He's taxed with improving the tax base

Every election season, candidates for county office talk about their desire to expand the tax base so that county expenses can be spread across a wider swath of property owners. Growth outpacing expenses would lower individual taxes, which have only risen in recent years.

But those are campaign promises. Reality offers a more difficult picture.

To learn more about how well Carlton County is positioned for growth, the Pine Knot met this week with one of the primary people responsible for it, economic development director Ryan Pervenanze.

“Whether it’s Carlton County, St. Louis County, or Duluth, you need to grow just to maintain what you have — to provide the ongoing level of services,” Pervenanze said. “Nothing is getting cheaper.”

Only a couple regional cities, Grand Rapids and Hermantown, are seeing growth outpace their levies, Pervenanze said. While Hermantown is a unique retail hotspot, Grand Rapids is similarly positioned to Cloquet and Carlton County. It’s been capitalizing on trails and tourism, the development of a brewery culture, new hospitality settings, multiple new housing developments, and business development, such as the new L&M distribution center.

“Ideally, where I’d like to see this department help the county get to is where our growth is starting to outpace our increases,” Pervenanze said. “It’s attainable. We can get there. It will take a smart, targeted approach, and we’ve got a lot of smart people.”

Though an office of only one, Carlton County economic development oversees the Housing Trust Fund and Economic Development Authority boards. The housing trust fund has met twice since its inception earlier this year. And the EDA board also met recently for the first time in several months.

“The members, they want to be involved in their communities and have a lot of expertise to do that,” Pervenanze said of both boards. “The more the county can take advantage of those individuals makes a lot of sense.”

Pervenanze took over from Mary Finnegan in August. Finnegan launched the Housing Trust Fund with $350,000 from the state last year. She then retired earlier this year before tragically losing her life to cancer.

The housing trust provides things like home-buying solutions, in the form of loans and grants, and rental assistance. The fund also gives Carlton County access to billions of additional dollars in state and federal housing funds.

The county landed Pervenanze from the city of Duluth, where he was a manager in planning and economic development for two years. Prior to that he spent five years as the city clerk and administrator of Buhl. A graduate of Chisholm, Pervenanze is an Iron Ranger who grew accustomed to the ways of such legislators as the late Tom Rukavina and David Tomassoni, and David Lislegard, DFL-Virginia.

“They advocated for their communities; they got creative, and they delivered results,” Pervenanze said.

Those legislators set an example Carlton County would do well to follow, Pervenanze said.

“We need to make sure our hands are out and we’re at the table to make sure our needs are recognized,” he said. “The challenges here in the county are no different than anywhere else; it’s being proactive and making sure our hat is in the ring for limited funds.”

Pervenanze seems to have a good handle on where to locate some of those future funds, citing resources such as the Entrepreneur Fund in Duluth and the U.S. Department of Agriculture’s Rural Development program, which funds housing and finances infrastructure.

Aging infrastructure is one thing that hamstrings growth locally, he said.

“Every community up here struggles with aging infrastructure,” Pervenanze said. “When we’re looking at where to put tax levy resources, it’s almost always to maintain what they have already. So, how can they focus on anything else?”

To learn the landscape and its needs, Pervenanze has been traveling the county since the summer to meet with township and city officials.

“You’ve got to dig in once you start,” he said.

He’s learned about how Cromwell is trying to entice a restaurant to town. How Moose Lake is struggling with sewer capacity. How one township needs a new firetruck.

Pervenanze’s office can help with all of those issues, combing for grants and other financing opportunities.

“When you get cities and townships’ major things taken care of, it gives them flexibility to really get creative and have resources to put into supporting new businesses, and let’s not forget about all the existing businesses,” he said. “We’re there to support them, too — especially if they want to expand.”

In past roles, Pervenanze has had experience administering Community Development Block Grant programs, helping bring about housing developments, and the expansions of industrial parks.

When it comes to housing, a Comprehensive Housing Needs Analysis in February showed Carlton County short in numerous categories — up to 50 units needed for entry-level housing for new homebuyers, 350 units for affordable apartments, 60 units for workforce rentals and scores of units for seniors who desire to own, scale down, or transition into settings such as assisted living.

“The whole state — the whole country — is struggling with housing and need for housing,” he said.

Asked about using tax increment financing — an enticing development tool which eliminates property taxes on a development for a prescribed period of time — Pervenanze said it makes sense in some situations, including for affordable housing developments. He advocates for stronger negotiations during the TIF process, leading to shorter tax-free periods.

“We don’t necessarily have to tie up the tax base for 26 years,” he said. “Maybe it’s only 10?”

He noted the Fond du Lac Band and its developments being made toward operating a legal marijuana dispensary and to bring an elk herd to the county — described as both a sporting and tourist driver.

“We need to be partners with Fond du Lac,” Pervenanze said. “They have big-time ambitions and both of us can benefit from the growth.”

Pervenanze cited Carlton County’s population growth as a positive — going from 35,386 residents in 2010 to 36,207 in 2020, according to U.S. Census data.

“I’m very confident,” he said about the future of development and growth. “There’s a reason why the Carlton County population is growing. … Carlton County is fortunate to have I-35. There’s a lot of traffic, and it’s how do we get those people coming into Jay Cooke, exiting 210 to come into Carlton?”

County commissioners next month expect to approve a proposed 3-percent tax levy increase for 2025, to a $34.4 million levy — the amount that will be levied on taxable properties in Carlton County for 2025. The figure is $1 million more than 2024’s $33.4 million levy.

Spreading the share of future levies among new housing and commercial developments won’t come easy.

“I go back to helping communities, and taking care of the needs they have right now — and it’s a lot on the infrastructure side,” Pervenanze said. “Getting that taken care of is going to go a long way toward thinking bigger.”

Simple measures — such as extending utilities into undeveloped areas while revitalizing streets and roads — can help set the stage for future growth.

“So, when the time comes and we have a developer who wants to do a project,” Pervenanze said, “we can get that site as close to shovel-ready as we can be.”

More Carlton County news:

-The Carlton County board at its meeting Monday heard from Melissa Walls of the Johns Hopkins Center for Indigenous Health based in Duluth. Walls told the board the Johns Hopkins Center — aimed at advancing Indian health through programs, research and policy — is growing and positioned to move from Duluth in one to two years, and would like to find 5,000 square feet of office space in Carlton County. “We’ve got room,” commissioner Gary Peterson said. “I would love to have you guys here.” The local unit of Johns Hopkins is little-known, Walls said, but she and the staff are working to change that. Walls cited proximity to the Fond du Lac Band as a reason to move to Carlton County. “We would love to be here,” she said. “It feels like a natural thing.”

• The board unanimously approved the reappointment of Duane Brownie as Carlton County Veteran Service Officer.

• A 4 p.m. Wednesday, Dec. 11 board meeting will be followed by the annual Truth-In-Taxation meeting at 6 p.m. at the Carlton County Transportation Center off Highway 61 in Carlton.

• As part of its consent agenda, the board approved a five-year extension for Talon Metals on an existing test borehole in Automba Township. The Minnesota Department of Health currently regulates the borehole and the variance will be added to the end of the previous 10-year permit. Talon Metals is based in Tamarack, Minnesota, where they have proposed a nickel mining operation. Talon is also exploring bedrock suitable for carbon capture in part of Carlton County, near the border with Aitkin County.

• A 4 p.m. Wednesday, Dec. 11 board meeting will be followed by the annual Truth-In-Taxation meeting at 6 p.m. at the Carlton County Transportation Center off Highway 61.

Editor's note: References to Talon Metals were corrected from an earlier version on Nov. 28.