Engineer of the Board of Estimate and Apportionment of New York City, recommended that the 25 per cent of additional cost begin at a sixty-foot width, and end at one hundred and forty feet, thereby mak- ing the percentage of cost which would be locally assessed as follows for vari- ous street widths : per cent 60 feet 100 70 " 89.3 80 " 81.25 90 " 75 100 " 70 120 " 62.5 140 " 57.1 150 " 53.3 200 " 40 In the case of street widening the same plan would be applicable, that is, if the street were less than sixty feet in width, the additional expense in order to make it sixty feet would be assessed locally, while for any additional width the above table could be used. In blocks of ordinary length and width, it is customary to include in the assessment area all property to the parallel middle line of the block. In determining individual assessments within this area, the method described later under "street paving" is used. STREET GRADING As it is ofttimes desirable to grade certain streets some years before it is either possible or expedient to pave them, the question of paying this cost naturally arises. As this step is es- sentially a part of the preparation for paving the cost should be distributed and the assessment spread in conform- ity with the policies pursued when deal- ing with a pavement. STREET PAVING There is probably no other improve- ment in the municipal field which claims so large a share of special assess- ment receipts as the paving of streets. No extended argument is necessary here to emphasize the importance of pavements from an economic, social, and aesthetic point of view. Progres- sive cities have realized this and have provided well paved streets financed largely through special assessments. Because the benefit accruing to the property owner on account of the en- hancement in the sale value of his land by the construction of a pavement adjacent thereto is often far in excess of the assessment, no argument is needed to justify the application of the special assessment policy to this kind of improvement. The points to be dis- cussed here are: first, the determina- tion of the total amount of special 48 NATIONAL MUNICIPAL REVIEW [February benefit to be assessed and the boun- daries of the area of benefit; and, sec- ond, the method of determining the in- dividual levies. In arriving at an equitable distribu- tion of the cost there are several ele- ments to be considered. In the first place, if the street is purely residential there can be no question but the entire cost should be borne locally regardless of the width of the pavement deter- mined upon, provided that the prop- erty owners desire a greater width than would be essential from an economic point of view. On the other hand, should the street to be paved be a main artery of traffic or develop into one by reason of the improvement, then it is urged, the assessment should be more general, and the greater percentage of the additional cost over and above the width required for local use should be spread over the district benefited there- by. It might be that the additional width should be provided to stimulate the development of a certain district lying beyond or at one end of the pro- posed improvement, in which case the benefited districts at both extremes might be called upon to bear their pro- portional share of the burden It is obvious that local circumstances must govern the distribution of the cost in such cases as those mentioned above. The development of the motor truck and its use for interurban freight trans- portation over the city thoroughfares, surburban roads and county highways has produced a difficult problem from the standpoint of special assessments. Where paving specifications are ma- terially afltected by through truck traffic, this fact in itself is evidence that not all of the cost should be assessed locally regardless of the street width. Statistics show that practically three- I fourths of all cities in the United States, with populations in excess of 30,000, assess the cost of pavements to the property benefited, one-half assessing the entire cost, while one-foiu'th assess only a portion of the cost, due, in many cases, to charter restrictions. In many jurisdictions charter restrictions have been adopted that serve to thwart a sound special assessment policy. This is particularly true of the restrictions placed on the assessment of street in- tersections and of the arbitrary per- centage limits for special assessments. Street intersections are as much an in- tegral section of an improvement as any other part. Consequently, the absurdity of such restrictions is ob- vious. This is typical of many similar legal restrictions which are hampering the free use of the special assessment policy. To illustrate further the lack of uni- formity in assessing for pavements, in Boston the amount cannot by law be over 50 per cent of the cost; and in New York, it cannot be over 50 per cent of the value of the property assessed. On the other hand, in Providence, 110 per cent of the construction cost is sometimes assessed because expense of collection, issuance of bonds, etc., are included; for Buffalo also all of the expense is assessed. The methods of spreading the assess- ment over the area of benefit are simi- larly diverse. Many cities are spread- ing their assessments on the basis of frontage. This method may be justified as long as all lots are the same depth and shape, but obviously overbur- dens a corner lot. It is entirely inade- quate when applied to irregularly shaped lots. The method used by Seattle, Wash- ington, should be noticed in this con- nection. There the property fronting on the street is divided into belts or zones parallel to the street, and the cost is assessed on the property in a stated ratio to its area lying within 1922] SPECIAL ASSESSMENTS 49 I these zones. Forty per cent is assessed against property lying within the first zone, thirty feet