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House DFLers propose property tax relief plan

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News Alexandria,Minnesota 56308
Echo Press
House DFLers propose property tax relief plan
Alexandria Minnesota 225 7th Ave E
P.O. Box 549

State Representative Jay McNamar, DFL-Elbow Lake, released details on Wednesday about a $250 million property tax relief package for Minnesotans.


He said it includes direct property tax relief to homeowners and renters in west central Minnesota and modernizes the state's local government aid formula, including additional property tax relief to communities across Minnesota.

Up to 1 million Minnesotans will see direct, targeted property tax relief through the proposal, McNamar said.

"Property taxes have been a huge problem for rural Minnesota," said McNamar. "With the homestead credit being eliminated last session, we really needed to get something done that would help families across the state. These investments will do that."

The House DFL plan would provide $157 million for the Homestead Credit Refund.

Under the Homestead Credit Refund:

• More than 300,000 homeowners (75 percent of filers) will see an increase in their property tax refund.

• More than 100,000 additional homeowners will be eligible for the refund.

• The average homeowner will see their refund increase by $212.

• A grand total of 636,000 homeowners will see property tax relief.

In addition to providing middle class homeowners a refund, the DFL proposal includes $15.5 million for the Renter's Credit, a refund that provides property tax relief to low and middle-income renters.

The credit was cut last session, McNamar said, and renters saw their property taxes increase by an average of $87. The new proposal enhances the renter's credit by increasing the maximum refund allowed for renters.

McNamar said 66,000 filers will see a bigger refund and a total of 340,000 renters will see property tax relief through the Renters' Credit.

"We have new people coming to our communities that are starting new jobs and they are usually renters to begin with," said McNamar. "This will help make it easier for new people to come live in our area and become members of the community and it helps give some relief to those families that are working hard to pay their rent and put food on the table."

The DFL is also proposing to reform local government aid (LGA) by providing an additional $60 million and another $28 million for county program aid.

Under this proposal, nearly every town in District 12A will see an increase in LGA, with cities like Breckenridge, Hancock, and others receiving increases between 10 and 20 percent over the current year, McNamar said.

The LGA formula, he added, is meant to provide cities with state aid when their essential needs exceed the amount that they can raise in property and local taxes. Many Greater Minnesota communities have faced severe LGA cuts in recent years, forcing them to cut back or eliminate vital city services such as police and fire, McNamar said.

"For years we have seen towns struggling with the inconsistency of the LGA from the state," he said. "This aid will help local communities bring down their property taxes and keep their area appealing for new businesses and jobs."

The new property tax relief proposal includes an updated LGA formula that McNamar described as stable, easier to understand, and predictable.

"The new formula is need-based, and provides the most aid to the communities with the greatest need," he said. "Giving cities a more stable source of aid will allow them to better plan financially and to sustain or expand local services such as police, fire and infrastructure."

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