Revised February 1, 2024
At the Dec. 11, 2023 City Council meeting a number of presentations focused on tax and rate increases going into effect for 2024. It’s important to note all rate increases and budgets passed unanimously with little discussion or question from council members. Read previous SCA budget article here for more background.
Property Tax
Before we can begin to understand the complexities of our property tax bills, it’s important to note that in 2022, the inflation rate was 8.3%. In 2023 the inflation rate is 3.1%. Costs have risen and we may be paying now for the low inflation rates from 2010–2020.
To simplify, the largest components of our property tax bills are Hennepin County, City of Shorewood and Minnetonka School District levies. Specifically, for the City of Shorewood the overall 2024 tax levy combined with other fee increases is $7.1 million. This is 9.3% higher than 2023.
According to the example put forth by Joe Rigdon, Finance Director: If your home was valued at $600,000 and the value did not change from year to year there would be no CITY tax increase. He offers the following examples:
2023 to 2024 Annual Change
$600,000 $600,000 ($6)
5% property value increase $78
10% property value increase $162
15% property value increase $245
During the meeting, a resident informed the City Council of several multi-unit properties where tax values decrease significantly–by as much as 11.3%. The implication is a negative fiscal effect on all other residents of Shorewood. Although Hennepin County makes these value decisions, city staff will follow up with answers for the next council meeting scheduled for Monday, January 8th.
Water, Sewer and Storm Sewer Fees
Rates are increasing in 2024 as part of a 10 year plan to catch up with utility expense shortfalls from previous years and capital improvements. The new rates will increase 10% for water, 9% for sewer and 8% for storm sewer. An average household using 25,000 gallons per quarter will see a yearly increase of $48 for water, $40 for sanitary sewer and $12 for stormwater management for a total of $100 per year.
Council Member Sanschagrin recommended a further increase in water rates that would add $40 per year to the average usage to alleviate the water (enterprise) fund shortfall. Council decided to table this discussion until the January 26 retreat, due to lack of data.
Recycling Fees
Recycling will see an increase of only $8 per year.
Permits
Permits for mechanical plumbing permits to include water heaters, softeners, purification systems will increase from $60/minimum to $80 minimum or 33% increase due to increases in staff and inspections costs.
Since 2022 the city’s budget has increased by $942,000 or 15.25% and outpaces inflation by 3.85%. See more detail on the 2024 budget here. Only you can determine if these increases are justified by the service experiences received from the city.
