Minnesota Statute §§ 273.1231 - 1235 authorizes the County to provide property tax relief to the owners of property significantly damaged by disasters such as storms, floods, fires, arson and vandalism. Property tax relief is available in two forms: Disaster Credit (Minn. Stat. § 273.1235) which reduces the property tax liability in the year following the disaster, and Disaster Abatement (Minn. Stat. § 273.1233) which reduces the property tax liability in the current year. Both homestead and non-homestead property may receive one or both forms of relief, provided that a structure on the property was more than 50% damaged as determined by the assessor and the County approves the property owner’s application. In this situation, the 50% damage determination is made by the Minneapolis City Assessor.
In addition to these statutory provisions, when a disaster occurs that affects a large geographic area, the State Executive Council may declare a Disaster Area. Homestead property within the declared area will receive Disaster Credit, regardless of the extent of damage and without application or approval by the county. Disaster Abatements for all property types within the declared area are still subject to the greater than 50% damage assessment requirement, application and approval requirements. Disaster Credits for non-homestead property within the declared area are still subject to the greater than 50% damage assessment requirement, application and approval requirements.
When the County Board provides disaster relief, it acts on the behalf of all taxing districts that have the authority to levy property tax upon the affected properties (e.g., cities, schools). Any Disaster Credit or Disaster Abatement provided by the County Board will reduce the property tax collections of all applicable taxing districts for the applicable tax year. The amount of the Disaster Credit or Disaster Abatement attributable to each taxing district is in the same proportion as the authority’s tax rate is to the total tax rate.
The City of Minneapolis experienced a disaster that occurred between May 25, 2020 and June 8, 2020. Unlawful actors caused extensive property damage to structures in the City of Minneapolis. A defined portion of the City of Minneapolis has been declared a disaster area. Minnesota Statute §§ 273.1231-.1235 provides for property tax relief upon reassessment of properties damaged by disaster, and upon application to the Governor of the State of Minnesota and the Executive Council. The City of Minneapolis Assessor’s Office has completed its review and reassessment of the damaged or destroyed properties and has made application for disaster relief to the Governor for the State of Minnesota and the Executive Council. The assumption is that the Executive Council will approve the application at their next meeting. It is the recommendation of the County Auditor that the minimum requirements of the referenced statutes have been met and as such recommends that the Hennepin County Board of Commissioners approve qualifying applications for local option disaster credits and local option disaster abatements made by the owners of property entitled to relief under state law. It is also recommended that Hennepin County requests that the property tax abatements and credits granted to property owners under state law for the disaster that occurred between May 25, 2020 and June 8, 2020 be reimbursed by the State of Minnesota pursuant to the provisions of Minnesota Statute §§ 273.1231-.1235.