FAQ's for Tax Levies

1. How the Tax Levy Affects Property Taxes

The tax levy is the total amount of money the City of Maple Plain needs to collect to fund its budget for city services like police, fire protection, street maintenance, parks, and debt repayment.

The levy affects your property taxes as follows:

• The total levy is divided among all properties in the city based on their tax capacity, which is derived from each property’s taxable market value and classification (e.g., residential, commercial).
• Your share of the levy depends on your property’s tax capacity compared to the total tax capacity of all properties in the city.

How Changes in the Levy or Market Value Affect Your Taxes

Several factors influence how much you pay:

1. If the levy increases: The city collects more total revenue, and taxes may go up unless there is significant growth in the tax base (e.g., new development or properties added to the tax rolls).
2. If your property’s market value increases more than others: Your share of the levy may increase, leading to higher taxes. Conversely, if your market value grows slower than others or decreases, your share may decrease.
3. City-wide changes: When market values across the city rise or fall, the tax rate may adjust to ensure the levy amount is collected.

2. How Your Taxes Are Calculated

Homestead properties with an estimated market value less 517,200 may receive an exclusion on a portion of their estimated market value, which results in a lower taxable market value.  Taxable market value is converted into net tax capacity by multiplying

Your property taxes are calculated as follows:

1. Tax Capacity:
   • The county determines your tax capacitybased on your property’s taxable market value and classification.
     • For most residential properties, the tax capacity is 1% of the first $500,000 in taxable market value and 1.25% of any value over $500,000.
     • Homestead properties with an estimated market value less 517,200 may receive an exclusion on a portion of their estimated market value, which results in a lower taxable market value.  
     • Example: If your property’s taxable market value is $290,000, your tax capacity is:
2. Tax Rate:
   • The county calculates the city’s tax rate by dividing the total levy by the total tax capacity of all properties in the city.
   • Example: If the city’s levy is $1,000,000 and the total tax capacity is $200,000, the tax rate is:
3. Property Tax Calculation:
   • Your property tax is determined by multiplying your tax capacity by the tax rate.
     • Example:

Your total property tax also includes amounts levied by the county, school district, and special districts, which are calculated similarly.

3. How to Dispute Your Market Value

If you believe your property’s market value is incorrect, here are the steps to dispute it:

Step 1: Review Your Valuation Notice

• Verify the market value listed and check for errors in property details (e.g., square footage, number of bedrooms).

Step 2: Gather Evidence

• Collect documentation such as:
  • Recent sale prices of similar properties in your area.
  • A professional appraisal.
  • Photos or reports showing property damage or conditions that reduce value.

Step 3: Contact the County Assessor

• Call the Hennepin County Assessor’s Office at the number listed on your valuation notice.
• Discuss your concerns and provide your evidence. Often, issues can be resolved informally at this stage.

Step 4: File a Formal Appeal

If the issue isn’t resolved informally, you can file an appeal:

1. Local Board of Appeal and Equalization (LBAE):
   • File an appeal with the Local Board (usually held in April or May).
2. County Board of Appeal and Equalization (CBAE):
   • If necessary, escalate to the County Board (held in June).

Step 5: Appeal to Minnesota Tax Court

• As a last resort, you can file with the Minnesota Tax Court by April 30 of the year your taxes are payable.

4. The City’s Role in Property Taxes

The City of Maple Plain is responsible for:

• Setting the tax levy amount to fund the city’s budget.
• Managing the budget to provide essential services efficiently.
• Communicating the levy to the county, which handles property assessments and tax calculations.

The City does not determine property values or classifications—that is the role of Hennepin County.

If you have additional questions about your property taxes or need assistance with the appeal process, please don’t hesitate to contact Jacob Kolander. I’m happy to help guide you through the process.