To the editor of the Floodwood Forum:
During the 2012 campaign, many Minnesotans told me that their property taxes were too high and they wanted the state legislature to do something about it.
In addition to making new investments in education and creating good jobs, one of the DFL-led legislature’s top priorities during the 2013 session was to deliver middle class property tax relief.
When you do the math, you’ll find that property taxes have increased by 86 percent since 2002. That kind of financial burden is not acceptable if we want to build a thriving middle class.
That’s why DFLers used a comprehensive approach of aid to local governments, tax reforms, and direct relief for homeowners and renters to begin reversing the decade-long trend of property tax hikes.
According to new projections from the Minnesota Department of Revenue, our new state budget will reduce property taxes in 2014 by an estimated $121 million, or 1.5 percent—the first decrease in over a decade.
Here’s how:
First, our budget increases Local Government Aid (LGA), which helps cities and towns pay for the kinds of vital services like police officers, firefighters, and road repairs that allow us to enjoy such a high quality of life.
For the past decade, previous legislatures consistently cut LGA, pushing the burden of paying for our needs onto the backs of Minnesotans in the form of higher property taxes. With more LGA available to pay for vital services, our communities can afford to reduce that property tax burden. In 2014, Floodwood is set to receive over $18,000 in additional LGA—that’s an increase of over 13 percent from 2013.
Second, our budget exempts all cities and counties from paying sales taxes. When state lawmakers originally extended the state sales tax to purchases by cities and counties in 1992, local governments passed those additional costs on to residents in the form of higher property taxes.
The new sales tax exemption in our budget creates significant savings for cities like Floodwood, eliminating the additional costs once responsible for property tax hikes.
Lastly, the direct property tax relief in our budget means that more Minnesotans will qualify for a property tax refund and many will see a larger refund.
For example, in 2014, over 300,000 homeowners will see their Homestead Credit Refund increase by an average of $212, with more than 137,000 additional homeowners qualifying for a refund. In addition, over 65,000 renters will see their Renter’s Credit increase by an average of $179, with more than 10,000 additional renters qualifying for a refund.
Thanks to the steps lawmakers took to deliver property tax relief, Minnesotans will have more money in their pockets to save for retirement, send their kids to college, or purchase everyday necessities like gas and groceries from local businesses.
At the end of the day, our new state budget helps create a stronger economy and a fairer tax system.
Sincerely,
Carly Melin
State Representative, District 6A