Proposed property tax hikes perplex county residents
Brian Fritsinger's office phone has been ringing off the hook.
This week, the Cloquet city administrator has done a lot of listening to property owners who are confused and dismayed about 2010 proposed property tax statements which arrived just before the Thanksgiving holiday.
"We've had more questions than we've had at any time I can remember regarding the budget," he said. "Hindsight being what it is - we should have done [a story] about this beforehand so people weren't so taken by surprise."
The questions stem largely from tax hikes due to levies from the newly-created Cloquet Area Fire District (CAFD) and from the Cloquet School District. Added to the angst is that taxes appear to be rising even though many property values have declined.
"I don't think it's fair to do this to the people," said Cloquet resident Clarence Badger, who spoke at the regular Cloquet City Council meeting Tuesday.
The highest tax increases are hitting mainly those residents in outlying areas of Cloquet and Perch Lake Township because they are - for the first time - helping to fund the fire and ambulance services, due to the creation of the CAFD. The district is now its own taxing authority through the state legislature and can set levies, similar to the Western Lake Superior Sanitary District and Cloquet School District.
"We're trying to make sure everyone is paying for services they receive," said Cloquet Mayor Bruce Ahlgren, who, along with council member Neil Nemmers, sit on the board of the CAFD.
"Inner city" residents will probably not notice much of a difference in their tax statements due to district creation because they have been taxed for fire and ambulance all along, according to Fritsinger. "Up to now, [Cloquet] has been a service center to all kinds of people who technically don't live here."
The new fire district is the result of Cloquet and Perch Lake Township consolidating after years of talks, which initially included departments from Thomson Township, Wrenshall, Scanlon, Carlton and the Fond du Lac Reservation, among others. Many, including Carlton Fire Chief Steve White, opted to take a wait-and-see approach, and have been paying close attention to how it's being set up. Fire officials in Scanlon and Thomson Township are already back at the table and talking again about joining, Fritsinger said. If that happens, people in those areas will also share the tax burden, which could spell a decrease in taxes in the long-term.
Talks to consolidate area fire departments began in 2003 after Cloquet's local government aid was cut significantly. In 2005, Carlton County officials hired an outside consulting firm to evaluate fire and ambulance services in the area and consolidation was one of the major recommendations.
Today, a CAFD board made up of five people oversees operations of the 21 full-time and approximately 15 paid on-call members who now respond together to emergencies in 71 square miles throughout northeastern Carlton County and parts of southern St. Louis County. Perch Lake Township is west of Cloquet and covers much of the Big Lake area.
The main goal of the district is to provide the best possible service in the most economically responsible manner, according to District Fire Chief Jim Langenbrunner.
Despite many administrative changes, service in the district should remain the same for all emergency services, from calls due to fire, medical emergencies, motor vehicle accidents and rescue, Langenbrunner said.
Most of the 15 residents' questions at the Tuesday city council meeting wanted answers about taxes related to the CAFD.
For a property valued at approximately $150,000, owners will see an increase due to CAFD of about $22 for "inner city" residents, $173 for Cloquet's outlying property owners, and $144 for those in Perch Lake Township, city officials said.
"The former system of only urban residents taking on the tax burden for everyone else was no longer sustainable," Fritsinger said. "If we didn't do this, we were looking at some kind of loss of services in fire and ambulance."
Fritsinger also admitted that the tax increases are perhaps higher than they might be down the road due to monies needed to begin building reserve and capital funds.
"We've been the bank for the district this year," Fritsinger said. "As a start-up organization, they have to have cash to operate."
Property owners at the meeting also asked about the CAFD budget, which was set at $1.75 million for 2010,
"We certainly didn't just rubber-stamp the budget, but we really didn't know for sure in this first year," Nemmers said. More information about the CAFD can be found at www.cloquetareafiredistrict.com, which has been up and running since January.
On the Cloquet School District side, in early October, the Cloquet School Board approved increasing the proposed school levy by nearly $1 million for a total of $4 million. The increase came largely from $300,000 worth of unexpected asbestos removal in Cloquet schools during summer construction projects. This was in addition to the approximately $550,000 cost of the Other Post-Employment Benefits (OPEB) liability to pay insurance benefits owed to retired district employees.
The impact on local taxpayers is as follows: On a $100,000 home, taxes will increase $55 a year. On a $150,000 home the increase will be $82. A business worth $250,000 will see an increase of $234 a year in 2010.
A school board meeting will be held at Garfield School at 6 p.m. Monday, Dec. 14, and will include a Truth in Taxation Hearing, giving the public a chance to understand the levy increase. The board will finalize the levy amount that night.