4.1. SR 10-09-2000 - Laserfiche WebLink

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. City of 1Y Elk Item # 4.1. MEMORANDUM TO: Mayor and City Council FROM: Pat Klaers, City Ad~ator October 9, 2000 ~ DATE: SUBJECT: Tax Rate Increase . A new state law was adopted in 1999, which requires municipalities to hold a public hearing and to pass a resolution if their tax levy will result in a tax rate increase. This will be the case for Elk River in 2001. Accordingly, the city's public hearing on the proposed tax rate increase is scheduled for this Monday. The tax system is complex and often confusing terms are used. The state legislature wants accountability at the local government level and does not want cities to "play games" with technical terms. It is not unusual for a city (or county) to say "if your property value did not change...then you will see no change or only a modest increase in our share of your tax bill." This type of statement has resulted in some frustrations at the state legislature because, if a municipality or county is experiencing growth, then the municipality or county is usually receiving additional tax revenues without this being clearly stated. Additionally, in Elk River this isn't really a fair statement because every other year or so the business or homeowner usually sees an increase in their property value (and as a result their taxes usually go up). This public hearing is another state legislature requirement for cities to discuss taxes. Additionally, the state has created another complex tax formula to determine if a city will have a tax rate increase. Please see the League of Minnesota Cities attachment for information on this new law and tax formula. For a growing city like Elk River, this new formula will typically result in showing a tax rate increase. . At the October 9, 2000, City Council meeting the Mayor should open the public hearing on the tax rate. Staff can answer questions on the tax rate, the 13065 Orono Parkway. P.O. Box 490. Elk River, MN 55330. TDD & Phone (763) 441-7420. Fax (763) 441-7425