Moose Lake Star Gazette - Serving Carlton and Pine Counties Since 1895

By Dan Reed
Moose Lake Star-Gazette 

Impact of utility tax court cases continues to unfold


April 18, 2019

Per a press release from the Chair of the Carlton County Board of Commissioners Dick Brenner posted April 12, 2019, the Great Lakes Transmission and Enbridge Energy Southern Lights Line Pollution Control Exemption 2018 cases have been finalized and refunds due are settled. These follow settlements with four other utility entities doing business in Carlton County.

This cases were brought forward by the utility companies regarding the estimated market value assigned to them by the Minnesota Department of Revenue. In essence, they believed their valuations, which determines the amount of tax they pay, were incorrect and they have overpaid. Refunds granted to the companies are to be paid back by local taxing authorities, including counties, cities, townships, and schools.

The Great Lakes Transmission 2019 refund due is between $120-130k and the Enbridge Energy Exemption for 2018 refund is $70,125. This cash impact will be shared by the County, affected townships, affected school districts, and the State of Minnesota. This is just the tip of the iceberg.

Cases pending in Minnesota Tax Court and the decisions are being appealed are: Enbridge Energy for 2012-2014 estimated refund of $2.5 million with $1.1 million from Carlton County, $200,000 from the affected townships, $400,000 from the affected school districts, & $700,000 from the State of Minnesota. In the case for Northern Natural Gas for 2015-16, the estimated refund is approximately $600,000 with $240,000 from the County, $50,000 from the affected townships, $100,000 from the affected school districts, and $210,000 from the State of Minnesota.

Of greater concern the Commissioner’s press release goes on to say, “With these cases, it should be noted that still to be addressed is the 2015-19 for Enbridge and 2017-19 for Northern Natural Gas, with additional refunds likely in the $6.5 million to $9 million range. Tax court cases for these years have been filed but are being stayed while the original cases are finalized, after which they will be addressed. It is possible that they will settle based upon the original cases.”

Of long term concern, a probable 25% reduction of the value of the utilities operating in Carlton County could cause an approximate shift of 7-9% or more for the County portion of a property tax levy, and a tax shift of 25-45% on the affected townships and school districts in their property tax levy. In other words, a 25% reduction of the taxable value of our area utilities would shift the payment of the property tax bill to the rest of the taxpayers in Carlton County. The reduction of value for taxing purposes on Enbridge and Northern Natural Gas will impact Perch Lake, Sawyer, Twin Lakes, and Silver Brook Township residents the most.

This difficult situation could be helped if the Enbridge Line 3 was built soon and would add taxable value. It is still hoped that the Legislature will step in with financial help.

Representative Mike Sundin was contacted and said bills are moving along in the State Legislature and he is hoping to get financial help to help resolve this burden on Carlton County taxpayers. “We have a way to go to get the job done,” he reported.

The press release concludes with these words: “It is also very important to understand the unresolved cases include two of the largest taxpayers in Carlton County, and that the tax impacts are likely to be the most significant to date.”

Any questions should be directed to Kyle Holmes, Carlton County Assessor, or Paul Gassert, Carlton County Auditor/Treasurer.

In other County Board news that occurred at the April 9th Regular meeting of the Carlton County Board of Commissioners:

County Attorney Lauri Ketola asked for Board input for the parameters of a new ordinance for restricting the sale of tobacco and E-cigarettes to young adults below the age of 21. She proposed enforcing the ban on the local retailers and requirements to post the legal guidelines at each place of business. She proposed putting the burden on the seller to monitor their sales correctly.

Commissioner Tom Proulx commented, “We are talking about restricting the sale of tobacco and E-cigarretes to the 18-19-20 year old young adults. We do not need to fill the court system with young adults in trouble for an illegal purchase.”

Ketola reinforced that concern by saying that there is no benefit to criminalizing tobacco purchases by these young adults. The County Board directed her to craft a new ordinance on the matter.

The County Board approved the purchase of Karpel software for the County Attorney’s Office with $58,000 coming from the County Attorney’s budget and the rest of the $70,000+ coming from general fund balances. The transfer to the new Karpel system will be completed by the end of this fiscal year.

In Scanlon the County Board approved a tobacco license to Kwik Spirits which was formerly known as Gramma Polo’s Bottle Shoppe.

Transportation bids for supplies and contracted annual work came in with road salt rising to 96 cents and gravel crushing prices per yard or ton about the same as last year.


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