wide and adjoining the street; 25 per cent on property in the zone between thirty and sixty feet from the street ; 20 per cent in the zone bounded by lines sixty and ninety feet from the street ; and 15 per cent on the property lying between the line ninety feet from the street and the central line of the blocks. This plan is a step in the right direction, for it eliminates many of the glaring faults of the front foot method. It is a, crude form of the proximity method. A more complete and scientific meth- od of distributing assessments for grad- ing and paving improvements is em- ployed by the city of Flint, Michigan. The plan for levying special assess- ments was introduced by H. E. Terry, former city engineer of Flint, and was developed to its present form, about six years ago, by W. R. Drury, at that time oflBce engineer in the department of public works. The main elements of this plan are as follows : all property lying between the improvement and a line midway between it and the next street is included in the area of assess- ment. The amount apportioned to this area which is assessed to individual properties is determined by mathe- matical rules which vary the assess- ment on the basis of proximity to the improvement. Tables have been prepared running by foot intervals to a depth of 300 feet showing the amount to be assessed ac- cording to these rules. (See Reference No. 12). In spreading assessments with the aid of these tables, the deter- mination of the comparative assess- ments of long and short lots is a simple matter and irregular and triangular lots are handled without difficulty. These rules and tables resemble those used by assessors as described in the National Municipal Review Supple- ment of January, 1920. While there are cases where such rules cannot be relied upon completely, experience shows that they do serve to increase the fairness of assessments because they eliminate guesswork and discrim- ination in a large measure. REPAVING Special assessments for repaving are by no means as universal as for meeting the cost of the original construction, yet the proper distribution of the cost is no more complicated than in the case of the original pavement, and if the different factors enumerated under the discussion of pavements above are taken into account, there is no reason for any different plan of assessment. It is true that the reconstruction of a pavement often may not enhance the value of a piece of land to the ex- tent that the original pavement does, yet it is just as true that a depreciation in the value of the land would certainly result if the adjacent pavement were allowed to get into such condition as to render the property less accessible. Some cities are not permitted by law to levy a special assessment upon the land benefited for a renewal pave- ment. The costs of such pavements must therefore be distributed through the general property tax rate on the basis of the assessed values of all prop- erty. Such a policy is unfair to high priced land, to improved land and to the owners of other taxable subjects. SIDEWALKS The usual practice in sidewalk con- struction in practically all American cities is to assess the total cost against the abutting property. In most cities the property owners are required to pay the cost of construction, repair and maintenance, and reconstruction when 50 NATIONAL MUNICIPAL REVIEW [February deemed necessary for public safety and convenience. There are, however, a few exceptions. For example, in Bos- ton but one assessment can be made against property owners for the con- struction of sidewalks. This means that when a sidewalk of any character has once been built and a portion of the cost assessed against the property the city must forever after repair and rebuild when necessary, or even con- struct a much wider walk than was originally built. Such a provision is not in accordance with accepted practice. It shifts the burden from the land owner, the one directly benefited, to the city at large, where the benefit is but very limited. As a general rule, property owners should be required to construct, main- tain and rebuild when necessary the walks adjacent to their property and should be held liable for any injury or damage to persons or property as a result of neglect to repair or maintain such sidewalks. In spite of this general rule there are, of course, cases where the construction of a sidewalk may with equity be borne in part by the city at large. Where sidewalk construction forms a part of a street widening or city-planning project and the demands of pedestrian traffic necessitate a material widening the work would hardly be construed as conferring a strictly local benefit. CROSSWALKS In some few cases the cost of cross- walks is made the matter of independ- ent local assessment. A crosswalk constitutes an integral part of the street section in which it is located. The cost of constructing it should be included in the cost of improving the street and the identical method should be followed in meeting the cost as obtains in the case of the street improvement. BRIDGES Ordinarily bridges alone are not con- sidered among public improvements subject to special assessment. Bridge construction required in connection with a specific highway improvement may be considered as constituting an integral part of the improvement. Where this is done the cost involved should be included in the general cost of the improvement. In some cases the widening or replacement of an ex- isting bridge by one of more substan- tial construction might be construed as conferring, at least in part, a local benefit. Under such conditions a portion of the cost should well be dis- tributed by special assessment over the area deemed to be benefited. It has been the practice in New York City in financing certain of its bridges, not only to assess a part locally, over a benefit area, but also to lay a special assessment, as a