Ramsey County proposing 6.7% property tax levy hike as part of 2024 budget plan

Ramsey County officials are proposing to increase property tax revenue by 6.7% in 2024, roughly double the average annual levy rate increase in recent years.

That doesn’t mean taxpayers in Ramsey County would necessarily see their taxes rise by that percentage. Rather, they’d see increases or decreases in proportion to the change in their property’s value, adding up to 6.7% more county revenue from property taxes.

“We actually anticipate that most St. Paul homeowners are going to see a hold-even or a slight decrease on their property tax bill, and in suburban Ramsey County, a hold-even to a moderate increase,” County Manager Ryan O’Connor said.

O’Connor pitched the levy increase last week to the Ramsey County Board as critical for maintaining services at a consistent level, especially as the need for social services continues to be high, and to retain staffers.

O’Connor said that despite an increase in county aid passed by the Legislature this year, other pandemic-related funding from the federal and state government that has supplemented the budget in the last few years is drying up.

The levy increase would help pay for the first year of the 2024-25 biennial budget for Ramsey County, the only one of Minnesota’s 87 counties to use such a process. O’Connor’s proposed 2024 county budget is $813.4 million, 3.48% bigger than this year’s spending plan.

For 2025, he proposed an $841.8 million budget accompanied by a 4.75% tax levy increase, an amount he said could shrink when the county factors in sales tax revenue from marijuana sales,

O’Connor characterized next year’s proposed 6.7% levy increase as a catch-up number, since the county kept its 2021 levy flat amid concerns about pandemic pressures on residents. The tax levy went up by 1.5% for 2022, and 4.5% for 2023.

“This is a year we’re trying to catch that budget up and really make sure we’re on stable footing going forward,” he said.

Under O’Connor’s proposal, the owner of a median-value home in St. Paul would pay an estimated $92 less to the county in property taxes next year. In Maplewood and Roseville, tax hikes for median-value homeowners would range from an estimated $80 to $138. Median-value industrial and commercial property owners would likely see tax bills rise.

In July, the first month that hemp-derived THC gummies and drinks were subject to the state’s new tax, the state took in upwards of $594,000 in revenue, some of which goes to local governments, according to the Minnesota Department of Revenue.

Matt Hilgart, government relations manager with the Association of Minnesota Counties, said he’s not surprised local governments are thinking ahead about the new revenue stream. But he said it’s unclear so far how significant the tax revenues will be from the sale of marijuana — a new industry that’s likely to grow.

“I’m hopeful that it’s actually a significant amount of revenue,” said O’Connor, who expects to know more next year when the state Department of Revenue provides estimates to counties.

Using ballpark figures, O’Connor said that $3 million in marijuana sales tax revenue could decrease Ramsey County’s 2025 levy increase by 1 percentage point, while $12 million could decrease it by 4 percentage points.

It’s too early to say how Ramsey County’s proposed levy increase compares to other counties statewide, since most of them have yet to release their budget proposals. St. Paul Mayor Melvin Carter last month proposed a 3.7% property tax levy increase for his city, and Roseville officials are pitching a 9% property tax levy increase,

will hold a public hearing on the budget proposal on Sept. 19, before the County Board sets a maximum tax levy Sept. 26. . Another public budget hearing is expected to be held before the County Board approves the final budget on Dec. 12.