The debate over whether Minnesota will allow copper nickel mining has intensified this week. On Wednesday, the state’s Department of Natural Resources (DNR) and the U.S. Army Corps of Engineers released the long-awaited environmental review of the proposed PolyMet copper mine project. Let’s recap how the project got started, the scope of the project, and the governmental process.
In 2005, Polymet Corporation purchased assets of the bankrupt iron-ore LTV mining Corporation, which was located near Hoyt Lakes in northeastern Minnesota. The land and facility is part of the Duluth complex, which contains the world’s largest undeveloped deposits of non-ferrous metals. The deposits, which were discovered in the 1940’s, are now economically viable. In the 1990’s, a hydrometallurgical process for recovering copper, nickel, cobalt, platinum, palladium, and gold from rock became commercially viable. These metals are typically used in construction, plumbing, electrical wiring, batteries, cell phones, aircraft engines, medical treatments, electronics and more.
In 2005, Polymet began the process to receive the required permits to mine copper nickel. The Minnesota Environmental Policy Act (MEPA) requires that an environmental impact statement (EIS) be conducted for all new mining operations. The DNR is usually the responsible government unit for producing the statement; however, the federal government can also be involved depending on the specific conditions of the proposed project (land ownership, wetland, etc.). The proposed Polymet project raises several different environmental concerns then projects associated with taconite or ferrous mining. This has increased the complexity of the environmental review process.
On October 19th, after more than four years of analysis and input by a number of the state and federal agencies, the nearly 1,000 page draft EIS was made available to the public on the DNR website. A major environmental concern raised is the effect the disposal of sulfide based tailings will have on water quality. The completion of the EIS marks the start of the public comment period, an opportunity for the public comment on the proposed project and the processes used by the governmental agencies in drafting the EIS, a period that will last 45 days or longer.
So what does the EIS do? It helps permitting organizations and the public understand the environmental and socioeconomic impact of the proposed project. It uses the best data available to determine potential environmental impacts and explores ways to mitigate or avoid potential adverse impacts. What doesn’t the EIS do? It does not approve or disapprove the proposed project, nor does it guarantee that permits can be issued. Once the EIS process is complete, after public comments and revisions by the DNR and Corps of Engineers, Polymet will then apply for mining and air and water pollution permits through the MN Pollution Control Agency, MN DNR Division of Waters, and MN DNR Division of Land and Minerals.
Sunday, November 1, 2009
Monday, October 26, 2009
Passing the Family Cabin Outright to Your Children
It is the end of another long week of meetings, traffic, deadlines, and stress. You leave work and set off into the night. The closer you get to your private hideaway, the faster your troubles seem to fade away. There is no better medicine for your worries.
The weekend is filled with laughter, relaxation, and family fun. The hideaway has become a multigenerational meeting place where grandparents, adult children and their spouses, and grandchildren come to play. Perhaps it is a cabin located on Lake Vermilion, Burntside, or Pokegama. No matter where your destination is, there sense peace and happiness.
Your goal is to pass this property on to your family. Perhaps, for both nostalgic and financial reasons, you want to keep this vacation home in the family for future generations. However, passing on a cabin without a proper succession plan can cause unintended consequences. For example, consider if your three children inherit your cabin outright, all three are listed on the deed. As life often does, it may throw in a curve ball. Perhaps, one child loses her job, can’t afford her share of maintenance costs and want to sell out her share. But, the other children are not financially in a position to buy her out. Therefore, the distressed daughter is forced to ask the court to “partition” the cabin. Other words, sell the family hideaway.
This is just a small example of the undesirable outcomes of inheriting or passing on property outright to your children. This outright transfer creates “tenants in common,” which refers to arrangements under which two or more people co-own a parcel of real estate without a right of survivorship. This type of co-ownership allows each co-owner to choose who will inherit his/her ownership interest upon death. In addition, each owner can also individually sell their interest in the property.
