REGIONAL- Property tax relief and millions of dollars in new spending could be on the way to the Iron Range and the North Country if bills pushed by two area lawmakers find their way into overall tax legislation before the end of the session.
Ely and Tower-Soudan would be among the biggest winners should the package make it to final passage unchanged. Ely would see $5.25 million for a variety of investments in sports facilities, while Tower-Soudan would see $3 million to bridge a major funding gap in a long-planned new drinking water treatment plant.
With the deadline for action on finance bills looming, Rep. Dave Lislegard, DFL-Aurora, on Monday introduced HF 5198, a summary of recommendations of the House Property Tax Division, which Lislegard chairs. Sen. Grant Hauschild introduced SF 5435, a companion bill in the Senate.
The package – authored by Rep. Lislegard – includes a long list of infrastructure investments along with permanent property tax cuts for homeowners on the Iron Range and northeastern Minnesota. The proposal appropriates taconite taxes – which mining companies pay in lieu of property taxes – to pay for it all.
“Senator Hauschild and I are working with a ‘Range First’ focus to cut taxes and invest in our local communities,” Lislegard said. “This package continues our commitment to building a better life for seniors and families in our region by improving our schools, taking advantage of economic opportunities, growing tourism, and more to strengthen the core Iron Range.”
Property tax relief
The broadest impact of the bill will be felt by homeowners. The legislation would increase the Taconite Homestead Credit from an average of $289-$315 per household to $515, a nearly 77 percent increase. The credit has lost much of its impact since being frozen in 1998. The credit applies to homeowners in school districts in the Taconite Relief Area, including Ely, St. Louis County, and Mesabi East.
“By increasing the Taconite Homestead Credit, we can provide relief to Iron Range families immediately and permanently,” said Sen. Hauschild. “After a 26-year freeze, it’s the right thing to do for the Iron Range.”
The bill also makes other adjustments, one of which is to the valuation tiers for class 1c homestead resort property. An increase of between $500,000 and $900,000 could result in lower property taxes.
Nonprofit land banks that acquire, hold or manage vacant, blighted, foreclosed or tax-forfeited properties for future development, including affordable housing development, would be eligible for tax abatements of up to five years.
Townships would be able to obtain the total amount of local government aid appropriated for them with an increase in funding for the program to $11.5 million. Current law restricts aid to a percentage of the allocation. The distribution formula would still factor aid based on each township’s area, population, and share of tax base made up of agricultural land.
Another provision of the bill specific to Breitung Township would increase their annual taconite production tax distribution from $15,000 to $25,000.
IRRR bonds
The bill also authorizes the Department of Iron Range Resources and Rehabilitation to issue $79.5 million of revenue bonds over two years to provide funding for projects across the region. The bonds will be paid for by increased taconite production tax distributions from the Douglas J. Johnson economic protection trust fund to the Iron Range consolidation and cooperatively operated school account, with various amounts scheduled through 2036 and then continuing annually at $3.5 million.
The bill also designates the projects to be funded by the IRRR bonds. North Country area projects included in the $49 million proposed total for 2024 include:
• $950,000 to the Buyck Volunteer Fire Department for design, engineering, and construction of a new fire and training hall and related equipment.
• $750,000 to the Voyageur Trail Society for a joint maintenance facility with Voyageur Country ATV in the city of Orr.
• $1.2 million to Northland Learning Center for construction costs.
• $3 million to the city of Tower for water management for construction of a new drinking water plant to serve the communities of Tower and Soudan.
• $600,000 to the St. Louis County school district, $400,000 of which must be used for septic system upgrades at the South Ridge School and $200,000 must be used for cafeteria renovations at Northeast Range School in Babbitt and Tower-Soudan Elementary School in Tower.
• $5.2 million for design, engineering, and replacement of chair lifts, and for design, engineering, demolition, and construction of a Nordic and welcome center at the Giants Ridge Recreation Center.
• $250,000 for the Ely school district for baseball field renovations.
• $400,000 for Veterans On The Lake for demolition of existing structures and construction of a triplex compliant with ADA standards.
• $300,000 for the Northern Lights Music Festival to support programs, with $100,000 annually for three years.
• $500,000 to the Northland Foundation for businesses or resorts that were economically damaged by floods in 2022 or 2023.
• $25,000 to Northwoods Friends of the Arts in Cook for facility upgrades and programs.
• $50,000 to the Bois Forte band for food shelf expenses.
• $100,000 to the Lake Vermilion Cultural Center to improve and renovate the facility and its displays.
• $50,000 for the Pioneer Mine historical site in Ely for maintenance and displays.
• $25,000 each to the Ely Igloo Snowmobile Club, Cook Timberwolves Snowmobile Club, Crane Lake Voyageurs Club, Voyageur Snowmobile Club, Prospector ATV Club, Babbitt ATV and Snowmobile Club, and Vermilion Penguins Snowmobile Club.
Of the $30.5 million in bonds to be funded in 2025, area projects receiving funds would include:
• $5 million to Ely ISD 696 for planning, design, engineering, demolition and construction related to the district’s athletic complex.
• $7.8 million for the chair lift and welcome center construction at Giants Ridge.
• $1.08 million to the Northland Learning Center to construct the Alternative Learning Center.
Liselgard’s bill was scheduled to be considered by the full House Tax Committee on Wednesday, where it was expected to be incorporated into this year’s tax bill. Hauschild’s bill was set to be heard by the Senate Tax Committee on Thursday.