Rochester City Council to Vote on Tax Increase Monday

Rochester, MN (KROC-AM News)- The Rochester City Council is set to vote on a tax levy increase included in its 2024 operating budget Monday evening. 

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A public hearing will precede the vote. The hearing and resolution to adopt are the final steps of the city’s annual budgeting process. 

The 2024 budget proposal calls for raising the city’s tax levy to $101.5 million, a 9.44% increase from 2023, which is above the 5% increase the city typically plans for to keep up with labor costs and price increase fueled by inflation. 

City officials have previously said the main factors that are leading to the larger than usual proposed tax levy increase are costs for a new software license for the Rochester Police Department and increasing costs of materials for street maintenance.

See Also: Rochester Sales Tax Extension Approve, School District Levy Fails

The proposal also aims to solve issues the city has had with its vehicle and equipment maintenance fund.

The proposed 9.44% property tax increase is, “ spread across properties based on the value construction will absorb the tax adjustment first and then other properties will absorb based on category (apartment, commercial, residential, agricultural, industrial, etc.) proportionately to how assessed value for the category and each individual property has changed,” city officials said earlier in the process. 

Along with a vote adopting the $579,056,567 city budget, council members are also set to consider a $183,000,000 Capital Improvement plan that would fund over 200 projects. 

The 2024 budget also includes a rate hike for Rochester Public Utilities customers that would increase the average monthly bill by $4.12 next year and $4.30 in 2025. 

The city’s property taxes account for about one-third of a Rochester resident's total property tax bill, with Olmsted County, Rochester Public School District and State of Minnesota being the other property tax collectors.