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Crow Wing County property tax levy to rise 3.99%

How this levy increase would impact the average county property owner depends on a number of factors, including changes to one’s own property value and the number of additional taxpayers added to the rolls through new construction, which along with market value affects the overall tax rate.

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The Crow Wing County Historic Courthouse is located at 326 Laurel St., Brainerd. The Crow Wing County Board meets on the third floor. Chelsey Perkins / Brainerd Dispatch

The Crow Wing County Board agreed to a 3.99% increase to its property tax levy for 2022, amounting to $1.64 million more than the county collected this year.

The county board Tuesday, Dec. 14, unanimously agreed to set the levy at $42,908,106, which accounts for approximately 43% of the county’s projected $100,104,568 in revenues for next year. This is the first time in Crow Wing County history when the amount of money the county will collect is expected to exceed the $100 million mark. Expected expenditures fell just short - $99,911,854.

How this levy increase would impact the average county property owner depends on a number of factors, including changes to one’s own property value and the number of additional taxpayers added to the rolls through new construction, which along with market value affects the overall tax rate.

A county analysis showed an expected $140,573,617 worth of new construction during 2021, a 26% increase over 2020 and the highest total in a decade. Although next year is expected to see a slight dip to $134.3 million, it would still represent just over 1% of the estimated market value. That figure for all properties in Crow Wing combined is expected to hit $12.94 billion next year, also a decade-high and more than $3 billion more than the market value in 2013.


"There is even more upward movement on property values this year and we all see what is happening in the construction trades. This will make it a very challenging year for those with the biggest value increases as they are taking a bigger chunk of the total tax pie."

— County Administrator Tim Houle


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With that projected change in market value taken into account, the property owner of an average residential homestead property in Brainerd - worth $136,800 in 2022 - would see an increase of $5 for the county portion of taxes, from $421 to $426. The owner of a commercial/industrial property in Baxter valued at $1,044,000 would experience a decrease in county taxes of $293, from $6,487 to $6,364. And the owner of a seasonal recreational property in Crosslake with an average value of $420,400 would pay $52 more, or $1,329 instead of $1,277.

County Administrator Tim Houle noted after the Dec. 14 meeting some areas of the county are experiencing more dramatic swings in market value - in particular, the Crosby/Ironton area, where economic growth is fueled by a tourism draw to the Cuyuna Country State Recreation Area mountain biking trails.

“There is even more upward movement on property values this year and we all see what is happening in the construction trades. This will make it a very challenging year for those with the biggest value increases as they are taking a bigger chunk of the total tax pie,” Houle wrote in an email. “This is a year when there will be more folks who need to check into the property tax refund programs at the state, and we can help them find the right forms.”

How property taxes would be spent

While property taxes are expected to account for 43% of total county revenues next year, intergovernmental revenue - such as grants, cost-sharing agreements and other financial arrangements with other units of government - would account for 35%. Other taxes (9%), including the local option sales tax supporting highway projects, and charges for services (7%) make up the bulk of the remaining revenue.

The increase in intergovernmental revenue is related to state and federal aid along with local participation in road projects included in the highway improvement plan, according to Nick Mielke, finance director. There are also some increases in state and federal grants in the community services area.

Of the $42.9 million in taxes set to be collected in 2022, the bulk will support community services and public safety. Close to one-third of the taxes will be directed to community services - the county department tasked with adult services, child support, children and family services, community corrections, public health, financial assistance, nutrition support and veteran services. Public safety services - including the sheriff’s office and the county jail - will receive 30% of the collected property taxes.

“Public safety services is mostly reliant on the levy itself. They have some outside funding, but it’s very limited,” Mielke said. “Community services, on the other hand, is an area that relies on both the levy and outside funding. There are many mandates and statutes that require us to do certain activities that we don’t necessarily have funded by the state that drives the money need for them. And there are areas that the state and the federal government requires to do things and we get grants or other funding for those.”

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The remaining taxes collected will be split among the other county departments and spending areas — administrative services (13%), governance services (11%), land services (6%), highway services (4%) and capital projects (4%). None of the tax levy will go toward paying off a small amount of remaining debt, which includes airport bonds and a small portion for the Crosslake highway department facility. Instead, that $98,000 budget line will be covered by money already in the county’s possession and represents the final debt payment of any kind for the county.

