Minneapolis Mayor, R.T Rybak proposed increasing Property Taxes by 1.7% for the latest budget.  The City Council would need to approve this proposal this Fall.  This is lower than the City was expecting because of increase in Sales Tax revenue and removal of financial obligations for the Target Center.

The mayor’s office said 70 percent of homeowners would see no increase — or possibly a decrease — in their city property tax levy because commercial property values have stronger than residential values.

Read Star Tribune Article

I have not seen the 2013 proposed budget to know what is in it yet.  You can view the 2012 Budget here.

I would like to see more details on this, I don’t believe shifting tax burden is the answer – but from the Star Tribune’s article it is unclear to me whether or not the tax burden is being shifted or not.

I also don’t believe a 1.7% tax increase is a good idea.  If it is needed because of the decline in property values, will it go away once property values increase???

Property Taxes Icon (Photo credit: danielmoyle)

I caught this article from MPR and had to link to it.  MPR reports that the City of Minneapolis and the City of St Paul are both to release their budgets this week.  And to what surprise, another tax levy.

Here we go again…

Coleman says he’ll propose to increase the city’s property tax levy by about 2 percent. In spite of that, most homeowners will actually see their tax bills go down, because residential property values have fallen further than other types of real estate.

Minneapolis Mayor R.T. Rybak presents his budget to the city council on Wednesday. His spokesman says he’s aiming for a tax levy increase of less than 3 percent.

Read Full Article from MPR

But don’t worry, with the tax increase you won’t actually be paying more because your biggest asset and family nest egg has shrunk so much in value.  (umm.. the values are starting to go back up.)  I suppose it’s not like anyone is unemployed or underemployed struggling to make ends meet as it is..

Higher property taxes bring values down!  People purchase based on their monthly payments, if you keep dedicating more and more of that monthly payment to property taxes then the value has to drop.  (or monthly income has to go up…)

Detroit is an extreme case in high property taxes and home values, but property owners found a loophole.  Apparently some don’t pay their property taxes and liens and then the City condemns them to resell the property to collect.  The owners then buy back the property at auction for a fraction less than what the tax liens were for.   Check out the details here.

I should refrain until I see the budgets…  but it seems like we just went through this.

Related articles

• Where are the Least Taxing Places to Live?
• Minneapolis Mayor Rybak Express Doubt About Running for Re-election

The City of Bloomington’s published their June Newsletter and had an interesting break down of property taxes.  I thought it was well done on how Bloomington compares to Eden Prairie, Edina, Minnetonka, Maple Grove, Brooklyn Park, Plymouth and Richfield property taxes.

I am not certain of the methodology used here, but am assuming they ran apples to apples comparisons.

Meeting demands with quality City services
Bloomington ranks well in comparison The City continues to meet the needs of its residents while constantly looking for ways to improve and keep costs affordable. In a 2011 comparison of seven communities in Hennepin County with more than 20,000 residents, the monthly cost of City services for a single-family home in Bloomington ranked lowest at $67.82. The graph at left illustrates the cost effectiveness of Bloomington services in terms of what the owner of a median-value home pays in the metro area. Bloomington is very cost competitive even with newer communities such as Brooklyn Park, Plymouth and Maple Grove that are just on the cusp of infrastructure renewal that Bloomington began almost 20 years ago.

Read Full Article from City of Bloomington

Your 2012 tax dollar
How it all breaks down The single-family residential tax dollar is divided among several governmental entities. As the graphic at right shows, for every dollar of taxes paid, 29 cents are for City services. The actual amount of taxes owed is based on market value, tax law and the levy. The levy for all local governmental entities is spread across properties within each entity’s respective boundaries using tax capacity, a function of market value and property type. After applying educational aids, a Bloomington homeowner with a median-value home pays $2,788 in property taxes. Of that, $814, or $67.82 per month, goes to the City for services. The remaining $1,974 or $164.50 a month goes to other taxing districts.

This is a good visual of the “mil rates”, without giving us the actual mil rates…  The County, City and School District each have their own mil rate and combining them and multiplying that with your Assessed Property Value gives you your property taxes.  So when property taxes go up everyone screams at the City, while they are only 1/3 of the culprit.  The County and School Districts should also be receiving the calls.

Over all, property taxes seem to be the lowest in Hennepin County that I have seen from a non-scientific observation.  They raised a good point in this article, that the infrastructure replacement(water/sewer lines/roads/sidewalks etc) is going to be impacting Cities going forward.  Bloomington has begun to address this issue.

Related articles

• MN Local Sales Taxes Authorized But Not Yet Imposed(minnesotaattorney.com)

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• MN Property Tax collections(craigkamman.com)

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• FREEDOM: North Dakota Considers Getting Rid of Property Tax(investmentwatchblog.com)

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• North Dakota votes ‘no’ on ending property tax(money.cnn.com)

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The US Census tracks the Property Tax revenue by State since 1992.  This is a staggering image of the revenue MN is generating from property taxes.  Don’t tell me we don’t have any money…   (updated data 4/16/2012)

Title:               State Government Tax Collections, Property Taxes in Minnesota
Series ID:           MNPROPTAX
Source:              U.S. Department of Commerce: Census Bureau
Release:             State Government Tax Collections (Not a Press Release)
Seasonal Adjustment: Not Applicable
Frequency:           Annual
Units:               Thousands of Dollars
Date Range:          1992-01-01 to 2011-01-01
Last Updated:        2012-04-16 4:19 PM CDT
Notes:               For more information, see
                     http://www.census.gov/govs/www/statetax.html.

DATE         VALUE
1992-01-01    7961
1993-01-01    8155
1994-01-01    8200
1995-01-01    8632
1996-01-01    8288
1997-01-01    9748
1998-01-01    9772
1999-01-01    9281
2000-01-01    9411
2001-01-01    9509
2002-01-01  305573
2003-01-01  585416
2004-01-01  607863
2005-01-01  619122
2006-01-01  634697
2007-01-01  674559
2008-01-01  712463
2009-01-01  713019
2010-01-01  765742
2011-01-01  774891

Related articles

• 14 Reasons Why Property Taxes Vary (johnmurphyreports.com)
• Property Taxes Remain Historically High (eyeonhousing.wordpress.com)
• 2011 Certificate of Rent Paid (CRP) for MN (craigkamman.com)