providesinformation on statewide property tax increases overthe last eight years. The following is a supplementto that report that provides specic informationfor 146 Minnesota cities with a population over5,000 and for all Minnesota cities in aggregate.The information in this supplement focusesexclusively on Minnesota cities; no county, schooldistrict, township, or special taxing jurisdictioninformation is included. The analysis will focuson city “revenue base,” which is the sum of “property taxes” plus “aids and credits.”•
“Rvn as”
as dened in state law(Minnesota Statutes 2009, 477A.011, subdivision27) refers to the sum of city property taxesplus property tax relief aids and credits. Whilethe “revenue base” does not include all cityrevenues, it is a commonly used proxy for cityspending and is used to apportion aid cuts andset levy limits. Furthermore, the revenue baseincludes the portion of city revenues that havethe most direct impact on property tax levels.•
“Stat aids and crdits”
include propertytax aids and credits that are part of the city“revenue base.” Some forms of state assistanceto cities—such as police and re aid—are notpart of the city “revenue base” and thus are notincluded in the following discussion of stateaid. “State aid” as used in this section will referto city LGA, taconite aid, and—for 2002 and2003—a few smaller aid programs that wereeliminated or folded into the LGA program.“Credits” include the city share of the marketvalue homestead and agricultural credits, sincethese are property tax relief dollars received by cities that are part of the “revenue base.”•
“Prprt taxs”
include the propertytax dollars received by the city (excludingtax increment nancing revenue) aftersubtracting market value credits.The material in this supplement show the changesince 2002 in per capita revenue base, state aids andcredits, and property taxes in constant 2010 dollarsper capita. The ination adjustment to constant2010 dollars is based on the implicit price deatorfor state and local government purchases, which is the appropriate measure of ination
for state and local governments.Of the 146 cities with a population over 5,000, all but one underwent a decline in real per capitastate aids and credits from 2002 to 2010. In mostof these cities, property tax increases were notsufcient to replace the real per capita declinein state aid, so the real per capita revenue basealso declined despite property tax increases.Shrinking government revenue and increasingproperty taxes is consistent with a broad statewidetrend for all levels of government since 2002.
Tax & Rvn Infrmatin fr Minnsta Citis
City Property Taxes, Aids & Credits, and Revenue Basefor Minnesota Cities with a population over 5,000
Cmpild Jff Van wchn
Minnesota 2020 Fiscal Policy Fellow August 2010
Data listed by property tax payable year.
Minnesota 2020
8/31/10PT_REP10.xls
All Minnesota Cities
City "aids & credits" is the sum of city Local Government Aid (LGA), market value credits, and othercity property tax aids.City "revenue base" is the sum of city property taxes and city "aids & credits." "Revenue base" is acommonly used proxy for city spending,The adjustment to constant 2010 dollars is based on the implicit price deflator for state and localgovernment purchases.
-$150-$100-$50$0$50$100
CityPropertyTaxesCityRevenueBaseCity Aids& Credits
City Property Taxes- $6$16$21$27$38$46$62$70City Revenue Base- -$46-$53-$60-$51-$45-$61-$35-$52City Aids & Credits- -$52-$70-$81-$78-$83-$107-$97-$123200220032004200520062007200820092010
City Property Taxes, Aids & Credits, and Revenue Base
Change Since 2002 in Constant 2010 Dollars Per Capita
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Tax & Revenue Information for Minnesota Cities
City Property Taxes, Aids & Credits, and Revenue Base
for Minnesota Cities with a population over 5,000
for Minnesota Cities with a population over 5,000
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