Tuesday, April 3, 2012

Albert Lea Tribune: GOP says bye-bye to homestead credit

Published Friday, March 30, 2012; 9:02 am
By Paul Marquart, Guest Columnist
Tough luck. That’s the message that Minnesota Republicans sent to homeowners in Greater Minnesota last week when they passed a tax bill that didn’t address the property tax increases they caused last session.

To understand why their bill was particularly troubling for Greater Minnesota it is helpful to review what happened last year. The budget the Republicans passed to end the state shutdown completely eliminated the homestead credit, a tax benefit that homeowners had cherished and valued for over four decades. This raised property taxes on homeowners, farmers and small businesses.

If you are curious what the elimination of the homestead credit meant to you, I encourage you to take out your 2011 property tax statement and compare it your 2012 statement, which should be coming soon in the mail. You will notice that on line 4A from your 2011 property tax statement the word “homestead” has vanished from your 2012 statement — along with your tax relief.

The permanent elimination of the homestead credit led to $370 million in property tax increases in 2012. The state now has the highest property tax level in our 154-year history. Over the last 10 years property taxes for homeowners have now increased by 92 percent. For farmers, property taxes have increased 150 percent. And Greater Minnesota was disproportionately harmed. Of the property tax increases last year, 64 percent of them came from Greater Minnesota. Rural Minnesota is hit with three times the property tax increases as the metro area. Rural homeowners’ property taxes rise eight times higher than metro homeowners — that’s right — eight times higher and rural businesses saw their taxes rise three times higher than in the metro area.
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