PILT Report to the Legislature Minn. Laws 1st Special Session, ch. 2, art. 4, sec. 35

Transcription

1 PILT Report to the Legislature 2011 Minn. Laws 1st Special Session, ch. 2, art. 4, sec. 35

2 Legislative Charge By December 1, 2012, the commissioner of natural resources, in cooperation with the commissioners of revenue and management and budget, and stakeholders,... shall report to [the Legislature] with recommended changes to changes to payment in lieu of taxes for natural resource lands.

3 Legislative Charge The report shall include an analysis of the current payment and distribution system and any recommended changes to: 1) The purpose of the payment system and the criteria for payments; 2) The rate of payments for specific classes of natural resources lands; 3) The adequacy of current funding for payments and the impact of additional land acquisition on the funding; 4) Alternative methods of reimbursing local units of government for state natural resource lands; and 5) The formula for distribution of the payments to local units of government.

4 Process

5 Preliminary Findings The current payment and distribution system is unnecessarily complex Some components of the PILT laws are obsolete

6 PILT Rates Natural Resources Land Type Statutory Authority Payment Rate Acquired M.S. 477A.12, subd. 1(a)(1) $5.133/acre or 3/4 of 1% of appraised value of all acquired natural resources lands in the county DNR-Administered Other County Administered Other LUP M.S. 477A.12, subd. 1(a)(4) 64.2 cents/acre M.S. 477A.12, subd. 1(a)(2) $1.283/acre M.S. 477A.12, subd. 1(a)(3) $1.283/acre Lake Vermilion/Soudan M.S. 477A % of appraised value of the land DOT Wetland Acres Camp Ripley M.S. 477A.12, subd. 1(b) M.S. 97A.061, subd. 1(b) $5.133/acre or 3/4 of 1% of appraised value of all acquired natural resources lands in the county 50% of $5.133/acre or 3/4 of 1% of appraised value of all acquired natural resources lands in the county Goose Management Cropland M.S. 97A.061, subd. 3 Equal to taxes on comparable, privately owned, adjacent land Acquired Hunting (additional payment) M.S. 97A.061, subd. 1(a) 35% of gross receipts; 3/4 of 1% of appraised value; or 50 cents/acre

7

8 Preliminary Findings PILT increases are driven primarily by increases in the value of acquired lands There are concerns about the accuracy of land valuations used to calculate PILT

9 Preliminary Findings Payments for waterfront may not adequately compensate LGU s for loss of tax revenues

10 Preliminary Findings Repeal in 2011 of an inflation adjustment for flat rate payments impacts all counties but has particularly adverse impacts on counties with high percentages of state-owned land

11 Preliminary Findings Townships are not receiving their fair share of PILT for acquired non-hunting lands where payments are based on ¾ of 1% of appraised value

12 Recommendations Being Considered Simplify PILT laws and rate structure Merge Minn. Stat. 97A.061 with PILT provisions in Minn. Stat. ch. 477A Reduce the number of payment rates

13 Recommendations Being Considered Standardize valuation methods for acquired lands Provide the state authority to appeal valuations upon which acquired lands payments are based

14 Recommendations Being Considered Reinstate the inflation adjustment for flat rate payments Increases are fair, predictable

15 Recommendations Being Considered Consider a trust fund type of payment system for new state land acquisitions Create investment fund At time of land acquisition, a principal amount calculated to earn enough money to replace lost property taxes would be deposited Proceeds of investments would be paid to LGU s

16 Recommendations Being Considered Revise PILT distribution Address distribution to townships for non-hunting acquired land Do school districts need to be included in the hunting distribution?

17 For further information See the PILT Report web page: Contact Susan Damon, Minnesota DNR Telephone: