Public Hearing Truth In Taxation Budget & Property Taxes Proposed Payable PDF Free Download

Public Hearing Truth In Taxation Budget & Property Taxes Proposed Payable 2014 Sibley County Special County Board Meeting Thursday, December 5, 2013 6:00 p.m. Sibley County Courthouse Commissioners Room 400 Court Avenue PO Box 171 Gaylord, Minnesota 55334 Phone: 507-237-4070 Fax: 507-237-4073 Email: PropertyTax@co.sibley.mn.us Sibley County Board of Commissioners Chair Jim Swanson Vice-Chair Joy Cohrs Jim Nytes Harold Pettis Bill Pinske Page 1 of 74

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SIBLEY COUNTY BOARD OF COMMISSIONERS Address Phone E-mail Term of Office COMMISSIONER DISTRICT #1 Jim Nytes 32855 Fort Road, Henderson, MN 56044 (507) 248-3539 e-mail: JimN@co.sibley.mn.us January 2015 COMMISSIONER DISTRICT #2 William Bill Pinske 409 E. Baker St., Box 527, Arlington, MN 55307 (507) 964-2250 e-mail: BillP@co.sibley.mn.us January 2017 COMMISSIONER DISTRICT #3 James Jim Swanson 1020 Lakeside Drive, Gaylord, MN 55334 (507) 237-2505 e-mail: JimS@co.sibley.mn.us January 2017 COMMISSIONER DISTRICT #4 Joy Cohrs 17138 State Highway 22, Glencoe, MN 55336 (320)864-5252 e-mail: JoyC@co.sibley.mn.us January 2015 COMMISSIONER DISTRICT #5 Harold Pettis 249 W. 5th St., Box 72, Gibbon, MN 55335 (507) 834-6623 e-mail: HaroldP@co.sibley.mn.us January 2015 SIBLEY COUNTY ELECTED OFFICERS Address Phone E-mail Term of Office ATTORNEY David Schauer 307 N Pleasant Ave., Box H, Winthrop, MN 55396 (507) 647-5377 e-mail: David@co.sibley.mn.us January 2015 AUDITOR Lisa Pfarr Box 171, Courthouse, Gaylord, MN 55334 (507) 237-4070 e-mail: pfarrl@co.sibley.mn.us January 2015 RECORDER Kathy Dietz Box 44, Courthouse, Gaylord, MN 55334 (507) 237-4080 e-mail: KathyD@co.sibley.mn.us January 2015 SHERIFF Bruce Ponath Box 102, Jail Bldg, Gaylord, MN 55334 (507) 237-4330 e-mail: Bruce@co.sibley.mn.us January 2015 TREASURER Mary Fisher Box 51, Courthouse, Gaylord, MN 55334 (507) 237-4084 e-mail: MaryF@co.sibley.mn.us January 2015 Page 3 of 74

SIBLEY COUNTY APPOINTED DEPARTMENT HEADS Address Phone E-mail Term of Office ADMINISTRATOR Matthew Jaunich Box 52, Courthouse, Gaylord, MN 55334 (507) 237-7800 e-mail: MattJ@co.sibley.mn.us Indefinite ASSESSOR Calvin Roberts Box 532, Courthouse, Gaylord, MN 55334 (507) 237-4078 e-mail: Cal@co.sibley.mn.us December 2016 COURT ADMINISTRATOR (STATE) Karen Messner Box 867, Courthouse, Gaylord, MN 55334 (507) 237-4051 e-mail: Karen.Messner@courts.state.mn.us Indefinite COURT SERVICES DIRECTOR (STATE) Joely Patten Eskens Box 405, Courthouse, Gaylord, MN 55334 (507) 237-4097 e-mail: JoelyE@co.sibley.mn.us Indefinite EMERGENCY MANAGEMENT DIRECTOR Bryan Gorman Box 1054, Courthouse, Gaylord, MN 55334 (507)237-4109 e-mail: BryanG@co.sibley.mn.us Indefinite ENVIRONMENTAL SERVICES DIRECTOR Jeff Majeski Box 82, Courthouse, Gaylord, MN 55334 (507) 237-4091 e-mail: JeffM@co.sibley.mn.us Indefinite EXTENSION EDUCATOR Julie Sievert Box 207, Sibley Co. Service Center, Gaylord, MN 55334 (507) 237-4100 e-mail: JulieS@co.sibley.mn.us Indefinite HUMAN RESOURCE DIRECTOR Kim Moore Box 256, Courthouse, Gaylord, MN 55334 (507) 237-4117 e-mail: KimM@co.sibley.mn.us Indefinite INFORMATION SERVICES DIRECTOR Beth Wilson Box 231, Courthouse, Gaylord, MN 55334 (507) 237-4105 e-mail: Beth@co.sibley.mn.us Indefinite MAINTENANCE SUPERINTENDENT Jim Gronholz Box 897, Courthouse/SCSC, Gaylord, MN 55334 (507) 381-4223 e-mail: JimG@co.sibley.mn.us Indefinite MEDICAL EXAMINER Dr. A. Quinn Strobl MD 14341 Rhinestone St NW, Ramsey, MN 55303 (763) 323-6400 e-mail: quinn.strobl@co.anoka.mn.us January 2015 PUBLIC HEALTH & HUMAN SERVICES DIRECTOR Vicki Stock Box 237, Sibley Co. Service Center, Gaylord, MN 55334 (507) 237-4000 e-mail: VICKI@co.sibley.mn.us Indefinite PUBLIC WORKS DIRECTOR (COUNTY ENGINEER) Tim Becker Box 897, Sibley Co. Service Center, Gaylord, MN 55334 (507) 237-4092 e-mail: TimB@co.sibley.mn.us April 2017 SURVEYOR Avery Grochow 335 Main Ave, Gaylord, MN 55334 (507) 237-5212 e-mail: ssincavery@mchsi.com January 2015 TRI-COUNTY SOLID WASTE DIRECTOR Al Christensen Box 238, Courthouse, Gaylord, MN 55334 (507) 237-4321 e-mail: AIC@co.sibley.mn.us Indefinite VETERANS SERVICES OFFICER Lisa Klenk Box 1061, Sibley Co. Service Center, Gaylord, MN 55334 (507) 237-4090 e-mail: Lisak@co.sibley.mn.us August 2016 Page 4 of 74

HOW YOUR PROPERTY TAXES ARE DETERMINED FINANCE PROPERTY Taxing Authorities Proposed Expenditure Budget (activity/function/program/service) Assessor's Market Value (-) Subtract (x) Multiplied By Non-Property Tax Revenue (aids/fees/grants/interest/fines/misc.) (=) Results Proposed Property Tax Revenue (Tax Levy) State Mandated Class Rates (=) Results Total "Tax Capacity" (f.k.a. assessed value) Proposed Property Tax Revenue (Tax Levy) (/) Divided By Total "Tax Capacity" (f.k.a. assessed value) (=) Results Property Tax Rate (a.k.a "Tax Capacity" Rate) YOUR PROPERTY TAX = Your Property's Market Value X Class Rate(s) X "Tax Capacity" Rate S:\AUD\SHARED\Finance Administration\Budget\2014\TNT\TNT Packet\T&T Pages\4 TNT 20 How Your Property Taxes Are Determined... Page 5 of 74

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County of Sibley COUNTY BOARD MEETING 6:00 p.m., Thursday, December 5, 2013 Proposed 2014 Budget/Levy Adopted Adopted Adopted Proposed Percent Sibley County Budget/Levy 2011 2012 2013 2014 Change Change Other Taxes 130,500 141,500 235,300 176,500 (58,800) -24.989% Special Assessments 130,000 130,000 134,000 134,000 0 0.000% Licenses & Permits 33,500 23,780 28,380 23,380 (5,000) -17.618% Federal Grants 1,540,707 1,122,927 1,393,838 2,418,615 1,024,777 73.522% Local Grants 4,009,374 4,408,492 4,318,057 3,398,050 (920,007) -21.306% State Categorical Aid 2,277,551 1,735,777 2,259,398 2,379,732 120,334 5.326% Charges for Services 1,449,119 1,431,047 1,243,052 1,413,851 170,799 13.740% Fines & Forfeits 35,370 35,400 35,900 36,120 220 0.613% Interest on Investments 332,465 312,061 236,639 200,250 (36,389) -15.377% Miscellaneous Revenue 474,098 485,356 550,738 483,533 (67,205) -12.203% Other Financing Sources 138,500 91,000 32,500 37,500 5,000 15.385% Transfers from Other Funds 5,117 945,117 212,908 1,286,801 1,073,893 504.393% Use of Fund Balance 855,078 1,820,464 907,064 2,090,907 1,183,843 130.514% NON-TAX REVENUES: 11,411,379 12,682,921 11,587,774 14,079,239 2,491,465 21.501% Personal Services 9,159,314 9,087,147 9,273,316 9,648,620 375,304 4.047% Other Services & Charges 9,470,412 9,610,258 10,029,472 11,469,753 1,440,281 14.360% Supplies & Non-Capitalized Equipment 1,165,967 1,325,611 1,400,736 1,379,583 (21,153) -1.510% Capital Expenses 947,561 945,957 619,093 893,243 274,150 44.283% Appropriations & Pass Through Funding 1,182,318 1,489,491 1,561,784 2,407,848 846,064 54.173% Debt Service 258,216 257,623 256,553 234,023 (22,530) -8.782% Other Financing Uses 203,117 917,589 66,908 101,000 34,092 50.954% EXPENDITURES: 22,386,905 23,633,676 23,207,862 26,134,070 2,926,208 12.609% PROPERTY TAX LEVY: 10,975,526 10,950,755 11,620,088 12,054,831 434,743 3.741% COUNTY PROGRAM AID: 420,708 273,026 361,661 365,693 4,032 1.115% NET PROPERTY TAX LEVY: 10,554,818 10,677,729 11,258,427 11,689,138 430,711 3.826% 2008 December County Program Aid Unallotment - - - - 2009 July/December County Program Aid Unallotment - - - - 2010 July/December County Program Aid Unallotment 270,593 - - - 2011 July/December County Program Aid Unallotment - 147,682 - - July/December County Program Aid Unallotment (Not Applicable) - - - - COUNTY PROGRAM AID UNALLOTMENT: 270,593 147,682 - - 0 #DIV/0! ADJUSTED NET PROPERTY TAX LEVY: 10,825,411 10,825,411 11,258,427 11,689,138 430,711 3.826% Prepared by the Office of the Sibley County Auditor 12/4/2013 10:03 PM lkp paper color: white Page 7 of 74

This page has been left blank intentionally. Note to the Packet: Comparing the adopted 2013 23,207,862 to the proposed 2014 26,134,070 one may formulate the following: 36,389 Decrease in Interest Income 2,926,208 Increase in Spending 2,962,597 Reconciled/Balanced by 229,136 Increase in Federal and State Aids 430,711 Increase in Local Taxes 170,799 Increase in Fees for Service 1,183,843 Increase in Budgeted Reserves 948,108 Increase in Other Revenue Sources 2,962,597 Page 8 of 74

County of Sibley Estimated Market Value By Class of Property Source: County Assessor's Report to the Sibley County Board of Appeal and Equalization Pay 14 2010 Assessment 2011 Assessment 2012 Assessment 2013 Assessment vs for for for for Pay 13 Payable 2011 Payable 2012 Payable 2013 Payable 2014 % of Inc/(Dec) Residential Homestead 510,866,100 487,573,300 412,972,856 404,726,300-2.00% Res NHS, MHP & Apartments 73,999,800 72,704,700 60,161,294 60,395,500 0.39% Mobile Home Park 332,600 332,600 330,000 300,000-9.09% Apartments 13,855,500 13,791,800 13,599,200 13,833,600 1.72% Commercial 37,413,600 37,098,400 36,928,400 37,242,700 0.85% Industrial 25,217,200 31,013,600 29,706,300 28,606,400-3.70% Agricultural - Productive 1,627,534,800 1,693,186,100 1,946,176,449 2,465,145,100 26.67% Agricultural - Non Productive 44,763,600 54,707,900 53,679,401 48,879,300-8.94% Seasonal Recreation 8,603,200 1,953,400 1,444,400 984,000-31.87% EMV* 2,342,586,400 2,392,361,800 2,554,998,300 3,060,112,900 19.77% amount of inc./(dec.) from prior year 49,991,200 49,775,400 162,636,500 505,114,600 % inc./(dec.) from prior year 2.18% 2.12% 6.80% 19.77% *Data from County Assessor's Reports Sibley County Board of Appeal & Equalization - REAL ESTATE ONLY *Does Include New Construction *Does Not Include market values for personal property or utilities NEW CONSTRUCTION Source: County Assessor's Report to the Sibley County Board of Appeal and Equalization Residential Homestead 8,273,800 3,268,300 3,114,900 2,946,600 Res NHS, MHP & Apartments Mobile Home Park Apartments Commercial 3,383,800 399,900 151,000 118,400 Industrial 0 460,200 0 333,100 Agricultural 3,846,800 3,108,100 4,447,500 3,248,600 Seasonal Recreation 0 0 0 0 NEW CONSTRUCTION 15,504,400 7,236,500 7,713,400 6,646,700 % of Amount of Inc./(Dec.) in Total EMV 31.01% 14.54% 4.74% 1.32% Sibley County Estimated Market Value (EMV) By Class of Property EMV Millions Payable 2011 Payable 2012 Payable 2013 Payable 2014 2,500 2,000 1,500 1,000 500 0 Residential Homestead Res NHS, MHP & Apartments Mobile Home Park Apartments Commercial Industrial Agricultural - Productive Class of Property Agricultural - Non Productive Seasonal Recreation Payable 2011 Payable 2012 Payable 2013 Payable 2014 vs TAX CAPACITY: FINAL FINAL FINAL Proposed Pay 13 *Values from Abstract Dated: 2/25/2011 INITIAL TAX CAPACITY RATE *Values from Abstract Dated: 3/12/2012 *Values from Abstract Dated: 3/19/2013 Pay 14 *Values from Abstract Dated: 11/05/2013 % of Inc/(Dec) Real Estate (830): AG (265) 12,488,085 12,824,266 14,945,483 19,517,025 30.59% NON-AG (820) 7,224,638 6,135,191 5,231,560 5,169,465-1.19% Sub-Total 19,712,723 18,959,457 20,177,043 24,686,490 22.35% Personal Property (1020) 606,510 579,391 604,616 645,873 6.82% TOTAL TAX CAPACITY 20,319,233 19,538,848 20,781,659 25,332,363 21.90% TIF Capt. Tax Capacity (1040) (141,338) (150,786) (146,164) (149,155) 2.05% TOTAL NET TAX CAPACITY 20,177,895 19,388,062 20,635,495 25,183,208 22.04% % of NTC inc./(dec.) 1.83% -3.91% 6.43% 22.04% Certified Levy 10,825,411 10,825,411 11,258,427 11,689,138 3.83% % of levy inc./(dec.) -0.54% 0.00% 4.00% 3.83% Initial Tax Capacity Rate 53.6499% 55.8354% 54.5586% 46.4164% -14.92% % of initial tax rate inc./(dec.) -2.33% 4.07% -2.29% -14.92% Disclaimers: The above two page report represents "county-wide" averages. Increases/(Decreases) to Estimated Market Value by Class of Property relative to a specific Taxing District and/or a specific Parcel may vary +/- from the "county-wide" average. Prepared by the Office of the Sibley County Auditor 12/3/2013 7:55 PM lkp S:\AUD\SHARED\Finance Administration\Budget\2014\Budget 2014 paper color: white Page 9 of 74

Truth-In-Taxation Tax Capacity Rates Comparison County of Sibley (Authority 12) Final Taxes Proposed Taxes 2014 Proposed Tax Rate If NO Payable 2013 Levy Increase Payable 2014 % of Inc./(Dec.) Tax Tax Tax Capacity Capacity Capacity Real Est: (830) Ag (290/265) 14,945,483 19,517,025 30.59% Non-Ag (820) 5,231,560 5,169,465-1.19% Sub-Total 20,177,043 24,686,490 22.35% Pers. Prop. (1020) 604,616 645,873 6.82% TOTAL TAX CAP 20,781,659 25,332,363 21.90% TIF Capt. TC (1040) (146,164) (149,155) 2.05% TOTAL NET TAX CAP 20,635,495 25,183,208 22.04% Certified Percent of Proposed Percent of Fund Levy Total Levy Levy Total Levy Levy General Revenue 5,240,365 46.18% 5,391,930 45.67% 2.89% Public Works 4,032,113 35.53% 4,093,110 34.67% 1.51% Health & Human Services 2,075,110 18.29% 2,320,951 19.66% 11.85% Sub-Total 11,347,588 11,805,991 4.04% Debt Service 272,500 248,840-8.68% TOTAL 11,620,088 100.00% 12,054,831 100.00% 3.74% CPA CPA Fund Distribution Distribution Aid General Revenue 167,017 167,016 0.00% Public Works 128,508 126,785-1.34% Health & Human Services 66,136 71,892 8.70% Sub-Total 361,661 365,693 1.11% Debt Service - - TOTAL 361,661 365,693 1.11% CPA CPA Fund Unallotment Unallotment Aid General Revenue - - #DIV/0! Public Works - - #DIV/0! Health & Human Services - - #DIV/0! Sub-Total - - #DIV/0! Debt Service - - TOTAL - - #DIV/0! HRA Special Benefits Tax Levy (Authority 14) Certified Initial Tax Initial Tax Proposed Initial Tax Initial Fund Levy Capacity Rate Capacity Rate Levy Capacity Rate Levy Rate HRA Revenue (01) 125,680 0.6090% 0.4991% 128,194 0.5090% 2.00% -16.42% County of Sibley Tax Levy (Authority 12) Levy after Initial Tax Initial Tax Levy after Initial Tax Initial Fund CPA Capacity Rate Capacity Rate CPA Capacity Rate Levy Rate General Revenue (01) 4,947,668 23.9765% 19.6467% 5,096,720 20.2386% 3.01% -15.59% Public Works (02) 3,903,605 18.9169% 15.5008% 3,966,325 15.7499% 1.61% -16.74% Health & Human Services (03) 2,008,974 9.7355% 7.9774% 2,249,059 8.9308% 11.95% -8.27% Sub-Total 10,860,247 11,312,104 4.16% Debt Service (05) 272,500 1.3205% 1.0821% 248,840 0.9881% -8.68% -25.17% Total 11,132,747 53.9495% 44.2070% 11,560,944 45.9074% 3.85% -14.91% Total All Funds 11,258,427 54.5586% 44.7061% 11,689,138 46.4164% 3.83% -14.92% 54.5586% 44.7061% 46.4164% -14.92% % of Inc./(Dec.) Initial Rate -18.0585% Proof Payable 2014 25,183,208 X 45.9074% = 11,560,944.00 25,183,208 X 0.5090% = 128,194.00 11,689,138.00 12/3/13 lkp Prepared by the Office of the Sibley County Auditor 12/3/2013 8:16 PM paper color: white S:\AUD\SHARED\Property Tax Administration\Taxes\Levy Forms\Manual Calculations - County Levy - Current Year Page 10 of 74

