IRRRB scraps plan for private trust
An effort to keep the Iron Range Resources and Rehabilitation taconite-tax-stocked economic development fund off limits to the state Legislature stalled Wednesday when the agency's advisory board voted unanimously to drop the idea, at least for now.
The nine state lawmakers that comprise the advisory board for the state Department of Iron Range Resources and Rehabilitation agreed to rescind the December 2014 resolution by their predecessors that established Range Trust. The private, nonprofit corporation was supposed to safeguard the taconite production taxes that mining companies pay instead of paying property taxes.
The issue arises because IRRR is a state agency but gets its money from the local share of the taconite tax. The private trust idea was promoted in 2014 after several attempts by southern Minnesota lawmakers to tap into the mining fund to help balance the state's general fund budget.
But the advisory board on Wednesday agreed with IRRR Commissioner Mark Phillips that too many questions remained about how money would be moved to the trust and how it would then be spent. Republican lawmakers also questioned how the private trust would be accountable to the public.
The IRRR economic development fund, now at $175 million, is intended to help diversify the Range economy in preparation for the ultimate demise of mining.
While the private trust was created in 2014 no money was ever transferred. The board was set Wednesday to move the first $50,000 into the trust fund from the IRRR account, but instead decided to scrap the plan and let the nonprofit trust disband.
"I think we need to step back. I understand the need to protect the fund, but I want to work with staff and come back to the board" with other, viable options, Phillips said at Wednesday's board meeting in Eveleth.
The IRRR Board was comprised of 9 DFLers in 2014. Now, it's a more even mix of 5 DFLers and 4 Republicans from across the region. All agreed Wednesday to work on a "bipartisan solution" to protect the local tax money but still have public oversight.
"By rescinding the previous resolution it's going to take the microscope (of outside attention) off the commissioner and the agency," said Sen. Justin Eichorn, R-Grand Rapids. "It's a good thing for the public trust as well."