SSAs come in handy for groups of property owners considering large or expensive projects, IFB specialist explains.
By Brenda Matherly
The concept of Special Service Areas (SSA) has been around since the 1970s, but their popularity is not as well established.
An SSA is defined by law as “a contiguous area within a municipality or county in which special governmental services are provided.” Those services are in addition to those that would otherwise be provided by the general purpose unit of government, and are confined to and financed by only the area receiving the benefit.
An SSA is created under the existing county or municipal government. The benefit of creating and administering these services under an existing unit of government reduces the need to create a new special purpose unit of government with its own taxing authority to provide that service.
Every year, Illinois is populated with new units of government. At last count, the state contained close to 7,000 units. Special purpose districts make up the largest increase in that growth. The primary reason is the need to provide new services often puts financial pressure on existing units of government. Typically, exiting units of government are already taxing at their max rate, leaving little opportunity to generate revenue to fund a new service.
If instead an SSA were created, that same service could be provided without creating a new unit of government. For example, an SSA is made up of a group of property owners who have a common interest in completing a large project or other improvement that would be costly, such as the installation of sanitary sewer and water main pipes.
Once an SSA is created the financing for the improvements is tied to that property and not individual property owners. If one of the property owners moves, the tax payments stay with the property and become the financing obligation of the new owner.
Brenda Matherly serves as Illinois Farm Bureau assistant director of local government. This article appeared in the latest edition of LINK, Local Information, News & Know-How. Visit this link to view the newsletter.