Special Service Areas
What are Special Service Areas?
A Special Service Area (SSA) is a taxing mechanism that can be used to fund a wide range of special or additional services and/or physical improvements in a defined geographic area within a municipality or jurisdiction. This type of district allows local governments to establish such areas without incurring debt or levying a tax on the entire municipality. In short, an SSA allows local governments to tax for and deliver services to limited geographic areas within their jurisdictions.
SSAs are a unique financing tool that can be used to support and implement a wide-array of physical improvements such as roads, water, sewer, storm water, curbs and gutters. Different developments within Yorkville have used Special Service Areas to issue bonds in order to pay for such infrastructure improvements. The bonds are not a general obligation of the City and neither the full faith and credit nor the general taxing power of the City is pledged to the payment of the bonds. Under Special Service Area Bonds, only the property owners that benefit from the improvements are assessed an additional tax that is used to pay debt service and administrative expenses on the bonds. The SSA tax is collected through the property tax system, and is calculated on the basis of benefit, but is not a part of the Illinois real property tax system.
- Developer "exchanges" costs of improvements funded with bonds for a lower sales price
- Lower down payment
- Total monthly payments similar to conventional mortgage where infrastructure is included in the price of the home
- Gives the homeowner the flexibility of assuming the long-term, tax exempt rate financing or paying it off
Unless noted otherwise, all SSA information supplied by William Blair and Company.