Counties collect Payment in Lieu of Taxes for state-owned land not subject to property tax
Minnesota’s 87 counties are the beneficiaries of $35.9 million in state payments that help support public lands.
The state’s Department of Revenue recently distributed annual payments for Payment in Lieu of Taxes (PILT), a property tax relief program that offsets tax revenues not collected on public lands. Counties have received PILT payments annually since 1979 in place of property taxes on 5.6 million acres of state-managed lands and 2.8 million acres of county-managed tax-forfeited lands. Money for the payments comes from the state’s general fund.
Every county in Minnesota has public lands within its borders and receives an annual PILT payment. In July, counties received anywhere from $21,443 in Red Lake County up to $3,792,842 in St. Louis County.
"PILT is an important and consistent revenue source for counties, but the benefits of public lands for Minnesotans go far beyond these annual payments," said Minnesota Department of Natural Resources Commissioner Sarah Strommen. "Public lands support local economies through timber and mineral production, provide space for outdoor recreation and tourism, create habitat for wildlife, and help provide clean air and water."
The state makes PILT payments on public lands including state parks and forests, scientific and natural areas and wildlife management areas, school trust lands, Consolidated-Conservation lands as well as county-managed tax-forfeited lands. Even lands that could never be developed and placed on the tax rolls are included in PILT calculations used to compensate counties.
Payment rates vary according to land type and range from $2 per acre, to three-quarters of 1 percent of appraised value. Payment for Lake Vermilion Soudan Underground Mine State Park is assessed at 1.5 percent of the appraised value of the land.
A breakdown of PILT payments for each county is posted on the Minnesota Department of Revenue website.
More information about Minnesota’s public land portfolio, PILT payments, and a brief history of major public land transactions is available on the DNR's public lands page.