In the early part of 2002, because some Sibley Township residents were considering annexing into Jenkins on the north, Breezy to the east and Nisswa to the south, and not to break up the township of 18 square miles, the Sibley board approached the city of Pequot Lakes and asked to be annexed in as a whole — a friendly annexation, their choice.
On June 4, 2002, the contract was signed making Sibley Township part of the city of Pequot Lakes. The newspaper reads that on June 13, 2002, the Pequot Lakes City Council at that time, I believe because of a total mental meltdown, granted this to Sibley Township:
“All township residents will be part of the city of Pequot Lakes, taxes for former township residents will be based on their old township rates until they connect to city water and sewer service.”
I don’t know what the Pequot council was thinking, but even at that time 40 percent of the Pequot homeowners were never offered or asked if they would like city sewer and water. In reality, the west side of Sibley Lake and parts of Sibley Township won’t have sewer and water offered in the next 200 years — it was all razzle and dazzle by the Sibley board.
It wasn’t until this last May that I learned of this contract that Sibley Township had written up.
The annexation agreement reads, “The approximate ratio, which in the judgment of the town and city exists between the benefits resulting from the tax supported municipal service, to parcels of land of like market value situation in the urban service district and the rural service district is 2:1 (50 percent) respectively.”
Just to set the record straight, Sibley received police protection, fire protection and road maintenance from day one, the same as Pequot, and got the sweet deal of 50 percent off on their city taxes for the last 11 years.
With this information I went to the June 3, 2012, council meeting and complained something had to be done to correct this and make it right and equal for all taxpayers of Pequot. The council agreed that “the matter deserves further inquiry.” Nothing happened.
On Sept. 4, 2012, I again attended a council meeting, after picking up some paperwork from the county auditor’s office, and asked the council again to justify Sibley’s 50 percent tax break. One of the examples of paperwork I brought to the meeting from the auditor’s office was a tax printout to make the council aware of just how out of balance and slanted this tax setup is.
In the case of two homes, one Pequot and one Sibley, of fairly equal value, both never having been offered city water and sewer, the Pequot home, valued at $204,500, paid $1,382.84 in city taxes; the Sibley home, valued at $201,500, paid $595.27 in taxes.
That’s a difference of $787.62 in one year.
After the September meeting the mayor again said, “This is something the council plans to look at.”
A year later, nothing has happened. When people tell you one thing to your face, then do another, it’s called being two-faced and that’s just what the council has done to the Pequot taxpayer over this last year.
Now if you wonder why the Pequot City Council hasn’t acted on this matter since I brought it to their attention a year ago, here’s my opinion of the council’s action, as they were seated in 2012.
Mayor Nancy Adams, of Sibley, paid $10,499.73 in taxes from 2003-12 at the Sibley rate, putting $10,499.73 in her pocket.
Former council member Tom Ryan, of Sibley, paid $10,557.42 in city taxes from 2003-12, saving himself $10,557.42.
Council member Dave Sjoblad, of Sibley, paid $6,775.42 from 2003-12, saving himself $6,775.42.
Former council member Cathy Malecha, of Sibley, paid $2,519.13 in city taxes from 2003-12, saving herself $2,519.13.
Council member Jerry Akerson, of Sibley, paid $3,537.82 in taxes, saving himself $3,537.82.
The total saved by the council over that period of time is $33,890.03.
These figures all come from the county auditor’s office. If anyone would like to see them, I have them. As you can see by these figures, there was a great deal of city tax money lost over these last 10 years that the Pequot taxpayer made up to meet the financial budget at each year’s end.
To add a little salt to the wound, in 2003 there were properties containing commercial classification in Sibley Township that were given a 50 percent tax cut, which was called a “phase-in property tax which would be increased in substantially equal proportions over six years to equality with the local tax rate on property already within the city in the same tax classification.”
This is another part of the “friendly” annexation that the council doesn’t want you to know about.
This tax entitlement viewpoint the council has taken on is just like welfare; once you get a taste of it, it becomes an addiction, and this council certainly has acquired this taste and refuses to do anything about it, even after 11 years knowing it’s been unfair and wrong from the start. But, it does get votes from certain people, and now all indications point to the fact they’d like to extend it three more years.
I feel the solution to this tax mess using this 50 percent formula is to cut Pequot’s property tax 25 percent and increase Sibley’s 25 percent. Then we’re all playing on the same level field, and to do it at this year’s end. Sibley will say it can’t be done that quick; don’t buy it. They certainly moved quickly enough to complete the annexation. It was only six months to have their people on the ballot for Pequot City Council in 2003.
This is not intended to create hard feeling between Sibley and Pequot residents, but this annexation agreement was discriminating and totally wrong from the start. Sibley asked to be part of the city, voted to be part of the city, enjoys the benefits of the city, and now after 11 years it’s time you pay your fair share of taxes to be part of the city. If their tax roles were reversed this council wouldn’t be sitting here making time.
To all you Pequot property owners who sit down every May 15 and Oct. 15 and complain when you pay your city taxes, remember that if you don’t show up Tuesday, July 23, at 6:30 p.m. and voice your opinion, you have no one to blame but yourselves. As I’ve said before at the June 4, 2013, council meeting, the council agreed to a three-year phase-in on Sibley taxes to equalize them with Pequot Lakes, and these three years will cost you, and it won’t be cheap. Eleven years is enough.
(Jack Schmidt is a Pequot Lakes resident.)