A useful article on how school operating levies are levied

A friend sent this story to me about the Perham School district’s levy referendum. Its mostly correct and I suspect much of what it says is based on state laws and would relate to Duluth as well.

It mentions that some kinds of “post secondary residential” properties are not taxed. If that’s so I’d be curious to know if that is a statewide exception or one that only applies to Ottertail County. Duluth has a lot of housing that might be described that way. I presume that single family homes that have become rental residences would be subject to school operating levies although only at the lower homesteaded rate (as second homes.) I’d guess a lot of the Duluth housing along Rice Lake Road for college kids might be exempt but I don’t know for certain. Sorry, I’m not going to research it.

The story did get one thing wrong. I wrongly presumed that this explanation covered a “progressive tax.” It doesn’t.

The Perham-Dent levy would cost $105 per year for properties worth $100,000, with that amount progressively rising as the market values increase – up to $948 per year for a $900,000 property.

In this example every $100,000 of value has the same flat $105 tax applied to it so that $900,000 in value would result in taxes of 9 x $105. In a real progressive situation there would be an increase in the property tax rate as the value went up. For example, at a $500,000 valuation the tax might go up to $125 for every additional $100,000 of valuation over $500,000. That would be a “progressive” jump.

Minnesota property taxes used to be like that meaning that more expensive homes were taxed at higher rates. I wish it would come back. I suspect that a lot of folks in big Duluth houses were for the Red Plan and I’d like them to be pulling a heavier load.

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