Double-digit property tax increases for Mpls., St. Paul
For the second time in the past decade, the majority of homeowners in Minneapolis and St. Paul will see their property taxes rise by about 10% or more next year.
The boost comes a year after local authorities withheld major tax hikes, citing the pandemic and other factors, and will hit hardest in low-income neighborhoods where home values continue to rise .
Authorities are now stepping up efforts to direct homeowners to state property tax rebate programs. In Ramsey County, for example, about $25 million in potential refunds are unclaimed, auditor/treasurer Heather Bestler said.
Tax truth notices sent to homeowners in November revealed a handful of double-digit percentage hikes across the metro – from Oak Grove to Mounds View and Belle Plaine to Lake Elmo. The notices serve as preparation for tax hearings before local elected officials, but for the most part the opportunities for citizens to vent or urge restraint have passed.
There was no respite for Minneapolis homeowners like Karina Secord, who in an email to city council members complained that trash was strewn across her driveway and that police had failed to fight crime on his street – all while his tax bill was set to double.
“Outrageous,” she wrote. “Have any members of council considered a limit on tax increases? »
In the Near North neighborhood of Minneapolis where Secord lives, the median home value rose 12.6%, according to the report of a Hennepin County appraiser. The median value home in neighboring Camden is up 8%. Similar increases were reported in the North End and East Side neighborhoods of St. Paul, leaving homeowners vulnerable to bigger tax hikes.
Eric Charles, who moved to the East Side in 2019, said in a recent voicemail to St. Paul City Council members: “You need to figure out how to pay [for] stuff without relying on property taxes and raising them astronomically.”
His home increased in value by 12.5% in 2021, according to county records.
Last month’s tax notices do not reflect school district funding proposals approved by voters in November. That means ratepayers in communities like Stillwater and Shakopee will see much bigger bills come the spring. Stillwater’s school tax jumped 19.9% and Shakopee’s jumped 26.5%, according to the state Department of Revenue.
The St. Paul and Minneapolis school boards approved their district levies last week. Minneapolis, which had been slow to specify the size of its potential increase, told the Star Tribune on Dec. 9 that it was 7.4%, which later passed. The district also took the opportunity to tout the state’s property tax rebate and deferral programs.
City, county and St. Paul school officials were briefed in September on the combined impacts of their levy proposals. Next, the property tax system has been described as unfair to low-income homeowners because it is not based on income, but the payments eat up a larger share of a low-income family’s budget.
Mayor Melvin Carter also said low-income families are hit hardest when cuts are made to avoid tax increases.
Reimbursements, in turn, have taken on increased importance. But getting more people to apply — even after the blasts of emails, tax court documents and mail inserts — has been a challenge. This has led some officials to wonder: Couldn’t they be automatic?
The state now offers two types of homestead credit refunds: the regular credit, which is available to people with household incomes below $116,180, and a special credit, which applies when taxes go up. more than 12% and at least $100.
On Tuesday, Ramsey County Council will pass its 2022 legislative platform, and among the goals is an effort to change the special credit from one a homeowner claims to one that is automatically calculated and applied to property tax returns .
Revenue Department spokesman Ryan Brown said the office has spoken with Ramsey County officials about rebate programs. Any change would require legislative action, he said, and the ministry would have to review any proposed legislation.
He added that the Department of Revenue is unable to track the actual amount of unclaimed property tax refunds in any given year. But he said his general estimate is that a third of owners who might be eligible are not participating in the program.