As the legislative session approaches, a meeting between Dakota County officials and local legislators make clear that tensions still linger over decisions made last year.
The annual pre-session meet-and-greet between the County Board and state representatives and senators from districts touching Dakota County covered the standard fare -- policy positions, bonding requests, wishes for collaboration -- before giving way to a pointed debate about explaining tax increases.
The flashpoint was a flier Dakota County tucked into the truth-in-taxation statements mailed in November to explain changes to state tax policy, which the county said meant tax increases were beyond local government control.
"I think we should talk about it a little bit," said Sen. Chris Gerlach, R-Apple Valley, waving the slip of paper in the air. "What is unpleasant about it is that it was written in a way that reads like a very political document."
Six of seven metro area counties stuffed fliers about the property tax changes into notices mailed to residents this year. In approving the insert for Dakota County residents -- written and designed by county staff -- commissioners said they wanted to show that the county levy stayed flat from 2011 to 2012, and linked rising taxes to the state's changes.
"I don't think it was a political shot from our County Board to anybody at the Legislature," Commissioner Joe Harris said. "We weren't blaming you. We just said it was your decision."
The state eliminated the Market Value Homestead Credit -- a state property tax subsidy for homeowners -- cutting about $260 million as part of the deal to close the state's $5 billion budget gap.
In its place, attempting to shield homeowners from property tax hikes, the state instituted a new Market Value Exclusion that decreases the taxable value of homes under $413,800.
In Dakota County, where commissioners often boast about the low county property tax rate, the shrunken tax base meant that even no increase in the 2012 tax levy would push many people's tax bills up. County staff estimated that the county share of the tax bill for the median home would jump by about $20. High-end homes and commercial and industrial properties would also see increases.
"We felt that we had a duty to notify the public what was happening," said Commissioner Tom Egan.
"I'm wondering if there was an anticipation that there was going to be a larger problem than there actually was," Gerlach said. "I don't think there was an uprising."
Rep. Denny McNamara, R-Hastings, said he supported the switch to the market value exemption, in part, because he'd heard testimony from cities and counties bemoaning the inconsistency of the state's payments for the Market Value Homestead Credit.
"If they didn't represent you, you should've spoken up a lot before you put that in the mail," he said.
Other legislators said that they've had multiple cities thanking them for the change, noting that the new system is more transparent.
"We didn't like the program, but that didn't mean that you raise people's property taxes and you don't acknowledge that you did it," said Nancy Schouweiler, the County Board chairwoman.
If there was agreement, it was on the difficulty of explaining -- and the desire to simplify -- the complicated Minnesota property tax system.
Because the county mails out the truth-in-taxation statements, Commissioner Kathleen Gaylord said, residents come to the county with questions that might be better answered by the state or cities or the school districts.
"A lot of it is just thinking about the property tax system and how we make it more understandable to people," she said. "We're happy for any suggestions."
Katie Humphrey • 952-746-3286