Mixed Bag of Tax Votes on County Board

Written by Jeff Johnson on September 10, 2010. Posted in General

General tax levy will remain flat; rail and housing levies will increase

Tuesday was a big day in the county’s budget calendar as we set the maximum levy amount for Hennepin County’s three county-wide levies (the general levy, the housing levy and the rail levy). The result of Tuesday’s meeting was a mixed bag for taxpayers.

The big news: The county’s general levy amount WILL NOT increase in 2011. The board set the maximum levy amount at a 0% increase in 2011. Because it’s a maximum, we can levy less than a 0% increase when we set the final budget in December, but we can’t levy more.

The reason this is big news? It’s the first time since 1993 that Hennepin County has not increased the general levy amount. Obviously, this is a positive development.

The smaller (and not-so-good) news: The board set maximum increases for the county’s Housing and Redevelopment Authority levy and Regional Railroad Authority levy at 55% and 20%, respectively. Again, those are maximum increases, so we could set them lower in December, but I can all but guarantee that we will levy at those maximum amounts.

This is smaller news because the dollar amounts for the proposed housing levy ($5.6 million) and rail levy ($18 million) are small fractions of the general levy ($676 million).

The rail levy, however, is indicative of a pretty alarming trend of huge rail spending increases that appear to have no end in sight. The rail authority’s budget (which is only partially funded by the property tax levy) will increase about 130% in 2011 (from $27 million to $62 million), with similar increases budgeted into the foreseeable future. In short, we’ve gone completely nuts when it comes to spending on rail lines.

I made a motion at the meeting to hold the rail levy flat in 2011, just as we had done with the general levy. I could not get a second to my motion to amend.

I don’t, however, want to lose sight of the good news. The county administration had proposed a max levy increase of 1%, to allow some room to increase the tax in the event we learn over the next couple months that our budget projections are worse than we currently think. In contrast to last year, when the board set a max levy increase of 4.95% (with my vote being the only “no” to that increase), the entire board agreed to keep the levy flat next year.

Some members of the board supported the 0% increase based on the rationale that we need to send a strong message to Minnesota’s dastardly Governor (whom we all know is not nearly as compassionate – with other people’s money – as we on the Hennepin County Board are) that he cannot keep cutting county aid and expecting us to raise property taxes to fill the hole.

My rationale: I supported the 0% increase not because I wanted to stick it to the Governor, but because it was the right thing to do.

As I mentioned, last year we increased the levy by 4.95%. We did not end up needing or spending that increase, but we levied it nonetheless, and now it sits on the bottom line essentially as contingency funds. The amount we levied now becomes the new levy base for 2011, so in reality, we already have a 4.95 % property tax levy increase in place for 2011.

I think it’s reasonable to argue that a property tax CUT was in order based on the fact that we didn’t need last year’s increase, but I won’t dwell on the negative.  We should probably be thankful with tax levy flatness this year as the Hennepin County Board has increased the general levy every other year but one since 1980.

Be Sociable, Share!

Tags: , ,