Tax Aids and Credits

Other Local Government Payments - Mahnomen Property Tax Reimbursement

Statewide Outcome(s):

Mahnomen Property Tax Reimbursement supports the following statewide outcome(s).

Strong and stable families and communities.

Context:

Sudden, significant changes to tax base can lead to financial strain for local units of government.

Beginning with assessment year 2007, the Shooting Star Casino land was placed into tax-exempt trust status. Annual payments are made by the state to Mahnomen County ($450,000), the city of Mahnomen ($80,000), and Mahnomen School District #432 ($70,000) to compensate for property taxes not collected on the tax exempt land. The payment was first made in calendar year 2006 and became permanent in 2008.

Funding Source: State General Fund.

Strategies:

Provide payments for property tax revenue loss due to the placement of the Shooting Star Casino land into trust status.

Results:

The fiscal impacts of tax-exempt tribal-owned property are reduced for local governments in Mahnomen County.

Performance Measures Notes:

City tax base percentage compares assessment year 2007 (previous) to assessment year 2011 (current) for the city of Mahnomen. The pre-exemption tax base is assessment year 2006.

The total tax base for the city of Mahnomen decreased almost 50 percent following the exemption of the Shooting Star Casino. In recent years, the city tax base percentage had grown from 52 percent back to 57 percent of pre-exemption levels, but declined beginning in assessment year 2011 as a result of the market value homestead credit being converted into a market value exclusion. The exclusion reduced the taxable value of homesteads and the tax base of local taxing jurisdictions statewide.