As the name suggests, the valuation notice is an estimate of the market value for a piece of property. In other words, if you tried to sell your property on the open market, this is our estimate of how much it would sell for. The EMV notice also provides information on property classification according to use. The format of the notice is prescribed by statute.
The valuation notice sent in the spring of 2023 shows the value and classification as of January 2, 2023, and is used to determine a property owner’s share of property taxes which are to be paid in 2024. As provided in state statute, sales of properties between October 1, 2021, and September 30, 2022, are used to set values for the 2023 assessment.
The residential real estate market continues to be one of the busiest that the assessor’s office has seen in years. High demand and a short supply of residential property within the market has resulted in sale prices of homes prices increasing significantly. The steep costs of construction also had a significant impact on the value of property.
Your property’s market value is determined by sales of other properties and not solely based on what you do to your property. In determining a property’s valuation, we look to determine what a willing and knowledgeable buyer would pay for a piece of property if it were offered for sale in the open market. Assessors do not create value; they interpret what is happening in the marketplace.
The strong demand and short supply of residential property in our region means the value of homes has increased significantly. This is the situation throughout our region, not just in St. Louis County. Learn more about how market value is determined.
It is too soon to tell, as budgets have not been established by local jurisdictions, however; with significant property value increases expected for residential property owners for the 2023 assessment, there will likely be a larger percentage of the tax levy shifted to residential properties.
If all values increased similarly and tax levies stayed the same, the overall tax burden for property owners would stay the same. However, there isn’t necessarily a 1 to 1 ratio between property value increases and property tax increases. The values and classifications placed on a property are used to allocate the property tax burden.
State statute prevents us from doing that. It directs the assessor to assess the property at its market value. Both our department and the Minnesota Department of Revenue monitor assessments levels using sales ratio studies. This compares our assessed value with the price a property actually sold for. The median ratio must fall between 90 and 105 percent, otherwise the market values will be ordered to be adjusted. Learn more.
Property owners should contact their assessor first. Contact information can be found at the bottom center of the front page of the valuation notice or online. Issues can often be resolved at this level without the necessity to file an appeal.
After discussing concerns with the assessor, there are three levels of appeal available to property owners. These steps must be completed in order, unless a choice is made to appeal directly to the Minnesota Tax Court.
- Local Appeal: In April or May, city and township boards of appeal and equalization meet to review and rule upon appeals. They have the authority to order changes in value and classification. The bottom of the Estimated Market Value notice provides information on local board of appeal and equalization meeting dates/s and times.
- County Board of Appeal: If a property owner is not satisfied with the local Board of Appeal and Equalization decision, an appeal can be made to the County Board of Appeal and Equalization, which meets during the last two weeks in June. The bottom of the Estimated Market Value notice provides information on the planned County Board of Appeal and Equalization meeting dates/s and times.
- Minnesota Tax Court: If a property owner is not satisfied with the County Board of Appeal and Equalization decision, an appeal can be made to the Minnesota Tax Court. This option bypasses both the Local and County Boards of Appeal, or it may be used after the other forms of appeal. Petitions to the Minnesota Tax Court must be filed on or before April 30 of the year of the year the tax becomes payable.
Learn more about the appeals process.
The Minnesota Department of Revenue provides for two types of property tax refunds:
- Regular Homestead Credit Refund: for homesteaders whose property taxes exceed a specified percentage of household income (less than $128,280 in 2022).
- Special Homestead Credit Refund: for homestead properties where the net property tax increase exceeds 12%, from 2022 to 2023 and said increase is $100 or more (the tax increase cannot be due to new construction). There is no income limitation for this refund. The maximum refund is $1,000.
Both of these programs are operated by the State of Minnesota, more information is available at the Department of Revenue website or by calling (800) 652-9094. More information on special programs.