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Fiscal Disparities: Tax Base Sharing in the Twin Cities Metropolitan Area

Fiscal Disparities Description

The Twin Cities is well known for its unique tax base sharing program. Under the fiscal disparities program, taxing jurisdictions in the seven-county area contribute 40 percent of the growth in commercial-industrial (CI) property tax base since 1971 into an area-wide shared pool. Shared tax base is then redistributed back to jurisdictions - reducing fiscal disparities. Redistribution is based on population and the value of all property relative to the metro average. The smaller the per capita property value compared to the metro average, the larger the distribution. The larger the per capita property value compared to the metro average, the smaller the distribution.

Brief Summary

Shared tax base totaled $396 million for taxes payable in 2009. This represents 34 percent of total commercial-industrial tax base in the Twin Cities. For more information on the program’s impact see the slides below or download a brief presentation (pdf).

• Summary of program history (pdf)
• Purpose and mechanics (pdf)
• Impacts (pdf)
• Links for more information (pdf)

The top 20 communities with the highest share of commercial-industrial tax base are identified in the downloadable table (Excel) for areas with a population over 5,000.

Net Recipients and Contributors

After redistributing the shared area-wide pool of tax base, 126 communities covered by the Twin Cities fiscal disparities program receive more tax base than they contribute. The top 20 net recipients are shown in the downloadable table (Excel) and map (pdf).

A total of 54 communities contribute more tax base than they receive back from fiscal disparities. The top 20 net contributors appear in the downloadable table (Excel) and map (pdf).

Summary Information

Summary results for taxes payable in 2009 are shown in the one-page downloadable document of key findings (pdf).

For comprehensive information on fiscal disparities and related data by community, county and planning area, see the downloadable summary file (Excel). The file includes: definitions, sources and notes; fiscal disparities contribution tax base, distribution tax base, and net changes in tax base; tax-base values by type of property; and per household and per capita results.