Class Rate Percentages of Real and Personal Property by Property Type Taxes Payable 2013 and 2014 Payable 2013 Payable 2014 Class Real Property Description Class Rate Class Real Property Description Class Rate 1a Residential homestead Residential homestead first 500,000 1.00% first 500,000 1.00% over 500,000 1.25% over 500,000 1.25% 1b Blind/Disabled homestead Blind/Disabled homestead agricultural: agricultural: first 50,000 0.45% first 50,000 0.45% non-agricultural: non-agricultural: first 50,000 0.45% first 50,000 0.45% 1c Commercial seasonal - residential Commercial seasonal - residential recreational - under 250 recreational - under 250 days and includes homestead days and includes homestead first 600,000 0.50% first 600,000 0.50% 600,000 to 2,300,000 1.00% 600,000 to 2,300,000 1.00% over 2,300,000 1.25% * over 2,300,000 1.25% * 1d Migrant housing (structures only) Migrant housing (structures only) first 500,000 1.00% first 500,000 1.00% over 500,000 1.25% over 500,000 1.25% 2a Agricultural homestead Agricultural homestead House, Garage, One Acre: House, Garage, One Acre: first 500,000 1.00% first 500,000 1.00% over 500,000 1.25% over 500,000 1.25% 2a Remainder of Agricultural Homestead Remainder of Agricultural Homestead classified as 2a - Productive Agricultural: classified as 2a - Productive Agricultural: Page 11 of 74

Payable 2013 Payable 2014 Class Real Property Description Class Rate Class Real Property Description Class Rate first 1,290,000 0.50% ** first 1,500,000 0.50% ** over 1,290,000 1.00% ** over 1,500,000 1.00% ** 2b Remainder of Agricultural Homestead Remainder of Agricultural Homestead classified as 2b - Rural Vacant: classified as 2b - Rural Vacant: first 1,290,000 0.50% ** first 1,500,000 0.50% ** over 1,290,000 1.00% ** over 1,500,000 1.00% ** 2a Non-homestead Property classifed as 1.00% ** Non-homestead Property classifed as 1.00% ** 2a - Productive Agricultural: 2a - Productive Agricultural: 2a 2a Agricultural Non-Homestead Property 0.50% ** 2a Agricultural Non-Homestead Property 0.50% ** owned by Farming Entities with owned by Farming Entities with shareholders or members utilizing unused shareholders or members utilizing unused 1st tier Agricultural Homestead Value 1st tier Agricultural Homestead Value 2b Non-homestead Property classified as 1.00% ** Non-homestead Property classified as 1.00% ** 2b - Rural Vacant: 2b - Rural Vacant: 2b 2b Rural Vacant Non-Homestead Property 0.50% ** 2b Rural Vacant Non-Homestead Property 0.50% ** owned by Farming Entities with owned by Farming Entities with shareholders or members utilizing unused shareholders or members utilizing unused 1st tier Agricultural Homestead Value 1st tier Agricultural Homestead Value 2c Managed Forest 0.65% ** Managed Forest 0.65% ** 2d Private Airport 1.00% ** Private Airport 1.00% ** 2e Unmined Commercial Aggregate Deposit 1.00% ** Unmined Commercial Aggregate Deposit 1.00% ** 3a Commercial-Industrial Commercial-Industrial and public utility and public utility first 150,000 1.50% * first 150,000 1.50% * over 150,000 2.00% * over 150,000 2.00% * 3a Electric generating public utility Electric generating public utility machinery 2.00% machinery 2.00% Page 12 of 74

Payable 2013 Payable 2014 Class Real Property Description Class Rate Class Real Property Description Class Rate 3a All other public utility machinery 2.00% * All other public utility machinery 2.00% * 3a Real property owned in fee by a utility for Real property owned in fee by a utility for transmission line right-of-way 2.00% * transmission line right-of-way 2.00% * 4a Apartment (four or more units, including Apartment (four or more units, including private for-profit hospitals) 1.25% private for-profit hospitals) 1.25% 4b(1) Residential non-homestead one to three units Residential non-homestead one to three units that does not qualify for class 4bb 1.25% that does not qualify for class 4bb 1.25% 4b(2) Unclassified manufactured homes 1.25% Unclassified manufactured homes 1.25% 4b(3) Farm non-homestead containing more than one Farm non-homestead containing more than one residence but fewer than four along with the residence but fewer than four along with the acre(s) and garage(s) 1.25% acre(s) and garage(s) 1.25% 4b(4) Residential non-homestead not containing a 1.25% Residential non-homestead not containing a 1.25% structure structure 4bb(1) Residential non-homestead single unit Residential non-homestead single unit first 500,000 1.00% first 500,000 1.00% over 500,000 1.25% over 500,000 1.25% 4bb(2) Single house, garage and 1st acre on ag Single house, garage and 1st acre on ag non-homestead land non-homestead land first 500,000 1.00% first 500,000 1.00% over 500,000 1.25% over 500,000 1.25% 4c(1) Seasonal residential recreational Seasonal residential recreational commercial commercial first 500,000 1.00% * first 500,000 1.00% * over 500,000 1.25% * over 500,000 1.25% * Page 13 of 74

Payable 2013 Payable 2014 Class Real Property Description Class Rate Class Real Property Description Class Rate 4c(2) Qualifying golf courses 1.25% Qualifying golf courses 1.25% 4c(3) Nonprofit community service Nonprofit community service oriented organization oriented organization (i) Non-Revenue 1.50% (i) Non-Revenue 1.50% (ii) Donations 1.50% * (ii) Donations 1.50% * 4c(4) Post secondary student housing 1.00% ** Post secondary student housing 1.00% ** 4c(5)(i) Manufactured home park 1.25% Manufactured home park 1.25% 4c(5)(ii)Manufactured home park cooperative Manufactured home park cooperative over 50% shareholder occupied 0.75% over 50% shareholder occupied 0.75% 50% or less shareholder occupied 1.00% 50% or less shareholder occupied 1.00% 4c(6) Metro non-profit recreational property 1.25% Metro non-profit recreational property 1.25% 4c(7) Certain leased or privately owned non- 1.50% Certain leased or privately owned non- 1.50% commercial aircraft storage hangars commercial aircraft storage hangars (includes land) : on leased land (includes land) : on leased land 4c(8) Certain leased or privately owned non- 1.50% Certain leased or privately owned non- 1.50% commercial aircraft storage hangars commercial aircraft storage hangars (includes land) : on private land (includes land) : on private land 4c(9) Bed and Breakfast up to 5 units 1.25% Bed and Breakfast up to 5 units 1.25% 4c(10) Seasonal Restaurant on a Lake 1.25% Seasonal Restaurant on a Lake 1.25% 4c(11) Qualifying Marinas: Qualifying Marinas: First 500,000 1.00% First 500,000 1.00% Over 500,000 1.25% Over 500,000 1.25% 4c(12) Non-Commercial Seasonal residential recreational Non-Commercial Seasonal residential recreational first 500,000 1.00% * ** first 500,000 1.00% * ** over 500,000 1.25% * ** over 500,000 1.25% * ** Page 14 of 74

Payable 2013 Payable 2014 Class Real Property Description Class Rate Class Real Property Description Class Rate 4d Qualifying low income - land and buildings 0.75% Qualifying low income - land and buildings 0.75% 5(1) Unmined or low recovery iron ore 2.00% * Unmined or low recovery iron ore 2.00% * 5(2) All other property not All other property not included in any other class 2.00% included in any other class 2.00% * State tax is applicable to these classifications NOTE: For purposes of the state general property tax only, the net tax capacity of non-commercial class 4c(1) seasonal residential recreational property has the following class rate structure: First 76,000 0.40% 76,000 500,000 1.00% Over 500,000 1.25% In addition to the state tax base exemptions referenced by property classification, airport property exempt from city and school district property taxes under M.S. 473.625 is exempt from the state general property tax (MSP International Airport and Holman Field in St.Paul are exempt under this provision). ** Exempt from referendum market value based taxes. Page 15 of 74

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Examples Calculating Net Tax Capacity and Net Tax Capacity Tax T-IN-T Payable 2014 Sibley County s Net Tax Capacity Tax Rate = 46.4170% Residential Homestead Residential Homestead (Class 1a) parcel with a taxable market value of 249,000 (after applying the Market Value Exclusion). Net Tax Capacity = Taxable Market Value x Class Rate 249,000 x 1.00% = 2,490 Net Tax Capacity Tax = Net Tax Capacity x Tax Rate 2,490 x 46.4170% = 1,156 Agricultural Homestead A 160-acre farm parcel (2a). The house, garage and first acre have a value of 120,000 (after applying the Market Value Exclusion). The remainder of the farm (Productive Ag.) is valued at 159,000. Net Tax Capacity = Taxable Market Value x Class Rate HGA: 120,000 x 1.00% = 1,200 Remainder of farm: 159,000 x 0.50% = 795 Total Net Tax Capacity = 1,200 + 795 = 1,995 Net Tax Capacity Tax = Net Tax Capacity x Tax Rate 1,995 x 46.4170% = 926 Commercial A commercial (Class 3a) parcel with a taxable market value of 352,000. Net Tax Capacity = Taxable Market Value x Class Rate 150,000 x 1.50% = 2,250 202,000 x 2.00% = 4,040 Total Net Tax Capacity = 6,290 Net Tax Capacity Tax = Net Tax Capacity x Tax Rate 6,290 x 46.4170% = 2,920 Page 17 of 74

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County of Sibley Comparison of County Tax by Property Type County SCMMCHRA (Amberfield Housing Project) S:\AUD\SHARED\Finance Administration\Budget\2014\TNT\TNT Packet\T&T Pages\27 TNT 2014 Packet Comparison of County Tax by Property Type - HSTD MV OLD LAW VS HSTD MV NEW LAW OLD LAW Payable 2011 Payable 2012 Payable 2012 Payable 2013 Payable 2014 Proposed Rate Rate Rate Rate Rate 53.0510% 55.1990% (TMV) 55.1990% 53.9500% 45.9080% 0.5990% 0.6360% 76000 0.6360% 0.6090% 0.5090% 53.6500% 55.8350% 40% 55.8350% 54.5590% 46.4170% -2.33% 4.07% 9% 4.07% -2.29% -14.92% (EMV) Taxable Market Value Class Description Estimated Market Value Tax Capacity Tax Tax (after HSTD MV Exclusion) Tax Capacity Tax Tax Tax Residential Homestead 50,000 500 268 279 30,000 300 168 164 139 75,000 750 402 419 45,000 450 251 246 209 100,000 1,000 537 558 71,760 718 401 392 333 125,000 1,250 671 698 99,010 990 553 540 460 150,000 1,500 805 838 126,260 1,263 705 689 586 175,000 1,750 939 977 153,510 1,535 857 838 713 200,000 2,000 1,073 1,117 180,760 1,808 1,009 986 839 225,000 2,250 1,207 1,256 208,010 2,080 1,161 1,135 966 250,000 2,500 1,341 1,396 235,260 2,353 1,314 1,284 1,092 275,000 2,750 1,475 1,535 262,510 2,625 1,466 1,432 1,218 300,000 3,000 1,610 1,675 289,760 2,898 1,618 1,581 1,345 Agricultural Homestead 100,000 500 268 279 100,000 500 279 273 232 (Productive Ag Value Only) 200,000 1,000 537 558 200,000 1,000 558 546 464 Add Residential Homestead value 300,000 1,500 805 838 300,000 1,500 838 818 696 from above to get Total Tax 400,000 2,000 1,073 1,117 400,000 2,000 1,117 1,091 928 500,000 2,500 1,341 1,396 500,000 2,500 1,396 1,364 1,160 600,000 3,000 1,610 1,675 600,000 3,000 1,675 1,637 1,393 700,000 3,500 1,878 1,954 700,000 3,500 1,954 1,910 1,625 800,000 4,000 2,146 2,233 800,000 4,000 2,233 2,182 1,857 900,000 4,500 2,414 2,513 900,000 4,500 2,513 2,455 2,089 1,000,000 5,000 2,683 2,792 1,000,000 5,000 2,792 2,728 2,321 Agricultural Non Homestead 100,000 1,000 537 558 100,000 1,000 558 546 464 (Productive Ag Value Only) 200,000 2,000 1,073 1,117 200,000 2,000 1,117 1,091 928 300,000 3,000 1,610 1,675 300,000 3,000 1,675 1,637 1,393 400,000 4,000 2,146 2,233 400,000 4,000 2,233 2,182 1,857 500,000 5,000 2,683 2,792 500,000 5,000 2,792 2,728 2,321 600,000 6,000 3,219 3,350 600,000 6,000 3,350 3,274 2,785 700,000 7,000 3,756 3,908 700,000 7,000 3,908 3,819 3,249 800,000 8,000 4,292 4,467 800,000 8,000 4,467 4,365 3,713 900,000 9,000 4,829 5,025 900,000 9,000 5,025 4,910 4,178 1,000,000 10,000 5,365 5,584 1,000,000 10,000 5,584 5,456 4,642 Commercial/Industrial 100,000 1,500 805 838 100,000 1,500 838 818 696 150,000 2,250 1,207 1,256 150,000 2,250 1,256 1,228 1,044 200,000 3,250 1,744 1,815 200,000 3,250 1,815 1,773 1,509 250,000 4,250 2,280 2,373 250,000 4,250 2,373 2,319 1,973 300,000 5,250 2,817 2,931 300,000 5,250 2,931 2,864 2,437 400,000 7,250 3,890 4,048 400,000 7,250 4,048 3,956 3,365 500,000 9,250 4,963 5,165 500,000 9,250 5,165 5,047 4,294 600,000 11,250 6,036 6,281 600,000 11,250 6,281 6,138 5,222 700,000 13,250 7,109 7,398 700,000 13,250 7,398 7,229 6,150 800,000 15,250 8,182 8,515 800,000 15,250 8,515 8,320 7,079 900,000 17,250 9,255 9,632 900,000 17,250 9,632 9,411 8,007 1,000,000 19,250 10,328 10,748 1,000,000 19,250 10,748 10,503 8,935 Prepared by the Office of the Sibley County Auditor 12/3/2013 8:46 PM lkp paper color: white NEW LAW Page 19 of 74

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IMPORTANT PROPERTY TAX LAW CHANGE 2011 Law Change: A New Homestead Market Value Exclusion replaces the Homestead Market Value Credit The 2011 Legislature repealed the Homestead Residential Market Value Credit and replaced it with a new program called the Homestead Market Value Exclusion. This change is impacting the property taxes on all homesteaded and non-homesteaded property for Pay 2012. This change saves the state 261 million. LOCAL GOVERNMENTS CANNOT UNDO THIS STATE LAW CHANGE. Old Law: All homesteaded property less than 413,800 in value received a Homestead Residential Market Value Credit. This credit reduced the property taxes billed and was shown on line 4 of the property tax statement mailed in March of each year. Homesteaded property received a credit or reduction on the amount of property taxes. The credit was equal to.4% of market value for the first 76,000 in market value, reaching its maximum level of 304. The 304 credit was gradually phased out for homes valued more than 76,000, until it was reduced to 0 at a value of 413,800. The chart below gives examples of the amount of credit on various valued homes. Estimated Market Value Taxable Market Value Old Law Homestead Credit 76,000 76,000 304.00 150,000 150,000 237.40 250,000 250,000 147.40 350,000 350,000 57.40 400,000 400,000 12.40 425,000 425,000 - New Law: All homesteaded property less than 413,800 in value will receive a Homestead Market Value Exclusion. This value exclusion will be identified on the valuation notices mailed in March of each year. The taxable value listed on your Proposed Property Tax Statement has been reduced by the amount of the homestead exclusion. Homesteaded property no longer receives a credit that reduces the property taxes paid. Instead, a portion of the homestead s property value will be excluded from taxation. The Homestead Market Value Exclusion excludes from taxation 40% of the value on the first 76,000 of a property s value. The amount excluded is reduced as the value rises above 76,000 (the exclusion reduction is equal to 9% of the value above 76,000). Homesteads that exceed 413,800 in value will receive no homestead exclusion. The chart below gives examples of the exclusion amount on homes of various values. Estimated Market Value Homestead Exclusion Taxable Market Value (after Homestead Exclusion) 76,000 30,400 45,600 150,000 23,740 126,260 250,000 14,740 235,260 350,000 5,740 344,260 400,000 1,240 398,760 425,000-425,000 6 Page 21 of 74

IMPORTANT PROPERTY TAX LAW CHANGE 2011 Law Change: A New Homestead Market Value Exclusion replaces the Homestead Market Value Credit Page 2 Why the State Change: The elimination of the market value homestead credit was included in the 2011 budget bills passed in the legislative special session in July of 2011. By eliminating the credit, the state was able to save roughly 260 million each year. This was one cost saving measure the state used to close the 5 billion two-year state budget deficit. Under the old credit law, the state was reducing the taxes paid by homesteaded property and instead the state was promising to pay that portion of the tax to the local taxing districts (i.e., your city, county, school, and other local taxing districts). However, in seven of the last eight years, the state did not pay the full credit amount to at least some local governments, due to its budget problems. This meant each year many local governments were left with a deficit in their budgets because of the state s inability to pay the amount it owed. What is the Impact: The impact of this state change will vary for each property depending on a variety of factors. However, in general, the elimination of the homestead credit and replacement with a homestead exclusion is going to mean higher property taxes for most property owners, even if property tax levies adopted by local governments do not increase. The bullets below explain the most significant impacts of this change: The state is no longer providing a homestead credit and instead the entire levy is being paid by local property taxpayers. The new homestead exclusion lowers the tax base, which has led to increases in the property tax rates of most local taxing jurisdictions. A property tax rate is calculated by dividing the property tax levy by the total tax base. For properties that are non-homestead, including commercial and industrial property, the higher property tax rates are likely to mean higher property tax bills even if their values have declined. For properties that are homestead, the new homestead exclusion may not be enough to offset the increases in tax rates and the elimination of the homestead credit, thus many homestead properties as well will experience tax increases. For additional information on understanding the changes in homestead benefits and to see detailed calculations of how it affects taxes in 2012, please visit: http://taxes.state.mn.us/property/documents/hmve-taxpayers.pdf. Additional Resources for Homeowners Affected homeowners with household incomes below 100,780 or whose property taxes increase by more than 12% or 100 (whichever is greater) may apply for the state s property tax refund and, if qualified, will get some of the increase refunded. Information contained in this flyer was gathered from bulletins and documents prepared by the Minnesota House Research Department and Minnesota Department of Revenue. 7 Page 22 of 74

