There’s a story, I’m sure, behind every one of the 375 parcels on the Morrison County delinquent tax list. The list is being published this week under the public notices in the Record. Some people are having financial difficulty. Some people forgot. Some people sent in a check for the wrong amount. Some people don’t open their mail. Some people have experienced a death in the family, and the person who died was the one who made sure the property taxes are paid.
The names that appear in the paper are not all the names on the list. The published list includes only those parcels which first became delinquent on Nov. 16, 2013.
A more complete list is on the county’s website, which has 969 parcels, including those that go back many years.
One that stands out is a parcel that the county says belongs to James Benusa of Royalton.
The land is only 65 feet by 185 feet, and Benusa says it was once used by his grandfather as a cattle path. He came to own it because of some survivorship papers he signed, but never wanted it and would gladly have forfeited it back to the county a long time ago.
He says the taxes are delinquent back to 1964, when he was only 11 years old, but the delinquent tax list says that he owes taxes on it back to 1981. In 1981, the taxes on that strip of land were only $31.52. Today, the list says $9,802.50 is owed on it.
Morrison County Auditor Russ Nygren says that the property lines or title is in question. Nygren intends to get the matter resolved before he retires at the end of the year.
It seems like the property should have been prevented from being acquired without the back taxes being paid, and again, if the taxes weren’t paid, the county should have seized it back in 1986 or so, although Benusa says the county doesn’t want it back because, “It’s not good for anything.”
Also on the list, a parcel in Scandia Valley was given to the Minnesota Department of Natural Resources, by the estate of well-known Little Falls attorney and former legislator Gordon Rosenmeier, Nygren said. The property taxes from 1997 are still owed on the parcel. With penalties and interest, the amount owed is now $6,212.85. But state government agencies don’t pay property taxes.
Nygren said that the first half property taxes were paid, and then the property was transferred to the DNR, but the second half taxes were never sent in.
As I said, every parcel has a story behind it.
Another quirk of the property tax laws, says state Rep. Ron Kresha, R-Little Falls, is that “It’s better to die in May right now than in October.”
That’s because if the payment of property taxes gets delayed while an estate is being probated, the late penalties are lower on the first half taxes than on the second half. Homesteaded property and cabin owners who miss paying by a day must pay a 2 percent penalty on the amount owed May 16, but 8 percent on Oct. 16. The penalty percentage goes up a point or two each month until it reaches 10 percent.
On non-homesteaded property, the penalty is even higher, topping out at 14 percent, but again, the penalty is more severe if one is late with second half taxes. This is state law.
Kresha said the history is that the penalty was flat, not graduated back in the 1970s, but then when high-interest rates hit in the early 1980s, too many stopped paying their property taxes because the interest was lower than on other debts they may have had.
Now with interest rates at generational lows, Kresha has introduced a bill to lower the penalty percentage, which would reach a maximum of 6 percent on June 1. However, with four Republican-minority co-authors, the bill has not had a hearing and is unlikely to this year.
The total amount of the delinquent taxes on the 975 county parcels listed online is more than $1.47 million. Penalties owed as of March 31 will be $164,203, interest $267,609 and processing fees (currently $25 on each parcel) $21,898. That means the county is trying to collect $1.92 million.
Nygren said in 2013, his office collected $62,069 in penalties, $198,097 in interest and $9,922 in processing fees. The county received about half of the penalty revenue and 42 percent of the interest. The remainder went to cities, townships and school districts.
The good news, Nygren said, is that 98.5 percent of property taxes were paid on time this year. He believes it’s the highest rate in his career. When he began as county auditor in 1987, he said, the on-time rate was only 96 or 97 percent. “I’m impressed with the dedication of the taxpayers,” Nygren said.
This year’s list is also shorter than it has been in recent years. Last year, 502 parcels were listed, and the number of delinquent parcels had been close to that since the start of the Great Recession.
However, no matter the reason, publishing the list is effective. Because we are all social beings, none of us like to show up on such a list. It’s embarrassing when acquaintances or neighbors call one out on it. Some people pay just in time to avoid getting their name in the paper.
At the Record, the county used to call to cross off names at the last minute. That ritual was stopped because the chance of error was too high, and it took a lot of time both at the courthouse and here. However, the list will be published again in two weeks, and the names of those who have paid in the interim will have been removed.
Tom West is the editor and general manager of the Record. Reach him at (320) 616-1932 or [email protected]