Hennepin, Ramsey, Anoka counties propose 2014 property tax ceilings
- Article by: Rochelle Olson, Kevin Duchschere and Paul Levy
- Star Tribune staff writers
- September 10, 2013 - 9:46 PM
The boards of three of Minnesota’s largest counties proposed varying property tax ceilings on Tuesday — up in Hennepin, the same in Ramsey and down in Anoka.
In Hennepin County, Administrator David Hough described rebounding property values as he proposed increased property tax collections of almost 1 percent.
He portrayed county finances buoyed by increases in state aid and increased property values, along with collections from the new $10-per-vehicle annual registration fee, called the wheelage tax.
“We’ve all heard the statement that government is wasteful in its spending and excessive in its taxing,” he said. “I want to be clear that Hennepin County is neither.”
Hough proposed a 2014 budget of $1.78 billion, which is a decrease of $12.5 million from the 2013 budget. The budget would pay for 29 new full-time employees, making up for recent losses due to retirements and departures.
The proposed property tax levy for 2014 is $681 million, or $6.6 million more than 2013. Along with increased state aid for next year, Hough noted assessed property value improvements. The high point was 2007’s $148 billion assessed value. But that number slid every year until 2012, when it hit $123 billion.
The overall value for next year’s county property payments is $124 billion. “The rebound has started, and the valuations are now rising,” Hough said.
The board is expected to set the maximum levy Thursday, then hold budget and public hearings in coming weeks. The final 2014 budget will be adopted in December.
At the proposed level, a median-valued home, $202,500 for next year, would see the county portion of its property taxes go down $1, or 0.1 percent. If levy increases are adopted for the county’s rail and redevelopment authorities, the overall increase on that home would be $6.
In addition to adding employees to the workforce, Hough’s budget proposal includes money for a “general salary adjustment” for county workers to be worked out in labor negotiations. Combined with the “modest increase” this year, Hough said the money would “help stabilize compensation and work toward re-establishing Hennepin County’s competitive edge in retaining our current talent and recruiting our future workforce,” he said.
Another increase: The recently adopted wheelage tax of $10 on vehicle registration renewals. Hough said $2 million of the collection will go toward transportation debt.
After he spoke, County Commissioner Gail Dorfman highlighted workforce development. “We’re going to have to pay competitive wages or we’re not going to be on the cutting edge as a county,” she said.
Commissioner Peter McLaughlin welcomed Hough’s first proposed budget as the county administrative as a “positive performance” and said, “This is the first real post-recession budget.”
Challenges are coming. Hough described a county with an aging white population and increasingly diverse, but smaller younger generation. A shrinking workforce may be asked to shoulder increased health and social services demands, he said.
Baby boomers also make up more than half the county’s workforce and most will be retiring soon, Hough said. “This is a significant change our organization is preparing for through succession planning, knowledge transfer, training and development and a streamlined hiring process,” he said.
The Ramsey County Board agreed not to raise the county’s property tax levy for 2014, affirming the county administration’s judgment that increased state and federal funding will cover higher costs.
The board’s vote to make zero percent the ceiling for the tax levy means that while commissioners may reduce the levy while hammering out the biennial budget this fall, they can’t raise the levy beyond this year’s level.
The 2012-13 budget contained tax levy increases of 1.7 percent in 2012, and 2.7 percent this year.
County Manager Julie Kleinschmidt proposed no tax levy increases for her proposed 2014-15 budget in July, saying that $20.1 million in additional spending can be largely covered by increases in state and federal funding, along with department fees.
Kleinschmidt said that higher spending in the next two years is partly the result of pent-up demand after years of flat or reduced funding.
The proposed budget includes funding for a new computer-aided dispatch system, a sheriff’s officer to process crime scenes, expansion of child protection services and a staffer to help veterans secure their benefits.
Commissioner Victoria Reinhardt thanked the Legislature and Gov. Mark Dayton for sending more state money to the county to cover the cost of state mandates, but noted that state funding remains at 2006 levels.
“We still have a ways to go,” she said.
Commissioner Janice Rettman, a perennial budget hawk, said she was pleased. “We have lived up to our expectations of ourselves ... as agents of the citizens,” she said.
The board will continue to work on the budget throughout the fall before final approval, slated for Dec. 17. A public hearing on the budget will be held Nov. 25 at Central High School in St. Paul.
Anoka County, which turned heads when it repealed its wheelage tax and later declined a shot at $1 million in Statewide Health Improvement Program funds, on Tuesday voted to cut its property-tax levy by $1 million.
The proposed 2014 budget of $278,047,330 should result in property-tax reductions for most low- and moderate-value Anoka County homes, the county said. The new levy levels will be comparable to those of a decade ago.
“This is the result of innovation at work,” said Rhonda Sivarajah, county board chairwoman. She said that for the third consecutive year, the board has worked to “right”-size county government, while taking advantage of technological innovations.
In July, the county board repealed the wheelage tax, effective Jan. 1, at a time when other metro counties have adopted the tax. Later, the county’s human services committee voted not to apply for SHIP grants, worth up to $1.3 million and used to fight child obesity, promote physical activity and decrease exposure to second-hand smoke. Sivarajah said at the time that the grants aren’t a wise use of taxpayer money, that they’re used for developing policy and there’s “not a measurable outcome.” Others disagreed with that position.
As the county announced the levy reduction on Tuesday, Sivarahah said: “Every day our actions reaffirm our commitment to our mission to be respectful, innovative and fiscally responsible.”
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