Understanding Recent Changes in Homestead Benefits For Property Tax Purposes What Changed? The 2011 Legislature repealed the Homestead Market Value Credit, (the homestead credit), and replaced it with a new Homestead Market Value Exclusion. The last year of the credit is for property taxes paid in 2011 and the exclusion begins for property taxes payable in 2012. What is a credit? A credit is a reduction in the amount of taxes due. What is an exclusion? An exclusion is a reduction in the amount of value subject to tax. The old law with the credit was as simple as: X Y = Z If your initial tax was X, and your credit was Y, then the tax you had to pay was Z. Under the new law, an exclusion changes the initial tax amount (X), and with the credit gone, the new initial tax becomes the final tax (X = Z). HOW DO HOMESTEAD BENEFITS CHANGE? Under the old law, the credit itself equaled the homestead benefit, and its calculation depended only on the value of the homestead. Because the credit was subtracted from the initial tax amount, the credit affected each taxpayer independently. Under the new law, the exclusion is still calculated using the value of the homestead, but the tax benefit depends on a variety of factors other than homestead value. Because the exclusion is a reduction in the value subject to tax, it also affects tax rates and the taxes of all properties. WHY IS THIS CHANGE COMMONLY RESULTING IN TAX INCREASES? There are four reasons why the change commonly results in increases: 1) State money is no longer reducing total taxes. For 2012, the state was projected to pay approximately 260 million of local taxes through the credit program. With the change, there will be no state paid credit and the entire local property tax levy will be paid by taxpayers. 2) The reduction in taxable value increases tax rates. With the total taxable value being reduced by the exclusion, raising the same total levy as the prior year requires a higher rate. 3) The reduction in taxable value shifts the relative burdens of who pays. With homestead values reduced, other property types (and homes with higher values) pay a larger share of the tax. 4) The exclusion provides less benefit in low tax rate areas than the credit. The computation of the exclusion and credit amounts are roughly comparable where the tax rate is close to the state average, but in lower tax rate areas the excluded value provides less benefit. High rate areas may see greater benefit. Minnesota Revenue, Understanding Recent Changes in Homestead Benefits 1 Page 23 of 74

COMPUTATION OF CREDIT AND EXCLUSION AMOUNTS Even though the tax benefits of the credit and the exclusion are not equal, the calculation of the exclusion amount is similar to the calculation of the former credit. Both reach their maximum at 76,000 of market value (304 for the credit; 30,400 for the exclusion). Both reduce to 0 at about 414,000 of market value. Example: A house valued at 116,000. Credit = (0.4% x 76,000) (40,000 x 0.09%) = 304 36 = 268 AVERAGE TAX RATE ILLUSTRATION Old Law: New Law: Credit Exclusion Estimated Market Value 116,000 116,000 Exclusion 0 26,800 Taxable Market Value 116,000 89,200 Class Rate 1% 1% Net Tax Capacity 1,160 892 Tax Rate 105.810% 110.920% Gross Tax 1,227 989 Credit 268 0 Net Tax 959 989 LOW TAX RATE ILLUSTRATION Tax Rate 63.486% 66.552% Gross Tax 736 594 Credit 268 0 Net Tax 468 594 Exclusion = (40% x 76,000) (40,000 x 9%) = 30,400 3,600 = 26,800 WANT MORE DETAILS? CONSIDER THIS THEORETICAL ILLUSTRATION Similarly computed amounts do not yield equal benefits: NOTE: This illustration does not reflect an actual location. Credit = 0.4% of the first 76,000, minus 0.09% of the value over 76,000. Exclusion = 40% of the first 76,000, minus 9% of the value over 76,000. Let s say you live in a house valued at 116,000. Under the old law the full value was taxed, but the new exclusion lowers the taxable value. Different classes of property are taxed at different levels. The first 500,000 of homestead value has a rate of 1%. (Higher value has a rate of 1.25%.) Net tax capacity is a term describing the taxable value after class rates are applied. Again, this is lower under the new law due to the exclusion. Tax rates increase because the exclusion shrinks the taxable value. This illustration shows statewide average rates before and after the change. The gross tax under the old law was higher because there was no exclusion, but the credit reduced the net tax. Under the new law the gross and net are the same. Here the increase is modest, but Tax rates affect the relative strength of the exclusion because multiplying excluded value by a low rate is less beneficial than multiplying it by a high rate. So, under a low tax rate example, the increase in tax is more extreme. WHAT ELSE AFFECTS MY TAXES (IN ADDITION TO THE HOMESTEAD BENEFIT)? Local levy decisions, including the effects of changes in state aid and local budget priorities. Market forces can affect property taxes in two ways: The value of your property may increase or decrease. The value of other properties may increase or decrease and change the share that your property is of the total tax base, whether your property s value changed or not. Various other changes (the classification or your property, eligibility for other benefits, and miscellaneous law changes) may also affect property taxes. Minnesota Revenue, Understanding Recent Changes in Homestead Benefits 2 Page 24 of 74

2014 VS 2013 TAX LEVIES BY TAXING AUTHORITES 2014 PROPOSED LEVY SURVEY 2013 FINAL NTC 2014 PROPOSED PERCENT 2013 FINAL MV 2014 PROPOSED PERCENT COUNTY CTCODE SD STD OBJ NAME LEVY NTC LEVY CHANGE LEVY MV LEVY CHANGE 72 0000 0000 000 717 SIBLEY COUNTY 11,258,427 11,689,138 3.83% 0 0 County Government Total 11,258,427 11,689,138 3.83% 0 0 72 0100 0000 000 727 ARLINGTON CITY OF 756,805 793,462 4.84% 0 0 72 0200 0000 000 727 GAYLORD CITY OF 811,293 912,731 12.50% 0 0 72 0300 0000 000 727 GIBBON CITY OF 420,548 434,618 3.35% 0 0 72 0400 0000 000 727 GREEN ISLE CITY OF 502,327 522,419 4.00% 0 0 72 0500 0000 000 727 HENDERSON CITY OF 635,000 599,000-5.67% 0 0 72 0600 0000 000 727 NEW AUBURN CITY OF 213,410 218,410 2.34% 0 0 72 0700 0000 000 727 WINTHROP CITY OF 637,557 649,288 1.84% 0 0 Cities Total 3,976,940 4,129,928 3.85% 0 0 72 0001 0000 000 737 ALFSBORG TOWN OF 152,000 132,000-13.16% 0 0 72 0002 0000 000 737 ARLINGTON TOWN OF 162,500 162,500 0.00% 0 0 72 0003 0000 000 737 BISMARCK TOWN OF 140,000 140,000 0.00% 0 0 72 0004 0000 000 737 CORNISH TOWN OF 120,000 120,000 0.00% 0 0 72 0005 0000 000 737 DRYDEN TOWN OF 102,500 119,500 16.59% 0 0 72 0006 0000 000 737 FAXON TOWN OF 101,208 101,208 0.00% 0 0 72 0007 0000 000 737 GRAFTON TOWN OF 215,000 215,000 0.00% 0 0 72 0008 0000 000 737 GREEN ISLE TOWN OF 150,000 150,000 0.00% 0 0 72 0009 0000 000 737 HENDERSON TOWN OF 196,819 196,819 0.00% 0 0 72 0010 0000 000 737 JESSENLAND TOWN OF 158,500 161,000 1.58% 0 0 72 0011 0000 000 737 KELSO TOWN OF 85,000 85,000 0.00% 0 0 72 0012 0000 000 737 MOLTKE TOWN OF 143,900 148,900 3.47% 0 0 72 0013 0000 000 737 NEW AUBURN TOWN OF 157,500 157,500 0.00% 0 0 72 0014 0000 000 737 SEVERANCE TOWN OF 116,761 109,770-5.99% 0 0 72 0015 0000 000 737 SIBLEY TOWN OF 170,000 190,000 11.76% 0 0 72 0016 0000 000 737 TRANSIT TOWN OF 106,000 115,000 8.49% 0 0 72 0017 0000 000 737 WASHINGTON LAKE TOWN OF 199,990 200,975 0.49% 0 0 Townships Total 2,477,678 2,505,172 1.11% 0 0 72 0000 2310 000 757 IND SCHOOL DIST 2310 678,010 681,928 0.58% 589,682 402,068-31.82% 72 0000 2365 000 757 IND SCHOOL DIST 2365 1,088,276 1,126,528 3.51% 695,930 588,814-15.39% School Districts Total 1,766,286 1,808,456 2.39% 1,285,612 990,882-22.93% 72 0000 0000 018 777 HIGH ISLAND WATERSHED 150,000 150,000 0.00% 0 0 0 Special Taxing Districts Total 150,000 150,000 0.00% 0 0 0 72 Total 19,629,331 20,282,694 3.33% 1,285,612 990,882-22.93% S:\AUD\SHARED\Property Tax Administration\Taxes\Payable 2014\Levy Survey for MN DOR\Sibley County Certification of Payable 2014 Proposed Levies for MN Dept of Rev Prepared by the Office of the Sibley County Auditor Page 25 of 74

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SIBLEY COUNTY 2014 TAX CAPACITIES AND MARKET VALUES ** Proposed ** TOWNSHIP ESTMATED MARKET VALUE - REAL ESTMATED MARKET VALUE - PERSONAL ESTMATED MARKET VALUE - TOTAL TAXABLE MARKET VALUE TAX CAPACITY - AG TAX CAPACITY - NON AG TAX CAPACITY - PERSONAL TAX CAPACITY - TOTAL TIF RETAINED CAPTURED VALUE TAXABLE TAX CAPACITY TAXABLE REFERENDUM MARKET VALUE STATE SRR TAX STATE C/I TAX ALFSBORG 179,482,600 4,217,500 183,700,100 180,760,400 1,368,607 92,566 81,681 1,542,854-1,542,854 20,671,400 109,955 ARLINGTON 178,898,300 1,239,300 180,137,600 175,486,200 1,220,782 193,764 23,730 1,438,276-1,438,276 33,187,300 30,211 BISMARCK 171,705,600 3,292,800 174,998,400 172,693,000 1,346,902 106,246 65,856 1,519,004-1,519,004 17,219,000-102,869 CORNISH 176,486,000 3,148,200 179,634,200 177,067,300 1,397,979 61,011 62,849 1,521,839-1,521,839 15,714,200 69,604 DRYDEN 145,595,400 392,000 145,987,400 143,460,300 1,045,650 86,221 7,390 1,139,261-1,139,261 16,786,100 467 21,044 FAXON 111,117,800 5,486,600 116,604,400 112,426,000 512,176 418,928 108,982 1,040,086-1,040,086 56,084,700 136,356 GRAFTON 189,513,000 2,900,200 192,413,200 190,184,600 1,552,719 37,278 58,004 1,648,001-1,648,001 13,473,500 58,054 GREEN ISLE 157,753,700 576,500 158,330,200 153,841,200 981,231 179,966 11,530 1,172,727-1,172,727 32,131,500 351 14,511 HENDERSON 135,904,000 53,300 135,957,300 131,286,200 768,494 291,009 800 1,060,303-1,060,303 42,129,800 1,143 15,634 JESSENLAND 130,668,600-130,668,600 127,095,600 838,571 198,013-1,036,584-1,036,584 30,817,700 2,192 14,525 KELSO 178,077,100 248,400 178,325,500 175,630,400 1,316,340 105,548 4,968 1,426,856-1,426,856 17,551,400 1,047 28,439 MOLTKE 189,439,300 3,136,000 192,575,300 189,914,700 1,427,885 37,392 62,720 1,527,997-1,527,997 14,024,500-63,876 NEW AUBURN 128,149,100 71,000 128,220,100 124,297,400 813,140 101,203 1,366 915,709-915,709 21,642,400 532 3,068 SEVERANCE 178,526,200 109,500 178,635,700 176,304,400 1,328,653 45,619 2,190 1,376,462-1,376,462 10,989,000 426 17,645 SIBLEY 172,083,700-172,083,700 169,476,900 1,263,258 66,672-1,329,930-1,329,930 14,832,900 1,258 TRANSIT 166,557,700 187,500 166,745,200 164,030,500 1,201,377 75,674 3,750 1,280,801-1,280,801 15,738,700 420 8,076 WASHINGTON LAKE 160,091,800 4,128,500 164,220,300 160,483,200 1,034,426 207,854 82,570 1,324,850-1,324,850 37,342,800 205 103,221 TOWNSHIP SUB TOTAL 2,750,049,900 29,187,300 2,779,237,200 2,724,438,300 19,418,190 2,304,964 578,386 22,301,540-22,301,540 410,336,900 6,783 798,346 CITIES ESTMATED MARKET VALUE - REAL ESTMATED MARKET VALUE - PERSONAL ESTMATED MARKET VALUE - TOTAL TAXABLE MARKET VALUE TAX CAPACITY - AG TAX CAPCAITY - NON AG TAX CAPCAITY - PERSONAL TAX CAPCAITY - TOTAL TIF RETAINED CAPTURED VALUE TAXABLE TAX CAPACITY TAXABLE REFERENDUM MARKET VALUE STATE SRR TAX STATE C/I TAX ARLINGTON 83,347,100 334,100 83,681,200 66,794,000 21,098 697,645 6,682 725,425 725,425 80,950,380 135,846 GAYLORD 72,597,600 1,529,700 74,127,300 58,859,600 26,249 679,859 30,594 736,702 143,202 593,500 70,499,250-302,221 GIBBON 20,186,600 331,600 20,518,200 15,178,700 11,053 154,764 6,632 172,449 5,650 166,799 19,361,975-48,613 GREEN ISLE 24,388,400 149,900 24,538,300 19,156,600 18,672 195,936 2,998 217,606-217,606 22,784,700-56,193 HENDERSON 36,090,800 532,800 36,623,600 28,865,200 2,729 298,274 10,173 311,176 303 310,873 36,254,425 265 53,710 NEW AUBURN 10,603,500 259,300 10,862,800 7,849,900 3,481 74,941 5,186 83,608-83,608 10,336,425 1,280 11,971 WINTHROP 66,742,200 261,100 67,003,300 55,429,000 15,553 763,082 5,222 783,857-783,857 64,557,220-487,623 CITIES SUB TOTAL 313,956,200 3,398,500 317,354,700 252,133,000 98,835 2,864,501 67,487 3,030,823 149,155 2,881,668 304,744,375 1,545 1,096,177 GRAND TOTAL 3,064,006,100 32,585,800 3,096,591,900 2,976,571,300 19,517,025 5,169,465 645,873 25,332,363 149,155 25,183,208 715,081,275 8,328 1,894,523 14 vs 13 INC/(DEC) 505,125,600 2,062,900 507,188,500 511,966,300 4,571,542 (62,095) 41,257 4,550,704 2,991 4,547,713 (8,223,380) (321) 20,077 19.74% 6.76% 19.59% 20.77% 30.59% -1.19% 6.82% 21.90% 2.05% 22.04% -1.14% -3.71% 1.07% S:\AUD\SHARED\Property Tax Administration\Taxes\TAX CAPACITIES AND MARKET VALUES BY TAXING AUTHORITIES\Tax Capacities and Market Values by Taxing Authorities Prepared by the Office of the Sibley County Auditor 12/3/2013 6:54 PM paper color: white 1 of 2 Page 27 of 74

SIBLEY COUNTY 2014 TAX CAPACITIES AND MARKET VALUES ** Proposed ** WATERSHEDS ESTMATED MARKET VALUE - REAL ESTMATED MARKET VALUE - PERSONAL ESTMATED MARKET VALUE - TOTAL TAXABLE MARKET VALUE TAX CAPACITY - AG TAX CAPCAITY - NON AG TAX CAPCAITY - PERSONAL TAX CAPCAITY - TOTAL TIF RETAINED CAPTURED VALUE TAXABLE TAX CAPACITY TAXABLE REFERENDUM MARKET VALUE STATE SRR TAX STATE C/I TAX HIGH ISLAND 797,124,400 4,640,500 801,764,900 766,559,200 5,032,991 1,300,061 92,006 6,425,058 6,425,058 192,989,305 2,271 249,418 BUFFALO CREEK 65,479,500-65,479,500 63,480,900 415,270 66,113-481,383-481,383 13,310,600 532 2,868 WATERSHEDS TOTAL 862,603,900 4,640,500 867,244,400 830,040,100 5,448,261 1,366,174 92,006 6,906,441-6,906,441 206,299,905 2,803 252,286 SCHOOLS ESTMATED MARKET VALUE - REAL ESTMATED MARKET VALUE - PERSONAL ESTMATED MARKET VALUE - TOTAL TAXABLE MARKET VALUE TAX CAPACITY - AG TAX CAPCAITY - NON AG TAX CAPCAITY - PERSONAL TAX CAPCAITY - TOTAL TIF RETAINED CAPTURED VALUE TAXABLE TAX CAPACITY TAXABLE REFERENDUM MARKET VALUE STATE SRR TAX STATE C/I TAX 108 NORWOOD YOUNG AMERICA 36,585,500 3,362,700 39,948,200 39,154,100 203,517 43,391 67,254 314,162-314,162 11,562,000-75,089 716 BELLE PLAINE 120,569,600 6,173,200 126,742,800 122,546,700 595,654 420,175 122,714 1,138,543-1,138,543 56,949,900-150,088 2159 BUFFALO LAKE HECTOR 175,285,900 2,900,200 178,186,100 176,089,900 1,437,057 35,244 58,004 1,530,305-1,530,305 12,761,900-58,004 2310 SIBLEY EAST 1,205,404,100 4,314,800 1,209,718,900 1,150,548,100 7,207,506 2,369,700 84,790 9,661,996 143,202 9,518,794 321,568,930 1,552 575,758 2365 GIBBON FAIRFAX WINTHROP 1,074,492,000 14,635,900 1,089,127,900 1,058,031,400 7,555,316 1,308,129 289,934 9,153,379 5,650 9,147,729 171,509,495 846 906,245 2397 LESUEUR HENDERSON 323,245,900 759,700 324,005,600 308,240,000 1,791,969 799,467 14,445 2,605,881 303 2,605,578 107,449,625 4,118 109,326 2859 GLENCOE SILVER LAKE 128,423,100 439,300 128,862,400 121,961,100 726,006 193,359 8,732 928,097-928,097 33,279,425 1,812 20,013 SCHOOLS SUB TOTAL 3,064,006,100 32,585,800 3,096,591,900 2,976,571,300 19,517,025 5,169,465 645,873 25,332,363 149,155 25,183,208 715,081,275 8,328 1,894,523 Footnote: 2887 MCLEOD WEST This specified portion of ISD# 2887 was consolidated with ISD# 2159, effective Payable 2010 S:\AUD\SHARED\Property Tax Administration\Taxes\TAX CAPACITIES AND MARKET VALUES BY TAXING AUTHORITIES\Tax Capacities and Market Values by Taxing Authorities Prepared by the Office of the Sibley County Auditor 12/3/2013 6:54 PM paper color: white 2 of 2 Page 28 of 74

