One of the most important classes of fees is formed by special assessments. They are for some benefit to real property. A special assessment is a fee paid to cover the cost, less that of supervision by a salaried public officer, of a specified improvement to property undertaken in the public interest. In his excellent study on this subject Mr. Rosewater1 tries to establish a difference between fees and special assessments.

1 Columbia College Studies, II, 3.

He admits the similarity, but points out that special assessments are restricted in purpose and in place, are apportioned among the members of a class, are assessed once and for all and for benefits to real property only. Professor Seligman makes the same distinction. But it is certainly not defensible on purely theoretical grounds, for the differences are not essential but accidental. We might as well set up a separate class of taxes on marriages, for they are restricted in purpose, are assessed upon members of a class, once and for all, and are for benefits to the family only. Like all other fees, special assessments are imposed by the taxing power, cover both public and private benefits, and do not exceed the costs.

The simplest case of a special assessment is when a street is to be built, with necessary sewers and water-pipes. The costs of this have to be met. There is a public interest in the street as a thoroughfare. Private enterprise cannot be trusted to properly protect the public interest. The city, therefore, must step in. It could pay the cost from general taxes or from tolls, of both of which the specially benefited persons would pay their share. But in that case, temporarily at least, the abutting land-owners would reap an unearned harvest at the expense of their fellow-citizens. It appeals to our sense of justice that they should pay for it. They can always afford to do so, as they gain by the improvement. This system has received large currency in the United States, and has according to Mr. Rosewater's extensive investigations given general satisfaction.

Another method has been used to some extent in England. It is similar to that used by private speculators in America, when they open up a new city, or suburb. The city condemns and buys up enough of the land to be improved to furnish, when sold after the improvements, the funds needed. This method has a very limited application.

Special assessments are not frequent in Europe, but do occur. Mr. Rosewater finds them in varied form in France and Germany ; and they are proposed in England under the name of the"betterment" tax. In the last-namedcountry they were early applied to "walls, ditches, gutters, sewers, bridges, etc., damaged by the sea." But not until lately has the principle of measuring the tax by the particular benefit been applied or proposed, and even now the principle is not quite clear. In England the assessment is to cover the cost of the removal of injury rather than the cost of conferring a benefit. In England the cost of improvements is assessed in general taxes from which certain unbenefited districts are exempt. Strictly speaking, the principle is not regularly applied in England at all.

In the United States this fee finds almost universal acceptance. It is, indeed, remarkably well suited to the economic conditions of a new country, and renders rapid improvement possible. In some parts of the country there are harmful results that arise from the desire to give property owners full control over the improvements for which such assessments are to be made. Thus, in some commonwealths, street improvements are only made with the consent of the owners of a majority of the property concerned. The result is that streets are opened irregularly, and some of the main streets are untouched while side streets are improved. But this is an evil of expenditure rather than necessarily connected with this mode of collecting the revenue. The abuses of special assessments are few, and, on the whole, it is a part of the tax system of which America can be justly proud. Professor Bastable's criticism (p. 377) of these fees rests upon a misconception of the method of handling the assessments. They are assessed according to the cost of the improvements ; the special benefit is the justification of the contribution, not its measure. There is seldom any difficulty in apportioning the cost fairly. No charge need be made for any additional benefit beyond the cost, and the contributor has, usually, a voice in deciding whether the proposed improvement shall be undertaken or not.

In view of the fact that the prevailing theory of taxation in this country is that which we have designated as the benefit theory, it is natural that Americans should have been the ones to have made the application of the theory in this particular case. The special assessment is applied in just those cases in which it is easiest to measure the special benefit. And although the principle cannot be given a wider application with any degree of satisfaction, it does, in this instance, comply with the demands of justice and equality. It would, moreover, be rather hard to find under the faculty theory any better justification.