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Democrats face property tax campaign issue

ST. PAUL — Democrats for years blamed Republicans for forcing local governments to raise property taxes.

But now that Democratic-Farmer-Laborites control the Minnesota Legislature and the governor’s office, it appears that property taxes will continue their increase, if only slightly, in the next year.

Republicans will not let it escape voters’ attention in 2014’s election, adding that fact to Democrats $2.1 billion tax increase as they try to regain control of the state House and governor’s office.

“There obviously is a political liability,” said Larry Jacobs from the University of Minnesota’s Humphrey School of Public Affairs. “The DFLers in St. Paul clearly are going to be on the hook.”

Preliminary figures show a nearly 2 percent overall statewide property tax levy increase is possible, although decisions local governments make by mid-December could shrink that number.

Individual taxpayers may see lower property tax bills, depending on factors ranging from local government levies to whether property is increasing in value.

“Any tax increase in inherently unpopular,” Democratic Gov. Mark Dayton said in a Forum News Service interview. “But it will be a message battle. Republicans will try to say ‘largest tax increase in history’ and we will say ‘the people who have the most are paying it, and smokers.’”

Overall, much of the $2.1 billion, two-year tax increase comes from the state’s highest earners and smokers.

Dayton made the point that if property taxes rise 2 percent statewide, that would far less than the 83 percent they have gone up in the past decade.

“I think that we did the job of delivering property tax relief,” House Speaker Paul Thissen, DFL-Minneapolis, said.

Democrats say that higher taxes usually mean better services.

Something not shown in property tax bills is helping Minnesotans’ pocketbooks, he added. Legislators approved sending $140 million directly to Minnesotans in the current two-year budget via higher renters’ refunds and a new homeowner refund program.

DFL Party Chairman Ken Martin said that his party will benefit from the 500,000 people receiving that direct relief.

“It is going to take time in getting that under control,” Martin said about property tax increases. “The Democrats have reversed that trend and have begun to invest in communities.”

Republican state Chairman Keith Downey said that after Democratic promises of lower taxes, Republicans will not be shy about mentioning the tax increase in campaigns.

“It is a hard predicament to explain,” Jacobs said about Democrats’ actions. “It is a little bit of speaking out of both sides of their mouth.”

Property taxes will be an important issue, Downey said, because “they are one of the most, if not the most, transparent taxes. People actually have to write a check for their property taxes.” Most taxes are more hidden, he said.

But, the GOP leader said, his party’s campaign will be more than just about property taxes. He said the campaign will be about the Democrats’ overall tax increase and up to $500 million in higher fees.

“This legislative session may go down as the most tax-friendly session in 40 years,” Jacobs said.

On the campaign trail, Democrats will talk about services their new taxes have provided, in most cases services many Minnesotans requested.

“The rhetoric is black and white, but reality is a lot more complicated,” Jacobs said.

Don Davis
Don Davis has been the Forum Communications Minnesota Capitol Bureau chief since 2001, covering state government and politics for two dozen newspapers in the state. Don also blogs at Capital Chatter on Areavoices.