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Benton, seven other counties upset by property tax mistake

State and wire reports

FOLEY, Minn. -- Benton County might sue the state Department of Revenue for a mistake that will cost the county $566,513 in property taxes during the next three years.

Benton is one of eight counties that collected more taxes than allowed by state levy limits. Those counties must subtract the excess from the amount they can levy in the next three years.

For Benton County, that means cutting $188,837 for each of the next three years.

"It puts us in a difficult situation in terms of being able to fund the county and the services we have provided," said County Coordinator Rick Speak.

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Benton County officials are talking about a lawsuit with the other affected counties: Cottonwood, Isanti, Kanabec, McLeod, Nicollet, Steele and Winona. McLeod County was the most severely affected, with $1.7 million in excess levy.

Officials of Steele and Winona counties say their boards have discussed lawsuits, but neither has taken action. Winona County Administrator Bob Reinert said it's unlikely the board will opt for a suit.

"Of course we're concerned with the financial impact to the county (and) we're interested in seeing that taxpayers are taxed fairly," Reinert said. "The good thing is we will see a reduction in the amount levied in 2003."

The error was made last fall, when county staff members calculated the amount they could collect through a special levy for jail operating expenses. They should have deducted the amount they levied for jail costs the year before from the total amount they could levy in 2002 taxes, but didn't.

Revenue department officials acknowledge they certified the levies were correct last winter. And they didn't immediately notify the counties when the error was discovered by researchers at the House of Representatives this winter.

Instead, they discussed the situation with state lawmakers and notified the eight counties by letter in May that the jail levy was miscalculated.

By that time, it was too late for the counties to change their levies because tax notices already had been sent to property owners.

Staff writer Lanier Frush Holt contributed to this report.

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