Faribault County assessor Brady Rauenhorst was at the Blue Earth meeting on April 14.

Community members from across the city of Blue Earth showed up to discuss the changes to their 2026 property taxes at the Local Board of Appeals and Equalization meeting on Monday, April 14.

County assessor Brady Rauenhorst presented the board with an overview of the property sales and median sales ratios (MSR) for the city of Blue Earth.

“There were 39 sales of residential properties in Blue Earth over the last year, and our MSR was 99.7 percent,” Rauenhorst explained. “Apartment and commercial sales were calculated on a county-wide basis, as our town does not have enough sales in a year to calculate these percentages with just us. Apartments had a MSR of 95.05 percent, and commercial properties had a MSR of 94.33 percent. The Minnesota Department of Revenues requires us to be between 90-105 percent, so we’ve hit our goals there.”

Following this explanation, the meeting was opened for public comment from the community. The first person to come forward was Kevin Krieger of Blue Earth Tire, who sought to contest the valuation of parcel 21.693.1060 (327 Main St.) and the tax rate increase.

“I noticed that the estimated value of my property has increased from $149,200 in 2025 to $158,000 in 2026, which is an increase of 6.5 percent,” Krieger shared. “I would like to contest this, as I believe there has been no appreciable improvements to the property in that time.”

“The big increase on your property valuation came last year, as we re-appraised the commercial and industrial properties of Blue Earth a few summers ago because they hadn’t been updated for the last 15-20 years,” Rauenhorst replied. “We’ve also had a couple of auto shops sell over the last 4-5 years, and even with the increases, your shop is still coming in low compared to what some of the others have sold for.”

“I understand that property values have gone up across Blue Earth in the last few years, but if the city and county were negligent in failing to raise my property values over the years, that’s not my fault,” Kreiger remarked. “I also don’t think that high sale prices should be used to determine the property tax of similar businesses – that’s not good policy.”

Mayor Rick Scholtes inquired of Rauenhorst what the appropriate next steps would be for Krieger if he wanted to continue disputing the value of his property.

“He can come to the County Board with this issue, and I would recommend he does, as his is a unique case,” Rauenhorst replied.

Hearing no further discussion, the comment period for Krieger’s property was closed.

Dave Classon came forward with a question about the property value for parcel 21.552.0030 (1116 South Ramsey St.).

“The value of the property is noticeably higher than the property of our neighbors to the north, which is almost the same as ours: it’s set up the same way, and the only main difference is that ours has a sun room added on to the back,” Classon explained. “We had the county assessors do an evaluation of both properties, and their response is that our house is valued above average, while the one to the north is valued below average.”

“The 2025 value for the house is $146,100, and the estimated value of the house for 2026 is $163,900 – that’s an increase of $12,000 in the course of a single year,” Mayor Scholtes commented. “It seems weird that a house can increase that much in value after a year of doing nothing just to stay in line with state-mandated percentages.”

Board member Ann Hanna asked how the recent increases to property values in the previous years impacted the city’s compliance with the state guidelines.

“With residential property values increasing two years ago, and the commercial ones increasing last year, are we in better compliance with the state now, or will there continue to be issues?” Hanna asked.

“No, we’re in better compliance with the state guidelines now,” Rauenhorst replied. “We’ve been playing catch-up from all of the years where property values sat stagnant.”

After some more discussion, board member John Huisman commented that he would like to adjust the value of the property, but was unsure how that would impact Classon’s taxes.

“If you change the assessment value of a property, does that change the tax levy?” Huisman asked.

“No, the levy is through the city – all we can change is the estimated value,” Scholtes answered.

Scholtes also provided the board with an explanation for how adjusting the estimated value of a home would impact future tax years, using Classen’s property as an example.

“This year, for 2025, Classon’s taxes will be set at the original property value of $146,600,” Scholtes explained. “In the fall, when the city resets the tax levy, the value will increase to $152,300 effective Jan. 1 2026, which is what we’re going to set it to now. When the tax form comes around in March 2026, the value will increase again to the current proposed value of 163,900, which will take effect for Jan. 2027.”

Following this explanation, a motion was made and seconded to adjust the value of parcel 21.552.0030 to $152,300 for the 2026 tax year. The motion was passed unanimously by the board.

After some further discussion on how certain property tax and estimated values are determined, multiple members of the board voiced their frustration at how difficult the current system is to explain to people inquiring about their property taxes.

“It’s incredibly difficult to explain the increase in property taxes after the recent changes to the system over the last two years – it’s very different from how it used to be,” Scholtes remarked. “It feels like the adjustments being made are being based on the need, rather than factoring in the whole city.”

“I agree that the current neighborhood system is confusing – it all feels very arbitrary,” Huisman added. “As I hear Brady talk about the different classifications of how homes are valued, I feel there are too many ways for residential property to be evaluated.”

Rauenhorst remarked that if the community has any questions about the assessment process, they are welcome to ask the county assessors directly. However, Scholtes disagreed with this idea.

“When people have questions about their property taxes, they come to me, not the assessors – that’s what meetings like this are for,” Scholtes said. “But I can’t explain how this works clearly with all of these extra factors.”

Scholtes also expressed interest in figuring out a way to simplify the system to make it easier to explain.

“If a certain neighborhood in Blue Earth has a MSR of 80 percent, but the city as a whole has a MSR of 99 percent, nobody’s taxes should increase because the city met the median goal set by the state,” Scholtes remarked.

“I do agree that the current process is a mess,” Rauenhorst conceded. “The state has tried several times to simplify the process, but unfortunately that never seems to be the case.”

Other business discussed at the Local Board of Appeals and Equalization meeting included:

• A motion was made and approved to adjust the value of parcel 21.200.7100 (406 West Fifth Street) to $217,400 for the 2026 tax year. The motion was passed unanimously.

• A motion was made and approved to adjust the value of parcel 21.629.0030 (1019 Highland Dr.) to $341,400 for the 2026 tax year. The motion was passed unanimously.

• New proposed values for parcels 21.446.0220, 21.693.2080, and 21.017.0580 following recent re-evaluations of the parcels by the assessors were unanimously approved.