Minnesota lawmakers have proposed property tax relief for the state’s farmers this legislative session.

During a recent press conference, Lt. Gov. Tina Smith and state Rep. Paul Marquart reviewed the particulars in the bill, which was initially proposed by Marquart during the 2016 legislative session.

If passed, up to 74,000 Minnesota farmers, plus additional agricultural landowners, could see relief, they said.

“Farmers in Minnesota have seen their property taxes increase 11% over the last decade,” said Smith. To help relieve property tax burdens on Minnesota farmers, Smith and Gov. Mark Dayton have proposed investing $34 million in tax relief for owners of agricultural property.

“Ensuring that property taxes are fair and affordable in is vital to making our rural economies competitive and our communities livable,” said Marquart. “During this legislative session, we must commit to keeping property taxes in check through local government aid and property tax relief.”

The proposed tax credit would be available to all individual farm owners in Minnesota who pay property taxes for school district debt levies. For those farmers, the tax credit would reduce their taxes from those levies by 40%. For the 74,000 Minnesota farmers who live on their land, that would mean average relief of $243 on their annual property tax bill. No shift would be made to other property taxes. Rather, needed monies would come from the general fund.

Rural aging schools hit farmers' pocketbooks  hard
Bond issues that come up to update aging schools in rural Minnesota put farmers in a tough spot, Marquart said. He cited several recent examples of bond issues that failed, such as the $31.5 million bond issue in the Dilworth-Glyndon-Felton school district where he teaches, and a $35 million bond issue in Barnesville. In his school district, 64% of the cost would have been covered by farmers. In Barnesville, farmers would have picked up 74% of the tab.

“Time and again, it’s an unfair burden,” he said. “A 40% reduction will go a long ways, and it equals the playing field. Farmers have been covering 60% to 90% of the tab.”

Marquart also noted the proposal has bipartisan support in the state Legislature.

Another component of proposed bill is $62 million over four years for low-property-tax school districts. Also known as debt service equalization funding, 40 school districts would receive funding in fiscal year 2019 under current legislation. Under the new proposal, 38 of these 40 school districts would see an increase in funding. Plus, 21 more school districts would receive funding.

Districts that receive equalization funding under current legislation in fiscal year 2019 are Elk River, Farmington, Shakopee, New Prague, Cambridge-Isanti, St. Michael-Albertville, Sauk Rapids, North Branch, Sartell, Big Lake, Delano, Byron, Cloquet, Kasson-Mantorville, Tri-City United, Foley, Pine Island, Jordan, Rockford, Roseau, Warroad, Brooklyn Center, Rush City, Watertown-Mayer, Royalton, Ogilvie, East Central, Howard Lake-Waverly, Esko, Upsala, Cromwell, Littlefork-Big Falls, Bertha-Hewitt, Kelliher, Verndale, Laporte, Nett Lake, Red Lake, Mora and New York Mills.

Additional districts that would receive equalization funding in fiscal year 2019 under the proposal are South Washington, Lakeville, Waconia, Owatonna, Prior Lake, Dover-Eyota, Albany, Belle Plaine, Eastern Carver County, Maple Lake, Thief River Falls, Mahtomedi, Long Prairie-Grey Eagle, Hermantown, Eden Valley, Waseca, Cass Lake, Osakis, Medford, Spring Lake Park and Hawley.