surcharge of the tax rate, in large areas of the city. 2. Sewers There are three general types of sewers: first, there is the sanitary sewer which disposes of waste water, especially water carrying polluted matter commonly spoken of as "house sewage"; second, the storm sewer which carries off storm water; and third, the combined sewer which per- forms the functions of both sanitary and storm sewers. Because of the different problems arising in handling special assessments for the various kinds of sewers, they are discussed separately below. SANITARY SEWERS There are different types of sanitary sewers in a complete sewerage system for any community. The simplest 1922] SPECIAL ASSESSMENTS 51 type is the lateral sewer, sometimes spoken of as a service or local sewer because it usually serves one particu- lar street and its benefit therefore is strictly local. The next in order is the trunk sewer, usually larger in size, and into which the lateral sewers discharge, provided, of course, that the lateral does not empty directly at the point of final disposition, which is rarely the case. This sewer may also furnish direct connection to abutting property. Then next comes the intercepting sewer, which is a still larger sewer, and as its name implies its function is that of in- tercepting and collecting sewage from a number of trunk sewers and convey- ing it to a point of final discharge. And finally, there is the relief sewer, which is usually built parallel to an old sewer that is inadequate because of growing needs. It is obvious that each of these sewers presents a problem of its own. They are therefore considered separately. . LATERAL SEWERS It would appear that inasmuch as the benefit derived from a lateral sewer is merely local in character, that it ought to be fairly simple to determine the method of levying the cost upon the property benefited. However, this is not the case. If one will sketch a few lots with their multifarious shapes and sizes, it will be seen at once that the problem is difficult and is made even more so by the nature of the improve- ments situated on the lots. To illus- trate, two lots may be of equal front- age and depth; one may have a house built in the center, thereby prohibiting the construction of a second house without tearing down or moving the present structure; the other lot may have a house built upon one side with the idea of building another house upon the lot. Since this new house. when built, will require sewer service, the lot is benefited more than the lot with only one house which has but one connection. Again, one street has a sewer. A sewer is required on a cross street. The comer lot is already served. It can use but one sewer. Certainly another sewer adjacent to the property will not enhance the value, or render a benefit. Such situations as these make the problem of an equitable as- sessment for sewers a difficult one. To solve these difficulties, assessors have applied many apportionment rules. It is evident that the frontage method of assessment favors deep lots, and the area method favors shallow ones, so some cities have combined the two in order to secure the merits of both, but unfortunately the drawbacks of the methods sometimes oflFset the merits, and dissatisfaction has been the result. The arbitrary ratio assumed in most cases is to assess three-fifths of the cost on the basis of area of property sewered and the remaining two-fifths on the basis of frontage. Another plan used to a very limited extent is the entrance fee plan, that is, charging a fee for connecting to the sewer. This is unsatisfactory, since the money to defray the cost of an improvement is needed when the improvement is made, or if deferred, within a definite period and not when adjacent property is built upon. On the basis of these facts it would seem necessary to consider the entire cost of lateral sanitary sewers as assess- able to the local area served and to dis- tribute the individual assessments on | a basis of area and frontage, allowing j more weight to the former. I TRUNK SEWERS Inasmuch as trunk sewers often per- form the dual service of picking up the discharge from laterals as well as direct 52 NATIONAL MUNICIPAL REVIEW [February property connection, it is clear at once that we have a problem of allocating the proper percentage of the cost to each of these services. Obviously, the property owners adjacent to a trunk sewer should not be called upon to pay more than what it would cost to con- struct a sewer sufficient for their re- quirements plus their proportionate shares of the cost of the trunk sewer. This cost would be levied on the prop- erty benefited as in levying the assess- ment for laterals. The balances of the cost of the trunk sewer should be dis- tributed uniformly over all the tribu- tary area in proportion to the assess- ments for lateral sewers. INTERCEPTING SEWERS There are good grounds for not assessing the cost of intercepting sewers against the property benefited, for, while this part of the system is an in- tegral part of the whole, its local bene- fit is less apparent. It is more a general benefit and consequently its cost should be distributed over the community at large either by special assessment or in the form of general taxation. There are cases, however, where an improvement of this kind serves only a limited area and confers a distinct local benefit. In such cases the cost can be met equitably by special assessment by the same general method outlined for trunk sewers. RELIEF SEWERS The need of additional carrying capacity in a certain section does not necessarily imply a faulty design of the original sewer. It is not always pos- sible to forecast developments, nor is it always sound policy to construct a system to anticipate development by too many years; the carrying charges become too heavy. When the relief sewer becomes necessary, its cost should be distributed over the area benefited