Legislative session a boon to Cloquet

Minnesota state legislators and Gov. Tim Walz came through in a big way for the city of Cloquet, judging by the list of benefits shared by city administrator Tim Peterson during Tuesday’s council meeting.

Top of the list was an increase to Local Government Aid, or LGA, which is set to increase statewide by $80 million annually starting in 2024, translating to an additional $500,000 for the city of Cloquet. Peterson told councilors some of the money will help put the city on more solid footing.

“Let’s just remember that our budget looked really, really, really bad going into this,” Peterson said. “We were projecting probably needing to lay people off, so I just want to be really clear that we will not have an extra $500,000.”

For the first time — perhaps ever, Peterson thought — the city received capital bonding dollars from the state: up to $5 million for needed improvements to the Lake Superior Waterline. The waterline brings water to the Sappi mill from Lake Superior and returns it to the Western Lake Superior Sanitary District for treatment before returning it to the lake.

Peterson said the money is a 50/50 match, and the project is estimated at $9 million to $10 million, so half of whatever the final bill is will come from the state. Sappi has historically paid for the costs of maintaining the line.

Passage of the Public Safety Duty Disability bill will have a sizable and long-lasting impact on the city, which saw close to a third of its police department (seven officers) retire on disability between 2019 and 2021.

In 2021, former Cloquet finance director Nancy Klassen provided an actuarially determined figure of $3.2 million for the long-term costs of the insurance payment for the former employees if all seven kept insurance at current levels.

Under the terms of the new legislation, the state will fully fund the continued health benefits, which Peterson said Tuesday will save the city $140,000 to $160,000 per year.

“That was also increasing with no ending in sight for a large number of years,” he said.

The new legislation fixed issues with a change made by lawmakers in 2018, when the state passed a law stating that if a public safety employee is diagnosed with post-traumatic stress disorder, it is presumed to be due to the nature of the employment. According to a Pine Knot story on police numbers written in November 2019, the majority of the departures came in the first 10 months of 2019, the first year the PTSD law was in effect.

The new bill also stipulated “no duty disability … unless 24 weeks of treatment are completed,” Peterson said. “Right now there is actually no requirement to seek treatment as part of going out on this duty disability,” he said.

The state will also help the city cover the costs of time off and some of the expenses for treatment while officers and others are off duty and in treatment for up to 24 weeks.

Peterson added that the bill also requires “mental injury prevention training,” explaining that the city already has programs that provide most of what is required.

Also on Peterson’s legislative gift list was a $210 million one-time investment in public safety aid to be shared across the state, which could be used for a variety of items, including violence prevention and intervention, training, equipment or personnel costs. Cloquet should be receiving $556,397 in December of this year.

“It’s a pretty sizable chunk of money that the police department is already digging into the best way we can provide options … [that] we can present to the council,” Peterson said, adding that there is no deadline for spending the additional money.

Other new money for the city includes an estimated $65,000 in affordable housing funding over a two-year period and an increase in state aid for road projects.

Additionally, Peterson noted Cloquet is in a good position to apply for new climate resiliency funds after its recent stormwater studies. The state created a pool of $100 million for projects related to climate change.

USG project

Also Tuesday, councilors unanimously approved a $300,000 grant application to the Minnesota Department of Employment and Economic Development office that would help support a $38.5 million USG project. In return, the company would commit to retaining 300 manufacturing jobs in the city of Cloquet. Costs to the city would be less than $1,500.

Cloquet Community Development Director Holly Hansen explained that USG plans to replace an enormous 60-year-old board dryer at an estimated cost of $38.5 million. The project would take roughly a year starting in February 2024, and employ an additional 50-75 people during its construction. Once completed, the upgrade would reduce natural gas usage by 21 percent.

Hansen talked about the value USG brings to Cloquet, currently employing 320 employees with an average salary of $61,000 plus benefits.

“It’s an important project because once the equipment is in, it helps the viability longterm of the plant,” she said. “We know that Knauf is the leader in the construction industry in the world and owns USG and is looking long-term at 20-, 50-year [plans].”

It’s not a scam

City administrator Tim Peterson wants residents to know that the city has hired a company to replace all the water meters in the city. So if residents receive a message to schedule an appointment, please respond, he said. Otherwise city staff will have to use their hours to sort things out. Someone 18 or older needs to be home when the meter is replaced. There is no charge to the customer.

“It’s not a scam, they actually want to replace your meter,” he said.