Minnesota House of Representatives
District 12A 651-296-4929 – rep.jay.mcnamar@house.mn
431 State Office Building, St. Paul, MN 55155
FOR IMMEDIATE RELEASE
CONTACT:
Matt Privratsky – 651-296-6860
April 2, 2013
House DFL Releases $250 Million Property Tax Relief Package for Minnesotans
West Central Minnesota residents to see significant property tax relief
ST. PAUL, MN – State Representative Jay McNamar (DFL – Elbow Lake) released details today on a $250 million property tax relief package for Minnesotans that includes direct property tax relief to homeowners and renters in west central Minnesota and modernizes the state's local government aid formula, including additional property tax relief to the communities across Minnesota. Up to 1 million Minnesotans will see direct, targeted property tax relief through the proposal.
“Property taxes have been a huge problem for rural Minnesota,” said Rep. McNamar. “With the Homestead Credit being eliminated last session we really needed to get something done that would help families across the state. These investments will do that.”
Property taxes have risen 86% in the last decade and last year the GOP-controlled legislature eliminated the Homestead Credit, causing property taxes to increase $370 million statewide. The House DFL plan will provide direct property tax relief to middle class Minnesotans by providing $157 million for the Homestead Credit Refund.
Under the Homestead Credit Refund:
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More than 300,000 homeowners (75% of filers) will see an increase in their property tax refund
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More than 100,000 additional homeowners will be eligible for the refund
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The average homeowner will see their refund increase by $212
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A grand total of 636,000 homeowners will see direct property tax relief
In addition to providing middle class homeowners a refund, the DFL proposal includes $15.5 million for the Renter’s Credit. The Renter’s Credit is a refund that provides direct property tax relief to low- and middle-income renters. The previous legislature raised property taxes on renters who earn less than $55,000 a year by cutting the Renter’s Credit and renters saw their property taxes increase by an average of $87. The new proposal enhances the renter’s credit by increasing the maximum refund allowed for renters. 66,000 filers will see a bigger refund and a total of 340,000 renters will see property tax relief through the Renters’ Credit.
“We have new people coming to our communities that are starting new jobs and they are usually renters to begin with,” commented Rep. McNamar. “This will help make it easier for new people to come live in our area and become members of the community and it helps give some relief to those families that are working hard to pay their rent and put food on the table.”
The DFL is proposing the most significant Local Government Aid (LGA) reform in over a decade, including $60 million for Local Government Aid and $28 million for County Program Aid. Under this proposal, nearly every town in District 12A will see an increase in LGA, with cities like Breckenridge, Hancock, and others receiving increases between 10% and 20% over the current year.
The LGA formula is meant to provide cities with state aid when their essential needs exceed the amount that they can raise in property and local taxes. Many Greater Minnesota communities have faced severe LGA cuts in recent years, forcing them to cut back or eliminate vital city services such as police and fire.
“For years we have seen towns struggling with the inconsistency of the LGA aid from the state,” said Rep. McNamar. “This aid will help local communities bring down their property taxes and keep their area appealing for new businesses and jobs.”
The new property tax relief proposal includes an updated LGA formula that is stable, easier to understand, and predictable. The new formula is need-based, and provides the most aid to the communities with the greatest need. Giving cities a more stable source of aid will allow them to better plan financially and to sustain or expand local services such as police, fire and infrastructure.
Throughout the legislative session, Rep. McNamar encourages all constituents to contact him directly with any questions, comments, or concerns on any legislative issue. Rep. McNamar can be reached by phone at (651) 296-4929 or by email at rep.jay.mcnamar@house.mn .
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