01-08-2025 Workshop Packet - Laserfiche WebLink

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MR-7 PROPERTY VALUATION LIMITS/LIMITED MARKET VALUE MR-8 MARKET VALUE HOMESTEAD EXCLUSION PROGRAM Metro Cities supports state funded property tax relief programs paid directly to homestead property taxpayers such as the “circuit breaker” program and enhanced targeting for special circumstances. Metro Cities also supports the renter’s credit program. Metro Cities supports an analysis of property tax relief programs to determine their effectiveness and equity in providing property tax relief to individuals and families across the state. Metro Cities supports efforts by the Minnesota Department of Revenue to expand outreach and notification efforts about state property tax relief programs to homeowners, and notifications to local units of government to support such efforts. Metro Cities also supports legislative modifications to make tax relief payments to taxpayers automatic. Metro Cities supports the use of the Department of Revenue’s Voss database to link income and property values, and the consideration of income relative to property taxes paid in determining eligibility for state property tax relief programs. Updates to the database should occur in a timely manner, with data reviewed periodically to ensure the database’s accuracy and usefulness. Metro Cities opposes the use of artificial limits in valuing property at market for taxation purposes since such limitations shift tax burdens to other classes of property and create disparities between properties of equal value. The Market Value Homestead Exclusion Program (MVHE) provides property tax relief to qualifying homesteads, through reductions in property tax values, which shifts property taxes within jurisdictions. The MVHE replaced a former Market Value Homestead Credit Program, which provided credits on local government tax bills to qualifying properties, with reimbursements provided by the state to local governments. Metro Cities opposes restoration of the former Market Value Homestead Credit, as reimbursements to local governments were inconsistent, and encourages further study of the exclusion program, with input by city officials, to determine the program’s overall efficacy and its effects on local tax bases. Due to the recent rapid increase in home values, Metro Cities supported 2023 modifications to the homestead market value exclusion program to increase the benefit of the exclusion to qualifying homeowners and will continue to support future periodic modifications for qualifying homeowners. Changes to the homestead market value exclusion should be considered in concert with the impact of the homestead credit refund program. MR-6 STATE PROPERTY TAX RELIEF PROGRAMS 5