Agenda - Council - 06/23/1998 - Laserfiche WebLink

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I I I I I I I I I I I I etc.). Such abatements can be added in an equal amount to the district's levy for that year but are not included in abatement aid and levy authority. Senior Citizen Deferrals - Taxpayers over the age of 65 can defer a portion of their property tax burden if they've lived in their homes for 15 years and their total annual household income does not exceed $30,000. Senior citizens can, for taxes payable in 1999, defer an amount up to their total property taxes minus 5% of their total household income, not to exceed an aggregate tax amount of 75% of the property's market value. A lien will be placed on the property payable when the house is sold, the owner dies, or discontinues the deferment, or the propeay no longer qualifies as a homestead. Levy Limits and Tax Truth - Temporary levy limits on counties and cities of more than 2,500 population were implemented for two years. The Commissioner of Revenue determines the levy limit base for each county and municipality, using 1997 figures weighted for inflation and population increases. With certain exceptions, property taxes within that jurisdiction are limited to the base figure, minus the amount of general purpose aids provided by the state. Communities also need to provide more specific budget information in newspaper advertisements pertaining to public hearings of property tax matters. Tax Increment Financing - A new law requires development authorities to conduct physical, on-site inspections of properties being considered for TIF action. In addition, the law imposes new restrictions on the uses of TIF money, and adopts explicit definitions aimed at tightening the use of TIF districts. Municipal Bankruptcy Allowed - Cities and towns facing financial meltdown may now file a petition seeking Chapter 9 bankruptcy protection under a new Minnesota law. Bankruptcies filed under Chapter 9 allow municipalities to reorganize their debt payments to make them more manageable. In addition to accepting the arrangement for lower payments, creditors also may lower their interest rates on the outstanding balance. Emergency Services Fees - A new law allows towns to charge emergency service recipients for the cost of providing fire, rescue, medical, and related services. The law also provides a process for the collection of delinquent payments fi.om those receiving the services. In the case of property owners, the emergency service fee may be added to the property taxes of the service recipients. Budget Reserve Account - The Legislature established priorities for future forecasted revenue surpluses in November of odd-numbered years. Aiter ensuring that the budget reserve account is at $522 million, 60% of any additional amounts will be deposited into a property tax reform account and 40% will be deposited in the General Fund as an unrestricted balance. The Governor will then make recommenda- tions to the Legislature for use of the money in the property tax reform account, but the money can only be used for: a) compressing property class rates, b) increasing state education aids to reduce property taxes, c) increasing the state share of education funding to 70%, d) increasing the education homestead credit, or e) increasing the property tax refund. Sales Tax Exemptions - The Legislature implemented several sales tax exemptions which relate to cities. Effective July 1, 1997 and thereaiter, the purchase of petroleum products to fuel city fire apparatus including support vehicles, marked police patrols and ambulances are exempt from the sales tax. Certain search devices used by firefighters have also been added to the list of exempt items for fire fighting equipment. -2-