DFL: Taxes create 'two-tier' state

Suburbs experience lower tax hikes

than rural areas

By KURT NESBITT

Journal Staff Writer

MANKATO -- Democratic lawmakers charge that a recent House property tax report shows a pattern of unfairness in the amount of property taxes Minnesotans pay.

House Minority Leader Matt Entenza, DFL-St. Paul, visited several cities around the state Thursday and gave press conferences where he and other local legislators talked about the report.

Cities and counties experienced cuts in state aid made by the Legislature in efforts to balance the state's looming deficit.

Many city and county officials responded by proposing increases in local and county property taxes and by cutting services in hopes of regaining what the Legislature cut.

On Thursday, Entenza, State Rep. Lyle Koenen (DFL-Maynard) and former DFL Rep. Ruth Johnson of St. Peter, blamed the Republican majority in the Legislature and Gov. Tim Pawlenty's 'no-new-taxes' pledge for making Minnesota into a 'two-tier' state, where some suburbs receive modest tax cuts while many other see tax increases.

He said Republicans have a philosophy that is "almost Darwin in that (some cities) were picked by the Republican majority."

Entenza said an example is in the fact that homeowners in Roseville are seeing increases in property taxes, while property taxes nearby Woodbury have actually seen modest decreases. He said taxes are increasing by over 10 percent in southwestern and southcentral Minnesota.

Johnson said the cuts made by the Legislature last year forced city and county officials to either raise taxes or cut services.

"That's not the kind of quality-of-life we want to see in the future," Johnson said.

Koenen said the cuts were based upon Pawlenty's "no-new taxes" pledge. He said the cuts effectively made a cost shift to cities and counties. He credited city and county officials for "doing a good job with what they were given."

The Department of Finance released its latest state budget forecast on Dec. 3. That report said that the state's deficit is predicted to be at $185 million at the end of the 2004-05 biennium. The amount of income the state expects to see over those two years is expected to drop by $407 million from the estimates that were made at the end of the 2003 legislative session.

The Minnesota Department of Revenue released a report on Nov. 26 saying that it expects property taxes to increase by an average of 6.6 percent if proposed local tax levies are adopted this month.

The rate of growth for property taxes is 25 percent slower than it was in 2002. The report said property taxes in Greater Minnesota were supposed to increase by 11.6 percent while cities in the seven-county metro area would see an average increase of 7.7 percent.

Entenza said DFLers plan to introduce a series of proposals for the start of the legislative session in February to deal with the state's budget. He said the Minnesota Department of Finance is expected to have a newer, more up-to-date budget forecast in February, which will give DFLers ideas about what to do. He said legislators are going to work on forming a coalition that will try to redirect some of the state funding that went to wealthy suburbs towards cities that saw cuts in aid.

Entenza and other DFL representatives held similar talks in Duluth, the Minneapolis-St. Paul area, Rochester, Winona and Moorhead. Entenza said the DFL has two goals in mind: "To show that the governor's tax pledge was phony and to talk about tax increases and spending cuts."