Minnesota cities’ growing reliance on property tax is perilous

What do you know of Minnesota? It is a state in the Midwestern region of the United States and also the twelfth largest state by area in the U.S., it is the twenty-first most populous, with just over five million residents. But there are other realities also. Do you know that at present the state is witnessing a hullabaloo? Yes it is, and it is due to the fact the 855 cities of the state of Minnesota are counting on more on property taxes for their revenue. This, according to many, is a dangerous trend happening since the state and federal assistances are contracting and may lead to grimmer future. All these have come out due to a newly published report.

Well, it’s true that Minnesota homeowners are quite familiar with this notion but little they do know of the rate of escalation of property taxes. According to the aforementioned report which is moreover from the state auditor’s office, this dependence has grown steadily with the passing of years and is also fastening the noose for the commoners. The situation can be realized from the fact that the revenue received from property taxes in the state’s 855 cities, between1998 and 2007, increased by 98 percent and this has come out owing to the annual Minnesota City Finances Report. What had been the revenue from governmental sources? It increased merely by 14 percent during the same period.

Look at this also statistics also. In 1998 the cities’ reliance on property taxes was for 23 percent of their revenue but that figure has risen to 32 percent in 2008. On the contrary, revenue from state and federal government decreased from 33 percent of revenue to 26 percent in the same period. Is this a dangerous trend? It is quite dangerous on the word of Auditor Rebecca Otto who also said, “This was happening before everything went south and it spells real trouble. You can only put so much pressure on property taxes before it causes problems.”

This exerts a striking pressure on the common citizens and also makes the economy more stagnant, which is not desirable.