Created: 11/12/2013 7:53 PM KSTP.com
By: Cassie Hart
Preliminary figures released Tuesday by the Minnesota Department of Revenue show cities, counties and school districts could reap an additional $152 million next year from property taxes.
The data reflect the maximum amount taxes can go up. The precise amount won't be known until after next month's Truth-in-Taxation hearings. Nor do the early figures show how the levies affect specific parcels or different types of property - from homes to farms to commercial buildings. And rising property values and new construction are a contributing factor.
But if the pattern holds, it could present political difficulty for Democratic Gov. Mark Dayton and the Democratic-led Legislature. They made reversing years of property tax hikes a key goal and said their budget would accomplish that. In July, Democratic leaders touted a projection showing a $121 million drop in property tax bills. The analysis doesn't take into account the direct-to-homeowner relief measures.
Revenue Commissioner Myron Frans, a Dayton appointee, said the most-definitive figures aren't expected until February. He said he suspects some of the initial levy amounts will drop as local officials convene their public tax hearings.
"We still don't know what the cities and counties will land on," Frans said. "We're hopeful that more cities and counties will use this money we gave them in (local government aid) and revise their budgets downward."
Republicans have maintained that extra state spending won't be successful in suppressing property taxes.
State Sen. Julianne Ortman, the lead Republican on the tax committee, said it's proof that increasing local aid doesn't bring down property taxes.
"That's not what's happening here. I'm not surprised," she said.
Levies are on course to rise in most cities and counties, but fall in places like Minneapolis and Dakota County. Many school districts also passed levy hikes at the ballot box.
Of the $152 million, counties and cities would see an additional $40 million each. Schools are projected to take in $60 million more from property taxes. The rest would go to townships, watershed authorities and other special taxing districts.
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