Expanded Circuit Breaker Bill Introduced

The second bill introduced in the Minnesota House this year is an expansion of the homeowner property tax refund program, also known as the circuit breaker and the renters refund program. Property taxes were widely discussed during the 2012 campaign and many candidates indicated their intent to author property tax relief legislation during the 2013 session.
(Published Jan 11, 2013)

The chief author of the bill is Representative Jim Davnie (DFL-Minneapolis) who is also the chair of the House Property and Local Tax Division of the Tax Committee. The bill is co-authored by more than 30 other House members.

The bill would expand eligibility for the homeowners refund to household incomes up to $105,300 (currently $103,730) and would modify the refund schedule and increase the maximum refund to $2,570 from the current maximum of $2,530. The income limits and the refund maximums continue to be adjusted by inflation under the bill. For renters, the bill would increase the percentage of rent assumed to be paid in lieu of property taxes to 18 percent from the current 17 percent.

The bill would also require the Minnesota Department of Revenue to notify by August 1 each year, in writing or electronically, those homeowners likely eligible for the refund. Under current law, there is no notification process and there have been indications that many eligible refund recipients have not filed for the program.

At this point, it is unclear whether legislators might also propose a restoration of the former market value homestead credit. That program, which cost more than $500 million per biennium, was sunset in the 2011 special session budget balancing legislation.

Questions? Contact Gary N. Carlson at gcarlson@lmc.org 651-281-1255

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