100 Days of Reality in Duluth, MN - A Shrinking Community
Mayor Don Ne$$ and his administration’s first 100 days are here and with the positive campaign behind us, the reality is only starting to set in for Duluth taxpayers.
Duluth homeowners are looking at an average $7,500 per household for sewer improvements at the same time the City of Duluth funds tens of millions of taxpayer dollars on the likes of the Great Lakes Aquarium, Sister Cities programs, railroad studies, golf courses, unsold low-income housing and more.
It doesn’t stop there for Duluth homeowners as they can forget about the street monies from the Community Investment Trust, CIT, proceeds from the Fond-Du-Luth Casino agreement. The original plan was that property owners were to pay 25 percent of the cost of street improvements abutting their property. The Ne$$ Administration and Duluth City Council are looking at assessing somewhere between 75 and 100 percent of street improvements on the backs property owners. Duluth residents can say “so long” to the CIT street program and the pilfered estimated $60 million dollars of CIT funds.
Over a $5 million dollar budget shortfall is facing the Duluth taxpayers for 2008. This deficit hardly includes the increased energy costs and fallout from the national recession.
Over $270 million dollars of taxpayer obligation for retiree health care remains grossly underfunded for Duluth City employees and retirees. This issue seems to have been forgotten with all of the other governmental dysfunction.
The ISD709 Red Plan, a $437 million school district bonding improvement plan which the people of Duluth were not allowed to vote on, is directly competing with the city government need for more dollars.
At the same time, Duluth has a poverty rate twice that of the state average and the pressure is only beginning to be felt by those Duluth residents and business that do pay taxes.
Duluth is well known as a “labor town”. This past election Duluth Political Action Committees, PAC, contributed 233 percent more than the previous election, $130,000, to getting their candidates elected. These PAC expenditures were mostly led by the government worker unions, AFSCME and the Duluth Fire Department PAC.
Compile this with Minnesota ranking the 6th highest in per-capita taxes in the nation, 2nd highest corporate tax rate nationally, and is ranked 45th in its friendliness towards small business; you don’t need a degree in economics Duluth to conclude in serious financial trouble.
Speaking of economic degrees, in 2001, the Knight Foundation commissioned Ned Hill, a Professor and Distinguished Scholar of Economic Development at Cleveland State University, for an Economic Summit and presentation to the Duluth City Council. The tax base has remained relatively the same while expenses continue to go up and liabilities such as the unfunded retiree health care over doubled. Unfortunately Professor Hill’s message was ineffective and change continues to be uncommonly difficult in Duluth.
In 1960 Duluth had a population of 106,884 and today 86,319. Today there are approximately 26,000 area college students, thus Duluth’s actual year round population is estimated to be only 70,000.
Duluth city government has a long tradition of capitalizing non-essential core services and providing some of the best paying government jobs and benefits to its workers. The time to pay the piper has arrived. The actual number of taxpayers contributing to the tax base is too few to meet the obligations cause by decades of neglect and mismanagement. A population drop is imminent as more of the obligations are force upon the remaining taxpayers. Sadly, many will find it impossible to meet these demands.
After nearly nine years of Ne$$ in the system, as an elected official, one can only conclude that what's another 100 days?
The Ne$$ Administration 100 day agenda can be viewed at: http://www.duluthmn.gov/city/government/mayor/100_day_agenda.pdf
My name is Tony Ramone and I approve the use and reproduction of this opinion.