Association for Public Policy Analysis & Management

Challenged by increased local demands coupled with limited financial resources, some local governments in the region are considering establishing more special service areas (SSAs) within their jurisdiction as a funding mechanism for infrastructure improvements and some services such as snow plowing.  Most often called special assessments in other states, SSAs in Illinois are areas within local jurisdictions that are assessed additional property taxes, and sometime higher fees or other taxes, to pay for infrastructure improvements and services that benefit property owners and businesses within the area.

This study examines whether governments in the region could or should increase their use of SSAs as a method of funding a wider range of services and infrastructure improvements.  Our study will assess the equity and efficiency of SSAs as a funding mechanism for local government, especially with respect to the problem of assigning benefit and the additional burdens of implementation.  While some local officials believe SSAs realize the benefit principle by asking only those who receive the goods and service to pay for them, others argue that it is an inappropriate method of financing goods and services that have spillover effects and benefit all residents.

This study uses both qualitative and quantitative analysis to investigate the consequences of the use of SSAs by the local governments in the Chicago metropolitan area. The qualitative data are collected from financial reports, ordinances, news articles, and interviews with local officials, and analyzed with QDA Miner.  We expect to understand the costs and benefits of SSAs from a behavioral perspective.