CCP 08-09-1993 - Laserfiche WebLink

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. CITY 01i' 1\ROEN HILLS MEKIU\NDtlM mTE: August 18, 1993 ro:@ Dorothy Person, City Mministrator nICK: Terry Post, city 1\coountant SOBJD::T: Reduced Valuation of Cc:mnercial and Industrial Real Propertv in Arden Hills - nnn..ct on 1994 Budqet Process BACKGROUND 1993 marked the beginning of a negative trend for the City of Arden Hills. Est:iJnated Market Valuation (EMV) for Real Property declined from 1992. The decline was $1,630,100 or .35% of the 1992 base. Preliminary Real Property Vaulation figures from the County show a sharper decline ($8,705,700 or 1.87% of the 1993 base) for taxes payable in 1994. 1993 results also contained an un=mnon variance item related to market . valuation. 1993 General Fund =ent property tax receipts were reduced approxillately $23,000 in abatements paid out to commerical property amers that had successfully petitioned in court to have their property valuations reduced. INVESTIGATION /FINDlllGS Analysis of County Real Property Valuation records has revealed the following: / l. The 1994 decline in EMV is not evenly distributed between property classes. Residential EMV is up $3,787,000 (1.29% of 1993 base) while Commercial and Industrial is down $11,000,000 (6.87%). 2. Since the highest 1994 tax capacity class rate for commercialj industrial is 4. 60% and the highest rate for residential is 2.00%, each $1000 lost in commericaljindustrial valuation translates into $46 less tax capacity 1rIhereas $1000 less in residential valuation .would result in $20 less tax capacity. 3. The decline in EMV is not evenly distributed among neighboring communities (see attached "Prelim Real Property EMV-Arden Hills Corrparables" chart). It is interesting to note that Arden Hills is the only East Metro Community showing EMV declines in 1993 and 1994 as well as the only . city with a EMV decline in 1994.