as with other sewers. STORM SEWERS While the assessment principles of sanitary and storm sewers are some- what alike in character, there is also one particular point of difference that makes it more difficult to locate the benefit in the latter case. Storm sewers are not required on all streets since ad- vantage is taken of the slope of the ground or grade of the pavement and the storm water is allowed to run in open gutters for a block before entering a sewer through the inlet. This fea- ture makes the determination of the local benefit more difficult and has led some cities to pay for all storm sewers out of general taxation or bond issues. As the construction of storm sewers must precede the laying of permanent pavements, there is likely to be a heavy burden placed upon a particular terri- tory if the total cost of both the pave- ments and sewers is defrayed by special assessment. There are cases, however, where the policy of special assessment should be adopted since a direct and measurable benefit is derived from such an improvement. In levying the assessment, however, the same princi- ple that was applied to sanitary sewers cannot be wholly accepted when assess- ing for storm sewers. While a sanitary sewer must be adjacent to the property in order to allow a connection and per- mit a benefit, a storm sewer may be a block away, inasmuch as it handles merely storm water. Therefore, the drainage area served by the sewer should form the assessment area regardless of the location of the storm sewer. The distribution of the assessments within the area of benefit presents a somewhat different problem from that raised in connection with other sewers. 1922] SPECIAL ASSESSMENTS 53 The amount of storm water to be car- ried off varies in direct proportion to the area. It would therefore seem reasonable to distribute the burden in proportion to area. COMBINED SEWERS In dealing with a combined sewer, that is, one performing the functions of both sanitary and storm sewers, it is evident that the problem will be- come less complex if we divide the total cost into two proportionate parts just as if the separate design had been adopted. After this has been done, the cost assigned to the sanitary sewer- age system can be assessed as has already been described and the re- maining amount, or the storm sewer share, assessed to the drainage area. 3. Parks A number of cities to-day are enjoy- ing the benefits derived from the crea- tion of parks, boulevards and civic centers made possible by liberal charter provisions allowing the special assess- ment policy to be applied in defraying the cost. That the function of a park is not alone to provide means for rec- reation is brought out clearly in court decisions relating to the liberal pro- visions relative to parks, contained in the Kansas City, Missouri, charter. Brief passages of these decisions follow: "Public parks in cities are essential to health, comfort, and prosperity of their citizens. They are a public use, within the meaning of the constitution, for which land of citizens may be taken upon payment of just compensation. They confer general benefit upon all citizens and special and peculiar bene- fit upon owners of real estate in their immediate vicinity." "It is comf>etent for the council to define the benefit district and to assess benefits against real estate benefited and it is not necessary that a park be paid for by general taxation of the whole city." In the case of Haenssler vs. St. Louis (205 Mo. 656, 1. c. 681) the court ruled that "city may acquire property out- side of city yet near for park purposes." As the problem of assessing for the opening and improving of parks calls for special consideration as compared with the question of maintenance, we shall consider the two problems under separate headings and follow then with the treatment of boulevards and civic centers. OPENING AND IMPROVING PARKS One of the early applications of the principle of assessing for acquisition of land and its development for park pur- poses was made in New York City in 1853, when land was acquired for Cen- tral Park, and of the total cost amount- ing to $5,169,369.90 a certain share was assessed against the property benefited. Since that time developments have been such that Central Park now forms the border for the most valuable res- idential property in the city, which is largely the result of the park develop- ment. The enhancement in value of the property benefited probably would have justified the levying of the total cost of the improvement. The same is true of parks in many other cities. Expe- rience has demonstrated beyond doubt that the mere taking of property for park purposes immediately enhances the sale value of adjacent property. The amount of the benefit depends upon the proximity of the property to the park and will diminish as the distance from the park increases. It would seem, therefore, that the method pursued by such cities as Kansas City, Denver and Indianapolis of dividing the city into certain park districts 54 NATIONAL MUNICIPAL REVIEW [February and then assessing each district for the entire cost of the parks for that particular district is in most cases sound. As to the method of levying the assessment within the area of ben- efit, excellent opportunity is offered for the application of the zone method. The location of the lines determining the boundaries of the different zones and the proportion of the total cost to be paid by each zone should be fixed to fit the particular territory. Perhaps the most scientific method of deter- mining the distribution of cost by this method was worked out during 1917 under the jurisdiction of the chief en- gineer of the Board of Estimate and Apportionment of New York City. (See Reference No. 9.) It is based on various mathematical formulae derived from a careful study of benefits de- rived from parks in New York City. BOULEVARDS Any well-designed park plan