The Rushford Peterson Chamber of Commerce held a meeting Thursday, March 23, open to the public and attended by more than 20 individuals representing a number of municipalities, businesses, and organizations. The meeting was geared towards highlighting property sales and trends, as well as taxes and assessments for properties within the tri-county area.
Fillmore County Assessor Cindy Blagsvedt started off the morning’s discussion by delving into annual sales, ratios, and five-year trends on residential, commercial, and agricultural land sales in Fillmore County. The data ran for a one-year period beginning October 1, 2015 for taxes payable in 2018.
In looking at the three communities that encompass the Rushford Peterson Valley, Blagsvedt explained that Estimated Market Value is based on sales and mass appraisal. “We have to look at all sales; the whole of taxing districts, including commercial, agricultural, rural vacant land, and residential.” The median ratio is then determined by dividing the estimated market value of sales by the net sales price of all sales. Department of Revenue guidelines for those ratios are within 90-105%.
Peterson market values are low, according to Blagsvedt, who cited three sales. The Department of Revenue applied a 14% annual trend to Peterson sale prices based on these market conditions. According to Blagsvedt, this equates to more value to sale prices and was applied from January 2015 to September 2016 and adjusted to January 2, 2017. “We will have to watch it over a five-year history,” she explained.
For the City of Rushford Village, where there were eight residential sales, Blagsvedt indicated an increase in values is needed, due to a low 76% median ratio. “We’re going to have to take a closer look and see if we’re missing something with the values,” added Blagsvedt. The similar Department of Revenue trend of 7% was applied to the Village.
Rushford saw 20 residental sales and saw no change to its median sales ratio of 96%.
When looking at commercial values for the year, there were no noticeable changes, having been up 15% the previous year. For commercial properties, a gradual limited market value used to help businesses with value adjustments. However, there is no longer a limit on those value changes, which can mean a big hit for businesses.
Agricultural land is divided into agricultural unimproved and improved, with unimproved further divided into land sales over 34.5 acres and less than that threshold. Ratios for tillable, pasture, and woods all appear okay, but wasteland is low and will have to be adjusted to get the combined 89% median ratio up at least a point to the 90% minimum. In land over 34.5 acres; Blagsvedt said all townships will get an increase.
Sales of improved agricultural land are rising. Averages per acre are right around $2,900 for pasture, $2,400 for woodland, $1,200 for wasteland, and tillable sales easily top the group at $5,300-7,100.
Blagsvedt continued with a breakdown of taxable market value, classification rates, and tax capacity. The formulas have a variety of rules, thresholds, and calculations that determine levy rates, state tax, and final tax for properties. Items that impact the tax rates are far ranging and are often unseen or misunderstood by property owners. They include sales, classifications, increases in classes, new construction, changes in exclusions, budgets or each jurisdiction (cities, townships, schools, counties, and special districts), and other changes at the state level, among other things. “There are a lot of factors involved,” added Blagsvedt, wrapping up her presentation.
Winona County Recorder Bob Bambenek was also a scheduled speaker at the meeting and covered further sales data, comparing local statistics with regional and statewide data. “I want to focus on current sales in 2016 and what we’re seeing,” said Bambenek. “We’ve come full circle since the 2008 downturn. There is little for sale and it’s selling considerably above the county market values.” He went on to add that some properties went “sky high”, resulting in bid-offs. The significant shortage of residential properties can be attributed to both interest rates and buyers finding exactly what they’ve been looking for. Property in townships along the Highway 43 corridor have seen far less change, being more conservative in sales, but the sales trend is continuing.
Increases in commercial and agricultural land, in some cases at unprecedented numbers, are also continuing. The number of buyers planning construction on agricultural or recreational land is also positive, according to Bambenek. “Fillmore County is a softer area, but the interest is there,” he explained. “There are diverse buyers. It’s part of a trend that has to be looked at.” Bambenek also alluded to some shifts in taxing entities. Typically, rural property owners see the schools as the highest, followed by the county and township. Urban property owners typically see the municipality as the highest tax levy demand, followed by the school and county. “We’ll have to see where that’s all going to come out,” he added.