Tenants in common can be formed when real estate is left directly to multiple family members in a will, deeds property outright, or in the event that one passes without a will. A reason to avoid creating this type of ownership is the right of each owner to partition. Partition is the right of a land owner to petition the court to sell the property, if the other joint owners are unwilling or unable to buy him/her out.
A trust, a partnership agreement, or LLC operating agreement can address how the each family members’ interests are to be treated in the event of death or divorce, address the inability of one or more owners to afford maintenance, establish how capital improvement are to made (and at whose expense), and more. Take time to make a succession plan, this will help ensure your cabin is there for generations to come.
The weekend is filled with laughter, relaxation, and family fun. The hideaway has become a multigenerational meeting place where grandparents, adult children and their spouses, and grandchildren come to play. Perhaps it is a cabin located on Lake Vermilion, Burntside, or Pokegama. No matter where your destination is, there sense peace and happiness.
Your goal is to pass this property on to your family. Perhaps, for both nostalgic and financial reasons, you want to keep this vacation home in the family for future generations. However, passing on a cabin without a proper succession plan can cause unintended consequences. For example, consider if your three children inherit your cabin outright, all three are listed on the deed. As life often does, it may throw in a curve ball. Perhaps, one child loses her job, can’t afford her share of maintenance costs and want to sell out her share. But, the other children are not financially in a position to buy her out. Therefore, the distressed daughter is forced to ask the court to “partition” the cabin. Other words, sell the family hideaway.
This is just a small example of the undesirable outcomes of inheriting or passing on property outright to your children. This outright transfer creates “tenants in common,” which refers to arrangements under which two or more people co-own a parcel of real estate without a right of survivorship. This type of co-ownership allows each co-owner to choose who will inherit his/her ownership interest upon death. In addition, each owner can also individually sell their interest in the property.
Tenants in common can be formed when real estate is left directly to multiple family members in a will, deeds property outright, or in the event that one passes without a will. A reason to avoid creating this type of ownership is the right of each owner to partition. Partition is the right of a land owner to petition the court to sell the property, if the other joint owners are unwilling or unable to buy him/her out.
A trust, a partnership agreement, or LLC operating agreement can address how the each family members’ interests are to be treated in the event of death or divorce, address the inability of one or more owners to afford maintenance, establish how capital improvement are to made (and at whose expense), and more. Take time to make a succession plan, this will help ensure your cabin is there for generations to come.
Shouldn't My Property Taxes Be Going Down?
Property values across the U.S., including Minnesota (and Minnesota lakeshore) have been declining. So, of course, one would expect their property taxes will decrease next year as well. Sadly, a decrease in your property taxes is unlikely to happen. In order to understand why, we have to take a look at how the property tax system in Minnesota works.
Unlike income and sales taxes, which are rate-based taxes, Minnesota's property tax does not work this way. Rather, property tax is a levy based tax. This means that taxing districts, such as cities, counties, school districts and special taxing districts, determine how much money they will need to raise in property taxes in order to balance their budget. The “levy” amount is then used to determine the tax rate which is to be applied to local property. Therefore, a change in the value of local taxable property will affect the distribution of what each property’s share is, but will not likely affect total revenues generated by the state.
Given this levy-based system, there are three basic factors that will determine an individual parcel’s property tax liability: (1) your local levy, the rate your local taxing district(s) decide to impose on property, (2) your parcel’s share to total property tax base, this valuation includes estimated market values, the portion of the value which is taxable, and the class rate (statutorily set), and (3) applicable tax credits, credit amounts which are subtracted from the tax liability.
Finally, the property tax system in Minnesota has a time lag component- the assessment cycle. It typically takes assessors six months or more to take into account new sales, in terms of valuing properties. Additionally, even once they do account for the decrease or increase in value there is another lag of one year or more before those values are used to calculate your property taxes.
This is a very simplified view of property taxes; don’t expect major changes in your tax bill to come quickly. However, that being said, it is worth while to talk to your local assessor about the valuation of your property, this could save you money in the future.
