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RESOLUTION NO. 12-035 STATE OF MINNESOTA COUNTY OF RAMSEY CITY OF NEW BRIGHTON UTION CALLING FOR THE REPEAL OF THE HOMESTEAD MARKET VALUE EXCLUSION LEGISLATION WHEREAS, IN 2010 AND 2011, THE STATE BALANCED ITS BUDGET DEFICIT, IN PART, BY CUTTING REIMBURSEMENTS DUE TO ALL CITIES FOR PROPERTY TAXES FOREGONE UNDER THE MARKET VALUE HOMESTEAD CREDIT (MVHC) SYSTEM; AND WHEREAS, IN 2003, 2004, 2005, 2006, 2008 AND 2009, MORE THAN 100 CITIES RECEIVED MVHC REIMBURSEMENTS THAT WERE CUT TO ADDRESS EARLIER STATE BUDGET DEFICITS; AND WHEREAS, THE 2011 MINNESOTA STATE LEGISLATURE AND GOVERNOR REPEALED THE MARKET VALUE HOMESTEAD CREDIT SYSTEM AND REPLACED IT WITH THE NEW HOMESTEAD MARKET VALUE EXCLUSION PROGRAM; AND WHEREAS, BOTH THE MARKET VALUE HOMESTEAD CREDIT SYSTEM AND THE HOMESTEAD MARKET VALUE EXCLUSION PROGRAM MANIPULATE THE DISTRIBUTION OF LOCAL PROPERTY TAXES AMONG TYPES OF PROPERTIES; AND WHEREAS, MINNESOTA'S PROPERTY TAX SYSTEM IS COMPLEX AND CONFUSING AND THEREFORE DIFFICULT FOR TAXPAYERS TO UNDERSTAND; AND WHEREAS, PROPERTY TAXATION HAS THREE MAIN COMPONENTS TO ITS CALCULATION WHICH INCLUDE THE ASSESSOR'S MARKET VALUATION WHICH IS GENERALLY ESTABLISHED BY THE COUNTY, THE LOCAL PROPERTY TAX LEVY WHICH IS ESTABLISHED BY THE LOCAL TAXING JURISDICTION, AND THE CLASSIFICATION SYSTEM AND CLASS RATES ESTABLISHED BY THE MINNESOTA LEGISLATURE; AND WHEREAS, ADDITIONAL MANIPULATION OF THE LOCAL PROPERTY TAX SYSTEM THROUGH THE MARKET VALUE HOMESTEAD CREDIT PROGRAM AND HOMESTEAD MARKET VALUE EXCLUSION SYSTEM ADDS LAYERS TO THE MINNESOTA PROPERTY TAX SYSTEM, COMPLICATING THE CALCULATION OF PROPERTY TAXES AND FURTHER REDUCING TAXPAYER UNDERSTANDING AND LOCAL CONTROL OF LOCAL PROPERTY TAXATION; AND WHEREAS, THE HOMESTEAD MARKET VALUE EXCLUSION ADDS TO THE COMPLEXITY OF MINNESOTA'S PROPERTY TAX SYSTEM, FURTHER. REDUCING TAXPAYER TRANSPARENCY BY: 1. ARTIFICIALLY REDUCING THE TAXABLE VALUE OF A SELECT GROUP OF RESIDENTIAL PROPERTIES WHILE OTHER PROPERTIES, INCLUDING HIGHER VALUED HOMES, APARTMENTS AND ALL BUSINESSES HAVE THEIR VALUES ESTABLISHED BY THE MARKET; 2. INADVERTENTLY INCREASING LOCAL GOVERNMENT TAX RATES FOR CITIES, COUNTIES AND SCHOOL DISTRICTS WHETHER THE LOCAL UNIT OF GOVERNMENT INCREASED THE ACTUAL TAX LEVY OR NOT; 3. CAUSING A SHIFT IN PROPERTY TAXATION ONTO BUSINESSES AND HIGHER VALUED HOMES. NOW THEREFORE, BE IT RESOLVED, THE NEW BRIGHTON CITY COUNCIL SUPPORTS THE REPEAL OF THE HOMESTEAD MARKET VALUE EXCLUSION; AND