09-11-1989 - Agenda Packet City Council - regular meeting

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MWNE,S0_T&J&WATIONS: PROPER Y—IAXES (continued) EXempt,_propUty: Exempt real property includes Indian lands, public property, and educational, religious emd charitable institutions. Most personal property is exempt from taxation (except investor -owned utility mains, generating plants, etc.). Cred""_9J Zl_8_8: Minnesota Statutes provide for various property tax credits: �lpes�ead Cr�di>s - Homestead taxes, including debt service taxes, are reduce by a 54% state -paid credit (to a $700 maximum) on the first $68,000 of a home's [assessor's] market value. The homestead tax credit is deducted from individual tax statements and is reimbursed by the State to the taxing districts in proportion to their levies. Proo�ty Ta_Y ncome Adjusted Refund Act (Circuit breake-) - Further property tax refunds to homeowners and renters are gauged by per -stages of the gross property tax to household income up to $35,000. If a homeowner's tax or a renter's share of the actual tax exceeds certain percentages of household incomes, homeowners or renters may receive State -paid refunds up to a maximum (credits and refunds) of $1,100. Senior citizens and disabled persons have an accelerated refund schedule available to them. �g�)�y�ty��j��it - Homestead - An agricultural credit of 36% of the tax imposed on the first 320 acres (including buildings and structures, but excluding dwellings and one acre of land for each dwelling), and 26% of the tax on the remainder, is deducted from the tax statement and paid directly to the local school district by the State of Minnesota. The farm home and surrounding onp acre do not receive the agricultural credit, but do qualify for the homestead credit and income adjusted (circuit breaker) refund. A,gricultural-Credit_-_Nort-g4mgg-tsRd - An ag.icultura, credit of 26% of the tax levy imposed on the property (excluding dwellings and one acre of land for each dwelling) is deducted from the tax statement and paid directly to the local school district by the State of Minnesota. Smail__Busi�ne.ePr4�ertyaX Cdi� - For property taxes payable in 1988 only, commercial industrial property is eligible for a state -paid small business transition property tax credit if taxes payable on the first $120,000 of market value exceed 3% of the 1987 market value. The credit is 50% of the tax in excess of 3% of market value. Only property qualifying for the 28% assessment ratio qualifies for this credit (i.e., one parcel per owner per county). Jaxes__for__J988/89: The Minne. Legislature passed the 1988 Omnibus Tax Bill which made some significant chat., io the property tax system. Some changes take effect for taxes payable in 1989, and others take effect fo•: taxes payable in 1990. For 1989, assessment values will be replaced with gross tax capacities, and mill rates will be replaced with tax capacity rates but will operate very much the same way. Existing classifications of various property types will be inflated by a factor of approximately 2.2. 1he homestead credit has been retained with the aximum credit increasitsg to $725. Agricultural credits have also been retained. he one-year small business credit has been eliminated. The Local Government Aid program for municipalities has been increased an estimated $75 million in funding 9 t,