7 things to know about Olmsted County's 2024 budget

Dec. 16—ROCHESTER — A proposed increase of nearly $6.6 million for overall property taxes collected by Olmsted County will result in an added $39 in property taxes for the average homeowner.

The actual increase on individual property tax bills will depend on the property classification and value, along with how it has changed in recent years. Additionally, school, city and township tax changes will appear on future statements.

With Olmsted County commissioners slated to make a final decision on the county's proposed $357.7 million budget and nearly $119.5 million tax levy during their 6 p.m. meeting Tuesday, here are a few things to know about the proposal:

1. The county collects two tax levies.

In addition to collecting property taxes to support nearly a third of the county budget, Olmsted County also has a Housing and Redevelopment Authority tax levy.

Established in 2018, the county's HRA levy is slated to collect $4.9 million in taxes in 2024 to support ongoing housing efforts.

The tax remains set at the maximum allowed level and is collected throughout the county, with the exception of Stewartville, which has its own HRA board.

2. The planned tax levy increase sits between historic highs and lows.

Olmsted County's general tax levy is slated to see a 5.2% increase in 2024.

It's a rate of increase that sits between a high of an 11.5% increase in 2002 and two years — 2012 and 2021 — when commissioners opted not to increase the levy.

At the same time, the added $6.21 million expected to be generated through the county's general levy in 2024 is third only to a $6.66 million increase approved last year and a $6.44 million increase in 2018.

3. Olmsted County's property tax collected per person is higher than the state average.

The proposed property levy equates to $748 being collected per person, based on county population.

"Olmsted County is lower than about 61%, or 53, of the 87 counties," Olmsted County Chief Financial Officer Wilfredo Roman-Catala said of the per-capital figure used to compare property tax collections among other counties.

Statewide, counties collect an average of $686 per resident, with Dakota County collecting the least at $343 per resident.

4. The county's tax rate is at its lowest in the past decade.

The tax rate is determined by dividing the total tax levy collected throughout Olmsted County by the total tax capacity in the county.

The current tax rate — 0.43 — is at a 12-year low, dropping from nearly 0.45 last year and a high of 0.60 in 2013.

"This number continues to decline," Roman-Catala said, pointing out the decrease means that any property not seeing a change in market value will see a decrease in taxes.

5. Property values are increasing at faster rates in some communities surrounding Rochester.

One of the biggest impacts on how the property tax burden is distributed is the increasing market values of property, which is driven by new construction and upgrades, as well as rising sales prices.

"We use those sales prices as a measure to understand the assessment," Roman-Catala said, pointing out the process is governed by the state.

The resulting taxable price increases are greater than Rochester in three of four other Olmsted County cities.

Comparing homes at the 50th percentile in five city markets throughout the county, the Rochester home saw a 81% taxable value increase in price during the past eight years.

During the same period the middle-valued home in Byron saw a 131% increase in value, the highest among the cities. Similar homes saw a 125% increase in Stewartville and 115% increase in Dover.

The home at the 50th percentile in Oronoco saw the lowest rate of increase in estimated market value, posting a 50% jump in eight years.

6. The state has adjusted the requirement for a special rebate.

With increased market values adding to the tax burden for some property owners, the state of Minnesota has reduced the requirement for a special property tax refund.

In addition to the Homestead Credit Refund, homeowners seeing a significant increase in property taxes can apply for an additional refund amount.

In the past, a property's tax had to increase by 12% or more to qualify, but the level of increase was lowered to 6%.

The refunds are available through the Minnesota Department of Revenue website at

revenue.state.mn.us/property-tax-refund.

7. The county spending is increasing by $161 per resident.

While the amount of property taxes proposed for 2024 is equal to a $20 increase per resident, the county's 2024 calls for spending an added $161 per resident, with the majority of funding coming from other sources.

In all, the county's 2024 budget calls for spending the equivalent of $2,129 per resident, with $748 of it supported by property taxes.

The budget calls for spending $738 per county resident on health, housing and human services programs, many of which are required by the state. Another $379 per resident will be spent on law enforcement and court services, while $364 per person is expected to be spent on highway construction and maintenance.