St. Paul City Council approves 22% ceiling on property tax hike

The St. Paul City Council approved a 22% limit on the 2020 property tax levy increase Wednesday, giving it the authority to raise an additional $35 million for the city — mostly to pay for trash hauling.

City officials are bracing for a November ballot referendum that will let residents decide whether they want to continue with the organized trash collection system. If they vote it down, the city will have to shoulder the cost of picking up the trash and residents will face a third consecutive year of double-digit levy hikes.

"This is a very hard vote to take," said Council Member Rebecca Noecker. "My strongly held hope is that we can bring this down dramatically by the time we actually set the levy in December, which is not what we're doing today."

The 22% limit is the maximum the council can include in its final 2020 budget; members may ultimately decide on a lower number.

Mayor Melvin Carter proposed a 4.85% property tax levy increase in August. Then the Minnesota Supreme Court ruled that St. Paul residents have the right to vote on the trash collection system, leaving the city with a potential $27 million hole to fill.

Council Members Jane Prince and Kassim Busuri, who represent the East Side, voted against the levy limit. Prince noted that she voted against the organized trash collection contract in 2017.

"I am not going to follow up one mistake after another after another by presuming that a bad trash contract needs to be assessed to all of the city's property taxpayers," she said.

The levy is the amount of money the city collects in property taxes, not the amount that individual property owners pay. In St. Paul, the levy is split between the city, libraries and the Port Authority.

The council vote came a day after the St. Paul school board agreed to boost the district's tax levy by up to 5%, or $8.9 million, in 2020. Unlike the city, the school district does not specify how money is spent at the school level until the spring.

The school district's levy increase includes an additional $10.1 million for facilities projects — all of which had been planned, Marie Schrul, the district's chief financial officer, told board members Tuesday night.

Ramsey County commissioners voted Sept. 17 to raise the county levy by up to 4.75%.

Council members voted unanimously to set the Housing and Redevelopment Authority (HRA) levy limit Wednesday.

The proposed $4.5 million will finance programs including the Housing Trust Fund and maintenance of HRA-owned properties. Like the city levy, it could drop before the council approves the budget in December.

"Obviously, the less we can spend the better," said Council Member Chris Tolbert, who chairs the HRA. "But we will work toward that over the coming months."

Factoring in city, county, school board, HRA and regional rail authority levies, owners of a median-value home — which in St. Paul is $199,800 — could see a $356 increase in their property tax bill in 2020.

Property owners can appeal the assessed value of their property in March, when Ramsey County sends out valuation notices. The state also has a property tax refund program, which reimburses property owners whose taxes have risen significantly from one year to the next.

Staff writer Anthony Lonetree contributed to this report. Emma Nelson • 612-673-4509