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40 | P a g e <br /> <br />Assessment Process: Statutory Requirements <br /> <br />Minnesota law establishes specific requirements for the entire property tax system, <br />including the assessment of property (M.S. Chapter 273). These requirements have not <br />changed during the past year. The laws require the following: <br /> <br />1. All real property is to be valued at market value, which is defined as the usual or most <br />likely selling price at the time of assessment. Special qualified exclusions such as the <br />Veterans’ Exclusion are subtracted from the market value to arrive at the taxable <br />value. <br /> <br />2. Property is classified according to state law, and the tax capacity is calculated. <br /> <br />3. The tax capacity is multiplied by the tax rate (the total of county, school, city, and <br />miscellaneous levies) to determine the amount of property tax. <br /> <br />The annual property assessment focuses on the very first step of this process—establishing <br />an estimated market value for each parcel of property. <br /> <br />Market values are assessed locally by either a county employed appraiser or a locally hired <br />assessor. The work of both county and local assessors is monitored by the County Assessor, <br />whose work is in turn monitored by the Minnesota Department of Revenue. The monitoring <br />agency is authorized by law to adjust the property assessment to help ensure county-wide <br />and state-wide equalization of property assessments. <br /> <br />The County Assessor has established the standard that all Washington County communities, <br />with at least six (6) sales in their sales study, has a community median ratio in the range of <br />93%-96% of actual market values in relationship to time-adjusted sales prices. At times, <br />local assessment levels have been adjusted by the County Assessor or the State of Minnesota. <br /> <br />State law also requires that each individual property be reviewed by the assessor at least <br />once every five years. Each community has a rotating revaluation schedule to ensure that <br />this requirement is met. <br /> <br /> What is market value? <br />Minnesota Statue 273.03 defines market value as “… the usual selling price at the time of <br />assessment.” The Assessor’s Office works throughout the year to estimate market values of <br />each property for the following January 2 assessment date. <br />