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Increase for public utilities proposed

Published (2/22/2008)
By Courtney Blanchard
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The House Taxes Committee approved the omnibus tax bill Feb. 20.

Sponsored by Chairwoman Rep. Ann Lenczewski (DFL-Bloomington), HF3201 includes a provision that is causing speculation about whether the governor will veto the bill.

The provision in question would increase property taxes on public utilities. After the department concluded that the value of the utility properties was lower than previously determined, it changed the rules and dramatically lowered property taxes collected by local governments where the utility companies are located.

Supporters of the provision say the revenue lost by the rule change is too large for cities to endure. Representatives from the utility industry say it’s unfair that they were “overcharged” only to have taxes raised near previous levels.

Revenue Commissioner Ward Einess said that neither his department nor the governor supports the class-rate increases. He said the provision was one of four outlined by the governor in last year’s veto message, and though he said he couldn’t speak for the governor, he speculated that it could result in another veto.

The committee voted against an amendment by Rep. Dean Simpson (R-Perham) that would have excluded the provision.

The omnibus tax bill is scheduled to be heard Feb. 22 in the House Ways and Means Committee. If approved, it will go to the House floor.

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