**Proposed** SIBLEY COUNTY 2014 TAX EXTENSION RATES 2014 2014 MKT 2013 2013 MKT 2014 STATE SPECIAL T.D. MULTI LOCAL VALUE LOCAL VALUE SRR C/I CODE DISTRICT TWP/CITY SCHOOL COUNTY WTRSHD REG. 9 CO HRA TAX RATE RATE TAX RATE RATE TAX RATE TAX RATE 801 Alfsborg 2310 8.5560 6.3330 45.9080 0.1570 0.5090 61.4630 0.12018 74.8660 0.17469 802 Alfsborg 2365 8.5560 6.6270 45.9080 0.1570 0.5090 61.7570 0.21121 74.9080 0.25165 53.0000 901 Arlington 2310 11.2980 6.3330 45.9080 0.1570 0.5090 64.2050 0.12018 76.4050 0.17469 53.0000 902 Arlington 2310 - HI 11.2980 6.3330 45.9080 1.5760 0.1570 0.5090 65.7810 0.12018 78.4100 0.17469 53.0000 905 Arlington 2397 - HI 11.2980 23.0240 45.9080 1.5760 0.1570 0.5090 82.4720 0.16514 92.8350 0.20846 1001 Bismarck 2365 9.2160 6.6270 45.9080 0.1570 0.5090 62.4170 0.21121 74.1860 0.25165 53.0000 1002 Bismarck 2365 - HI 9.2160 6.6270 45.9080 1.5760 0.1570 0.5090 63.9930 0.21121 76.1910 0.25165 1101 Cornish 2365 7.8850 6.6270 45.9080 0.1570 0.5090 61.0860 0.21121 72.5690 0.25165 53.0000 1201 Dryden 2310 10.4890 6.3330 45.9080 0.1570 0.5090 63.3960 0.12018 73.7040 0.17469 23.0000 53.0000 1202 Dryden 2310 - HI 10.4890 6.3330 45.9080 1.5760 0.1570 0.5090 64.9720 0.12018 75.7090 0.17469 1301 Faxon 716 9.7310 39.4570 45.9080 0.1570 0.5090 95.7620 0.13494 107.3950 0.08986 53.0000 1302 Faxon 2397 9.7310 23.0240 45.9080 0.1570 0.5090 79.3290 0.16514 87.7800 0.20846 1402 Grafton 2159 (Old 2887) - HI 13.0460 2.7220 45.9080 1.5760 0.1570 0.5090 63.9180 0.25622 89.0950 0.20921 1403 Grafton 2159 13.0460 2.7220 45.9080 0.1570 0.5090 62.3420 0.25622 75.5090 0.20921 1404 Grafton 2159 - HI 13.0460 2.7220 45.9080 1.5760 0.1570 0.5090 63.9180 0.25622 77.5140 0.20921 53.0000 1405 Grafton 2159 - BC 13.0460 2.7220 45.9080 0.7630 0.1570 0.5090 63.1050 0.25622 76.3760 0.20921 1407 Grafton 2365 - HI 13.0460 6.6270 45.9080 1.5760 0.1570 0.5090 67.8230 0.21121 82.0200 0.25165 53.0000 1501 Green Isle 2859 12.7910 6.7760 45.9080 0.1570 0.5090 66.1410 0.15681 76.7220 0.18899 53.0000 1502 Green Isle 2859 - HI 12.7910 6.7760 45.9080 1.5760 0.1570 0.5090 67.7170 0.15681 78.7270 0.18899 53.0000 1503 Green Isle 2859 - BC 12.7910 6.7760 45.9080 0.7630 0.1570 0.5090 66.9040 0.15681 77.5890 0.18899 53.0000 1504 Green Isle 2310 12.7910 6.3330 45.9080 0.1570 0.5090 65.6980 0.12018 77.6800 0.17469 53.0000 1505 Green Isle 2310 - HI 12.7910 6.3330 45.9080 1.5760 0.1570 0.5090 67.2740 0.12018 79.6850 0.17469 23.0000 1506 Green Isle 2310 - BC 12.7910 6.3330 45.9080 0.7630 0.1570 0.5090 66.4610 0.12018 78.5470 0.17469 1601 Henderson 2397 18.5620 23.0240 45.9080 0.1570 0.5090 88.1600 0.16514 98.3190 0.20846 23.0000 53.0000 1603 Henderson 2397 - HI 18.5620 23.0240 45.9080 1.5760 0.1570 0.5090 89.7360 0.16514 100.1040 0.20846 1604 Henderson 2397 - LS/Exempt 18.5620 23.0240 45.9080 0.1570 0.5090 88.1600 0.16514 98.3190 0.20846 1701 Jessenland 2310 15.5330 6.3330 45.9080 0.1570 0.5090 68.4400 0.12018 80.4280 0.17469 1702 Jessenland 2310 - HI 15.5330 6.3330 45.9080 1.5760 0.1570 0.5090 70.0160 0.12018 82.4330 0.17469 23.0000 1703 Jessenland 2397 15.5330 23.0240 45.9080 0.1570 0.5090 85.1310 0.16514 94.7900 0.20846 23.0000 53.0000 1704 Jessenland 2397 - HI 15.5330 23.0240 45.9080 1.5760 0.1570 0.5090 86.7070 0.16514 96.7600 0.20846 23.0000 53.0000 1801 Kelso 2397 5.9570 23.0240 45.9080 0.1570 0.5090 75.5550 0.16514 84.4050 0.20846 23.0000 53.0000 1802 Kelso 2310 5.9570 6.3330 45.9080 0.1570 0.5090 58.8640 0.12018 69.9800 0.17469 23.0000 53.0000 1803 Kelso 2310 - HI 5.9570 6.3330 45.9080 1.5760 0.1570 0.5090 60.4400 0.12018 71.9850 0.17469 1901 Moltke 2365 9.7450 6.6270 45.9080 0.1570 0.5090 62.9460 0.21121 75.0570 0.25165 53.0000 1902 Moltke 2365 - HI 9.7450 6.6270 45.9080 1.5760 0.1570 0.5090 64.5220 0.21121 77.0620 0.25165 2001 New Auburn 2859 - HI 17.1990 6.7760 45.9080 1.5760 0.1570 0.5090 72.1250 0.15681 84.7020 0.18899 53.0000 2002 New Auburn 2859 - BC 17.1990 6.7760 45.9080 0.7630 0.1570 0.5090 71.3120 0.15681 83.5640 0.18899 23.0000 2004 New Auburn 2310 - HI 17.1990 6.3330 45.9080 1.5760 0.1570 0.5090 71.6820 0.12018 85.6600 0.17469 53.0000 2005 New Auburn 2310 17.1990 6.3330 45.9080 0.1570 0.5090 70.1060 0.12018 83.6550 0.17469 2101 Severance 2365 7.9750 6.6270 45.9080 0.1570 0.5090 61.1760 0.21121 73.9030 0.25165 23.0000 53.0000 2201 Sibley 2310 14.2860 6.3330 45.9080 0.1570 0.5090 67.1930 0.12018 78.6230 0.17469 53.0000 2301 Transit 2310 8.9780 6.3330 45.9080 0.1570 0.5090 61.8850 0.12018 73.0760 0.17469 53.0000 2302 Transit 2310 - HI 8.9780 6.3330 45.9080 1.5760 0.1570 0.5090 63.4610 0.12018 75.0810 0.17469 2303 Transit 2365 8.9780 6.6270 45.9080 0.1570 0.5090 62.1790 0.21121 73.1180 0.25165 23.0000 53.0000 2304 Transit 2365 - HI 8.9780 6.6270 45.9080 1.5760 0.1570 0.5090 63.7550 0.21121 75.1230 0.25165 2401 Washington Lake 108 (FD #2) 16.2960 19.4720 45.9080 0.1570 0.5090 82.3420 0.10974 93.7100 0.12493 53.0000 2402 Washington Lake 716 (FD #1) 14.4450 39.4570 45.9080 0.1570 0.5090 100.4760 0.13494 114.2180 0.08986 53.0000 2403 Washington Lake 2310 (FD #1) 14.4450 6.3330 45.9080 0.1570 0.5090 67.3520 0.12018 80.1780 0.17469 23.0000 53.0000 2404 Washington Lake 2310 - HI (FD #1) 14.4450 6.3330 45.9080 1.5760 0.1570 0.5090 68.9280 0.12018 82.1830 0.17469 2405 Washington Lake 2397 (FD #1) 14.4450 23.0240 45.9080 0.1570 0.5090 84.0430 0.16514 94.6030 0.20846 2406 Washington Lake 716 (FD#2) 16.2960 39.4570 45.9080 0.1570 0.5090 102.3270 0.13494 116.3120 0.08986 2408 Washington Lake 2310 (FD #2) 16.2960 6.3330 45.9080 0.1570 0.5090 69.2030 0.12018 82.2720 0.17469 53.0000 2409 Washington Lake 2310 (FD #1) 14.4450 6.3330 45.9080 0.1570 0.5090 67.3520 0.12018 80.1780 0.17469 2410 Washington Lake 2397 (FD #1) 14.4450 23.0240 45.9080 0.1570 0.5090 84.0430 0.16514 94.6030 0.20846 3101 Arlington City 2310 - HI 110.6590 4.3000 44.1550 1.5760 0.1570 0.5090 161.3560 0.12018 177.3910 0.17469 53.0000 3102 Arlington RSD 2310 - HI 60.9790 6.3330 45.9080 1.5760 0.1570 0.5090 115.4620 0.12018 130.0000 0.17469 3103 Arlington Annex 2310 - HI 27.8570 6.3330 45.9080 1.5760 0.1570 0.5090 82.3400 0.12018 164.3930 0.17469 3201 Gaylord City 2310 154.2010 3.7400 43.7940 0.1570 0.5090 202.4010 0.12018 183.6660 0.17469 53.0000 3203 Gaylord City (Trtmnt Plt) Annex 2310 96.7150 6.3330 45.9080 0.1570 0.5090 149.6220 0.12018 119.4110 0.17469 53.0000 3301 Gibbon City 2365 270.2340 0.0000 38.2500 0.1570 0.5090 309.1500 0.21121 283.4400 0.25165 53.0000 3302 Gibbon RSD 2365 54.0470 6.6270 45.9080 0.1570 0.5090 107.2480 0.21121 109.5180 0.25165 3401 Green Isle City 2310 247.5530 3.9260 43.8830 0.1570 0.5090 296.0280 0.12018 268.9470 0.17469 53.0000 3404 Green Isle RSD 2310 15.8550 6.3330 45.9080 0.1570 0.5090 68.7620 0.12018 81.9590 0.17469 3501 Henderson City 2397 192.6830 20.9470 44.1480 0.1570 0.5090 258.4440 0.16514 270.0920 0.20846 23.0000 53.0000 3602 New Auburn City 2859 - HI 261.2310 6.4920 45.6850 1.5760 0.1570 0.5090 315.6500 0.15681 253.4870 0.18899 23.0000 53.0000 3701 Winthrop City 2365 83.2020 5.3800 44.9400 0.1570 0.5090 134.1880 0.21121 139.4740 0.25165 53.0000 3702 Winthrop RSD 2365 27.2950 6.6270 45.9080 0.1570 0.5090 80.4960 0.21121 90.6770 0.25165 STATE S:\AUD\SHARED\Property Tax Administration\Taxes\TAX EXTENSION RATES\2014 TAX EXTENSION RATES - Proposed Prepared by the Office of the Sibley County Auditor 12/3/2013 6:34 PM Page 1 of 1 Page 29 of 74

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Examples Comprehensive Tax Calculations T-IN-T Payable 2014 For All Examples: Unique Taxing Area = District 1505 County Net Tax Capacity Rate 46.4170% + Township (City) Rate 12.7910% + School District Rate 6.3330% + Special Taxing District Rate 1.7330% = Total Net Tax Capacity Tax Rate (Local Tax Rate) 67.2740% Total Referendum Market Value Rate.12018% State Tax Rate 76.0000% (C/I Rate = 53.0000% & SRR Rate = 23.0000%) Basic Formula for Calculating Net Tax: Local NTC Tax Credits + Ref. MV Tax + State Tax = Net Tax Residential Homestead Residential Homestead (Class 1a) parcel with a taxable market value of 249,000. Market Value Exclusion Residential Homestead MV Exclusion = Base Exclusion Exclusion Reduction Base Exclusion: 76,000 x 40% = 30,400 Exclusion Reduction: (249,000-76,000) x 9% = 173,000 x 9% = 15,570 Final MV Exclusion: 30,400-15,570 = 14,830 Net Tax Capacity = (Taxable Market Value Final MV Exclusion) x Class Rate (249,000 14,830) x 1.00% = 234,170 x 1.00% = 2,342 Local NTC Tax Net Tax Capacity Tax = Net Tax Capacity x Local Tax Rate 2,342 x 67.2740% = 1,576 (1,087 is County Tax) Credits - This property receives no credits. Referendum Market Value Tax Referendum Market Value Tax = RMV X RMV Tax Rate Referendum Market Value = 249,000 Referendum Market Value Tax = 249,000 x 0.12018% = 299 State Tax State Tax = State Net Tax Capacity X State Tax Rate State Net Tax Capacity = 0 State Tax = 0 (Not Subject to State Tax) Net Tax = 1,576-0 + 299 + 0 = 1,875 Page 31 of 74

Examples Comprehensive Tax Calculations T-IN-T Payable 2014 For All Examples: Unique Taxing Area = District 1505 County Net Tax Capacity Rate 46.4170% + Township (City) Rate 12.7910% + School District Rate 6.3330% + Special Taxing District Rate 1.7330% = Total Net Tax Capacity Tax Rate (Local Tax Rate) 67.2740% Total Referendum Market Value Rate.12018% State Tax Rate 76.0000% (C/I Rate = 53.0000% & SRR Rate = 23.0000%) Basic Formula for Calculating Net Tax: Local NTC Tax Credits + Ref. MV Tax + State Tax = Net Tax Agricultural Homestead A 160-acre farm parcel (2a) has a taxable market value of 279,000. The house, garage and first acre have a value of 120,000. The remainder of the farm (Productive Ag.) is valued at 159,000. Market Value Exclusion Residential Homestead MV Exclusion = Base Exclusion Exclusion Reduction Base Exclusion: 76,000 x 40% = 30,400 Exclusion Reduction: (120,000-76,000) x 9% = 44,000 x 9% = 3,960 Final MV Exclusion: 30,400-3,960 = 26,440 Net Tax Capacity = (Taxable Market Value Final MV Exclusion) x Class Rate HGA: (120,000-26,440) x 1.00% = 93,560 x 1.00% = 936 Remainder of farm: 159,000 x 0.50% = 795 Total Net Tax Capacity = 936 + 795 = 1,731 Local NTC Tax Net Tax Capacity Tax = Net Tax Capacity x Local Tax Rate 1,731 x 67.2740% = 1,165 (803 is County Tax) Agricultural Homestead Credit = Base Credit Credit Reduction Base credit: 115,000 x 0.3% = 345 Credit reduction: (159,000-115,000) x 0.05% = 22 Final credit: 345-22 = 323 Referendum Market Value Tax Referendum Market Value Tax = Referendum Market Value X RMV tax rate Referendum Market Value = 120,000 Referendum Market Value Tax = 120,000 x 0.12018% = 144 State Tax State Tax = State Net Tax Capacity X State Tax Rate State Net Tax Capacity = 0 State Tax = 0 (Not Subject to State Tax) Net Tax = 1,165-323 + 144 + 0 = 986 Page 32 of 74

