Letter Sent to Owatonna City Council and Steele County Commissioners
From: Owatonna Area Chamber of Commerce & Tourism Board of Directors, Public Policy Committee
RE: Budget Season
As you prepare your 2024 budgets, we’d like to share some feedback from businesses on what they’re facing looking forward. It’s not all negative!
We believe it’s important to point out a few key items from the legislative session that will impact businesses’ budgets. There were also some key pieces of legislation that will positively impact local government budgets.
The state legislature made some decisions that will have cost implications on those running businesses, including:
- Workplace Sick & Safe leave: Requires 1 hour paid time off for every 30 hours worked.
- Property tax changes: Some homeowners and low-income apartments result in tax shifts onto business property taxpayers.
- Homestead market value exclusion: To mitigate tax increases on lower-income rentals. The result is the shifting of property taxes onto businesses. Projections show a 1.8% shift in business property taxes.
- Delivery fee on all purchases over $100. Revenues from the delivery fee will be deposited into a new Transportation Advancement Account (TAA) with 36% designated to metropolitan counties, 27% to the Small Cities Assistance Account and 15% to a new Larger Cities Assistance Account.
- $578 million in corporate tax increases statewide.
- Ban on non-compete contracts.
The state of Minnesota is putting $80 million increase in Local Government Aid (LGA). According to senate documents, this will benefit the City of Owatonna by approximately $890,000 in 2024.
Additionally, based on the MN House and Senate research documents, Owatonna will receive more than $1.1M in one-time public safety aid in 2024 and $133,000 in affordable housing aid.
With all the extra tax burden the state has placed on the business community and in light of the additional funding they are providing the city/county we are hopeful the city/county will not have to increase the tax burden on the businesses of Owatonna this year.
Thank you for sharing this with your team at the City and County and for considering these things as you prepare your budgets.