Last week the Nicollet County Board of Commissioners and a member of the Auditor/Treasurer’s office met for the purpose of equalizing the property values of all commercial, residential, and agricultural properties in the county. This process is an attempt by public officials where each tract or lot of real property is examined and compared with the purpose of coming up with an equalized value for all property. This value is then entered on the assessment list as its market value.
This process is part of the way the tax system in Minnesota is run. While property values are a different issue than taxes, it is the value of our property that has a direct effect on how much we pay in taxes. Other issues that enter in are the tax rate that is given to each type of property by the legislature. For example: it is good public policy to encourage home ownership, so homes are given a lower rate than other types of property. Minnesota statute 274.14 describes the process in great detail.
In April I attended a meeting of counties and heard a presentation by the Hennepin County Assessor. He said that this year, for the first time in his 20 plus year history with the county, the total assessed value of the property would decline. This is primarily due to decreased values of homes. I was glad to sit in the audience and know I was from a county that has a diversity of kinds of property. We are not strictly dependent on homes and commercial property.
Last week, Nicollet County Assessor Doreen Pehrson noted that Nicollet County has seen some slow down in home sales, but she said “the average sales prices for homes was higher in 2007 than in 2006.” (Average sales price in 2006 was $169,953 and 2007 was $178,630.) So the slump has not hit Nicollet County to the same extent as the metro areas. The other positive we have for us is that farmland is increasing in value. So if we lose value in one area, we make up for it in another area. When all of the calculations are done, it is the tax capacity of the whole county that is important. This is the bread and butter of all local units of government i.e. schools, cities, counties, and townships. This figure and the budgets of each of those units is what determines our taxes. end