ELY – In a study session Monday, ISD 696 school board members considered retaining the services of a lobbying group for the next year. The Costin Group believes it has a several ideas to steer more Taconite Production Credits to the Ely community.
Costin Group principals Gary Cerkvenik and Jeff Anderson helped the Ely school district to successfully develop and implement a bonding bill and other funding last year to begin a $20 million school renovation project.
“In conversations with Superintendent (Erik) Erie and Board Chair (Ray) Marsnik, we have identified that the Ely Schools generally receive the least amount of taconite tax money in the Taconite Assistance Area,” Cerkvenik said. “We believe we have a legislative strategy to potentially remedy this and increase the amount Ely receives, without reducing the amount any other district receives.”
Taconite production credits replace revenue that would otherwise be collected from property owners, although it is not considered additional revenue.
ISD 696 and 13 other Iron Range districts are in the Taconite Assistance Area. For 2021, Ely is set to receive $91,806. While that amount has been increasing over the past couple of years, Ely is at the bottom of the list and receives less than half of the next lowest district, Aitkin, that is set to receive nearly $200,000 in production credits. At the top of the list, Hibbing will receive $1,671,437 and Rock Ridge will receive $1,437,328.
Taconite production credits are based on local mines’ prior three years of taconite production.
Ely does not have a mine or plant within the school district, and so is not eligible for the school maintenance fund in the taconite tax distributions. Ely does not have a taconite railroad and loses out on additional distributions. And, according to Cerkvenik, Ely gets less because of low numbers of students and the high-end property valuations of lakeshore properties in the district.
“We need to articulate that Ely schools continue to need assistance,” he said. “It is apparent that Ely is isolated geographically, and Ely schools must remain operational to serve these students as there is no realistic opportunity to send them elsewhere.”
Cerkvenik said the Costin Group “would like to work with the Ely school district and area lawmakers to consider changes in the taconite tax distribution formula to increase the flow of funds over the long term.”
He noted the contributions of State Sen. Thomas Bakk and State Rep. Rob Ecklund in the success of the $7 million in Department of Iron Range Resources and Rehabilitation funding for the ISD 696 facility renovation project, and said they will be key in helping them with this taconite tax distribution adjustment. “They have both been champions for the community of Ely and we expect they would have a willingness to help us with this issue,” Cerkvenik said.
The Costin Group also highlighted other ways they propose to lobby and advocate for ISD 696 in the coming year:
• “We will also effectively monitor proposed education legislation, committee hearings and other legislative activity. We maintain close and effective relationships with legislators, staff and other lobbyists to keep updated on issues we represent.
• “Through our strong relationships, we will be able to keep the school district connected with lawmakers and staff throughout the session and year-round.
• “Our team will assist in 2021 efforts related to the new school project. We will help execute a successful ground-breaking ceremony and assist in keeping lawmakers updated on progress related to the new building project.
• “In a large construction project over an extended period, there are always surprises. Our firm will be on the ground keeping our partners informed of the project and be prepared to seek potential assistance to address problems.”
The Costin Group proposed a flat fee of $2,000 per month for a one-year contract (with a 90-day cancelation clause).
Marsnik praised the efforts of Cerkvenik and Anderson.
“Your work was extremely important to us in getting the $7 million (from IRRR) for our building project,” he said. “Speaking for myself, I definitely would like to keep you on because there is more work to be done to benefit our school district. If we can get an increase in the taconite money, we will gain a lot more than it will cost us. While it does not bring direct revenue to the district, it will provide some help for our taxpayers.”
School board members will likely vote on the Costin Group’s lobbying proposal at their next meeting on Monday, Feb. 8. That meeting will be the first of many Ely school board public sessions to be held at the Ely City Hall council chambers while public health protocols are in place due to the coronavirus. That larger facility can accommodate in-person meetings while maintaining social distance mandates.