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CITIES SIBLEY COUNTY 2014 GROSS TAX BY TAXING AUTHORITY ** Proposed ** City/Twp % of City Levy Schools Watersheds County % of County Region 9 % of Region 9 HRA % of HRA State % of State Tax Increment Gross Tax Ag Credit (-) Homestead Credit (-) Net Tax % of Net Tax 14 vs 13 INC/(DEC) % of Total Arlington 793,462.97 19% 128,747.89 11,432.67 320,529.16 3% 1,139.11 3% 3,692.49 3% 71,998.38 7% - 1,331,002.67 269.60-1,330,733.07 6% (13,326.34) -2% Gaylord 1,026,923.21 24% 107,033.01-264,163.97 2% 931.77 2% 3,021.07 2% 160,177.13 16% 171,469.63 1,733,719.79 230.00-1,733,489.79 8% (5,632.31) -1% Gibbon 444,539.11 10% 41,388.84-64,417.09 1% 261.92 1% 849.24 1% 25,764.89 3% 7,545.69 584,766.78 - - 584,766.78 3% (21,418.95) -4% Green Isle 522,418.05 12% 36,094.88-95,636.85 1% 341.60 1% 1,107.59 1% 29,782.29 3% - 685,381.26 272.70-685,108.56 3% (33,136.96) -6% Henderson 599,183.80 14% 124,989.21-137,242.15 1% 488.07 1% 1,582.42 1% 28,527.25 3% 598.64 892,611.54 - - 892,611.54 4% (85,663.48) -15% New Auburn 218,409.99 5% 21,636.43 1,317.66 38,199.32 0% 131.34 0% 425.58 0% 6,639.03 1% - 286,759.35 276.30-286,483.05 1% (30,423.88) -5% Winthrop 649,288.17 15% 178,587.54-352,312.67 3% 1,230.58 3% 3,989.87 3% 258,440.19 26% - 1,443,849.02 262.50-1,443,586.52 6% (117,855.35) -21% 4,254,225.30 100% 638,477.80 12,750.33 1,272,501.21 11% 4,524.39 11% 14,668.26 11% 581,329.16 58% 179,613.96 6,958,090.41 1,311.10-6,956,779.31 30% (307,457.27) -55% 14 vs 13 INC/(DEC) 187,421.77 TOWNSHIPS City/Twp % of Twp Levy Schools Watersheds County % of County Region 9 % of Region 9 HRA % of HRA State % of State Tax Increment Gross Tax Ag Credit (-) Homestead Credit (-) Net Tax % of Net Tax 13 vs 12 INC/(DEC) % of Total Alfsborg 132,006.60 5% 141,491.76-708,293.57 6% 2,422.24 6% 7,853.12 6% 58,276.15 6% - 1,050,343.44 13,198.00-1,037,145.44 5% 34,626.37 6% Arlington 162,496.47 6% 133,464.19 21,244.17 660,295.46 6% 2,258.19 6% 7,320.83 6% 16,011.83 2% - 1,003,091.14 17,786.80-985,304.34 4% 21,640.10 4% Bismarck 139,991.35 6% 137,032.62 557.74 697,374.51 6% 2,384.83 6% 7,731.79 6% 54,520.57 5% - 1,039,593.41 10,486.40-1,029,107.01 4% 61,712.65 11% Cornish 119,997.04 5% 134,042.34-698,654.11 6% 2,389.31 6% 7,746.22 6% 36,890.12 4% - 999,719.14 11,305.90-988,413.24 4% 67,963.07 12% Dryden 119,496.96 5% 92,322.97 3,143.14 523,012.04 5% 1,788.61 5% 5,798.81 5% 11,260.73 1% - 756,823.26 15,289.49-741,533.77 3% 49,238.92 9% Faxon 101,210.83 4% 480,258.30-477,458.80 4% 1,632.87 4% 5,294.14 4% 72,268.68 7% - 1,138,123.62 10,434.45-1,127,689.17 5% 46,487.12 8% Grafton 214,998.17 9% 83,656.19 25,323.96 756,579.12 7% 2,587.30 7% 8,388.29 7% 30,768.62 3% - 1,122,301.65 12,223.20-1,110,078.45 5% 61,845.22 11% Green Isle 150,003.58 6% 117,060.28 10,366.44 538,408.64 5% 1,841.13 5% 5,969.15 5% 7,771.56 1% - 831,420.78 21,215.00-810,205.78 4% (1,274.17) 0% Henderson 196,813.44 8% 313,697.15 1,080.15 486,784.02 4% 1,664.74 4% 5,397.12 4% 8,548.91 1% - 1,013,985.53 20,488.75-993,496.78 4% 21,048.56 4% Jessenland 161,012.62 6% 219,440.54 11,037.11 475,874.10 4% 1,627.40 4.1% 5,276.34 4.1% 8,202.41 1% - 882,470.52 16,934.63-865,535.89 4% 18,496.66 3% Kelso 84,997.88 3% 197,065.53 355.12 655,023.27 6% 2,240.38 6% 7,262.78 6% 15,313.48 2% - 962,258.44 13,238.41-949,020.03 4% 78,771.45 14% Moltke 148,903.34 6% 130,881.32 4,572.75 701,485.99 6% 2,398.88 6% 7,777.65 6% 33,854.28 3% - 1,029,874.21 17,555.30-1,012,318.91 4% 105,443.06 19% New Auburn 157,492.74 6% 91,971.10 11,777.24 420,407.07 4% 1,437.70 4% 4,660.97 4% 1,748.40 0% - 689,495.22 20,344.64-669,150.58 3% 23,533.56 4% Severance 109,772.97 4% 114,427.92-631,930.29 5% 2,161.09 5% 7,006.15 5% 9,449.83 1% - 874,748.25 15,764.90-858,983.35 4% 91,601.74 16% Sibley 189,993.80 8% 102,050.78-610,548.84 5% 2,088.02 5% 6,769.25 5% 666.74 0% - 912,117.43 14,526.65-897,590.78 4% 65,069.01 12% Transit 114,990.20 5% 113,698.96 80.22 587,988.56 5% 2,010.91 5% 6,519.34 5% 4,376.88 0% - 829,665.07 15,663.13-814,001.94 4% 66,486.11 12% Washington Lake 200,966.29 8% 221,643.97 2,643.46 608,214.15 5% 2,079.81 5% 6,743.47 5% 54,754.28 5% - 1,097,045.43 18,568.25-1,078,477.18 5% 57,765.35 10% 2,505,144.28 100% 2,824,205.92 92,181.50 10,238,332.54 89% 35,013.41 89% 113,515.42 89% 424,683.47 42% - 16,233,076.54 265,023.90-15,968,052.64 70% 870,454.78 155% 14 vs 13 INC/(DEC) 27,559.07 Grand Total 6,759,369.58 3,462,683.72 104,931.83 11,510,833.75 100% 39,537.80 100% 128,183.68 100% 1,006,012.63 100% 179,613.96 23,191,166.95 266,335.00-22,924,831.95 100% 562,997.51 100% 14 vs 13 INC/(DEC) 214,980.84 (124,616.89) (2,634.91) 424,031.25 742.59 2,513.05 19,566.24 3,882.92 538,465.09 (24,532.42) - 562,997.51 S:\AUD\SHARED\Property Tax Administration\Taxes\TAX BY TAXING AUTHORITIES-ENTITY - GROSS TAX\Tax Value & Credit List Recap of Gross Tax by Taxing Authority-Entity Prepared by the Office of the Sibley County Auditor 12/3/2013 6:59 PM paper color: white Page 1 of 1 Page 35 of 74

CITIES SIBLEY COUNTY 2013 GROSS TAX BY TAXING AUTHORITY ** Certified ** City/Twp % of City Levy Schools Watersheds County % of County Region 9 % of Region 9 HRA % of HRA State % of State Tax Increment Gross Tax Ag Credit (-) Homestead Credit (-) Net Tax % of Net Tax 13 vs 12 INC/(DEC) % of Total Arlington 756,810.15 19% 163,990.82 12,985.80 336,928.81 3% 1,217.61 3% 3,944.28 3% 68,409.64 7% - 1,344,287.11 227.70-1,344,059.41 6% (153,044.68) -30% Gaylord 892,855.06 22% 169,573.97-345,469.87 3% 1,218.24 3% 3,945.62 3% 158,714.03 16% 167,586.71 1,739,363.50 241.40-1,739,122.10 8% (67,670.93) -13% Gibbon 428,620.61 11% 55,833.69-87,168.58 1% 344.90 1% 1,117.39 1% 25,574.97 3% 7,545.69 606,205.83 20.10-606,185.73 3% 15,826.23 3% Green Isle 502,323.98 12% 59,215.91-127,797.15 1% 460.05 1% 1,490.75 1% 27,300.40 3% - 718,588.24 342.72-718,245.52 3% (51,221.09) -10% Henderson 635,222.55 16% 142,777.28-168,416.58 2% 605.94 2% 1,963.00 2% 28,691.03 3% 598.64 978,275.02 - - 978,275.02 4% (56,036.47) -11% New Auburn 213,409.98 5% 32,708.43 2,246.57 60,262.70 1% 210.75 1% 682.36 1% 7,695.44 1% - 317,216.23 309.30-316,906.93 1% (11,711.45) -2% Winthrop 637,561.20 16% 218,065.22-428,013.05 4% 1,517.80 4% 4,916.56 4% 271,574.44 28% - 1,561,648.27 206.40-1,561,441.87 7% (42,987.07) -9% 4,066,803.53 100% 842,165.32 15,232.37 1,554,056.74 14% 5,575.29 14% 18,059.96 14% 587,959.95 60% 175,731.04 7,265,584.20 1,347.62-7,264,236.58 32% (366,845.46) -73% 13 vs 12 INC/(DEC) 84,140.78 TOWNSHIPS City/Twp % of Twp Levy Schools Watersheds County % of County Region 9 % of Region 9 HRA % of HRA State % of State Tax Increment Gross Tax Ag Credit (-) Homestead Credit (-) Net Tax % of Net Tax 13 vs 12 INC/(DEC) % of Total Alfsborg 152,002.23 6% 142,024.38-655,750.28 6% 2,285.04 6% 7,402.02 6% 58,140.87 6% - 1,017,604.82 15,085.75-1,002,519.07 4% 100,745.83 20% Arlington 162,509.15 7% 148,150.26 21,733.14 624,235.80 6% 2,175.29 6% 7,046.65 6% 16,814.72 2% - 982,665.01 19,000.77-963,664.24 4% 73,553.85 15% Bismarck 139,998.09 6% 134,453.96 536.39 640,920.32 6% 2,233.52 6% 7,235.14 6% 54,166.46 5% - 979,543.88 12,149.52-967,394.36 4% 51,326.97 10% Cornish 119,995.98 5% 129,670.69-636,747.09 6% 2,218.93 6% 7,187.74 6% 36,579.64 4% - 932,400.07 11,949.90-920,450.17 4% 75,127.06 15% Dryden 102,506.90 4% 97,355.58 3,276.13 487,499.80 4% 1,698.87 4% 5,503.03 4% 10,677.68 1% - 708,517.99 16,223.14-692,294.85 3% 58,277.73 12% Faxon 101,201.04 4% 427,779.09-496,576.26 4% 1,730.29 4% 5,605.43 4% 59,702.88 6% - 1,092,594.99 11,392.94-1,081,202.05 5% (59,586.01) -12% Grafton 215,013.07 9% 124,137.23 23,769.57 658,614.57 6% 2,295.04 6% 7,434.52 6% 30,798.43 3% - 1,062,062.43 13,829.20-1,048,233.23 5% 73,909.66 15% Green Isle 149,992.79 6% 129,769.38 10,794.79 528,213.83 5% 1,840.65 5% 5,962.54 5% 7,649.56 1% - 834,223.54 22,743.59-811,479.95 4% 33,034.01 7% Henderson 196,797.31 8% 288,605.76 1,123.41 493,059.63 4% 1,718.41 4% 5,566.13 4% 7,973.42 1% - 994,844.07 22,395.85-972,448.22 4% (14,941.51) -3% Jessenland 158,429.29 6% 206,753.61 11,917.14 473,076.36 4% 1,649.45 4.3% 5,342.58 4.3% 7,904.25 1% - 865,072.68 18,033.45-847,039.23 4% 9,442.63 2% Kelso 85,001.58 3% 174,466.00 382.85 601,818.54 5% 2,097.14 5% 6,793.47 5% 15,438.35 2% - 885,997.93 15,749.35-870,248.58 4% 77,092.83 15% Moltke 143,891.75 6% 121,964.83 4,254.59 613,449.54 6% 2,137.56 6% 6,924.55 6% 33,882.58 3% - 926,505.40 19,629.55-906,875.85 4% 79,098.17 16% New Auburn 157,492.42 6% 91,190.97 11,931.86 398,993.47 4% 1,390.42 4% 4,504.04 4% 1,626.19 0% - 667,129.37 21,512.35-645,617.02 3% 28,986.11 6% Severance 116,770.30 5% 104,528.90-547,766.51 5% 1,908.78 5% 6,183.20 5% 7,320.62 1% - 784,478.31 17,096.70-767,381.61 3% 80,298.77 16% Sibley 169,998.96 7% 105,506.58-563,952.48 5% 1,965.19 5% 6,365.96 5% 660.74 0% - 848,449.91 15,928.14-832,521.77 4% 103,231.11 20% Transit 106,000.86 4% 112,003.76 57.53 533,671.66 5% 1,859.68 5% 6,024.23 5% 4,326.61 0% - 763,944.33 16,428.50-747,515.83 3% 56,049.48 11% Washington Lake 199,983.49 8% 206,774.31 2,556.97 578,399.62 5% 2,015.66 5% 6,529.44 5% 44,823.44 5% - 1,041,082.93 20,371.10-1,020,711.83 5% 45,859.42 9% 2,477,585.21 100% 2,745,135.29 92,334.37 9,532,745.76 86% 33,219.92 86% 107,610.67 86% 398,486.44 40% - 15,387,117.66 289,519.80-15,097,597.86 68% 871,506.11 173% 13 vs 12 INC/(DEC) 135,394.76 Grand Total 6,544,388.74 3,587,300.61 107,566.74 11,086,802.50 100% 38,795.21 100% 125,670.63 100% 986,446.39 100% 175,731.04 22,652,701.86 290,867.42-22,361,834.44 100% 504,660.65 100% 13 vs 12 INC/(DEC) 219,535.54 (185,141.74) (525.09) 430,196.08 794.18 2,361.71 34,778.58 (5,960.61) 496,038.65 (8,622.00) - 504,660.65 S:\AUD\SHARED\Property Tax Administration\Taxes\TAX BY TAXING AUTHORITIES-ENTITY - GROSS TAX\Tax Value & Credit List Recap of Gross Tax by Taxing Authority-Entity Prepared by the Office of the Sibley County Auditor 3/20/2013 10:13 AM paper color: white Page 1 of 1 Page 36 of 74

Fourteen Reasons WHY PROPERTY TAXES VARY FROM YEAR TO YEAR THE MARKET VALUE OF A PROPERTY MAY CHANGE. Each parcel of property is assessed at least once every five years and a sales ratio study is done to determine if the property is assessed similarly to like properties. If not, the Commissioner of Revenue may issue an order that would affect the taxable value of a parcel. Additions and improvement made to a property generally increases its market value. THE MARKET VALUE OF OTHER PROPERTIES IN YOUR TAXING DISTRICT MAY CHANGE, SHIFTING TAXES FROM ONE PROPERTY TO ANOTHER. If the market value of a property increases more or less than the average increase or decrease in a taxing district, the taxes on that property will also change. New construction in a taxing district increases the tax base and will affect the district s tax rate. THE STATE GENERAL PROPERTY TAX MAY CHANGE. The state legislature directly applies a State General Property Tax to commercial/industrial and season/recreational property classes. A publication of the Association of Minnesota Counties A publication of the Association of Minnesota Counties Page 37 of 74

THE CITY BUDGET AND LEVY MAY CHANGE. Each year, cities review the needs and wants of their citizens and how to meet those needs and wants. This is called discretionary spending in the city budget. Also included in the budget is non-discretionary spending which is required by state and federal mandates and court decisions and orders. THE TOWNSHIP BUDGET AND LEVY MAY CHANGE. Each March, townships set the levy and budget for the next year. THE COUNTY BUDGET AND LEVY MAY CHANGE. Each year, counties review the needs and wants of their citizens and how to meet those discretionary needs and wants. In addition, also included in the county budget is nondiscretionary spending which is required by state and federal mandates and court decisions and orders. As much as sixty to eighty-five percent of the county expenditures are used to deliver mandated services. THE SCHOOL DISTRICT S BUDGET AND LEVY MAY CHANGE. The Legislature determines basic funding levels for K-12 education and mandates services that schools must perform. On average, approximately seventy percent of school costs are paid by the state. Local school districts set levies for purposes including safe school and community education, etc. A SPECIAL DISTRICT S BUDGET AND LEVY MAY CHANGE. Special districts such as the Metropolitan Council, hospital districts, watershed districts, drainage districts, etc. set levies to balance their budgets. SPECIAL ASSESSMENTS MAY BE ADDED TO YOUR PROPERTY TAX BILL. Water lines, curb and gutter, and street improvements that directly benefit your property may be funded, in whole or in part, through a special assessment that is added to your tax bill. A publication of the Association of Minnesota Counties Page 38 of 74

VOTERS MAY HAVE APPROVED A SCHOOL, CITY/ TOWNSHIP, COUNTY, OR SPECIAL DISTRICT REFERENDUM. Local referendums may be held for local government construction projects, excess operating levies for schools or many other purposes. Referendum levies may be spread on the market value or the tax capacity of a property depending on process and type of referendum levy. FEDERAL AND STATE MANDATES MAY HAVE CHANGED. Both the state and federal governments require local governments to provide certain services and follow certain rules. These mandates often require an increase in the cost and level of service delivery. AID AND REVENUE FROM THE STATE AND FEDERAL GOVERNMENTS MAY HAVE CHANGED. Each year the state legislature reviews and adjusts the level of funding for a variety of aids provided to local governments including Local Government Aid and County Program Aid. The formulas for how aid is determined and distributed among local governments may have changed. While direct aid and revenue from the federal government to local governments has declined greatly in recent years, federal revenue continues to be a key portion of the local government revenue stream and that revenue stream may have changed. THE STATE LEGISLATURE MAY HAVE CHANGED THE PORTION OF THE TAX BASE PAID BY DIFFERENT TYPES OF PROPERTIES. A change in class rates will require a change in the tax rate to raise the same amount of money. OTHER STATE LAW CHANGES MAY ADJUST THE TAX BASE. Fiscal disparities, personal property taxes on utility properties, limited market value, and tax increment financing are example of laws that affect property taxes. A publication of the Association of Minnesota Counties Page 39 of 74

