About Your 2013 Proposed Property Tax Notice
In November, every Minneapolis property owner is mailed a notice detailing their proposed property taxes for 2013. Here you will find additional information to answer any questions you may have based on your own property tax notices.
Reading Your Proposed 2013 Property Tax Notice
Your property tax notice is broken down by taxing jurisdiction. While there are several jurisdictions listed, the three largest portions of your taxes are from Hennepin County (28 percent), Minneapolis Public Schools (26 percent), and the City of Minneapolis (43 percent).
Understanding Your 2013 City Property Taxes
Why is the City portion of my property tax bill changing at a different rate than the City’s levy change?
Currently, the proposed property tax levy will increase by 1.77 percent over 2012. There are several factors that could have an impact on your property tax bill:
- Individual property value – If your property’s value increased or decreased, it will affect the amount of property taxes you owe. Rising property values increase the taxable amount of your property and decreasing property values lower the taxable amount of your property.
- Value of other properties in the City – If the total value of other property in the City rises faster than the value of your property, more of the burden of the property tax levy will be on those properties and your taxes will go down. If the total value of other property in the City rises more slowly than the value of your property, your property will bear more of the burden of the property tax levy, and your taxes will go up.
- Value of properties within Tax Increment Financing (TIF) districts – The City has used an economic development tool called Tax Increment Financing, which removes the value of properties within TIF districts from the City’s property tax base. When the amount of property in TIF districts increases from year to year, more of the property tax burden is shifted on to other City properties outside of those districts. If the City decreases the amount of property in TIF districts from year to year, the burden of property taxes is spread amongst more properties throughout the City, which lowers property taxes for properties not inside the TIF districts.
- Tax rate – The tax rate is determined by taking the City tax levy divided by the taxable value of property in the City. While the City’s proposed levy increases by 1.77 percent for taxes payable in 2013, the taxable value of properties within the City is projected to decrease by approximately 3 percent. Since the taxable value of properties is projected to drop, the tax rate applied to the remaining value will go up.
- Homestead Market Value Exclusion – The Homestead Market Value Exclusion program reduces the amount of taxable values on certain homes. The program is not a credit, but rather a means of reducing the amount of the value on certain homes that is subject to property taxes. You’ll notice the difference between “market value” and “taxable value” on your proposed property tax notice that is attributable to this program.
- Other jurisdictions’ tax increases – The Minneapolis Public Schools and Hennepin County portions of your property tax bill may also change this year. The school district’s proposed levy increase is 4 percent and the County’s proposed increase is 0.93 percent.
The Minneapolis City Council is considering the Mayor’s budget proposal and will vote to adopt a final 2013 budget on Dec. 12. 2012. Before that vote, there will be two public hearings for the public to comment on the 2013 budget proposal:
- 6:05 p.m., Wednesday, Nov. 28, 2011, Room 317, City Hall
- 6:05 p.m., Wednesday, Dec. 12, 2012, Room 317, City Hall
Last updated Nov. 15, 2012