Dec. 4—EAST GRAND FORKS — The East Grand Forks City Council approved a 3% increase in the city’s property tax levy for 2025 during its meeting Tuesday evening.
The council held its truth and tax hearing as part of its annual budget process. In September,
the city has increased its provisional property tax levy by 7%,
but stated at the time that the goal was to increase the property tax levy to 3%. In total, the city will collect $7,137,985 in property taxes for its 2025 budget.
The city did not approve the final 2025 budget as the city does
Negotiations with unions are still ongoing and specific health care costs are being finalized.
The city should have a final budget adopted by the end of the month and plans to bring it up at its next meeting on Dec. 17.
Setting the levy at that $7.1 million limit also keeps the city within the Minnesota State Auditor’s guidelines and reserves. For the 2025 budget, the city will use some of its reserves to cover expenses, something many governments do regularly to keep property tax increases low. The 2025 balance is expected to be 52% of revenues and 50% of expenses, well within guidance of between 35% and 50% of revenues and at least five months of expenses.
Property owners will see several impacts on their property tax returns, with a 3% tax increase. According to the property tax examples shown to the council, property owners in East Grand Forks saw a decline of over 18% in their municipal property taxes to a 7% increase, depending mainly on whether their market value increased or decreased. For an average property, property taxes will increase by 2.7%, with the average home price increasing by $7,100.
Across Minnesota, cities proposed increasing their levies by an average of 8.8%. In 2024, cities increased their levies by 7.5% in their final budgets.
The East Grand Forks School District is proposing a 5.97% property tax increase; the Minnesota School District average is an increase of 4.4%. Polk County has included a 5% property tax increase in their preliminary budget; the Minnesota county average is an increase of 6.4%.
The levy increase is less than in the 2024 budget
when the city approved a 5% levy increase.
This year there was little discussion about the determination of the final levy, but there was a lot of discussion in September when the provisional budget was adopted.
“I would like to be at 3% (tax increase) and I always want to be at 50% in reserves,” City Council President Mark Olstad said in September. “Starting in 2026, the Family Medical Leave Act will come forward and we do not know at this time what our health insurance will be.”
Other news from the municipality:
* Several memoranda of understanding have been approved with the city’s employee associations on contributions to the city’s health insurance plans for 2025. Three of the four unions have completed negotiations on the changes resulting from the city’s change of health insurance plans in the new year.
* Gave final approval for code changes for cannabis zoning and business regulations. Following the legalization of cannabis in Minnesota, municipalities across the state have been tasked with creating provisions and regulations in their codes to help conduct business.
East Grand Forks will accommodate up to two stores, more than the minimum.
