Under the preliminary 2020 levy, most Shakopee residents would see a slight increase in their annual property tax dollars, while their tax rates — or the percentage of taxes paid based on property value — will decrease.
The preliminary levy was increased by $1.15 million, or 5.86%, over last year. The $20.38 million budget would focus on maintaining street infrastructure and investing in regional park development, according to the city's Finance Director Darin Nelson, who presented on the levy at a Sept. 3 council meeting.
Based on the preliminary levies of comparable cities, Shakopee is right in the middle of its ask. On the low end, Savage is looking to increase its levy by 3.65%. On the higher end, Blaine is looking to increase its levy by 8.5%. Burnsville is similar to Shakopee, with a levy increase of 6% from last year.
Shakopee’s preliminary levy would reduce the city’s tax rate from 34.9% to 33.9% due to Shakopee’s growing infrastructure and the addition of housing developments. However, most Shakopee residents would pay slightly more in tax dollars due to an increase in property value.
On average, Shakopee homes will see a 6.7% increase in property value. This means the average home in Shakopee — a $255,400 home — would see its property value increase to $272,600 in 2020, adding $3.25 in additional property taxes per month. A home valued at $188,800 in 2020 would see a $3.16 monthly property tax increase, and a $369,600 home would see a $2 monthly property tax increase.
If a home’s property value does not increase, the owner’s property taxes will go down.
Shakopee’s tax capacity is estimated to increase by 10.8% due to the construction of new homes and the taxes paid off increasing property value. New growth alone adds $346,000 to the levy.
Council members will vote to officially approve the levy Dec. 17.