Who’s raising property tax levies the most? Look outside the metro area

More than 3,000 cities, school districts, counties, townships and other districts have the power to levy property taxes in Minnesota. These governments are run by the most local of elected officials, the people who tax and deliver services to their neighbors and then hear about it in the coffee shop or over Thanksgiving dinner if they don't get it right.

At this point, almost 1,900 of these entities are proposing to raise the amount of money they want to collect in property taxes next year.

That's another way of looking at the breakdown of information provided by the Minnesota Department of Revenue last week. Taken as a whole, local governments are seeking some $350 million more from property owners than they did in 2011.

(If you're really crunching the numbers closely, you'll see that the total increase in property tax levies on property owners is $379 million, but a little bit of that is levied by the state, not local governments.)

One big takeaway is that the big levy percentage increases seem to skew outstate.

The champion increase? Except for a tiny lake improvement district, that distinction goes to little Ranier on the Canadian border, where the property tax levy may rise 400 percent to $160,000. The reason for the increase looks like a classic case of the cost of maintaining infrastructure.

The city, which lies just east of International Falls, annexed a chunk of unorganized territory. So its population is quadrupling to 600 and its land value is rising by the same amount. But the levy is rising even faster because of new expenses associated with the annexation, said Koochiching County Auditor Bob Peterson. Water lines to the formerly rural area need to be replaced, and that required the property to be brought into the city.

Residents of the formerly unincorporated territory are not unhappy with the tax increases they're facing, Peterson said.

Another outstate city proposing a big percentage increase is Appleton at 45 percent -- the city is dealing with the closing of a big private prison and its economic consequences.

In all, two-thirds of the state's 854 cities are proposing an increase right now.

Of the state's 87 counties, four are proposing double digit levy increases. All of them are outstate --Waseca in the south and Pope, Lincoln and Grant in the west. In all, 64 have proposed an increase and 15 are planning for a flat levy. But some of those numbers will come down before final levies are set.

For example, I just talked with Wabasha County's auditor-treasurer and she said the county board has proposed a no-increase levy so far but is planning to cut it at least several percent by the end of December.

The outstate trend holds true for school districts. In fact, a handful in and around Todd County -- Eagle Valley, Browerville, Bertha-Hewitt, Staples Motley and Long Prairie are among those seeking 50-percent-plus levy increases. For the state, about half of the 330-plus districts are proposing increases, although that does not include new referendums approved by voters this month.

The Twin Cities are not immune from big percentage increases. Farmington, where residents are shouldering substantial debt payments for infrastructure and a new City Hall, is proposing a 15 percent increase. Oak Park Heights is proposing an 18 percent increase as it considers shifting some services from fee support to property tax support. That shift might actually result in a decline in total bills from the city.

About 1,000 local governments are planning at this point to hold their levies flat next year. Some 400 managed to lower their levies.

These are the levies that residents have a chance to talk about at truth-in-taxation hearings this week and next. Local officials have until the end of December to set their final levies. They can reduce them from the proposed levels but cannot raise them.

As a point of comparison, last year after all the levies were made final, a little over 1,800 taxing entities raised their property tax take.

You can find all the Department of Revenue figures for proposed levies here. Keep in mind they don't include figures for the school referendums just passed and there may be a few errors here and there. The last column is the key percentage to look at.

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