will ordinarily include a system of boule- vards either within or connecting the separate park areas. A boulevard is both a part of the park system and a pleasure thoroughfare. It is therefore reasonable to distribute a very con- siderable part of the cost of the boule- vard system over the city as a whole. CI\^C CENTERS In reality civic centers fall in the same category as parks, yet their im- portance the past few years and their almost certain prominence in the years to come warrant at least separate men- tion. One of the most elaborate civic centers is that developed by the city of Denver at a cost of $2,685,000. This civic center is near the heart of the city and on territory previously built up by permanent buildings which had to be acquired by the power of eminent domain and destroyed. It falls in one of Denver's four park districts which was assessed to meet the cost of the project on the basis of benefit. \ 4. Public Utilities The financing of service extensions of what are commonly called public utilities — ^water, gas, electric, and street railway systems — ^by means of special assessments presents a some- what different problem. With the ex- ception of water supply extensions few cities have levied special assessments for public utility extensions. Never- theless it needs no argument to show that the extension of public utilities confers a distinct local benefit. If the extension is not premature, the benefit conferred will exceed the costs of the extension. Where the utility is privately owned, the extensions are of necessity privately financed, but where they are publicly owned the service extensions should be locally assessed because the benefit is local. It should not be overlooked that such a policy will tend to restrict service extensions until they are needed and will to this extent encourage a more economical development of public utilities. Each utility presents distinct prob- lems. In the following paragraphs the more important of these are discussed. WATER line extensions Though a large number of cities meet the cost of laying water mains by special assessments, the majority still pay for service extensions from the surplus in the water fund. It is not easy to justify this practice of asking con- sumers to pay for new extensions. Service extensions should certainly be 1922] SPECIAL ASSESSMENTS 55 Some cities assess a certain stipu- lated amount per front foot. This plan is obviously not equitable for the same reasons that have been pointed out in the case of sewers. The city of Bristol, Connecticut, in 1919, adopted a char- ter amendment which provides that when the estimated net income from water revenue from a new line shall be less than 10 per cent of the construc- tion cost, the board of water commis- sioners may assess the deficit against the property benefited. Other cities have adopted similar provisions and on the whole the plan is commendable. Care should be exercised, however, to limit the application of this policy to lines primarily designed for private consumption. When extensions are made to support the distribution sys- tem, community benefit is involved and the difference in cost should be met from other sources. The area of benefit and the individ- ual assessments should be determined in accordance with the principles which govern assessments for sanitary sewers. The accruing benefit would seem to be similarly distributed in the two cases. HIGH PRESSURE FIRE PROTECTION SYSTEMS It is strange that many cities fail to recognize the possibility of special assessments in paying for separate high pressure fire protection systems. While there is an element of commu- nity or general benefit derived from the added safety of having an additional high pressure water supply service, this general benefit is slight compared with the very real benefit derived by the locality immediately served. In gen- eral these high pressure fire systems furnish water unsuitable and unused for any other purpose than fire-fighting, yet the ordinary practice has been to meet the capital cost by general taxa- tion, and the operation and mainte- nance charges from water revenue re- ceived from private consumers. Here again the consumers scattered over the entire city pay for the protection ajfforded a limited number of property owners who are reaping definite benefits through decreased fire insurance rates and better protection. If benefit is to govern the distribution of the cost for local improvements, surely here is a clear case for the application of a spe- cial assessment policy. The area served should be the area of benefit and the in- dividual assessments should be levied j in proportion to land values. Though it may at first thought appear strange to use land value as a measure of the benefit to be derived from a high pres- sure system which protects combus- tible property, and not land, analysis shows that land values reflect very closely the economic possibilities of the locality. It is only on the higher val- ued land that the taller buildings can be erected profitably. While there are isolated tall buildings on low priced land, this very isolation limits the dan- ger of a conflagration beyond the con- trol of the ordinary fire-fighting system and therefore the benefit of a high pres- sure system. STREET LIGHTING FACILITIES Street lighting is primarily intended to protect the community against haz- ards of various kinds, and as such may be considered as providing a strictly community benefit to be paid for in the general budget. At the same time unusual street lighting, for example of ] an ornamental character, on a main thoroughfare does not fall within the terms of this definition and may be considered as conferring a strictly local benefit, and as such subject to local assessment. Furthermore, the cost of any street lighting improvement 56 NATIONAL MUNICIPAL REVIEW [February providing facilities in excess of those recognized as