Her property-tax notice signaled a possible savings for 2017, but Jeanette Colby still believes government officials can be smarter about spending.
So, on a recent Tuesday night, she left her home in the Kenwood area of Minneapolis to go downtown to share her views on the subject with the Hennepin County Board.
Turns out she could’ve talked taxes, too.
Last week, Colby learned that she — like a majority of city homeowners — can expect to pay more in property taxes next year — not less, as had been forecast in the Truth in Taxation notices sent to property owners in November.
Truth in Taxation statements project what individuals could pay in taxes the next year, and are based on maximum levies set by local governments in September. They do not take into account any taxes approved by voters later in the fall. In the case of Minneapolis, voters agreed Nov. 8 to renew a levy that has provided additional operating revenue to the school district.
That levy renewal sailed through with ease, but because of the time it takes to prepare and mail the notices, the levy’s costs were not reflected on individual Truth in Taxation statements. The notices make clear that any ballot proposals put before voters in November, if passed, could increase what people owe. But in the state’s largest city, many people with eyes trained on the bottom line are bound to have missed that detail. For them, relief will give way to disappointment when actual bills come due in the spring.
Colby, for one, is outraged.
“We were not given the ‘truth’ in taxation,” she said.
A pass-fail problem
At a city tax hearing last week, City Council President Barb Johnson said that she’s heard concerns about the notices. Before inviting citizens to comment on the city’s budget, she had Mark Ruff, the city’s chief financial officer, explain why the statements lacked an up-to-date picture on school costs.
According to figures provided by Hennepin County to the Star Tribune, the owner of a median-valued Minneapolis home could have seen a tax decrease of about 5 percent, or $151, if the levy vote failed. That is what is reflected in the notices received by homeowners and other property owners in November. Now that the levy has been renewed, the owner of that same median-valued home can expect, instead, to see a tax increase of about 4.3 percent, or $129.
The updated figure takes into account all elements of the property-tax bill, from changes in home market values to tax plans put forward by all local governments.
Generally, across the metro, the property-tax outlook for 2017 is free of high drama. Fridley was the lone community in which the owner of a median-valued home was at risk of a property-tax hike in the double digits, percentage-wise — at least, that is, before any November school votes.
Other districts with levy proposals on the ballot included North St. Paul-Maplewood-Oakdale and West St. Paul-Mendota Heights-Eagan.
The West St. Paul measure was similar to the Minneapolis proposal in that it involved the renewal of an existing levy. Unlike Minneapolis, however, the West St. Paul district went to voters a full year before its levy was to expire, sparing its homeowners the jarring change that can occur between the proposed tax notice and the eventual tax bill.
As for why a Truth in Taxation notice cannot include the results of a November vote, Hennepin County said that it allows five weeks to prepare and mail its 410,000 tax notices. The county added that state law also requires the notices to be mailed between Nov. 10 and Nov. 24, specifically, and as such, “it would be difficult if not impossible to include the results of a referendum passed as late as Nov. 8.”
The state’s requirement that notices be delivered after Nov. 10 is significant, too, in that it answers a question sometimes asked at Truth in Taxation hearings, that being: Why can’t the notices arrive in time to influence votes on candidates running for office?