Council approves 2.85-percent levy increase

Cloquet city councilors and mayor Roger Maki approved a smaller budget Tuesday than they expected three months ago. That means the levy increase for property taxes will also be smaller than reflected in recent estimates, with a 2.85-percent levy increase versus 4.53 percent.

One local business owner spoke during the Truth in Taxation hearing that preceded the vote. Jim Kuklis, who owns Trails Edge subdivision - consisting of two-family townhomes available for rent by residents over the age of 55 - told the council that he "just about fell over" when he opened up his estimated property tax statement recently.

Taxes on the 15 buildings within Trails Edge went up by 26 percent since last year, he said. With some digging, Kuklis determined that about half of the increase was due to a change in the classification of the property. The other half comes from local tax levies from the city, Carlton County, the Cloquet school district and the Cloquet Area Fire District.

Kuklis said he will have to pass the tax increase on to his senior residents, who mostly live on fixed incomes.

"These people in your community that are renting from us could be your mother, your father, grandparents, or it could be you," he said. "We understand cost increases and budget increases, but something is wrong when we are asking these increases to be absorbed by this population."

Kuklis spoke at length, worried about senior citizens being asked for more money, unhappy with the way property taxes work in Minnesota.

"We're not opposed to taxation, we just want it to be fair for everyone," he said.

City administrator Tim Peterson didn't argue with Kuklis. In fact, Peterson agreed. But he explained the city has worked to decrease the budget since September. As a result, he said, Cloquet residents will see a lower levy increase than any in the past five years.

Peterson explained to the council that savings came from changing health insurance companies and removing $70,000 that would have gone toward the permanent improvement fund, which pays for street and utility projects.

He also pointed out that Carlton County taxes make up about 42 percent of the taxes on a Cloquet residence, followed by the school district at 23 percent, Cloquet at about 22 percent and the fire district at 13 percent.

Kuklis said he plans to address the county board next week.

Find more details on city budget figures in the Dec. 5 council packet at http://www.cloquetmn.gov.