necessary to safeguard the community could with equity be assessed in part against the property benefited at least to the extent that the cost exceeds that required to furnish the necessary facilities to afford ade- \ quate protection. Ohio specifically provides for the assessment of property 1 benefited by street lighting. In several 1 instances the courts have upheld the ! practice. Perhaps the most noted case is Ankeny vs. the City of Spokane, in which the courts held that the fiu*- nishing of electrical energy for street lighting purposes for a limited term is a local improvement within the meaning of a constitutional provision permitting the financing of such improvements by special taxation of the property benefited. It was also held that a street lighting system including orna- mental features does not prevent the assessment of the additional cost in- cidental to these features against the property benefited. In view of the nature of ornamental street lighting a distribution of its cost on the basis of frontage would appear sound practice. STREET RAILWAY AND RAPID TRANSIT LINES In our growing cities the extension of street railway or rapid transit lines has more effect upon real estate values than the development of any other sin- gle utility. Figures show that timely extensions of transportation facilities cost less than the enhancement of land values produced thereby. In the case of one of the subway extensions in New York City the aggregate in- crease in land value of a district extend- ing about a half mile on either side of the subway, due to the building of the subway, and in excess of a normal rise of $13,500,000 was about $31,300,000. The cost of theline was about $5,700,000. Had the property which was benefited borne this expense through the form of an assessment, after paying such assess- ment, there would still have remained an aggregate profit of $25,600,000 in excess of the normal rise in value. This case is not exceptional. Tran- sit facilities confer a distinct local ben- efit. It is clear, therefore, that financ- ing publicly-owned trolley and rapid transit extensions offers a legitimate field for special assessments. The distribution of cost, of course, will depend largely upon local condi- tions. The chief benefit resulting from the construction of rapid transit lines / accrues to two zones of the city. The ' first of these is the business district, the boundaries of which must be deter- mined by each city for itself. The sec- ond, and perhaps the more important, is the area tributary to the new line which will include the residential and undeveloped districts into which the line is extended. Very little benefit will accrue to the district intervening between these two areas except right along the lines themselves where these are surface street cars. The deter- mination of the area of benefit in the residence districts and the apportion- ment of individual assessments are to be handled by the proximity method. In the case of subways and elevated lines with stations several blocks apart, the zones will be concentric about those stops. Express stops confer a larger benefit and justify larger zones and heavier assessments. III. ADMINISTRATION A well-planned and eflficiently con- structed public improvement confers a benefit upon the community at least equal to its cost. This benefit is sel- dom distributed evenly over the entire city. In almost all cases certain lo- 1922] SPECIAL ASSESSMENTS 57 calities benefit far more than others from the improvement. It is there- fore only fair to ask the specially bene- fited areas to make special contribu- tions to meet the costs involved. Any other policy results in a special bene- fit to some at the expense of the entire community. In recognition of this an increasing majority of our cities are financing improvements by means of special assessments. There are still some communities, however, that have yet to adopt the policy of special assess- ments, and there are no cities that have recognized the full implications or pos- sibilities of the policy. The success of special assessment policies depends largely upon adminis- tration. While it is the purpose of this report to deal primarily with the technique of assessing the costs of local improvements, the following broader problems of administration may be mentioned. STABILIZED POLICY Land values in any community de- pend upon anticipations. Wherever these anticipations rest upon uncertain foundations, needless costs and for- tuitous profits result with an inevitable hampering of community growth. For this reason, a stabilized assessment policy is of great importance to the city as a whole. It assists in the stabi- lization of land values. PUBLICITY Publicity is the best safeguard a community can have against ill-ad- vised and extravagant improvements. The administrative provisions for in- itiating and authorizing assessable im- provements should therefore include adequate machinery for informing those who will pay for a given improvement what their individual assessments will be and what benefit they may expect to derive. Methods should be established whereby all the pertinent facts will be made known and the opponents as well as the proponents of an improve- ment given their day in court. Where full opportunity to be heard and full publicity are guaranteed, the govern- ing body of a community should have the final decision as to each individual improvement, in order that the con- servatism of one locality may not thwart the best interests of the entire city. COLLECTIONS Special assessments should be pay- able either in a lump sum or in install- ments at the option of the land owner. Such a policy makes it possible to lay and collect relatively heavy assessments without hardship. It is also of the ut- most importance that collections be rigidly enforced. A lax policy of tax collection is more expensive in the long run, and proves particularly