Revenue for special districts complicate local tax picture

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Property tax statements don’t only contain information about city, county and school levies. There may be levy line items for such things as economic development, watershed, transportation and hospital districts. These special taxing district levies have, over the years, increased in number as has the amount of tax dollars they collect.

In 2011, more that $300 million is being levied across the state for these entities, according to a nonpartisan House Research Department report presented to the House Property and Local Tax Division.

Researcher Steve Hinze said taxing districts can be grouped into five categories: housing and economic development; health and safety; transit and transportation; water and sewer; and metropolitan agencies and regional development commissions. They focus attention on a “task or problem, which may be low priority for the city and county,” according to the report. But over the years, their scope and programming has increased as well as the amount of money they take in from taxpayers.

Taxing districts are considered special or limited purpose units of local government, such as an economic development authority, port authority, housing and redevelopment authority or sanitary districts. Some have the ability to bond for projects (without taxpayer approval), while others don’t.

“Are most special taxing districts run by non-elected officials,” asked Rep. Bob Dettmer (R-Forest Lake).

Researcher Joel Michael said most district overseers are appointed by elected bodies, such as city councils.

The division took no action, but heard testimony from three different taxing districts on how the money is spent.