Final 2018 Certified Property Tax Levy Report Released

Property tax levies will increase statewide by 4.6 percent in 2018.
(Published Mar 5, 2018)

For 2018, certified property taxes for all taxing authorities statewide will increase by $430 million, or 4.6 percent, according to a report released by the Minnesota Department of Revenue last week.

The final levies set in December were reduced from the preliminary levels set in September, where the initial 2018 property taxes statewide were proposed to increase by $492 million, or 5.2 percent.

For comparison, the 2017 statewide increase in property tax levies (from 2016 to 2017) was 3.4 percent after a proposed increase of 3.8 percent. The report includes net tax capacity levies and levies assessed against market values. The table below summarizes the final 2018 levies by taxing jurisdiction.

Table: 2018 certified levies

Note that the reduction in the state property tax levy is due to tax relief provided in the 2017 special session tax bill. The tax bill eliminated the annual inflationary increase in the state property tax levy and exempted the first $100,000 of commercial and industrial property value from the state general levy, but also reduced the levy to prevent shifts of the state tax to larger businesses.

Also note that within the statewide city levy figures, the majority of the city of St. Paul’s property tax levy increase of $27.3 million (+23.9 percent) reflects a restructuring of assessments previously collected through the city’s right-of-way maintenance assessment program. Excluding this shift, the total statewide levy increase for cities would be approximately 5.3 percent. Last year’s final city levy increase (2016 to 2017) was 5.5 percent after a proposed increase of 6.2 percent.

The table below shows the frequency distribution of levy changes for preliminary 2018 levies and final certified 2018 levies. In total, 260 cities reduced their preliminary 2018 levies.

Table: 2018 city levy changes

Impact on individual property taxes varies
Increases in property tax levies do not automatically result in increased taxes to individual property owners. Changes in the valuation of individual properties, newly constructed properties, and other factors can result in tax changes that are either greater or less than the levy increase proposed by taxing entities (cities, counties, schools, etc.) in a particular geographic area. Final 2018 property tax notices will be distributed in March.

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