MANKATO — Property owners in Mankato will be paying the city no more than $27.7 million in combined real estate taxes next year under a preliminary levy approved by the Mankato City Council Monday night.
The preliminary levy establishes the maximum that can be collected.
“Once adopted, that number cannot be increased,” City Manager Susan Arntz said. “It can only be reduced.”
The 5% increase in tax collections in the preliminary levy is below what many Minnesota cities and counties are adopting, so the odds of it being reduced substantially before a final budget is approved in December are probably low.
The specific impact of the levy on individual taxpayers will vary widely based on changes in assessed market values on particular properties. Those values are set by county assessors based on the prices being paid for different types of properties in the local real estate market.
When growth in the tax base is factored in, the preliminary levy would bring a 7% increase in the municipal tax bill paid by an average Mankato homeowner and a 3% rise in taxes made by a typical business, according to examples provided by city staff. For properties that aren’t seeing an increase in assessed market values, including larger apartment buildings, city taxes might drop a bit.
The $27.7 million levy ceiling approved unanimously by the council is $1.33 million above what is being collected this year. Some of the additional dollars will be covered by growth in Mankato’s tax base, which will be 2.91% larger next year due to a combination of new construction and rising values on existing properties.
Under Minnesota law, local governments have until Sept. 30 to set the preliminary levy for 2027. With those maximums in hand, county tax officials next month will calculate the potential impact on the tax bills facing each property owner in the state.
Owners of homes and businesses can then offer opinions to their elected representatives about whether the preliminary figure is acceptable or should be lowered. A public hearing on Mankato’s budget is scheduled for Dec. 7, immediately after which the council is expected to approve a final levy amount, along with the broader municipal budget for next year.
Realistically, public input at the official budget hearing comes so late in the process that Mankato council members rarely adjust the figures in response. Public sentiment in September, October and November is more likely to have an impact. It’s during those months that council members will be holding work sessions where they will systematically be reviewing proposed spending levels in various parts of the budget. As the calendar moves closer to Dec. 7, city staff will be seeking final decisions by elected officials on expenditures and revenue so that the specific budget document can be prepared for a vote on that date or shortly thereafter.