About 40 residents in Windemere Township returned to the township hall on November 4 for a follow-up meeting over final assessments to be charged each property owner along or near Island Lake Road for recent road improvements to the 1.7 mile stretch of pavement. After hearing from more than a dozen filed complaints to the allocation of $193,294 in total proposed assessments, and on evaluating comparable estimated market values and figures for assessed neighboring townships for blacktop projects, the township board barely nudged from its revised proposal handed down in October.

On a motion from Jake Young, the board approved modifying only two property assessment figures. A parcel owned by Dave Rodestrom was reduced by half to $1,890, and property owned by Naomi Kiminski was reduced by $1,500, bringing that amount to $1,934. As for the assessments of the 62 remaining lots, pieces or parcels of land abutting and benefited by the bituminous paving of Island Lake Road, “We leave these the way they stand,” Young motioned.

The board approved the final assessment roll for placement in a formal resolution that is expected to be adopted at the next township meeting on November 12 at 6:00 pm. The assessments currently range from $185 for smaller parcels not directly affected by the road to $17,600 for larger parcels directly affected. Any owner of property to be assessed may appeal the final assessment to the district court of Pine County within 30 days after the adoption, and filing such notice with the district court within ten days after service upon the township chair or clerk.

Paving benefits market values

Prior to handing down the final roll, the board heard from Ann Heimbach, real estate appraiser with F.I. Salter Real Estate in Duluth, who explained the methods used to determine the estimated market values of the properties affected by the paving of Island Lake Road. Heimbach extensively researched comparable market values of property sales from Windemere Township and surrounding areas with similar road improvements. She evaluated data from original assessments on similar as well as various property types and compared those values to properties with road improvements. She found a 3-5 percent benefit to the market value of property abutting paved roads.

In comparing gravel roads versus paved roads in average price per square foot, said Heimbach, “I feel confident that paving does add value to properties.” Using the common assessment formula based on charges per front footage of land abutting the improved road, Heimbach also considered estimated market values for properties both directly and not directly on Island Lake Road.

The final assessment reveals a 50 percent decrease for property not directly on the road and for property on the edge of the road. Conversely, some final figures increased from the proposed assessments of September, because of estimated market values and reevaluation.

When asked why Heimbach did not consider assessment figures used by the Pine County assessor, she explained that the county uses a flat rate of value from road improvements. Heimbach said that her research includes market value sales that support the 3-5 percent increase in property value due to paved roads.

Before receiving final word from the board, residents took turns objecting to the latest assessment figures with varying reasons. Some requested the board place a reasonable cap, like $3,000, on assessments and disregard lot size and parcel value, saying, “All owners should be assessed the same.” They reasoned, “A paved road has the same value to all who live on it.”

Those owners with increased assessments objected to the new figures. Some said the whole township should bear a higher percentage to the costs of the project, as the road is “very widely used.” Residents also felt that the estimated property values are incongruous to any potential or actual sale figure.

The board also heard from Bill Helwig, attorney with the firm Rudy, Gassert, Yetka & Pritchett, P.A., in Cloquet, who represents a dozen landowners that filed a letter of objection two months ago with regard to the proposed assessments. Helwig spoke on behalf of his clients and reiterated complaints first presented at the public hearing on September 23, including procedural error in the board’s initial decision to pave the road. He said if the road improvement is not directly related to the increase in property value of each parcel, “the assessment is invalid.”

While landowner Rodestrom saw a decrease in one of his properties, he maintains the board decided to pave the road against objections from many owners who “tried to stop this project before it even got started.” He acknowledged the complaints stated by Helwig and said that while “legal fees are mounting, it would be nice to keep it out of court. But we’ll do what we have to do.”

Heimbach responded to the suggestion of capping affected owners, stating that more people’s assessments would go up by about 75 percent, “and that would not be fair. She continued, “On the face, it would seem fair, but a whole different group of people would be assessed more, and they would complain.”

After hearing opposition from residents, township attorney Kevin Hofstad, of Ledin and Hofstad, Ltd., in Pine City, informed the board that they could “reject all or more of the objections, or give them merit.” He told the public that the board’s decision on assessments is final.

Assessments take shape

Over the past year the board has entertained several scenarios for assessing the $276,135 cost of the Island Lake Road project. In October of 2008, when improvements were originally set to begin, the assessment schedule originally intended to charge owners with 80 percent of the cost for the road paving. The project was later considered a collector road, and proposed assessments to owners decreased to 70 percent of the total sum, or $193,294. The township is to pay the remaining $82,840 in costs.

A resolution in September of this year proposed that the 45 property owners affected by the road improvement pay varying amounts based on $13.42 per front footage of each parcel along the road. Charges ranged anywhere from about $500 to amounts hovering at $20,000 per parcel, plus interest if paid over the nine year limit. This was met with a flurry of opposition from owners who felt the amounts were unfair and unreasonable. The board was urged to “come up with a more fair way” of allocating the costs, possibly charging on a per user or partial basis of the township.

Opposition heightened at the September 23 meeting when the board learned of a dozen owners with higher charges who have sought legal representation to argue their case. Attorney Bill Helwig maintained, “Twelve people in the lawsuit are paying 70 percent of the project. They just want to pay their fair share.” Helwig believes that costs for paving “should be borne by the entire township and not by individual property owners.”

Helwig cited components to his mass appeal, including lack of proper documents produced. “We’re not sure if the project was based on petition or a decision of the board,” said Helwig, who noted that he could not find record of how the decision to pave the road was proceeded. “This constitutes procedural error,” he claims.

On the advice of township attorney Hofstad, it was decided in September that the board review the assessment roll with an outside appraiser (Heimbach) and evaluate charges with regard to reasonable increase in market value as a result of road improvements. “We will initiate the first phase and review what is fair and reasonable assessment compared to other blacktop projects in the area,” said Hofstad.

About the paving project

The Island Lake Road paving was one of a three-part bituminous road project that was to begin in the fall of 2008, which also included Majestic Pine Drive and Sturgeon Island Road. However, the project was canceled because the weather then proved unsuitable for optimal pavement work. Road improvements subsequently began in the spring of this year and were completed in July.

On September 23 the board approved a revised resolution declaring that $409,792 of the three-road project cost be assessed owners benefiting from the road improvements, with a corrected annual interest rate of 6.535 percent, payable beginning January 1, 2010 and effective from the date of the public hearings. The revised resolution restates terms from the initial declaration adopted September 3 and outlines the allocation of the $546,756 total cost of the three-part road project, with the township expected to bear $136,964 of the portion not assessed owners.

Allocation of assessments for owners affected by the paving of Majestic Pine Drive and Sturgeon Island Road are under separate consideration by the board. Assessment rolls for those roads are expected to be adopted with lesser fanfare later this month.