Polk County believes the worst-case scenario for two recent tax court rulings could mean more than $1.7 million in property tax collected between 2013-2016 would need to be refunded to Enbridge Energy for various taxing entities within the county.

Impacted entities could include Polk County, Fosston School District, Red Lake County Central School District, Clearbrook-Gonvick School District, Chester Township, Eden Township, Gully Township, Trail Township, the Red Lake Watershed District, Northwest Minnesota Multi-County Housing and Redevelopment Authority, Northwest Regional Development Commission, and the State of Minnesota.

Polk County Administrator Chuck Whiting said Enbridge has the right to appeal its taxes, but the result will be many entities getting told they have to refund taxes by the courts. “Enbridge has repeatedly appealed their valuations going back several years, which is their right,” said Whiting. “They go to tax court. The tax court has batted this around back and forth with the appeals court, the supreme court, trying to get this valuation correct. What it means for Polk County is we have to expect that valuations from several years ago are going to be decided as having been too high. They are going to get lowered, which will mean the county, some of the schools in that part of the county, some of the townships, will be told by the court to refund the taxes based on the reduction of the valuation.”

Entity Estimated refund
Polk County $608,477
Fosston School District $92,319.61
Red Lake Co. Central School District $114,061.67
Clearbrook-Gonvick School District $122,986.59
State of Minnesota $652,473.05
Chester Township $26,399.88
Eden Township $28,257.11
Gully Township $37,865.43
Trail Township $7,558.87
Red Lake Watershed $56,298.81
NW Regional Dev. Commission $2,740.21
NW MN Mult-County HRA $5,830.96
Total $1,755,269.97


Nearly $400,000 of the projected refunds in Polk County will be interest payments. “We’ve been trying to estimate what this cost will be and have come up with about $1.7 million in refunds,” said Whiting. “This includes about a 4 percent interest on each year we have to go back. This has added up real quick. We don’t like it at all. We’ve been talking with our legislators along with the 12 other counties affected by this. We are hoping for some legislative action, but we’re obviously under a countdown for that as well. The final court rulings have not come through, but we could be hearing something relatively soon.”

Polk County Assessor Mark Landsverk dug through the records and court decisions to provide the estimate. “You look at old tax statements and see what each jurisdiction paid,” said Landsverk. “You apportion it that way and try to break it down by district or jurisdiction, including the state. The state has a little skin in the game here too. You just keep digging until you come up with a number and add the interest on top of that.”

Landsverk said the valuations being considered are multi-faceted. “The court’s decision includes something on the total value of the pipeline that is in-state and out-state,” said Landsverk. “They also have a portion that is just in-state called the Minnesota Apportionable Value. The percentage change on that is more palatable, but it’s still ugly.”

While $1.7 million is not a small number, Whiting said the impact in neighboring counties could be much more severe. “We’re talking here about Polk County, but this includes other counties like Kittson, Marshall, Red Lake, Clearwater, and Pennington,” said Whiting. “All these counties around us, I hope they can withstand this well because this is going to hurt. It’s going to hurt some more than others. Certainly, it’s going to hurt Polk County, but I have a lot of sympathy for these smaller counties that could end up seeing refunds of this kind of magnitude.”

Not only did the state err in its property valuations, but Whiting believes they’ve also erred in how long it takes to get the valuations settled. “I should make it clear these valuations of the pipeline are done by the Minnesota Department of Revenue,” said Whiting. “We get those numbers and put them in the tax statements just like we do for everybody else in the county, except we have our own people doing your homes and businesses and so forth. But the fact that the state valuation is being determined to be too high, and the county has to repay the taxes we collected years ago. The short-term solution is the State of Minnesota should be paying this. I think the State of Minnesota ought to be looking at how come it takes seven or eight years to get these valuations settled. This is nonsense from a public policy standpoint. We don’t levy money to set aside in case we have to pay it back. We levy money so we can operate and do it as prudently as we can. To have a number like this, this far after the fact is just ridiculous.”