Unlike income and sales taxes, which are rate-based taxes, Minnesota's property tax does not work this way. Rather, property tax is a levy based tax. This means that taxing districts, such as cities, counties, school districts and special taxing districts, determine how much money they will need to raise in property taxes in order to balance their budget. The “levy” amount is then used to determine the tax rate which is to be applied to local property. Therefore, a change in the value of local taxable property will affect the distribution of what each property’s share is, but will not likely affect total revenues generated by the state.
Given this levy-based system, there are three basic factors that will determine an individual parcel’s property tax liability: (1) your local levy, the rate your local taxing district(s) decide to impose on property, (2) your parcel’s share to total property tax base, this valuation includes estimated market values, the portion of the value which is taxable, and the class rate (statutorily set), and (3) applicable tax credits, credit amounts which are subtracted from the tax liability.
Finally, the property tax system in Minnesota has a time lag component- the assessment cycle. It typically takes assessors six months or more to take into account new sales, in terms of valuing properties. Additionally, even once they do account for the decrease or increase in value there is another lag of one year or more before those values are used to calculate your property taxes.
This is a very simplified view of property taxes; don’t expect major changes in your tax bill to come quickly. However, that being said, it is worth while to talk to your local assessor about the valuation of your property, this could save you money in the future.
Friday, September 4, 2009
Top 3 Reasons To Have An Estate Plan
1. Make your retirement years easier.
Even though estate planning primarily benefits those you love and care about, you can also coordinate your estate plan with retirement, health care and other benefits to help you achieve the most comfortable final years while still providing for your loved ones.
2. Provide for your immediate family
Proper estate planning will provide enough money for your family to continue their lifestyle as well as ensure your children’s education and upbringing is provided for.
3. Ease the strain on your family
Ease the burden on your grieving survivors by planning your funeral arrangements when planning your estate. This is done in your healthcare directive.
3. Ease the strain on your family
Ease the burden on your grieving survivors by planning your funeral arrangements when planning your estate. This is done in your healthcare directive.
Basic Estate Plans include:
Will
Everyone needs a will. A will is a legal document that allows you to transfer your property at your death. A will is a simple way to ensure that your money, property, and personal belongings will be distributed as you wish after your death. If you die intestate (without a will), Minnesota's state laws of distribution will determine who receives your property by default, that law may or may not reflect your actual wishes.
Durable Power of Attorney
A durable power of attorney is a document authorizing someone to act "legally" on your behalf. You determine how much power the person will have over your affairs. A general power of attorney authorizes your agent to conduct your entire business and affairs (buy & sell your property, pay taxes, invest your money in stocks, bonds, etc.). A limited or special power of attorney authorizes your agent to conduct specified business or make only certain decisions on your behalf. A power of attorney is considered "durable" when it remains valid even if you become incompetent or incapacitated.
Healthcare Directive
A healthcare directive written document that informs others of your healthcare wishes. During your life time, it allows you to name a person or agent to make decisions for you if you are unable to do so. A healthcare directive is useful if you become unable to adequately communicate your healthcare wishes.
Everyone needs a will. A will is a legal document that allows you to transfer your property at your death. A will is a simple way to ensure that your money, property, and personal belongings will be distributed as you wish after your death. If you die intestate (without a will), Minnesota's state laws of distribution will determine who receives your property by default, that law may or may not reflect your actual wishes.
Durable Power of Attorney
A durable power of attorney is a document authorizing someone to act "legally" on your behalf. You determine how much power the person will have over your affairs. A general power of attorney authorizes your agent to conduct your entire business and affairs (buy & sell your property, pay taxes, invest your money in stocks, bonds, etc.). A limited or special power of attorney authorizes your agent to conduct specified business or make only certain decisions on your behalf. A power of attorney is considered "durable" when it remains valid even if you become incompetent or incapacitated.
Healthcare Directive
A healthcare directive written document that informs others of your healthcare wishes. During your life time, it allows you to name a person or agent to make decisions for you if you are unable to do so. A healthcare directive is useful if you become unable to adequately communicate your healthcare wishes.
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