Minneapolis Property Taxes

House values are dropping while taxes in Minneapolis rise. What’s happening? According to the Minneapolis Star Tribune

About one-third of the tax increase comes from a short-term blip. About 98 percent of Minneapolis homeowners saw flat to lower taxes on their 2010 bills, according to city figures. The main reason is that millions of dollars were restored to the city’s general tax base with the expiration of some tax-increment financing districts; TIF is a tool the city uses to encourage business or housing growth.

That revenue helped absorb a 2010 tax increase that’s in the same range as what’s being considered this year. But now the city has locked up some of the tax base of those expired TIF districts in new districts that will keep it off the general tax rolls for 10 years. The money will be used to pay off Target Center debt and to fund neighborhood programs, so it won’t be there to help absorb the 2011 increase. More than 90 percent of residential owners will pay more next year at a 7.5 percent levy hike.

Unfortunately knowing where it comes from doesn’t always help the pinch. Many folks are seeing big increases because their homes are holding their value better than other home.

Submitted by Minneapolis Real Estate Agent, Mary Rugani.

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