Notable changes to budget

Of all county departments, the sheriff’s office and jail would see the biggest increase in the amount of property tax levy supporting its programming with 14% more next year compared to this year.

During a previous discussion on the budget, Mielke explained while the portion of the levy dedicated to the sheriff’s office would increase, the actual expenditures were expected to drop by 2% year over year. About $1.8 million in fund balance was used this year to fund the sheriff’s office, and the increase in levy expenditures reflects a move to shore up that account once again.

Another factor is a loss of revenue for the jail due to the Minnesota Department of Corrections pulling back from housing state prisoners in Crow Wing during the pandemic. This created an approximately $1 million hole in the sheriff’s office budget. Houle said Wednesday while the number of prisoners housed has not returned to pre-COVID-19 levels, that revenue source is slowly rebounding.

Investment income is another area in which the county is seeing impacts, with revenue projected next year to be about half of what was budgeted in 2021.

“We continue to see our investment portfolios be hammered by the reduction in interest rates, and we continue to seek ways to improve our investment income,” Mielke said. “We continue to push far with that, but we do not anticipate that this is going to be a correction that’s going to occur in 2022. I want to be realistic with what we expect for investment income.”

More notable changes between this year and next come in the capital projects area, expenditures for which are expected to increase by more than double in 2022. Capital projects refer to projects maintaining or improving physical assets of the county, ranging from computers to vehicles to buildings. The resolution passed by the board Tuesday also included approval of the capital improvement plan.


"We continue to see our investment portfolios be hammered by the reduction in interest rates, and we continue to seek ways to improve our investment income."

— Finance Director Nick Mielke


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While the increase is stark, the $4 million slated for next year is more in line with a typical spending year after two years of muchWhile the increase is stark, the $3.85 million slated for next year is more in line with a typical spending year after two years of much lower than usual capital spending. In 2020, the board agreed to suspend its capital improvement plan in the midst of uncertainty surrounding the financial impact of COVID-19. Pandemic-driven supply chain disruptions further depressed spending in that area headed into this year, Houle noted.

Among the most impactful proposals is a multi-year buildout of the judicial center. The judicial center project would include building out Courtroom 2, judges’ chambers and Hearing Room 2 — these rooms are already located within the judicial center, but were never finished when the building was first built. This three-year project is expected to cost $1,315,000, with $410,420 in costs in 2022.

A community services building remodel previously submitted for consideration will not move forward next year. That project would have included changes to the customer service reception and intake area as well as the offices on the first floor, for a total expected cost of $2.4 million over four years.

The 2022 budget will include the addition of 11.5 full time-equivalent employees to the county workforce. This represents a 2.3% increase in the number of full-time equivalent staff.

What else was in the resolution

The board resolution setting the levy amount also resulted in a number of other actions, including setting the tax levies for both of the county’s unorganized territories, the levy for the Crow Wing County Housing and Residential Authority and the amounts to be redistributed to the Region Five Development Commission, the Cuyuna Range Hospital District and the Kitchigami Regional Library System.

In the First Assessment District, the levy will increase by 5.5% to $1.13 million. In the Second Assessment District, formerly Dean Lake Township, the levy will increase by 29% - $61,202 compared to $47,450 in 2021. This increase is due in part to a clerical error in 2020 that led to residents being taxed according to a $36,000 levy instead of a $62,000 levy.

The levy for the HRA saw no change between 2021 and 2022, remaining at $729,500. Region Five, the allocation for which was $161,997, will receive $5,805 more next year than it did this year. The hospital district’s amount remained the same at $200,000, as did the library allocation, which is $509,127.

Chelsey Perkins, Brainerd Dispatch community editor, may be reached at 218-855-5874 or chelsey.perkins@brainerddispatch.com. Follow on Twitter at twitter.com/DispatchChelsey.

Chelsey Perkins is the community editor of the Brainerd Dispatch. A lakes area native, Perkins joined the Dispatch staff in 2014. She is the Crow Wing County government beat reporter and the producer and primary host of the "Brainerd Dispatch Minute" podcast.
Reach her at chelsey.perkins@brainerddispatch.com or at 218-855-5874 and find @DispatchChelsey on Facebook, Twitter and Instagram.
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