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Pioneer Editorial: Property tax rebate in an election year?

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Pioneer Editorial: Property tax rebate in an election year?
Bemidji Minnesota P.O. Box 455 56619

Getting a check back from the government is always appreciated, but not always the best policy.

The House GOP would do just that this year under the guise of property tax relief. In a plan unveiled Monday, House Republicans proposed that all homesteads receive a rebate equal to 10 percent of their net property tax, excluding special assessments, shown on their 2006 property tax statement. The total estimated cost of the plan is $307.3 million, which is currently in a tax relief account. All bets are off, however, should the Minnesota Supreme Court rule that last year's "health impact fee" is in violation with the state's agreement with tobacco companies and the tax relief account will used to fill the resulting budget hole.

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There is no doubt that property taxes have risen -- in fact, 9.2 percent by the House GOP's own account. But the argument lies in how. Rep. Phil Krinkie, R-Shoreview, architect of the plan, would have you believe that "unreasonable local spending increases have led to (higher) property taxes."

In reality, it has been state actions that have led to higher property taxes, in an effort to either balance the state budget or to allow more spending for K-12 education without raising state taxes. Local Government Aid to cities, including Bemidji, saw drastic cuts as part of the state's 2003 effort to fill a $4.5 billion budget hole. The funding shift caused cities to either raise property taxes or cut police officers, firefighters or both.

And last year's budget agreement, coming after an eight-day partial state government shutdown, saw a needed $800 million increase to K-12 but only at the insistence of Republicans that $139 million of it come from local school district referendums -- which have added to local property tax burdens for those cities approving referendums. In many cases, especially in property poor areas, a positive vote is out of the question.

The House GOP plan would have rebate checks going out by the Oct. 15 second half tax payment deadline -- suspiciously close to the Nov. 7 election and certainly fodder for the House GOP which can claim credit. But where are those checks going? While claiming a statewide average of $205, breaking that down reveals the average check in wealthy suburban Minnesota is $400 while northwestern Minnesota homeowners would average $101. And, according to the plan, renters would not be eligible for the rebates.

A better plan would be in restoring LGA cuts, at least $40 million, allowing cities to ask property taxpayers for less. And that should be followed by the state taking a greater share of school funding, not allow-ing the wealthiest communities to raise property tax dollars to create unequal ed-ucational opportunities compared to poor-er districts. The latter either can't raise tax-es or, in doing so, at a much greater bur-den than the suburbs which can afford it.

Rather than an election-year gimmick which will give homeowners a one-time check, policy is needed to bring property taxes down -- period.

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