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   To the Editor:

   As local government leaders spanning counties, school boards, and townships, we have a responsibility to protect the taxpayers who fund our roads, schools, emergency services, and local government. Today, that responsibility extends beyond our county borders. Across rural Minnesota, communities are once again facing uncertainty because of another major property tax dispute between Enbridge and the State of Minnesota. While the legal arguments may be between a private company and the state, the financial consequences fall squarely on rural communities like ours. That is neither equitable nor sustainable.

   For many Minnesotans, a tax appeal may sound like a routine legal matter. For all pipeline counties, it is anything but routine. Unlike most property taxes, counties do not determine the taxable value of interstate pipelines. The State of Minnesota does due to the highly complex nature of assessing these properties. Counties simply receive their share of the taxes based on the state’s assessment. If Enbridge successfully challenges that state assessment years later, local governments can be required to return tax dollars they already collected and spent—even though they played no role in setting the value or negotiating the dispute.

   Enbridge is among the largest property taxpayers in every county its pipelines crosses. The assessed value of those assets equals multiple billions of dollars and directly affects the tax base that supports county government, school districts, townships, and other local services. When those values are challenged, millions of dollars can be at stake. If an appeal or settlement is resolved in Enbridge’s favor, local entities are ordered to refund a portion of these dollars retroactively, meaning local governments must draw from reserves and/or increase property tax levies to cover those refunds. Again, asking local governments not directly involved in the assessment to return dollars already spent on community investments. Those are not abstract numbers—they represent funding for public safety, road maintenance, education, and essential local government services such as teacher salaries, library hours, first responders, and more.

   This year, once again, Enbridge has sued the State of Minnesota over pipeline valuations.

While both parties have legitimate legal rights, they also have a responsibility to recognize that their dispute is creating collateral damage for communities that have no seat at the negotiating table.

   This is not a new problem. Previous disputes stretched across multiple tax years, creating uncertainty for local governments while litigation worked its way through the courts. By the time settlements were reached, some communities faced refund obligations larger than an entire year’s property tax levy. Recognizing that local governments had no role in the dispute and that the end result could have bankrupted many communities, in 2021 the Legislature ultimately appropriated nearly $30 million to keep local taxpayers from bearing the cost.

   That solution acknowledged an important principle: local governments should not become collateral damage in state-level tax litigation.

   Today, we risk repeating the same cycle.

   If no new approach is agreed on, additional years of appeals are almost certain. Every new appeal prolongs uncertainty, delays financial planning, increases legal costs, and places unnecessary strain on local governments that have no authority to resolve the underlying dispute.

   This situation highlights a broader policy problem, which is how to shore up Minnesota’s valuation process for pipeline property to reduce the likelihood of appeals and impact of these appeals on local communities. While local governments understand the need for the

State to assess these complex, multi-jurisdiction businesses, we must create more certainty and protection from the system for our local governments. In addition, it’s important that companies asking for community support recognize that when they appeal the valuations, they threaten the very communities they’ve asked for and received support from.

   Enbridge frequently emphasizes its partnerships with rural communities, local governments, and first responders. Those partnerships should extend beyond sponsorships and community investments. A company that values its relationship with rural Minnesota should also recognize the financial uncertainty repeated litigation creates for those same communities.

   Every year this dispute remains unresolved is another year rural communities are forced to budget around uncertainty they cannot control. Any resolution that requires multiple years of refunds places many communities in extreme financial peril, including the possibility of bankruptcy. Local governments should not function as the financial backstop for state tax litigation. The State and Enbridge both have the ability—and the responsibility—to break this cycle. Rural Minnesota deserves a permanent solution, not another decade of appeals.

Bob Kangas, 

Chairman, Cass 

County Board of 

Commissioners

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