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Property tax increases expected under Pawlenty plan

St. Paul, Minn. — (AP) - For weeks, the chairman of the Senate's tax committee has been repeating one phrase like a mantra: Gov. Tim Pawlenty's "no-tax" budget will drive up property taxes. On Wednesday, he proved it. Sort of.

Sen. Larry Pogemiller, DFL-Minneapolis, distributed to his committee information from the state Revenue Department that predicts taxes will increase 14 percent for homes on average statewide under Pawlenty's budget.

Counting farms, apartments and commercial or industrial properties, the total average increase is 7.5 percent.

Pogemiller contrasted that with his own plan to freeze property tax levies at last year's levels and found his plan would prevent $344 million worth of new taxes compared with the governor's plan.

But, because Pawlenty would limit how much cities and counties can increase their taxes to respond to his budget cuts, property taxes would actually increase less under Pawlenty's plan than they would if his budget didn't pass.

If current law stays the same, the department found, homeowners would see a 17 percent increase in their property taxes, and the total increase would be 9.6 percent, counting farms and businesses.

Pogemiller said the sheet isn't the final answer on property tax increases. He said he's still looking for information on how much Pawlenty's budget would increase property taxes if he didn't limit the size of county and city tax increases.

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