The legislation would consolidate all residential property, including cabins, into a single residential classification and make other modifications to the state’s property tax system.
(Published Mar 12, 2018)
Taking up a version of the recommendation from the 2012 Property Tax Working Group, Rep. Abigail Whelan (R-Ramsey) introduced HF 3276, a bill that consolidates all residential property types into a single residential classification and also consolidates some miscellaneous classifications, without making any changes in definitions or class rates.
Rep. Whelan presented the bill with an overview of the current property tax system, including a description of the vast array of classifications and sub-classifications of property. She said her goal was to make the property tax system easier for taxpayers to understand and for tax administrators to manage.
Impact on cabin property
The legislation also includes a significant change in the application of the state general property tax. With the consolidation of cabin property into the general residential class, cabins would no longer be subject to the state property tax. However, those same cabin properties would, under the bill, now be subject to local school district referendum levies.
Cabin property was removed from the school referendum tax base in the major 2001 property tax reform law and subjected to the state property tax levy. That transfer was done in response to cabin owner concerns about not having the ability to vote on school referendum levies.
New refund programs
The bill would also create two new state refund programs, one for homeowners who are blind or disabled, and a one-time refund for owners of bed-and-breakfast facilities, to help ensure that no property owners have excessive tax increases under the proposal.
The bill was heard in the House Property Tax and Local Government Finance Division. A representative of small, seasonal resorts testified in opposition to the bill, expressing concerns about the elimination of preferential treatment for those properties.
Testifying in support of the bill was the Minnesota Association of Assessing Officers, which was one of the entities represented in the 2012 Property Tax Working Group. Also included in the working group were representatives of the League of Minnesota Cities, the Association of Minnesota Counties, the Minnesota Association of Townships, the Minnesota Department of Revenue, the Minnesota Farm Bureau/Farmer’s Union as well at two members of the Minnesota House of Representatives and two members of the Minnesota Senate.
The bill was laid over for possible inclusion in a Division tax report.
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