Glossary of Terms CATEGORICAL AID: Aid given to a local unit of government to be used only for a specific purpose. CIRCUIT BREAKER: See Property Tax Refund. CLASS RATES: The percent of market value set by state law that establishes the property s tax capacity subject to the property tax. COUNTY PROGRAM AID: State property tax relief aid to counties, distributed with a formula based on needs (households on foodstamps, age of the population, number of serious crimes) and tax base equalization for counties with smaller tax bases. EDUCATION AID: The total amount of state dollars paid for K-12 education. This aid is paid to the school districts. FISCAL DISPARITIES: A program in the Twin Cities metropolitan area and on the iron range in which a portion of the commercial and industrial property value of each city and township is contributed to a tax base sharing pool. Each city and township then receives a distribution of property value from the pool based on market value and population in each city. GENERAL PURPOSE AID: Aid given to units of government to be used at their own discretion. Examples are Local Government Aid and County Program Aid. HIGHWAY AID: Motor fuels tax and license tab money the state distributes to counties, cities and townships for highways and bridges. HOMESTEAD: A residence occupied by the owner. INDIVIDUAL INCOME TAX: A state tax on the income of residents and non-residents with Minnesota sources of income that is deposited into the state general fund. LEVY: The imposition of a tax, associated with the property tax. LEVY LIMIT: The amount a local unit of government is permitted to levy for specific services under state law. LIMITED MARKET VALUE: A state imposed limit on property value increases for the purpose of calculating property taxes. LOCAL GOVERNMENT AID (LGA): A state government revenue sharing program for cities with low property wealth or high service burdens that is intended to provide an alternative to the property tax. LOCAL SALES TAX: A local tax, authorized by the state, levied on the sale of goods and services to be used for specific purposes by the local government. MARKET VALUE HOMESTEAD CREDIT: The Market Value Homestead Credit (MVHC) program was eliminated during the 2011 Special Session for taxes payable in 2012 and beyond. The credit was replaced with a market value exclusion. This guide describes the (MVHC) reimbursement program. The program was designed to provide state-paid property tax relief to owners of certain qualifying homestead property. This program has been replaced by the Market Value Homestead Exclusion (defined below). MARKET VALUE HOMESTEAD EXCLUSION: The exclusion reduces the taxable value of qualifying homesteads. Despite the decreased taxable value, taxes will increase on most properties including apartments and businesses and is independent of any action taken by local governments. The exclusion provides for a portion of each home s market value to be excluded from its value for property tax calculations. The amount of value excluded is directly proportional to the MVHC the home received under the old law. In this way, each home contributes a smaller amount to each taxing jurisdiction s tax base. The tax rate tends to be a little higher because of the reduced tax base, which is why taxes increase for the other types of property. The tax burden on any given homestead could be lesser or greater depending upon the mix of properties in the jurisdiction and the level of the tax rate. PROPERTY TAX: A tax levied on any kind of property. PROPERTY TAX REFUND: A partial property tax refund program for those who have property taxes out of proportion with their income. This program is available to homeowners and renters. SALES RATIO STUDY: A study conducted by the Department of Revenue of open market property sales, which is then compared to local assessments to ensure that local assessments adequately reflect the market. STATE GENERAL PROPERTY TAX: A state-imposed property tax on commercial, industrial, and seasonal recreational properties. STATE SALES TAX: A state tax (6.5%) levied on the sale of goods and services that is deposited into the state general fund. TAX CAPACITY: The valuation of property based on market value and class rates, on which property taxes are determined. Revised December 2011 LOCAL TAX RATE: The tax rate usually expressed as a percentage of tax capacity, used to determine the property tax due on a property. MARKET VALUE: An assessor s estimate of what property would be worth if it were sold. MARKET VALUE AGRICULTURE CREDIT: A state credit to reduce the property tax paid by agricultural homesteads to the local taxing jurisdiction. Association of Minnesota Counties 125 Charles Avenue Saint Paul, MN 55103-2108 Main Line/Switchboard: 651.224.3344 Fax: 651.224.6540 www.mncounties.org Page 40 of 74

County Budget Overview A publication of the Association of Minnesota Counties by Jim Culotta, Research Assistant, National Association of Counties (NACo); Edited by Association of Minnesota Counties (AMC) The budget is one of the most important documents a county government prepares because it identifies the services to be provided and how they are to be financed. Almost every decision, activity and program in a county government can be expressed in the financial language of the budget. To fully understand county budgets, it is essential to know the critical parts of the budget document, the primary budget players, the budget process, the different types of budgets, and how the budget is a tool for governing. Critical Parts of a County Budget Operating Budget The operating budget section is usually the longest of the budget document. This section outlines the operational and spending plans for county government agencies and programs. The operating budget is an aggregation of the individual budgets of each department and agency. Information on the mission, staffing levels, performance objectives and indicators, expenditure levels, and possibly even financing sources, are presented for each county department and agency. Financial Summaries The financial summary section of a county budget summarizes information contained in the operating detail section. At a minimum, most financial summaries present a consolidated budget summary, cross-classify financial data, and present information on revenues, indebtedness, and capital spending. The Budget Process The budget process is nearly as important as the budget itself. The process determines whose opinions will be solicited and how they will be weighed. The period for which a budget is authorized typically spans a fiscal year that may correspond to a calendar year or to some other twelve-month period. Budgeting is a yearlong process that consists of four phases: preparation, adoption, implementation and evaluation. Below is a typical budget process. Date June June/July activity Distribute instructions and forms for the next fiscal year to department managers for proposed capital improvements. Deadline for submission of capital improvements proposed by departments. Planning Department begins preparation of budget for capital improvement plan. Distribute operating budget request forms to department managers. Managers prepare department budgets. Begin study of capital improvements program. Capital Budget A capital budget is the appropriation of bonds or operating revenue for improvements to facilities and other infrastructure. A capital project is the acquisition or construction of fixed assets, which are of a long-term and permanent nature. Examples include land, buildings, streets and highways, bridges, sewers, and parks. Primary Budget Players County Commission: The ultimate holder of the purse strings. Makes and approves all budgetary changes. Chief Financial Officer (CFO): The primary architect of the budget. Provides options and recommendations to County Commission. This may be the County Administrator or Coordinator, Auditor, Financial Manager or other individual given this responsibility by the board. Central budget office/finance office: The CFO s main tool in preparing the budget for consideration and coordinating its implementation. Performs analyses and makes projections of revenues, expenditures and trends. This function can be performed in many offices. Department officials: The day-to-day managers of county programs and services. July/August September October November December January January-December Complete preliminary revenue estimates, based on current year s experience. Managers submit departmental budget requests, which are reviewed for accuracy and adherence to guidelines. Conduct meetings with department managers. Submit preliminary levy to the state. Note: the final levy cannot be higher than this amount. Prepare revenue estimates based on current year expenditures. Complete preliminary budget, including staff recommendations. Submit budget to County Commission for approval. Conduct Truth in Budgeting Hearing. County Commission finalizes budget decisions and adopts budget. New fiscal year begins. Adopted budget implemented, annual financial reports are prepared, external auditor hired and budget review conducted. Financial audit completed and submitted to the state auditor. Adopted budget is implemented, monitored and evaluated. Page 41 of 74

Major Types of Budgets Line-Item Budget: Focus is on financial accountability. Control oriented. Departmental outlays are grouped according to the items that will be purchased, with one item or group of items on each line (e.g. salaries and wages, contract services, supplies and equipment). Predominant form of budgeting because it is easiest to prepare and implement. Performance Budget: Focus is on improving service delivery. Output oriented. Budget becomes a work contract between departments and commission based on desired service levels. Workload measures help justify the budget; cost and output measures help evaluate whether service delivery is efficient and economical; and outcome measures reveal to what extent programs are achieving their goals. Program Budget: Focus is on goal attainment or effectiveness. Outcome oriented. Organizes budgetary information into a set of organized activities directed to particular goals. Funds are allocated along program rather than departmental lines. In pure form, depends heavily on analytical techniques (e.g. costbenefit analysis) to determine best allocation of resources. Zero Base Budget: Focus is on cost efficiency of services. Priority ranking oriented. Departments divide their activities into discrete services called decision units. Decision units area considered at various funding levels called decision packages (elimination, minimum, current and enhancements) and rank ordered. Departmental rankings are merged across the whole governmental unit to form a single, ranked list and final resource allocations are assigned. Target Base Budget: Focus is on limiting expenditures. Justification oriented. Revenue projections are done and a proportion is set aside for discretionary budget decisions. The remainder of the budget is allocated to departments based on historical share. Departments submit budgets showing spending plans for target base budget. Departments also submit requests that justify the need for enhancement packages, which are funded out of the discretionary set aside. Typically used in budget cutting situations. The Budget: A Tool for Governing Policy Making Tool: All budgets reflect decisions about a variety of policy issues. Ignoring the policy dimensions of budgeting may result in poor policy decisions by default. (For example, failure to allocate funds for ADA renovations could allow outdated policies to remain in effect.) The budget format, presentation, and even wording of a document all influence the making of public policy. A budget that explicitly reveals trade-offs can help ensure the making of policy rather than the obscuring of policy is the primary focus. Planning and Management Tool: A budget is a plan of financial activity for a specified period of time (either a fiscal year or biennium) indicating all planned revenues and expenses for the budget period. It provides a mechanism to allocate resources for the pursuit of community goals. Budgeting helps policy makers set goals, and assists program managers and department heads in improving organizational performance. Communication Tool: The budget is a concise way for decision makers to communicate changes in priorities and rationale for decisions made. The budget document and process can be an effective tool in helping citizens understand the need for change and the reasons behind policy and political decisions. A budget also provides a means of establishing public accountability by offering residents a clear statement of how tax money is spent and proof that county finances are in good shape. Sources and Additional References Berman, David R., State-Local Relations: Devolution, Mandates and Money in The Municipal Year Book 1997 (Washington, DC: International City Management Association, 1997) Petersen, John E. and Stachota, Dennis R., Local Government Finance (Chicago, IL: Government Finance Officers Association of the United States and Canada, 1991) U.S. Advisory Commission on Intergovernmental Relations, State Laws Governing Local Government Structure and Administration, March 1993 (Washington DC: United States Government Printing Office, 1993) Revised July 2002 Association of Minnesota Counties 125 Charles Avenue Saint Paul, MN 55103-2108 Main Line/Switchboard: 651.224.3344 Fax: 651.224.6540 www.mncounties.org A publication of the Association of Minnesota Counties Page 42 of 74

County Fund Payable Proposed Proposed CPA Net CPA Adjusted Net Year Revenue Amt of % of Expenditure Amt of % of Property Amt of % of % of Amt of Property Amt of % of Amt of Property Amt of % of Budget Inc./(Dec.) Inc./(Dec.) Budget Inc./(Dec.) Inc./(Dec.) Tax Levy Inc./(Dec.) Inc./(Dec.) Tax Levy Distribution Tax Levy Inc./(Dec.) Inc./(Dec.) Unallotment Tax Levy Inc./(Dec.) Inc./(Dec.) (51,146) -1.920% 7,922,635 18,675 0.236% 5,310,186 69,821 1.332% 44.98% 164,484 5,145,702 72,354 0.0142615-5,145,702 72,354 1.426% 2013 2,663,595 (572,344) -17.687% 7,903,960 (500,346) -5.953% 5,240,365 71,998 1.393% 46.18% 167,017 5,073,348 37,142 0.738% - 5,073,348 (34,345) -0.672% 2012 3,235,939 (517,582) -13.789% 8,404,306 (1,128,198) -11.835% 5,168,367 (610,616) -10.566% 48.41% 132,161 5,036,206 (515,583) -9.287% 71,487 5,107,693 (590,224) -10.359% 2011 3,753,521 9,532,504 5,778,983 54.00% 227,194 5,551,789 146,128 5,697,917 General Revenue 2014 2,612,449 Public Works 2014 7,432,329 2,310,831 45.120% 11,699,916 2,546,305 27.817% 4,267,587 235,474 5.840% 36.15% 132,189 4,135,398 231,793 0.0593792-4,135,398 231,793 5.938% 2013 5,121,498 (51,422) -0.994% 9,153,611 535,674 6.216% 4,032,113 587,096 17.042% 35.533% 128,508 3,903,605 546,681 16.285% - 3,903,605 499,031 14.658% 2012 5,172,920 (151,464) -2.845% 8,617,937 270,979 3.246% 3,445,017 422,443 13.976% 32.265% 88,093 3,356,924 453,179 15.607% 47,650 3,404,574 424,400 14.241% 2011 5,324,384 8,346,958 3,022,574 28.245% 118,829 2,903,745 76,429 2,980,174 Public Health & 2014 4,034,461 231,780 6.095% 6,262,679 384,888 6.548% 2,228,218 153,108 7.378% 18.87% 69,020 2,159,198 150,225 0.0747768 0 2,159,198 150,225 7.478% Human Services 2013 3,802,681 (471,381) -11.029% 5,877,791 (460,022) -7.258% 2,075,110 11,359 0.550% 18.287% 66,136 2,008,974 (2,005) -0.100% - 2,008,974 (30,550) -1.498% 2012 4,274,062 1,940,588 83.163% 6,337,813 2,104,615 49.717% 2,063,751 164,027 8.634% 19.329% 52,772 2,010,979 185,940 10.188% 28,545 2,039,524 166,449 8.886% 2011 2,333,474 4,233,198 1,899,724 17.752% 74,685 1,825,039 48,036 1,873,075 25,885,230 11,805,991 100.000% 365,693 11,440,298-11,440,298 2013 11,587,774 22,935,362 11,347,588 100.00% 361,661 10,985,927-10,985,927 2012 12,682,921 23,360,056 10,677,135 100.00% 273,026 10,404,109 147,682 10,551,791 2011 11,411,379 22,112,660 10,701,281 100.00% 420,708 10,280,573 270,593 10,551,166 Sub-Total: 2014 14,079,239 Proposed 2014 PROPERTY TAX LEVY AND COUNTY PROGRAM AID (CPA) DISTRIBUTION Debt Service 2014 - - #DIV/0! 248,840 (23,660) -8.68% 248,840 (23,660) -8.68% 248,840 (23,660) -8.68% 248,840 (23,660) -8.68% 2013 - - #DIV/0! 272,500 (1,120) -0.41% 272,500 (1,120) -0.41% 272,500 (1,120) -0.41% 272,500 (1,120) -0.41% 2012 - - #DIV/0! 273,620 (625) -0.23% 273,620 (625) -0.23% 273,620 (625) -0.23% 273,620 (625) -0.23% 2011-274,245 274,245 274,245 274,245 Total All Funds 2014 14,079,239 2,491,465 21.501% 26,134,070 2,926,208 12.609% 12,054,831 434,743 3.741% 365,693 11,689,138 430,711 3.826% - 11,689,138 430,711 3.826% 2013 11,587,774 (1,095,147) -8.635% 23,207,862 (425,814) -1.802% 11,620,088 669,333 6.112% 361,661 11,258,427 580,698 5.438% - 11,258,427 433,016 4.000% 2012 12,682,921 1,271,542 11.143% 23,633,676 1,246,771 5.569% 10,950,755 (24,771) -0.226% 273,026 10,677,729 122,911 1.165% 147,682 10,825,411-0.000% 2011 11,411,379 22,386,905 10,975,526 420,708 10,554,818 270,593 10,825,411 SPECIAL LEVIES 2014 248,840 (23,660) -8.68% 2013 272,500 (1,120) -0.41% Sub-Total Special Levies - DEBT SERVICE 2012 273,620 (625) -0.23% 2011 274,245 2014 181,871 (1,847,248) -91.04% 2013 2,029,119 (39,973) -1.93% Sub-Total Special Levies - OTHER 2012 2,069,092 (205,101) -9.02% 2011 2,274,193 2014 430,711 (1,870,908) -81.29% 2013 2,301,619 (41,093) -1.75% TOTAL SPECIAL LEVIES 2012 2,342,712 (205,726) -8.07% 2011 2,548,438 2014 11,258,427 2,301,619 25.70% 2013 8,956,808 474,109 5.59% Adjusted Property Tax Levy "Subject to Levy Limitation" 2012 8,482,699 205,726 2.49% 2011 8,276,973 2014 11,258,427 #VALUE! #VALUE! 2013 N/A #VALUE! #VALUE! CERTIFIED PAYABLE LEVY LIMIT 2012 N/A #VALUE! #VALUE! 2011 8,492,095 2014-2013 #VALUE! Over/(Under) Levy Limit 2012 #VALUE! 2011 (215,122) S:\AUD\SHARED\Finance Administration\Budget\2014\Budget 2014 Property Tax Levy and County Program Aid Distribution Prepared by the Office of the Sibley County Auditor 12/4/2013 10:12 PM paper color: white Page 43 of 74

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Community/Economic Development 0.80% Non-Departmental 0.00% Conservation/Natural Resources 1.53% Sibley County 2014 Expenses by Function Public Works 44.77% Culture & Recreation 2.06% Health & Sanitation 6.81% Public Safety 10.04% General Government 15.04% Debt Services 0.95% Human Services 18.00% Adopted Adopted Adopted Proposed Expenditures 2011 Percent 2012 Percent 2013 Percent 2014 Percent INC/(DEC) % of inc/(dec) General Government 3,825,459 17.09% 4,057,325 17.17% 3,929,462 16.93% 3,930,661 15.04% 1,199 0.03% Public Safety 2,645,177 11.82% 2,575,398 10.90% 2,620,308 11.29% 2,622,968 10.04% 2,660 0.10% Health & Sanitation 1,885,826 8.42% 237,489 1.00% 1,716,620 7.40% 1,779,858 6.81% 63,238 3.68% Culture & Recreation 453,402 2.03% 457,711 1.94% 523,182 2.25% 538,763 2.06% 15,581 2.98% Conservation/Natural Resources 391,864 1.75% 389,615 1.65% 396,021 1.71% 400,681 1.53% 4,660 1.18% Community/Economic Development 330,776 1.48% 256,768 1.09% 233,913 1.01% 209,548 0.80% (24,365) -10.42% Non-Departmental - 0.00% 430,000 1.82% - 0.00% - 0.00% - #DIV/0! Public Works 8,346,958 37.29% 8,617,937 36.46% 9,153,611 39.44% 11,699,916 44.77% 2,546,305 27.82% Human Services 4,233,198 18.91% 6,337,813 26.82% 4,362,245 18.80% 4,702,835 18.00% 340,590 7.81% Debt Services 274,245 1.23% 273,620 1.16% 272,500 1.17% 248,840 0.95% (23,660) -8.68% Total Expenditures 22,386,905 100.00% 23,633,676 100.00% 23,207,862 100.00% 26,134,070 100.00% 2,926,208 12.61% 5.57% -1.80% 12.61% 12,000,000 11,500,000 11,000,000 10,500,000 10,000,000 9,500,000 9,000,000 8,500,000 8,000,000 7,500,000 7,000,000 6,500,000 6,000,000 5,500,000 5,000,000 4,500,000 4,000,000 3,500,000 3,000,000 2,500,000 2,000,000 1,500,000 1,000,000 500,000 - General Government Public Safety Health & Sanitation Culture & Recreation Conservation/Natural Resources Community/Economic Development Non-Departmental Public Works Human Services Debt Services 2011 2012 2013 2014 S:\AUD\SHARED\Finance Administration\Budget\2014\Budget 2014 Prepared by the Office of the Sibley County Auditor 12/4/2013 10:16 PM paper color: white Page 47 of 74

