Differing values make effective property tax increases range between .4 to 13.5 percent
By JANE MCCLURE
The owner of a median-value home in St. Paul could see a property tax increase of about $99 in 2017, under the levies adopted this fall by the St. Paul City Council, St. Paul Public Schools, Ramsey County Board and the county’s Regional Rail Authority. Impacts of the levy increases vary greatly from neighborhood to neighborhood, the Joint Property Tax Advisory Committee was told recently.
Property tax statements will start landing in mailboxes in mid-November. State truth-in-taxation law required the three units of local government to review property tax impacts of their maximum levies in September
Ramsey County has proposed a 2.8 percent levy increase with a 3.5 percent increase for the regional Rail Authority. St. Paul Public Schools has a 5 percent increase while the city is at 7.9 percent. The local governments can cut their levies between now and years’ end but cannot increase them.
St. Paul’s median value home saw an increase in market value from $151,600 in 2016 to $161,200 in 2017, a 6.4 percent increase. Shifts and changes within the property tax system itself, as well as the regionwide fiscal disparities property tax sharing system, changes in homestead exclusion benefits and other shifts, would account for a $33 decrease. But levy and property tax increases would account for an increase of almost $130. Factor in the decreases and the net is $99.
Chris Samuel, property records and revenue manager for Ramsey County, said neighborhoods with lower-valued homes are seeing greater increases in market values and, as a result, in property taxes. Those neighborhoods saw some of the greatest property value decreases during the recent recession and have been slower to recover.
Values in Frogtown and other areas had “pretty much tanked” during and after the recession, said Ramsey County Commissioner and joint committee member Janice Rettman. While homeowners should be “thrilled” to see increases, Rettman said the higher increase could be a shock to lower-income homeowners.
She reminded officials to let homeowners facing higher value and property tax spikes that they should apply for targeted property tax refunds. County staff does mailings to encourage everyone eligible to apply for the refunds.
Still, the comparison for property taxes payable in 2016 to 2017 aren’t to change, even with the levy shift. The highest market value and property tax increase citywide is projected for Thomas-Dale or Frogtown, where the median home value has increased from $89,800 to $99,800 or 11.1 percent. The typical homeowner there paid $1,038 in property taxes this year and would see a $140 or 13.5 percent hike to $1,178 in 2017.
Similar increases are seen in East Side neighborhoods, including a 10.8 percent increase in values in Dayton’s Bluff. No neighborhoods showed decreases. The lowest median increase is expected on the West Side, at 3 percent.
Monitor area neighborhoods will see varying property tax increases. In Como, the median value home increases from $184,800 to $195,400, for a 5.7 percent increase in market value. Taxes would increase from $2,731 in 2016 to $2,826 in 2018, for a $95 or 3.5 percent increase.
In Hamline-Midway a 3.6 percent increase is projected, from $148,900 to $154,200. Property taxes would increase from $2,092 to $2,115, $23 or 1.1 percent.
Homeowners in the Merriam Park, Snelling-Hamline, and Lexington-Hamline neighborhoods, who have seen high increases in the past, would see the lowest median value increase. Values are estimated to increase just 3.3 percent for the median home, from $257,850 to $266,400. Property taxes would increase .4 percent or $18, from $4,032 to $4,050.
County officials caution that individual market values can hinge on a number of factors, including comparable home sales in an area or whether or not a property owner has made physical improvements to a property.
In general, property values are increasing more in the city of St. Paul than they are in the Ramsey County suburbs, said Samuel.
Members of the advisory committee said that no one takes the decision to raise levies and property taxes lightly. Looking at some of the increases to lower-income neighborhoods, Deputy Mayor Kristin Beckmann said, “Some of that is hard to swallow.”