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WS — Item 2 <br />WORK SESSION STAFF REPORT <br />Work Session Item 2 <br />Date: January 3, 2012 <br />To: City Council <br />From: Jeff Karlson <br />Re: Resolution Supporting Fiscal Disparities <br />Background <br />At the November 7 work session, staff informed the City Council that the Anoka County <br />Board was asking cities and school districts to adopt a resolution supporting the current fiscal <br />disparities program. <br />During the 2011 legislative session, there was an effort by legislators in the southern and west <br />regions of the metro area to eliminate the fiscal disparities program. Cities such as <br />Bloomington, Burnsville, Chanhassen, Eagan, Eden Prairie, and Shakopee are some of the top <br />net contributors to the fiscal disparities program. Because all but one city in Anoka County is <br />a net recipient of revenue under this tax -base sharing program, Anoka County wants to <br />convey a united message of support for fiscal disparities to legislators. <br />If fiscal disparities were eliminated, most homeowners and business owners in Anoka County <br />would see an average tax increase of ten percent on their combined city /school /county tax <br />statement. For example, in Lino Lakes, a homeowner with property valued at $200,000 <br />would have paid $174 of additional taxes in 2011 without the fiscal disparities program, <br />including $46 in city taxes. <br />The fiscal disparities program, which was implemented in the 7- county metropolitan area in <br />1975, was designed as a means to share tax revenue to narrow the gap between communities <br />with a strong and growing commercial - industrial tax base and communities with small or <br />stagnated commercial - industrial tax base. To lessen the difference between these "haves" and <br />"have - nots," the law requires that 40 percent of new commercial - industrial tax base be put <br />back into a pool and apportioned back to communities according to their population and <br />overall tax base. <br />Anoka County Commissioner Rhonda Sivarajah will be at the work session to endorse this <br />initiative. <br />Attachments <br />Minnesota House Research Report <br />Metropolitan Council Slide Presentation <br />