Pandemic grants help city's bottom line

The 2021 audit confirmed the city of Cloquet is in a good financial position, even after more than two years of pandemic challenges.

Wipfli’s Michelle Swoboda told the Cloquet City Council Tuesday that the accounting firm gave an unmodified, or clean, opinion on the city’s financial statements following the audit.

According to the audit report, the city of Cloquet ended 2021 with nearly a half-million dollars more than budgeted, thanks in large part to $930,000 in federal CARES Act funds from the federal government. Rising utility fees and decreasing expenses increased the city’s position by $2.35 million.

On the flip side, public safety expenses also rose due to expected future expenses of $3.2 million for former police officers who claim disabilities. The city’s net position increased by $2.35 million from 2020 to 2021 to more than $66 million. Most of that money is invested in capital assets, Swoboda noted, but 11 percent of that is unrestricted funds.

The city ended 2021 with $7.2 million in unrestricted funds, versus $3.76 million in 2020.

“That’s a nice increase over the prior year,” Swoboda said.

City administrator Tim Peterson praised city staff for holding the line on expenditures, which came in around $5,000 below the budget in 2021. He also cautioned against reading too much into the increased revenues, noting that revenues were “skewed” by federal pandemic funds last year and the same thing will happen again next year.

“It will look like we made a ton of money, but it’s basically money that we designated for certain areas,” Peterson said, giving as an example $300,000 set aside to help pay for expanded broadband access in north Cloquet.

“Really, we’re just keeping funds until we can get around to doing the projects,” he added.

The council is expected to begin considering the 2023 budget at its next meeting Aug. 16.

July Fourth

Cost increases and bad weather put a damper on this year’s July Fourth celebration, but business donations, volunteers from out of town, and help from city staff were bright spots. So was a creatively concocted plan for a “standstill” parade July 5 after the parade through downtown was canceled due to bad weather.

Cloquet city councilors got a review of the year’s July Fourth (and Fifth) festivities Tuesday along with some ideas for next year’s event and an earnest plea for volunteers from co-coordinators Ivan and Evan Hohnstadt, who presented Tuesday.

It was the first year the Pine Knot News contracted with the city to coordinate the annual celebration.

City administrator Tim Peterson said he knew it was a tough decision to move some events back to July 5.

“While tough, it was the right decision,” he said, adding he hoped to get a proposal for next year’s event from the Pine Knot soon.

In other matters:

• Councilors tabled a vote on a revision to the city’s policy on financing and assessments of street and other public improvements.

• Councilors approved two conditional use permits as recommended by the Planning Commission, including 2,900 square feet of added office spaces at the Human Development Center, and four more apartments at 807-809 Sunnyside Drive. Property owner Tony Nguyen plans to remodel the old carwash on the former hotel property into additional apartments.