Saint Paul property owners may want to prepare for a hefty property tax increase next year. The City Council approved a maximum levy increase of 15.3 percent for 2023, with promises, however, to bring that increase down in the weeks ahead.
Several council members called the increase “unacceptable.” It is the same tax levy hike proposed by Mayor Melvin Carter in his 2023 city budget. The $781.5 million budget is supported by $199.9 million in property taxes.
Property taxes are now paying for street maintenance.
Driving up the tax levy is the recent district court decision that found unconstitutional the city’s practice of assessing all property owners, even tax-exempt property owners, for the costs of street maintenance. The court ruled that street maintenance was a citywide benefit that should be covered by property taxes. The assessments raised about $15 million per year for the city’s coffers, and switching those costs to property taxes accounts for about half of the proposed levy increase.
State truth-in-taxation law requires local governments to adopt a maximum levy by the end of September. After September, the levy can be decreased but not increased.
City Council president Amy Brendmoen said that she and her colleagues would “dig very deeply” in the weeks ahead to find ways to trim the mayor’s proposed budget for next year. Ward 7 council member Jane Prince said the levy increase “fails to recognize the realities facing the city’s property taxpayers.”
Homeowners question 15% levy increase.
The vote on the maximum levy followed a September 20 public hearing on the city budget at Como Park Pavilion. Most of the three dozen people who testified at the hearing were city employees, though a few property owners spoke. Highland Park homeowner Joe Soucheray asked city officials, “Is Saint Paul experiencing some good fortune we’re unaware of? What is justifying a 15 percent increase? Who in God’s name is getting a 15 percent raise?”
South Como homeowner Patty Egger questioned how she and others will be able to pay such high property taxes on top of other cost increases. “I work in food service,” Egger said. “We don’t earn a lot of money. How am I going to get through?” Egger said she was sorry there were not more property taxpayers at the hearing. “They’re probably not here because they’re trying to make ends meet,” she said.
Merriam Park attorney Ferdinand Peters, who was involved in the litigation involving the city’s street right-of way maintenance assessments, suggested the city counter steep levy increases by avoiding costly court battles.
City workers dominate hearing.
Many speakers were city workers and union members who urged the City Council to look at compensation for those who labored on the front lines during the COVID-19 pandemic. One repeated comment was that wages have not kept up with inflation and that city employees will be hard-pressed to pay higher property taxes. They cited staffing shortages in many city departments and the need for city officials to reduce the number of higher-paid middle management positions.
“Everything’s rising. The cost of living’s going up, and all our bills are going up,” said Emanuel Gomez, who works for Saint Paul Regional Water Services. “We don’t get the proper pay that is needed for any of us to survive on here.”
Saint Paul Public Library employees complained of behavioral problems with library users. Female workers have been propositioned, stalked, groped and kissed by members of the public. They criticized library management for not doing enough.
Workers said high turnover and staff shortages are affecting public libraries and even forcing some to close for short periods. “We desperately need more front line staff,” said Betsy Hunter, who works at the Hamline-Midway Library. “Our leadership is failing.”
Carter’s budget includes $1.3 million for library safety measures. City Council members said they are deeply concerned about the safety issues and will look for additional funds.
Rise in home values
may boost taxes
The Ramsey County Board got a preview recently of the trends affecting the local real estate market in 2022 and the effect those trends could have on property taxes payable in 2023.
The total preliminary assessed value for all properties in Ramsey County stands at an all-time high of $70 billion, according to interim county assessor Pat Chapman. The aggregate value of properties across the county for taxes payable in 2023 has increased 12.88 percent in the past year, Chapman said.
The greatest value increase has come in multifamily residential property, at 17 percent countywide. The value of single-family homes increased by 14.21 percent. Industrial properties saw a 9.55 percent increase. The value of commercial property increased by 1.78 percent.
In Saint Paul specifically, the value of a median-priced single-family home increased 16.4 percent over the past year—from $228,700 to $266,300. In the Saint Paul neighborhoods served by MyVillager, a median-priced home increased by the following amounts:
Downtown — 23.1 percent, from $460,000 to $566,050.
Highland Park — 10.6 percent, from $359,900 to $398,050.
Macalester-Groveland — 12.7 percent, from $361,400 to $407,200.
Merriam Park, Snelling-Hamline and Lexington-Hamline — 12.6 percent, from $338,700 to $381,400.
Summit Hill — 10.4 percent, from $490,750 to $541,900.
Summit-University — 17.2 percent, from $250,500 to $293,700.
West End — 8.1 percent, from $204,700 to $221,200.
— Jane McClure
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