Mary Garness

J. Frey

REGIONAL- North Country homeowners could be in for a type of “sticker shock” when they receive their statements of the estimated market value (EMV) of their properties from the St. Louis County Assessor’s office in the next several weeks.
Public Records and Property Valuation Director Mary Garness said that some buildings will see an increase in their valuation of well over 20 percent, and some parcels of land will skyrocket by as much as 50 percent.
“It’s kind of a wide range, and it really depends on the property, its location, if there’s lake frontage or not – there’s a broad spectrum,” Garness said. “Some property owners will see a zero-percent increase, and others will see something quite significant. That’s mainly due to the sales prices that we’re seeing in the market.”
Garness has been in her position for three years, but the “sellers’ market” demonstrated by sales activity that took place in the county between Oct. 1, 2020, and Sept. 30, 2021 drove valuation increases that surprised even her most seasoned assessors.
“What I’m hearing from the assessor’s office and folks that have been employed here for quite a while is that they haven’t seen this type of activity in 20 years, so it is quite remarkable,” Garness said. “I’m hearing surprise and shock and awe that some properties are selling for $40,000 to $50,000 over list price and there are some bidding wars going on, which is interesting.”
While an increase in valuation might be seen as a boon to a property owner who is considering selling, to the vast majority of homeowners who intend to stay put, another question looms large: How much is my property tax bill going to increase?
That’s a question without a specific answer for now, Garness said. The estimated market values being distributed now will apply to the 2023 tax year, and taxing entities won’t finalize their new levies until December. With the number and variation of taxing entities involved and 2023 budget formulations still months and months away, one homeowner may see a tax increase while another owner with a similarly valued property may see little to no increase.
However, what is likely in the big picture, Garness said, is that residential property owners will assume a greater share of the overall tax burden.
“It’s the value that distributes the tax bill among different property categories such as commercial, agricultural, residential, industrial, etc.,” she said. “Last year for the 2021 assessment for taxes payable in 2022, (increased) residential property values made up 75 percent of the total value increase for the county, which was about a billion dollars, so the burden shifted more to residential. We don’t have all the final numbers put together yet, but that’s a likely scenario for the 2022 assessment as well. My best guess is that this will equate to some increase in taxes, but it’s too soon to tell how much.”
The EMV notice provides details on a property’s estimated market value - the price a property would sell for on the open market - as well as its classification and a list of possible deductions that end up with the property’s Taxable Market Value, or TMV. The most common exclusion is the Homestead Market Value Exclusion, which declines as the property value increases.
Another important piece of information on the EMV comes into play for those property owners who want to contest the county assessor’s findings. As only 20 percent of properties in a given assessment district are physically inspected each year, there may, for example, have been changes to the property that weren’t taken into account.
The first line of inquiry is to place a call to the assessor designated on the EMV to talk informally about your concerns, or attend a local meeting if one is available.
“Oftentimes, if there are errors or issues, the assessor can answer questions or make corrections without the necessity of going to a local board of appeal,” Garness said.
Formal appeals begin with the local board of appeal and equalization. For smaller towns, there may not be an actual board meeting at all, but the EMV has the information someone needs to file an appeal for consideration. If a property owner isn’t satisfied at the local level, they can take their case to the county board of equalization or to the Minnesota Tax Court. These steps are described on the back of the EMV form.
Garness encouraged those pursuing formal appeals to be well prepared. A little research can go a long way toward supporting your claims.
“An appraisal is always the best evidence, but there’s a cost to that,” Garness said.
The county has freely accessible online resources available through links on the county assessor’s property information webpage, Garness noted, such as the map-driven County Land Explorer and the address entry form of the property details search. One layer of the County Land Explorer displays recent property sales, which may help property owners more quickly identify properties comparable to their own.
“If you do some research about the market, then that typically will provide the information that’s needed for a good appeal,” Garness said.
Garness also promoted two options offered through the Minnesota Department of Revenue that could provide tax relief for certain taxpayers who qualify.
“The regular homestead credit refund is for homesteaders whose property taxes exceed a specified percentage of household income. That’s the first. The other is a special homestead credit refund program for homesteaders whose net property tax increase exceeds 12 percent, and is $100 or more, and that is a refund that would be on their Minnesota tax return,” Garness said.
The St. Louis County Assessor’s Office has created a webpage with answers to frequently asked questions and links to additional resources. It can be found at stlouiscountymn.gov/assessor. Any property owners with questions specific to their valuation and classification notice should contact their assessor first, using the information provided at the bottom right of the front page of the EMV notice or on the contacts webpage at stlouiscountymn.gov/assessor.