Brace for a tax increase

Talk about it

Information impacting your pocketbook will be in the mail next week.

Douglas County will send out nearly 30,000 assessment notices and tax statements starting Monday.

The “assessment notice” is the document that advises all property owners of the valuation and classification assigned to their property for the 2012 assessment for property taxes they’ll pay next year. As required by state law, the assessment values are based on real estate sales between October 1, 2010 through September 30, 2011.

The “tax statement” is for taxes payable this year and is based on 2011 assessed values.

To prepare taxpayers for what they’ll see, Douglas County Assessor Keith Albertsen provided the following highlights:

• The number of real estate sales are still down and prices are relatively flat. The actual selling price of sales in open “arm’s length” transactions are compared with assessed values to determine if assessed values go up or down. “Short sales” and bank foreclosure sales are omitted from the state sales ratio study but they do seem to be having an effect on the arm’s length transactions and assessed values on residential and seasonal properties, which are generally going down slightly.

• Agricultural properties seem to be increasing in value, especially irrigated agricultural property.

• A change the Minnesota Legislature made to the homestead credit in the special session last summer will be reflected in the tax statements payable this year. In nearly every case, the tax extension rate (the old mill rate) increased. To be clear, the homestead benefit is not gone. It was changed from a direct credit to a value exclusion. What was lost was nearly $2.3 million in state funding between all taxing entities in the county. The proposed notices sent out last fall reflected the change.

• If you live in Alexandria School District 206, the proposed notices sent last fall did not show the effect of the approved referendum to build a new high school. The payable 2012 tax statements will. In most cases, the increase in the tax extension rates from the proposed notice and the actual statement is about 10 percent. Since this is a “bricks and mortar” referendum instead of an operating referendum, everybody in the district will pay for it.

• If your homestead taxes significantly increased, there may be some relief available through the state property tax refund program. There are two parts. One compares the property taxes you pay with your income and depending on the program, you may be eligible for a partial refund. The second part compares the increase in property tax from one year to another and income is not a factor. The tables have changed so if you did not qualify in past years, you may now.

Tags: local news, news, tax, increase