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Agricultural property taxes may not decline

By Janet Kubat Willette
jkubat@agrinews.com

Date Modified: 08/21/2013 7:47 AM

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GILFILLAN — State Revenue Commissioner Myron Frans stopped short of saying property taxes on agricultural land will decrease during a visit to Farmfest.

Gov. Mark Dayton recently announced that an analysis showed property taxes would decrease for the first time in a decade.

Frans said agricultural land may be the exception as land values have been increasing rapidly over the past few years. Property taxes have shifted to agricultural land from other sources of property taxes as values have declined on other classes of property.

The rate of increase or decrease on agricultural land will depend upon the mix of other property in the taxing jurisdiction, among other factors, Frans said.

In general, property taxes are projected to decline due to five factors, he said.

First, the state increased local government aid to cities, counties and townships. The state increased funding to cities by $80 million, funding to counties by $40 million and gave townships $10 million.

Second, cities and counties will no longer have to pay sales tax, saving an estimated $172 million, Frans said.

The Renter's Property Tax Refund program received more funding as did the Homestead Tax Credit.

Fifth, the state put levy limits of 3 percent in place for 2014.

While the governor is projecting a decrease in property taxes, the amount levied is ultimately dependent upon the actions of local governments, Frans said.

Typically, local governments start developing their budgets around Sept. 1 and adopt their budgets in December after public hearings. By February, property owners will know if their property taxes are rising, falling or stable.

Taxpayers can influence the taxes either way by contacting their county commissioners, city councilors or township officers.