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General Revenue Fund Sibley County Expenses by Classification Adopted Adopted Adopted Proposed 2011 2012 2013 2014 INC/(DEC) Personal Services 5,401,125 3,955,167 4,140,109 4,224,668 84,559 Other Services & Charges 2,244,523 2,186,222 2,089,441 1,970,852 (118,589) Supplies 467,327 435,654 467,547 474,243 6,696 Capital Expenses 564,061 599,457 337,593 354,943 17,350 Appropriations & Pass Through Funding 850,351 794,217 856,362 897,929 41,567 Debt - - - - 0 Other Financing Uses 5,117 433,589 12,908 - (12,908) SUB-TOTAL: 9,532,504 8,404,306 7,903,960 7,922,635 18,675 6,000,000 5,000,000 4,000,000 3,000,000 2011 2012 2013 2014 2,000,000 1,000,000 - Personal Services Other Services & Charges Supplies Capital Expenses Appropriations & Pass Through Funding Debt Other Financing Uses S:\AUD\SHARED\Finance Administration\Budget\2014\Budget 2014 Prepared by the Office of the Sibley County Auditor 12/4/2013 10:27 PM paper color: white Page 49 of 74

Public Works Sibley County Expenses by Classification Adopted Adopted Adopted Proposed 2011 2012 2013 2014 INC/(DEC) Personal Services 1,727,789 1,664,710 1,683,435 1,700,522 17,087 Other Services & Charges 5,090,942 5,030,410 5,639,844 7,079,242 1,439,398 Supplies 669,200 748,750 828,810 805,633 (23,177) Capital Expenses 383,500 346,500 281,500 538,300 256,800 Appropriations & Pass Through Funding 277,527 653,567 666,022 1,475,219 809,197 Debt - - - - 0 Other Financing Uses 198,000 174,000 54,000 101,000 47,000 SUB-TOTAL: 8,346,958 8,617,937 9,153,611 11,699,916 2,546,305 8,000,000 7,000,000 6,000,000 5,000,000 4,000,000 2011 2012 2013 2014 3,000,000 2,000,000 1,000,000 - Personal Services Other Services & Charges Supplies Capital Expenses Appropriations & Pass Through Funding Debt Other Financing Uses S:\AUD\SHARED\Finance Administration\Budget\2014\Budget 2014 Prepared by the Office of the Sibley County Auditor 12/4/2013 10:27 PM paper color: white Page 50 of 74

Human Services Sibley County Expenses by Classification Adopted Adopted Adopted Proposed 2011 2012 2013 2014 INC/(DEC) Personal Services 2,030,400 3,467,270 3,449,772 3,723,430 273,658 Other Services & Charges 2,118,918 2,377,629 2,284,240 2,404,842 120,602 Supplies 29,440 141,207 104,379 99,707 (4,672) Capital Expenses - - - - 0 Appropriations & Pass Through Funding 54,440 41,707 39,400 34,700 (4,700) Debt - - - - 0 Other Financing Uses - 310,000 - - 0 SUB-TOTAL: 4,233,198 6,337,813 5,877,791 6,262,679 384,888 4,000,000 3,500,000 3,000,000 2,500,000 2,000,000 1,500,000 2011 2012 2013 2014 1,000,000 500,000 - Personal Services Other Services & Charges Supplies Capital Expenses Appropriations & Pass Through Funding Debt Other Financing Uses S:\AUD\SHARED\Finance Administration\Budget\2014\Budget 2014 Prepared by the Office of the Sibley County Auditor 12/4/2013 10:27 PM paper color: white Page 51 of 74

Debt Service Sibley County Expenses by Classification Adopted Adopted Adopted Proposed 2011 2012 2013 2014 INC/(DEC) Personal Services - - - - - Other Services & Charges 16,029 15,997 15,947 14,817 (1,130) Supplies - - - - 0 Capital Expenses - - - - 0 Appropriations & Pass Through Funding - - - - 0 Debt 258,216 257,623 256,553 234,023 (22,530) Other Financing Uses - - - - 0 SUB-TOTAL: 274,245 273,620 272,500 248,840 (23,660) 300,000 250,000 200,000 150,000 2011 2012 2013 2014 100,000 50,000 - Personal Services Other Services & Charges Supplies Capital Expenses Appropriations & Pass Through Funding Debt Other Financing Uses S:\AUD\SHARED\Finance Administration\Budget\2014\Budget 2014 Prepared by the Office of the Sibley County Auditor 12/4/2013 10:27 PM paper color: white Page 52 of 74

All Funds Sibley County Expenses by Classification Adopted Adopted Adopted Proposed 2011 2012 2013 2014 INC/(DEC) Personal Services 9,159,314 9,087,147 9,273,316 9,648,620 375,304 Other Services & Charges 9,470,412 9,610,258 10,029,472 11,469,753 1,440,281 Supplies 1,165,967 1,325,611 1,400,736 1,379,583 (21,153) Capital Expenses 947,561 945,957 619,093 893,243 274,150 Appropriations & Pass Through Funding 1,182,318 1,489,491 1,561,784 2,407,848 846,064 Debt 258,216 257,623 256,553 234,023 (22,530) Other Financing Uses 203,117 917,589 66,908 101,000 34,092 GRAND TOTAL: 22,386,905 23,633,676 23,207,862 26,134,070 2,926,208 14,000,000 12,000,000 10,000,000 8,000,000 6,000,000 2011 2012 2013 2014 4,000,000 2,000,000 - Personal Services Other Services & Charges Supplies Capital Expenses Appropriations & Pass Through Funding Debt Other Financing Uses S:\AUD\SHARED\Finance Administration\Budget\2014\Budget 2014 Prepared by the Office of the Sibley County Auditor 12/4/2013 10:27 PM paper color: white Page 53 of 74

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County Government Revenue A publication of the Association of Minnesota Counties In Minnesota, local governments derive the majority of their funding from property taxes and from state and federal grants. Fees, fines, forfeitures, sale of public lands, investments and special assessments are other sources that augment these major revenue sources. Property Tax The property tax is the chief source of revenue for Minnesota counties. Most counties receive between 30 and 50 percent of their revenues from property tax collections. All property except that owned by governments, churches, charitable institutions and certain other tax exempt entities, is subject to the ad valorem property tax. The ad valorem tax is based on the value of an undivided piece of property or building. Minnesota has one of the most complicated property tax systems in the nation. Property taxes are levied by counties, cities and school districts, and some special purpose taxing jurisdictions such as watershed districts. County commissioners have the power to raise the county property tax levy, i.e., the amount of money which homes, businesses and land within the county will pay, if additional income is needed to fund county programs and services. However, city and school district officials also levy taxes on property within the county. The state establishes the class rates, or the percentage of each property s market value subject to taxation. For example, the class rate for low value homes is 1.0 percent while the class rate for most commercial property is 3.4 percent (recently reduced from 4.0 percent). These class rates are one factor that makes Minnesota s property tax system so complex. State and Federal Grants Grants from the state and federal government are another large source of revenue for counties. Generally, these grants assist the county in providing and paying for mandated services. However, the amount of the grant is often insufficient to cover the full cost of services, and the county must supplement the state or federal revenues with local property tax dollars. Categorical aids and block grants are the two basic categories of grants. They differ primarily in terms of the amount of flexibility they offer the county board. Categorical aids are the most restrictive, with the money provided on the condition that it is spent to provide specific services. Often, the purpose of a categorical grant and the associated mandate is to increase spending for specific programs. Block grants provide the county board with greater flexibility in using the money. In fact, some block grants are intended to provide property tax relief by replacing local property tax dollars. The distinctions between categorical aids and property tax relief are not always clear. One of the larger aids to counties, the County State Aid Highway money, has characteristics of both a block grant and a categorical aid. It reduces the property tax cost for county highway maintenance, the money must be used for county highways, and there are specific requirements and highway standards that accompany the money. SOURCE: Minnesota County Finances; 2008 Revenues, Expenditures and Debt produced by the Minnesota Office of State Auditor. Page 55 of 74

County Program Aid In the 2003 legislative session, county general-purpose aids were restructured into a single program called County Program Aid ) CPA. The following individual aid programs were eliminated: homestead and agricultural aid credit (including manufactured housing HACA), county criminal justice aid, family preservation aid, and attached machinery aid. The formula for distributing county program aid encompasses some factors from the programs being subsumed, along with some new ones. One-half of the funding for county program aid is distributed based on each county s relative shares of (1) persons receiving food stamps, (2) age-adjusted population (population weighted more heavily for the number of persons over age 65), and (3) reported crimes. The other half is distributed based on a formula that takes into account each county s population and its property wealth. For 2004, approximately 112 million was distributed based on the distribution formulas of the aid programs that were eliminated, minus the substantial aid cuts enacted during the 2003 legislative session. For 2005 through 2008, about 205 million was distributed according to the new formula, with the aid cuts fully restored. The total amount of county program aid for taxes payable in 2007 is 205,382,792. This total is after subtraction of 500,000 to pay for court-ordered counsel and 214,000 to pay for preparation of local impact notes. SOURCE: The county program aid data was obtained from the Department of Revenue and appeared in Major State Aids and Taxes: A Comparative Analysis produced by the Minnesota House of Representatives Research Division, December 2009. Fees The law permits certain fees to be charged for services provided by various county departments. Counties charge fees for, among other things, examining the record for taxes due, serving and filing legal papers in court actions, and renewing licenses. Most of the money generated by these fees go into the county s general revenue fund. In some cases, fees are set to fully cover the cost of the related services. Counties, acting as an agent of the state, also collect fees set by the state. In some instances, such as for game and fish licenses, the law allows counties to keep a small portion of the fees collected when acting as an agent of the state. Other Revenue Sources Fines and forfeitures of bail money are paid into a county s general fund. Some of this money is shared with the State of Minnesota as payment for state takeovers of certain judicial districts. Counties can assess property owners with a special assessment if their property benefits from county-made improvements. Such special assessments account for a small amount of county revenue. Some counties have pursued an aggressive program of investing county funds not needed immediately and have yielded considerable returns on their investments. In most cases, the law requires that income from such investments be used to support county expenditures. Counties can also invest funds not currently needed for cash flow purposes (i.e., funds needed on hand to pay bills as they become due) in securities issued by the U.S. government, the State of Minnesota, or any political subdivision or municipality therein subject to certain conditions and repurchase agreements as laid out in Minnesota statute. Updated September 2010 125 Charles Avenue Saint Paul, MN 55103-2108 Main Line/Switchboard: 651.224.3344 Fax: 651.224.6540 www.mncounties.org A publication of the Association of Minnesota Counties Page 56 of 74

Sibley County 2014 Revenues By Source Local Taxes 44.73% Fees For Services 5.41% Interest Income 0.77% Use of Fund Balance 8.00% All other Sources 8.33% Federal/State Aids 32.76% Adopted Adopted Adopted Proposed Revenues: 2011 Percent 2012 Percent 2013 Percent 2014 Percent INC/(DEC) Federal/State Aids 7,977,747 35.64% 7,392,540 31.28% 8,332,954 35.91% 8,562,090 32.76% 229,136 2.75% Local Taxes 10,825,411 48.36% 10,825,411 45.81% 11,258,427 48.51% 11,689,138 44.73% 430,711 3.83% Fees For Services 1,449,119 6.47% 1,431,047 6.06% 1,243,052 5.36% 1,413,851 5.41% 170,799 13.74% Interest Income 332,465 1.49% 312,061 1.32% 236,639 1.02% 200,250 0.77% (36,389) -15.38% Use of Fund Balance 855,078 3.82% 1,820,464 7.70% 907,064 3.91% 2,090,907 8.00% 1,183,843 130.51% All other Sources 947,085 4.23% 1,852,153 7.84% 1,229,726 5.30% 2,177,834 8.33% 948,108 77.10% Total Revenue 22,386,905 100.00% 23,633,676 100.00% 23,207,862 100.00% 26,134,070 % of INC/(DEC) 100.00% 2,926,208 12.61% 5.57% -1.80% 12.61% 11,000,000 10,000,000 9,000,000 8,000,000 7,000,000 6,000,000 5,000,000 4,000,000 3,000,000 2,000,000 1,000,000 - Federal/State Aids Local Taxes Fees For Services Interest Income Use of Fund Balance All other Sources 2011 2012 2013 2014 S:\AUD\SHARED\Finance Administration\Budget\2014\Budget 2014 Prepared by the Office of the Sibley County Auditor 12/4/2013 10:20 PM paper color: white Page 57 of 74

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Sibley County Revenues by Classification Adopted 2011 GENERAL REVENUE FUND Property Taxes (includes DRA) All Other Taxes Special Assessments Licenses & Permits Federal Grants Local Grants County Aid Program State Grants Charges for Services Fines & Forfeits Interest on Investments Miscellaneous Revenues Other Financing Sources Transfers from Other Funds Use of Fund Balance SUB-TOTAL: Adopted 2012 5,697,917 47,500 130,000 33,500 213,424 418,410 81,066 545,780 1,261,500 35,370 332,465 209,320 4,000 5,117 517,135 9,532,504 5,107,693 47,500 130,000 23,780 89,000 187,478 60,674 181,596 792,110 35,400 312,061 206,500 2,000 125,117 1,103,397 8,404,306 Adopted 2013 5,073,348 82,500 134,000 28,380 96,500 188,378 167,017 217,851 749,945 35,900 236,639 247,766 2,000 12,908 630,828 7,903,960 Proposed 2014 5,145,702 82,500 134,000 23,380 96,500 178,868 164,484 196,341 779,840 36,120 200,250 213,125 2,000 669,525 7,922,635 INC/(DEC) 72,354 0 0 (5,000) 0 (9,510) (2,533) (21,510) 29,895 220 (36,389) (34,641) 0 (12,908) 38,697 18,675 6,000,000 5,000,000 4,000,000 2011 2012 3,000,000 2013 2014 2,000,000 1,000,000 - S:\AUD\SHARED\Finance Administration\Budget\2014\Budget 2014 Prepared by the Office of the Sibley County Auditor 12/4/2013 10:36 PM paper color: white Page 59 of 74

Sibley County Revenues by Classification Adopted 2011 PUBLIC WORKS FUND Property Taxes (includes DRA) All Other Taxes Special Assessments Licenses & Permits Federal Grants Local Grants County Aid Program State Grants Charges for Services Fines & Forfeits Interest on Investments Miscellaneous Revenues Other Financing Sources Transfers from Other Funds Use of Fund Balance SUB-TOTAL: Adopted 2012 2,980,174 83,000 475,000 3,216,674 42,400 940,253 63,219 73,795 134,500 337,943 8,346,958 3,404,574 94,000 3,583,610 40,443 240,000 152,015 74,295 89,000 820,000 120,000 8,617,937 Adopted 2013 3,903,605 130,400 3,597,944 128,508 969,080 99,247 94,327 30,500 200,000 9,153,611 Proposed 2014 4,135,398 94,000 950,000 2,595,133 132,189 1,129,578 88,611 74,706 35,500 1,286,801 1,178,000 11,699,916 INC/(DEC) 231,793 (36,400) 950,000 (1,002,811) 3,681 160,498 (10,636) (19,621) 5,000 1,086,801 1,178,000 2,546,305 4,500,000 4,000,000 3,500,000 3,000,000 2011 2,500,000 2012 2013 2,000,000 2014 1,500,000 1,000,000 500,000 - S:\AUD\SHARED\Finance Administration\Budget\2014\Budget 2014 Prepared by the Office of the Sibley County Auditor 12/4/2013 10:36 PM paper color: white Page 60 of 74

Sibley County Revenues by Classification Adopted 2011 HUMAN SERVICES FUND Property Taxes (includes DRA) All Other Taxes Special Assessments Licenses & Permits Federal Grants Local Grants County Aid Program State Grants Charges for Services Fines & Forfeits Interest on Investments Miscellaneous Revenues Other Financing Sources Transfers from Other Funds Use of Fund Balance SUB-TOTAL: Adopted 2012 1,873,075 852,283 374,290 26,649 791,518 124,400 190,983 4,233,198 2,039,524 1,033,927 637,404 24,227 1,314,181 486,922 204,561 597,067 6,337,813 Adopted 2013 2,008,974 22,400 1,297,338 531,735 66,136 1,072,467 393,860 208,645 276,236 5,877,791 Proposed 2014 2,159,198 1,372,115 624,049 69,020 1,053,813 545,400 195,702 243,382 6,262,679 INC/(DEC) 150,225 (22,400) 0 0 74,777 92,314 2,883 (18,654) 151,540 0 0 (12,943) 0 0 (32,854) 384,888 2,500,000 2,000,000 2011 1,500,000 2012 2013 2014 1,000,000 500,000 - S:\AUD\SHARED\Finance Administration\Budget\2014\Budget 2014 Prepared by the Office of the Sibley County Auditor 12/4/2013 10:36 PM paper color: white Page 61 of 74

Sibley County Revenues by Classification Adopted 2011 DEBT SERVICE FUND Property Taxes (includes DRA) All Other Taxes Special Assessments Licenses & Permits Federal Grants Local Grants County Aid Program State Grants Charges for Services Fines & Forfeits Interest on Investments Miscellaneous Revenues Other Financing Sources Transfers from Other Funds Use of Fund Balance SUB-TOTAL: Adopted 2012 274,245 274,245 273,620 273,620 Adopted 2013 272,500 272,500 Proposed 2014 248,840 248,840 INC/(DEC) (23,660) 0 0 0 0 0 0 0 0 0 0 0 0 0 0 (23,660) 300,000 250,000 200,000 2011 2012 2013 150,000 2014 100,000 50,000 - S:\AUD\SHARED\Finance Administration\Budget\2014\Budget 2014 Prepared by the Office of the Sibley County Auditor 12/4/2013 10:36 PM paper color: white Page 62 of 74

