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Are Special Districts Undemocratic?
Daily Policy Digest

Tax Issues / State & Local Taxes

Tuesday, January 08, 2002
The fastest-growing form of government in America are special districts that have taxing and spending authority, but may be governed by unelected boards, or officials elected only by property owners. Some observers and taxpayers say the special districts are undemocratic and unaccountable.

  • For example, in California, two dozen hospital districts no longer run hospitals -- yet they go on taxing and spending anyway, taking in an estimated $20 million a year.
  • Florida's Walt Disney World has had its own special taxing district since the late 1960s, and beat out city governments in applying for $57 million in tax-free bonds from the state to build a sewage treatment plant for its hotels.
  • Some states have water or business districts in which the vote is restricted to property owners, sometimes on a one-acre, one-vote basis -- and sometimes even if voters aren't U.S. citizens.
  • In North Texas, the Dallas Morning News showed that some developers had purchased districts from other developers and had won hundreds of millions of dollars in taxing authority from a handful of financially interested voters.
Across the nation, special districts handle everything from building infrastructure -- roads, sewers, water lines -- to crop irrigation, flood control, fire protection, cemetery maintenance and mosquito spraying.

Nationwide, there were twice as many cities as districts 60 years ago; now it's nearly the other way around.

Source: Brooks Egerton and Reese Dunklin, "Special rules for special districts?" Dallas Morning News, December 30, 2001.

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