Legislation passed by the state Legislature and signed by Gov. Mark Dayton last month to end the state government shutdown includes a change that will increase property taxes to non-homestead residential and commercial facilities.
The Beltrami County Board of Commissioners will hold a special meeting from 3-5 p.m. Tuesday, Aug. 23, to discuss this new situation, as well as to consider the proposed 2012 levy. County Administrator Tony Murphy told commissioners last Tuesday that the deadline for passing a preliminary levy is Sept. 15. After that date, counties can reduce the levy, but not increase it for the final levy due before the end of 2011.
The total levy for 2011 was $16,901,013. The proposed 2012 levy proposed by Murphy last Tuesday was $17,501,013, an increase of $600,000, or 3.55 percent.
He said the additional funds are made up from taxes paid by Enbridge Energy and Menards construction.
However, Murphy also apprised the commissioners of the passage of an act to eliminate the Market Value Homestead Credit and replace it with the Market Value Exclusion. The Market Value Homestead Credit was eliminated in an attempt to erase the $5 billion deficit in the state's two-year budget.
Market Value Homestead Credit was created to reduce property taxes on low- and mid-value homes. It automatically reduced tax bills, in a graduated formula, on homes valued between $76,000 and $413,800, with the reduction decreasing as the home value increased.
The Market Value Exclusion will shift the system to cause a rise in property taxes on commercial and industrial properties, apartments and high-value homes.
Murphy said the result will be about a 7 percent property tax increase for Beltrami County.
"That's what the Legislature passed, and that's what the governor signed," Murphy said. "The Legislature has set county boards up for this conflict."
Commissioner Jim Lucachick said he thought the commissioners had agreed to hold the 2012 levy at the 2011 level with zero increase or decrease.