embarrassing in the case of special assessments. ASSESSMENT STANDARDS Certain cities experimenting inde- pendently have evolved standards of special assessment administration. It has been the purpose of this report to outline these standards and to make them the common property of all public officials and students of government. The determination of the broad questions (1) of the share of the cost of any project that is to be assessed, and (2) of the boundaries of the area of benefit, must be settled for each in- dividual project, but always on the basis of an established municipal policy. The lack of such a general policy and the settlement of these questions in accordance with political expediency can result in nothing but 58 NATIONAL MUNICIPAL REVIEW [February injustice and fluctuating land values. Once the amount to be assessed and the area of benefit have been deter- mined the individual levies can be made equitably on the basis of accepted assessment rules. It must not be for- gotten that these rules have been based on careful analyses of the effects of different types of improvements and of long experience, and that their conformity to the facts has been fre- quently tested. BRIEF BIBLIOGRAPHY AND REFERENCES ON SPECIAL ASSESSMENTS 1. Bassett, W. a. Special assessments. Library of National Institute of Public Adminis- tration, 261 Broadway, New York. 1921. 130 PP» (typewritten). 2. DiLXON, J. F. Law of Municipal Corpora- tions. 5 V. 1911. 3. Engineering Societies Library, New York City. Special searches No. 383, 383A and 2897, Special assessments. (Prepared for the Bureau of Municipal Research, New York City.) 4. Haig, R. M. The American system of special assessments and its applicability to other coimtries. 1917. 8 pp. Paper presented be- fore the Second Pan-American Scientific Con- gress, WashiHgton, December 27, 1915-January 8, 1916. 5. Lewis, N. P. Taxation and special assess- ments. In Mimicipal Engineering, Vol. XIII, p. 268. . Paying the bills for city planning. In National City Plaiming Conference Proceedings 1912. . Theory and practice of laying assess- ments for benefit. In Public Policy, v. 3, p. 349. 6. Library of Congress. Division of Bibli- ography. Select list of references on special assessments for Municipal Improvements. 1911. 4 pp. (typewritten). . Supplementary list 1915. 5 pp. 7. McQuillan, Eugene. Law of Municipal Corporations, 6 v. 1911-13, Supplements 1920. 8. Municipal Reference Library, New York. A selected bibliography on real estate assessments. 1921. 7 pp. (Contains numer- ous references on special assessments.) 9. New York City. Board of Estimate. Report of Chief Engineer, 1911, 1916, 1917. 10. New York City, Board of Estimate. Chief Engineer. ■ Report showing the resiJts of an investigation of the practice heretofore fol- lowed in levying assessments for street and park openings, with suggestions as to future policy. October 6, 1907. 42 pp. 11. Ormond, W. C. Assessments for local improvements. Municipal Engineers of the City of New York, paper No. 89, presented May 27. 1914. 51 pp. 12. Ridley, C. E. The growing importance of special assessments as a source of municipal revenue. (Describes Flint, Michigan, plan.) Library of National Institute of Public Adminis- tration. 52 pp. (typewritten). 13. Rosewater, Victor. Special assess- ments. Columbia University. Studies in his- tory, economics and public law. V. 2, No. 3. 2d edition, 1898. 156 pp. (Bibliography p. 152- 153.) 14. Seligman, E. R. a. The betterment tax. In his Essays in Taxation, 1913, p, 433-450. 15. Swan, Herbert. The assessment of benefits and damages in streets proceedings. American City pamphlets, No. 151. 16. Whinery, S. Special assessments. In his Municipal Public Works, 1903, chap, XII, p. 156-174. NOTES AND EVENTS C. A. Dykstra has resigned as secretary of the City Club of Chicago and moved to California to become secretary of the Los Angeles City Club. * Hany H. Freeman has resigned as secretary of the City Managers' Association to accept a busi- ness position. Paul B. Wilcox, assistant city manager of East Cleveland, Ohio, succeeds Mr. Freeman as secretary of the C. M. A. * Miss Edith Rockwood, formerly on the staff of the Woman's City Club of Chicago, has been made executive secretary of the Illinois League of Women Voters with headquarters at Chicago. * Kenosha to Vote on C. M. Government. — Early in January the League filled a rush order from Kenosha, Wisconsin, for 10,000 copies of the "Story of the City-Manager Plan," one of the pamphlets of our Pocket Civic Series. These were used in the campaign for a city-mana- ger charter which culminated in an election on January 26. * Illinois Municipal League. — Among the imme- diate projects of the League announced by Secre- tary R. M. Story of Urbana is the promotion of legislation that will make possible the further adoption of the city-manager plan among Illinois municipalities. At present only cities of 5,000 or less are empowered to adopt the plan. * St. Paul Rejects New Charter.— St. Paul voters are to be congratulated upon having re- jected the charter submitted at the election on December 29. As explained in the January Review the new charter provided for a mayor and council to replace present commission gov- ernment. The mayor-council plan was not of the approved type, however. A number of administrative boards were set up and power was divided between the mayor, the boards and the comptroller. ♦ Boston Elects New Mayor.