Sibley County Revenues by Classification Adopted 2011 ALL FUNDS Property Taxes (includes DRA) All Other Taxes Special Assessments Licenses & Permits Federal Grants Local Grants County Aid Program State Grants Charges for Services Fines & Forfeits Interest on Investments Miscellaneous Revenues Other Financing Sources Transfers from Other Funds Use of Fund Balance GRAND TOTAL: Adopted 2012 10,825,411 130,500 130,000 33,500 1,540,707 4,009,374 150,115 2,277,551 1,449,119 35,370 332,465 474,098 138,500 5,117 855,078 22,386,905 10,825,411 141,500 130,000 23,780 1,122,927 4,408,492 125,344 1,735,777 1,431,047 35,400 312,061 485,356 91,000 945,117 1,820,464 23,633,676 Adopted 2013 11,258,427 235,300 134,000 28,380 1,393,838 4,318,057 361,661 2,259,398 1,243,052 35,900 236,639 550,738 32,500 212,908 907,064 23,207,862 Proposed 2014 11,689,138 176,500 134,000 23,380 2,418,615 3,398,050 365,693 2,379,732 1,413,851 36,120 200,250 483,533 37,500 1,286,801 2,090,907 26,134,070 INC/(DEC) 430,711 (58,800) 0 (5,000) 1,024,777 (920,007) 4,032 120,334 170,799 220 (36,389) (67,205) 5,000 1,073,893 1,183,843 2,926,208 14,000,000 12,000,000 10,000,000 2011 8,000,000 2012 2013 2014 6,000,000 4,000,000 2,000,000 - S:\AUD\SHARED\Finance Administration\Budget\2014\Budget 2014 Prepared by the Office of the Sibley County Auditor 12/4/2013 10:36 PM paper color: white Page 63 of 74

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Debt Management for Counties A publication of the Association of Minnesota Counties By Jim Culotta, Research Assistant, National Association of Counties (NACo) The act of borrowing, obtaining funds today in exchange for a promise to pay them back tomorrow, is one of the most potent and profound activities undertaken in government finance. In recent years, counties have increasingly turned toward the issuance of debt to help finance basic infrastructure projects, such as schools, roads, and hospitals. A poorly designed or poorly managed bond issue can burden taxpayers with excess interest costs over the life of the issue. For this reason, it is more critical than ever that counties effectively manage their debt. Debt Policy: An Important Financial Management Tool A formal debt policy is an essential part of effective financial management and should be incorporated into a county s capital improvement program. There are several reasons to establish a debt policy. First, it establishes the parameters for the issuance of debt, which help prevent exceeding acceptable levels of indebtedness. Second, debt policies give investors and rating agencies evidence of the county s commitment to sound financial management. Third, debt policies provide consistency and continuity for public policy development and help guide county decision makers. The Government Finance Officers Association (GFOA) recommends that all state and local governments intending to issue debt develop a comprehensive debt policy. A debt policy should include the following elements: Purposes for which debt may be issued. Legal debt limitations, or limitations established by policy. Use of moral obligation pledges. Types of debt permitted to be issued and criteria for issuance. Structural features that may be considered. Credit objectives. Method of sale. Selection of external financial professionals. Refunding of debt. Disclosure (primary and secondary market). Compliance with federal tax law provisions, including arbitrage requirements. Integration of capital planning and debt financing activities. Investment of bond proceeds where otherwise not covered by explicit written law or written investment policy. In order to be an effective management tool, debt policy provisions must be compatible with the jurisdiction s goals pertaining to the capital program and budget, the financial plan, and the operating budget. It is important to find the appropriate balance between establishing limits on the debt program and providing sufficient flexibility to respond to unforeseen circumstances and opportunities. The debt policy should be formally adopted by the county board and continuously monitored to ensure compliance. Analyzing Debt Capacity and Establishing Debt Limits When a county issues bonds, it enters into a long-term commitment that requires it to make timely principal and interest payments over the life of the bonds. Therefore, the county needs to ensure that future debt service payments to bondholders can be made on time, without jeopardizing essential county services. A comprehensive and routine analysis of debt capacity provides assurance that the amount of debt issues by the county is affordable and cost-effective. An analysis of debt capacity should cover the following range of factors: Statutory or constitutional limitations affecting the amount that can be issued. Other legal limitations, such as coverage requirements or additional bonds tests imposed by bond covenants. Measures of the tax and revenue base. Evaluation of trends relating to the county s financial performance. Debt service obligations. Measures of debt burden on the community. Tax-exempt market factors affecting interest costs. Bond Ratings When a county borrows money by selling bonds, the most important variable that determines the interest cost of the bonds is their bond rating. Bond ratings are an assessment of credit quality or, conversely, the risk that the borrower will not make scheduled payments of principal and interest. Rating agencies base their ratings on a number of key economic, debt, financial and governmental factors. Economic Factors Rating agencies focus on major employers and taxpayers, regional economic factors, the impact of national and international economic developments on the local economy, and demographic data regarding the county s population (such as per capita income, average age, educational attainment, etc.). Debt Factors Rating agencies evaluate debt per capital, debt as a percentage of the assessed value of property, debt service as a percentage of annual revenues, payout rate, use of short term or variable rate debt, authorized but unissued debt and the legal structure of the issue s security. Page 65 of 74

Financial Factors Rating agencies analyze the county s comprehensive annual financial reports, annual budgets, revenue and expenditure composition and growth rates, accounting methods, contingent obligations (such as pension liabilities), intergovernmental transfers, and cash liquidity levels. Administrative Factors Rating agencies assess the county s management professionalism, ability to respond to economic adversity, willingness of elected officials to make unpopular financial decisions, the county s state objectives related to debt management, economic development activities, tax policies, capital improvement planning, employee relationships (e.g. unions), and the county s willingness to adhere to long-range financial plans. Major Forms of Debt Securities General Obligation (GO) Bonds are the most common form of debt issuance by state and local governments. These securities are commonly referred to as full-faith-and credit bonds because they are based on the pledge of a government unit to levy the necessary taxes to pay the interest and retire the principal. Unlimited-tax GO bonds legally obligate the county to levy taxes on all assessed property within its jurisdiction at whatever level necessary to meet the debt service payments. Limited-tax GO bonds are backed only by special taxes such as a sales tax; others are backed only by specific revenue sources. Historically, voter approval has been required to authorize the issuance of GO bonds. However, a growing number of jurisdictions have been given authority to issue limited amounts of GO bonds without referendum. Revenue Bonds are limited-liability obligations. The security for revenue bond issues is provided by a pledge of a specific revenue stream - usually derived from the project being funded or the enterprise system of which the project is a part. This ensures equitable distribution of the debt burden. These bonds are not backed by the taxing power, and as a result, they are not included in the usual debt limits. Unlike GO bonds, revenue bonds typically do not require voter approval. Certificates of Participation (COP) are a form of lease obligation in which the county enters into an agreement to pay a fixed amount annually to a third party, usually a nonprofit agency or a private leasing company. Otherwise, they do what municipal bonds do: They raise money to acquire equipment or construct a facility. According to municipal finance experts, almost anything can be engineered for lease. COPs do not need voter approval, and they do not generally count toward a jurisdiction s debt volume limitations. Payments are subject to annual appropriations. However, COPs are not permissible in all states, and they are generally more expensive to issue than bonds due to the involvement of a third party. More importantly, COPs are considered riskier investments because government can, in any given year, negate a lease contract without being considered in default. As a result, investors often require higher interest rates. Investment Grade Rating Designations of Major Rating Agencies Investment Grade Category Fitch Moody s Standard & Poor s Highest Quality AAA Aaa AAA Very high quality AA Aa AA High or strong quality A A A Adequate or satisfactory quality BBB Baa BBB Note: Fitch and Standard & Poor s use + and - to indicate relative quality with a major category. Moody s indicates better quality within a category by the symbols Aa1, A1 and Baa1. How To Win A Bond Referendum Most capital finance experts agree that bond referendums are risky business. This helps explain why a growing number of local officials are turning to COPs and other bond alternatives that do not require voter approval. However, bonds remain the basic means of raising money for capital improvements. When the voters say no to a bond referendum, more than a worthwhile infrastructure project my be at stake. A county s bond rating may be downgraded if county officials can t deliver the votes most of the time. The following are a few tips for a successful bond referendum campaign: Start off with a clearly defined statement of purpose - why the project that will be bond-financed is necessary. Get your voters attention and educate them on the issue. Meet with the news media early and often to gain their support and free publicity. Develop a good track record by promising only what you can deliver. Finance the bond campaign adequately by tapping funds from private industries and county government agencies affected by the bond, if allowable by law. Internet Resources Fitch Investors Service, L.P. (http://www.fitchinv.com) Moody s Investors Service (http://www.moodys.com) Standard & Poor s Rating Services (http://www.standardpoor.com) Government Finance Officers Association (http://www.gfoa.org) U.S. Securities and Exchange Commission (http://www.sec.gov) Municipal Securities Rulemaking Board (http://ww1.msrb.org) The Bond Buyer (http://www.bondbuyer.com) Revised July 2002 Association of Minnesota Counties 125 Charles Avenue Saint Paul, MN 55103-2108 Main Line/Switchboard: 651.224.3344 Fax: 651.224.6540 www.mncounties.org A publication of the Association of Minnesota Counties Page 66 of 74

SIBLEY COUNTY STATEMENT OF CHANGES IN LONG-TERM LIABILITIES DECEMBER 31, 2012 Type of Indebtedness Date of Issue Maturity Date: Interest Rate Outstanding January 01 Issued in 2012 Paid in 2012 Outstanding December 31 Due Within One Year General Obligation Bonds 2012B Capital Improvement Refunding Bonds December 4, 2012 March 1, 2021 1.07% 2,120,000 1,800,000 180,000 3,740,000 1,940,000 Total General Obligation: 2,120,000 1,800,000 180,000 3,740,000 1,940,000 General Obligation Special Assessment Bonds 2012A Drainage Ditch GO Refunded Bonds (JD LAT 1,2,3, & 4) January 26, 2012 January 31, 2017 1.78% 120,000 105,000 120,000 105,000 25,000 2012A Watershed District GO Refunded Bonds (High Project #11) January 26, 2012 January 31, 2023 1.78% 555,000 540,000 555,000 540,000 45,000 Less: Discounts (32,367) - (3,237) (29,130) - Plus: Premium - 2,069 175 1,894 - Total General Obligation Special Assessment Bonds: 642,633 647,069 671,938 617,764 70,000 Total Bonds Payable: 2,762,633 2,447,069 851,938 4,357,764 2,010,000 General Obligation Revenue Note County Wide Individual Sewage Treatment System I August 1, 2001 January 30, 2021 0.00% 93,300-10,330 82,970 10,330 Total General Obligation Special Assessment Bonds: 93,300-10,330 82,970 10,330 Minnesota Pollution Control Agency Loans MnPCA Loan - High Island Creek I November 18, 2004 May 31, 2017 2.00% 163,138-25,855 137,283 26,375 MnPCA Loan - High Island Creek II November 13, 2007 2.00% 352,980 14,973 33,589 334,364 34,264 MnPCA Loan - Rush River Creek I July 24, 2006 May 31, 2018 2.00% 178,419-25,969 152,450 26,491 MnPCA Loan - Rush River Creek II December 1, 2007 2.00% 552,906 24,711 52,728 524,889 53,787 MnPCA Loan - Buffalo Creek I December 17, 2007 December 15, 2019 2.00% 36,908-4,426 32,482 4,514 MnPCA Loan - Buffalo Creek II 2.00% 22,412 1,090-23,502 - MnPCA Loan - Middle Minnesota I July 10, 2007 2.00% 22,719 751 2,266 21,204 2,313 MnPCA Loan - Middle Minnesota II February 8, 2011 2.00% 26,568 15,431-41,999 - MnPCA Loan - Bevens Silver Creek March 22, 2006 2.00% 69,133 42,231-111,364 - Minnesota Department of Agriculture Loans Department of Ag - Sibley County SSTS Program March 12, 2012 2.00% - 384,382-384,382 - Total Minnesota Pollution Control Agency Loans: 1,425,183 483,569 144,833 1,763,919 147,744.00 Total Bonded & Notes Payable: 4,281,116 2,930,638 1,007,101 6,204,653 Compensated Absences: 1,019,751 48,387 57,654 1,010,484 272,831 Net OPEB Obligation - Non-current 138,284 43,101-181,385 Governmental Activates Long-Term Liabilities: 5,439,151 3,022,126 1,064,755 7,396,522 2,440,905 Page 67 of 74

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Who Does What? A GUIDE TO MINNESOTA S PROPERTY TAX SYSTEM ASSESSOR Locates the property to be taxed, estimates its market value (how much the property would sell for in today s market), and assigns it to a class according to its use. Sends out notices in the spring to all property owners. Multiplies the estimated market value of each piece of property by the tax capacity percentage set by law for its class. The result is the tax capacity. Adds together the tax capacities for all the property in the taxing district and gives the total to: Property owners who disagree with the assessor may appeal to: BOARDS OF APPEAL AND EQUALIZATION CITY OR TOWNSHIP BOARD OF APPEAL AND EQUALIZATION: The city council or township board. Meets between April 1 and May 31. COUNTY BOARD OF EQUALIZATION: County board of commissioners. Meets for two weeks in June. STATE BOARD OF EQUALIZATION: Commissioner of Revenue. Meets between April 15 and June 30. The review board may change the estimate of the market value of the classification. MINNESOTA TAX COURT: Small claims or regular division. TAXING DISTRICTS (YOUR SCHOOL DISTRICT, CITY OR TOWNSHIP, COUNTY, ETC.) Determine the services (such as street maintenance, fire and police protection) to be provided in the coming year. Estimate the costs of those services and determine what portion will come from property taxes. Prepare proposed budget/levy amounts Send final levy amounts to: Hold Truth-in-Taxation (TnT) hearings on budgets (if required by state law). Send final levy amounts to: FINANCE DEPARTMENT AUDITOR/TREASURER Determines the tax capacity rates and also uses the state general tax rate by dividing the proposed levy by the proposed total amount of tax capacity in the taxing district. Auditor uses state general tax rate to compute taxes (certified by the Commissioner of MN Dept. of Revenue). Calculates the amount of each property owner s proposed state paid credits and net tax amount. Prepares TnT notice and mails to each taxpayer. Recalculates the amount of each property owner s tax based upon the final levy amounts. Prepares a listing of the tax on all property owners in the county and gives the list to: Creates the property tax statements from the county tax lists. Mails the statements by March 31 of the following year. Property owners mail in their payments (due in two installments on May 15 and October 15; except that the second installment of taxes on agricultural property is due on November 15). A A publication of of the Association of of Minnesota Counties Page 69 of 74

Do You Think Your Property is Over-Assessed? THE DIAGRAM BELOW SHOWS THE STEPS IN CONTESTING YOUR PROPERTY VALUATION: VISIT YOUR LOCAL ASSESSOR S OFFICE Check the facts. Compare neighboring property values. Seek an adjustment. 3-STEP APPEAL 1-STEP APPEAL APPEAL TO CITY OR TOWNSHIP BOARD OF REVIEW Meets in April or May. Appeals in person or by letter. Call city or township clerk for appointment. APPEAL TO COUNTY BOARD OF EQUALIZATION Meets for two weeks in June. Appeal in person or by letter. Call county auditor or assessor for appointment. APPEAL TO MINNESOTA TAX COURT Appeal by April 30 of year following assessment. REGULAR DIVISION Attorney recommended. Decisions appealable to Supreme Court. Can be used for any property. Must be used for property assessed over 100,000. SMALL CLAIMS DIVISION Attorney not necessary. Decisions are final. Use for your home, or any property assessed under 100,000. A publication of the Association of Minnesota Counties Page 70 of 74

Property Tax Classification Rates 2011 Property Type 11 Class Rate Tax Code (a) Disabled Homestead up to 50,000 (b) 0.45 R Residential Homestead (b) Up to 500,000 1.0% R Over 500,000 1.25 R Residential Nonhomestead Single unit: Up to 500,000 1.0 R Over 500,000 1.25 R 2-3 unit and vacant land 1.25 R Apartments (4 or more units) 1.25 R Low-income apartments 0.75 R Agricultural Homestead House, garage, and one acre (HGA) (c) (c) Other land and buildings: Up to 1,140,000 (d) 0.5 Over 1,140,000 (d) 1.0 Agricultural Nonhomestead 1.0 Rural Vacant Land Nonhomestead 1.0 Managed Forest Land 0.65 Commercial-Industrial-Public Utility Electric generation machinery 2.0 R Other: Up to 150,000 1.5 S1, R Over 150,000 2.0 S1, R Seasonal-Recreational-Residential Up to 500,000 1.0 S2 Over 500,000 1.25 S2 Property Type 11 Class Rate Tax Code (a) Seasonal-Recreational-Commercial Homestead resorts (1c): Up to 500,000 R 500,000-2,200,000 R Over 2,200,000 S2, R Up to 600,000 0.5 R 600,000-2,300,000 1.0 R Over 2,300,000 1.25 S2, R Seasonal resorts (4c): Up to 500,000 1.0 S2, R Over 500,000 1.25 S2, R Homestead bed and breakfasts (first 5 1.25 R units) Miscellaneous Properties Golf courses (open to the public) 1.25 R Nonprofit service organizations 1.5 R (nonrevenue) Nonprofit service organizations 1.5 S2, R (donations) (e) Fraternity/sorority houses 1.0 Manufactured home park land (>50% 0.75 R owner-occupied) Manufactured home park land (<50% 1.0 R owner-occupied) Metro indoor rec. facilities 1.25 R Noncommercial aircraft hangars 1.5 R Seasonal restaurants on lake 1.25 R Market Value Homestead Credit (f) Rate 0.4% Maximum 304 Phase-out rate 0.09% Market Value Agricultural Credit (g) Rate 0.3% Maximum 345 Phase-out rate 0.05% (a) Tax Codes: S1=Subject to state general levy (commercial-industrial rate); S2=Subject to state general levy (seasonal-recreational rate); R=Subject to operating referenda (all property is subject to school bond referenda) (b) Homesteads of disabled veterans have 300,000 of market value excluded if the disability is permanent and total (100 percent), or 150,000 excluded otherwise, provided that the disability is rated 70 percent or higher. Properties receiving a market value exclusion do not qualify for the disabled homestead classification rate. (c) Same as residential homestead. (d) The first-tier valuation limit for agricultural homestead property is annually adjusted by the Commissioner of Revenue. It was set to 1,140,000 for taxes payable in 2011, and then indexed to the change in the statewide average taxable market value per acre of deeded farmland. (e) Nonprofit service organizations that generate revenue qualify for this classification by making charitable donations at least equal to the previous year s property taxes and making the facility available for public meetings at no charge. (f) Due to the phase-out provision, homesteads valued above 414,000 receive no credit. (g) The phase-out rate reduces the credit, but will not reduce it below 230. More information on Property Taxes can be found on the Minnesota House of Representatives Research Department web site at http://www.house.leg.state.mn.us/hrd/topics.asp?topic=21 A publication of the Association of Minnesota Counties Page 71 of 74