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Last Updated: 12/17/2018

Capitalization Rate Study

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About This Page

The Minnesota Department of Revenue assesses utility, pipeline, and railroad operating property. We measure the present value of anticipated future benefits of property ownership to determine unitary valuations of State Assessed Property in Minnesota.


How does the department complete the Capitalization Rate Study?


We determine the following rates:

  • Yield Capitalization
  • Direct Capitalization
  • Implied Growth
  • Short-term Growth
  • Long-term Growth
  • Implied Infation

For each of these market segments:

  •  Electric
  • Gas Distribution
  • Gas Transmission Pipeline
  • Fluid Transportation Pipeline
  • Class I Railroads
  • Other Railroads

Yield and direct capitalization rates
combined rates of debt and equity components using capital structure indicated by the market.

Implied growth rate: difference between the yield and direct rates, by market segment.

Short-term growth rate: estimates of growth by market segment.

Long-term growth rate: long-term growth rate of the United States Economy.

Implied inflation rate: market indicators of expected inflation.

You can also view and download the 2018 Capitalization Rate Study.

Can I provide input for the Capitalization Rate Study?

You can provide input at our annual Spring Forum before the study is completed and after the study is posted.

We invite forum attendees to provide information about topics that may affect the Capitalization Rate Study. See our State Assessed Property Forums webpage for more information. If you would like to be invited to the Spring Forum, e-mail

Once posted, the study includes a section on how to provide comments and a deadline. We review the responses received during the comment period and publish the final study with a summary of the approved comments.


What if I have questions?


Mail: Minnesota Revenue
         Attn: State Assessed Property Section 
         Mail Station 3340
         St. Paul, MN 55146-3340