Marquette County settles with Cleveland steel giant over $50M tax bill


Marquette County has reached a settlement to resolve the nearly $50 million in delinquent taxes owed by a Cleveland-based steel producer on an idled Upper Peninsula ore mine.

The county announced the agreement with Cleveland-Cliffs, North America’s largest flat-rolled steel company, after publicly chastising the company in a press release Tuesday. The statement outlined the nearly $1 million spent over seven years of litigation as the county pursued delinquent tax payments on Empire Mine near Negaunee.

The company, a leading supplier of automotive-grade steel, met with county officials on Thursday to work out a settlement and reached a deal that “provides tax certainty for the four taxing units through 2032,” the county said in a statement Friday.

Details of the settlement were not immediately available.

“Cleveland-Cliffs CEO Lourenco Goncalves was directly involved with the negotiation, which led to a quick resolution,” Marquette County’s statement said. “The settlement met Marquette County’s three objectives: to arrive at a tax payment settlement, avert job layoffs and potential mine closure, and to end the costly ongoing litigation.”

Cleveland-Cliffs did not immediately return a call seeking comment.

Debbie Pellow, the clerk for Tilden Township, said the deal is expected to be finalized in the next few days. The parties did not want to give details of the agreement until then.

Pellow said she was satisfied with the deal, but disappointed with Goncalves, who she said made threats to the adjacent Tilden Mine if the communities didn’t agree to the settlement. Empire Mine is largely located in Richmond Township, with a small portion falling within Tilden Township boundaries.

“He pretty much said there will be layoffs and there will be closures if you don’t go along with this deal,” Pellow said. “It’s not that it’s a bad deal, it’s just the approach the CEO took — I would not do that to anyone.”

Marquette County said it has paid nearly $1 million in litigation expenses since 2018 trying to get Cleveland-Cliffs to pay its taxes. The company, county officials said, has paid one year of taxes since 2018, about $13 million in 2021 when it forgot to appeal that year, and owes roughly $50 million.

The county accused Cleveland-Cliffs in its press release of making conflicting representations on the value of it’s mine to state agencies, whom they told there were still iron ore deposits present in the mine, and local taxing authorities, to whom they’ve presented a bleaker picture to avoid paying $50 million in real and personal property taxes.

Among the taxes that have gone unpaid are about $2.9 million owed in personal property taxes to the townships of Richmond and Tilden, which have the authority to seize personal property for the unpaid taxes.

Cleveland-Cliffs, which idled the Empire Mine in 2016, has argued in litigation dating back to 2018 that the State Tax Commission’s valuation of the mine is too high, given that the mine is idle, the county said.

But the company also has represented separately to the state that there are additional ore deposits that could be unearthed at the mine site.


Read More: Marquette County settles with Cleveland steel giant over $50M tax bill

2024-02-24 01:56:57

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