— Although hardly a political leader in the city supported him, James M. Curley won the Boston mayoralty con- test last December with a plurality of 2,698. The mayor-elect's past term, 1914-1917, was against him, as his opponents found no difficulty in capitalizing on many points, but despite their logic and the Good Government Association's backing of John R. Murphy, Mr. Curley 's cam- paigning methods and personal appeal won him the necessary votes. There were four candidates in the field, and the contest was unusually intense and bitter in per- sonal criticism. At the polls the women did not show as much enthusiasm as was expected of them, and the Murphy supporters believe that this fact was much to their candidate's disadvan- tage. The total vote cast was 160,906, and was divided as follows: James M. Curley, 74,260; John R. Murphy, 71,562; Charles S. O'Connor, 10,818; Charles S. Baxter, 4,266. * A Judidaiy Constitutional Convention.— It has been a year of economic disturbance and acute international crises, so the ordinary man may be forgiven if he paid little attention to the judiciary constitutional convention which re- cently adjourned in New York. Created by the 1921 legislature to suggest amendments to the judiciary article of the state constitution it reports that no material changes in the judicial system are necessary. The election of judges is to be retained in preference to the appointive system. No changes are proposed in the organi- zation of the higher courts and only minor ones in the organization of the lower courts. The con- vention was indeed free from what Macaulay called the "mere rage of experiment." Com- placency was the keynote. * Altoona Council Gives Up C. M. Plan.— Advocates of the city- manager system have always pointed out that where it has been adopted by a mere ordinance of the council it is relatively unstable and not apt to be so effective as where it has been made an organic part of the charter. Altoona, Pennsylvania, is a recent case in point. After several years of successful opera- tion under a commission-council pledged to the plan two new members were elected opposed to it. As a consequence Altoona reverted to com* 59 NATIONAL MUNICIPAL REVIEW [February mission government on January 2. C. Gordon Hinckle, who served as manager for the four years the plan was in effect and enjoyed the full conBdence of the old council, has been appointed manager of Columbus, Georgia. Esthetics and the Constitution. — ^The recent case of Tovm of Wind.for v. Whitney in the Supreme Court of Connecticut (95 Conn., 357) deserves mention. A statute providing for a building line set back from the street line where a private owner seeks to open streets through his property, such streets and setback to be in accord with a town plan previously adopted by the town commission, was upheld as constitutional and as a proper exercise of the i)olice or general legisla- tive power of the state, requiring no compensa- tion to the owner. Incidentally the court re- ferred several times to beauty as a factor sup- porting such regulations and as stabilizing land values. It also said : " The state . . . may prevent the erection of billboards or limit their height. In short, it may regulate any business or the use of any property in the interest of the public health, safety or welfare, provided this be done reasonably. To that extent the public interest is supreme and the private interest must yield." Albebt S. Babd. Fiirther Administrative Consolidation Pro- posed in Massachusetts. — The Massachusetts commission on State Administration and Expend- itures reported last month recommending more complete reorganization of the state depart- ments. The commission finds that the act of 1919 did not concentrate authority in any one center and therefore did not and could not attain administrative efficiency. It will be recalled that this measure set up twenty independent departments in addition to several agencies which were left under the general supervision of the governor and council. Practically all the offices connected with the former administrative agencies were retain without alteration in per- sonnel or duties. The commission believes that there is much waste and inefficiency due to the failure to secure complete reorganization. It finds that there is no uniformity among the departments with respect to purchasing methods. The present system of accounting is wholly inadequate for the needs of to-day. Because of defective co-ordi- nation each department thinks primarily if not exclusively of its own work rather than of its function as a co-operating part of a common instrument. The commission believes that it proposed consolidations would save the sen.sa- tional sum of $10,000,000 a year. H. W. DODDS. CHAS. BROSSMAN M«m.Am.Soc.C.E. Mem. Am. Soe. M.E. Consulting Engineer Water Worka and Electric Light Plants Sewerage and Sewage Disposal Merchants Bank, Indianapolis, Ind. of OrxHQiza- tion— Methods— iidminiatratiun— Salary Standardization — Budget Making— Taxation— Kereuuei— Kxpenditurei— ClTil Serrire- Accounting— Public Worlii J. L. JACOBS & COMPANY Municipal CortMultantt and Engin€€rt Monadnock Building, Chicago (Over 11 yr».' experience in City, County and State Studif) PROPORTIONAL REPRESENTATION Bast Basic for the City Manager Plan Send 25c For Lf t. No. 1 (How P. R. Works in Sacramento) and new Ut. No. 5 (ExplanaUon of Hare System of P. R.) Still better, join the League. Dues, $2. pay for quarterly Review and all other literature for year. PROPORTIONAL REPRESENTATION LEAGUE 1417 LOCUST STREET, PHILADELPHIA R. HUSSELMAN Consultini; Engineer Design and Construction of Power Stations and Lighting Systems Reports. Estimates and Specifications Appraisals and Rate Investigations Electric. Gas and Street Railway CUYAHOGA BUILDING, CLEVELAND, O. A MODEL CITY CHARTER This model city charter drafted by a committee of experts has been used by hundreds of cities when rewriting their charters. Pamphlet Copies of Model Charter 50 cents each. NATIONAL MUNICIPAL LEAGUE 261 Broadway, New York City •«r^30! UNIVERSITY OF CAUFORNIA LIBRARY THIS BOOK IS DUE ON THE LAST DATE STAMPED BELOW AN INITIAL FINE OF 25 CENTS WILL BE ASSESSED FOR FAILURE TO RETURN THIS BOOK ON THE DATE DUE. THE PENALTY WILL INCREASE TO 50 CENTS ON THE FOURTH DAY AND TO $1.00 ON THE SEVENTH DAY OVERDUE. 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