OPENPUBLICA · PUBLIC MEETING RECORD
Record of Proceedings

Duluth City Council Meeting - April 27, 2026

City Council — Monday, April 27, 2026
BodyDuluth, Minnesota
SessionCity Council
DateMonday, April 27, 2026
StatusFILED
Video Record
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Transcript — Verbatim
0:03

There were so many of them.

0:10

That will always be my favorite.

0:39

We'll begin in one minute.

0:47

I don't know.

0:48

Is this recorder?

1:13

All right, good evening, everyone.

1:14

We'll begin the finance committee meeting.

1:16

Welcome.

1:17

I want to welcome uh Director Salinas and Manager Harrell here tonight.

1:20

And uh I want to take a moment just to frame the work ahead of us because I know this series of finance committee meetings is different than what we've done in past years.

1:28

But as we look ahead to 2027, we're facing that five million dollar funding gap.

1:32

It's not a small adjustment, it's a structural challenge that's going to require us to really do a lot of evaluating on our priorities, understanding our trade-offs, making you know, at times difficult choices and decisions.

1:45

So we want to make a shift.

1:47

So you'll see two documents in front of you, counselors.

1:49

One is the dates of all of the committee meetings and the topics the finance department will be providing for us.

1:57

We'll have a chance for a presentation and then always a QA at the end.

2:00

And then you'll also see just meeting at a glance, the calendar, so you can make sure to mark those down.

2:05

Hopefully, these are going to be working sessions.

2:08

Again, we'll meet one time a month.

2:09

They're designed to give us a longer runway as we prepare for the 2027 budget presentation.

2:14

These sessions are not about making final decisions, they're about building a shared understanding.

2:19

Um hopefully we'll be able to, you know, dive deeper into some uh yep, those are the two.

2:26

Um dates are wrong.

2:31

Which date is wrong?

2:33

June.

2:34

June 22nd to 29.

2:36

We'll check on it.

2:38

It's Monday, the 29th.

2:39

I think that's the council date, isn't it?

2:44

Okay, we'll check on this one.

2:45

I think this sheet's wrong.

2:47

We'll check on that.

2:48

Um, these are all council Mondays, and they are correct on your counselor calendar, so sorry for the confusion on that one.

2:54

Okay, um, and again, our budget presentation is uh September 11th from 9 uh to hopefully we'll get out of three.

3:01

It says to four, but we're gonna try to get out of it as soon as we can.

3:04

So mark your calendars.

3:05

That was the date that worked best for both for most counselors.

3:08

So sorry if it doesn't work for you.

3:10

I'll turn it over now to Director Salinas.

3:13

Thank you, Finance Committee Chair Randor, committee members Decatel Enforcement, President Nephew, Vice President Kennedy, and Councillors.

3:21

I am Nina Salinas, I'm the finance director, and today with me is our city budget manager, Missy Harold.

3:29

And we welcome the opportunity to present at these monthly meetings, our process and information related to the city budget and to collaborate with this committee as well as with the councilors.

3:45

The City of Duluth identified five strategic priorities housing at all income levels, growing our commercial tax base, the core services of streets and utilities, downtown Duluth, and affordable property taxes.

4:10

And we'll have to tackle this in the short term, and we will also be needing to consider any current maintenance, deferred maintenance, as well as any future maintenance for items that get placed in service.

4:24

Our focus today is around the introductory budget 101, is what we're calling our presentation today.

4:30

And it's going to be mostly focused around item five, the property tax, and we'll touch a little bit on how growing the commercial tax base affects the our different taxpayers.

4:42

The finance department plays a critical role in leading or supporting these strategic priorities, and we closely collaborate and support administration and all the other city departments.

4:54

Throughout these monthly committee meetings, we'll cover the stress points in our budget.

5:00

We'll look at options and scenarios, and as mentioned, the trade-offs of these different options and scenarios.

5:05

Our goal will be to provide as much information as possible so that we can make well-informed decisions, not only for this 2027 budget cycle, but for the coming years as well.

5:17

We're committed to financial stewardship, collaboration, and transparency, and our actions are going to be focused not only on the near term, but we really must consider the long-term sustainability of our city.

5:32

The agenda for today we will cover a budget timeline and property tax levies.

5:40

We'll go over assessment and classification, and there's going to be an example of how this increase of the commercial tax base affects other taxpayers.

5:51

And although it's not meant to be a training, there was a request to cover the city funds, and we won't do a thorough detail, but I will cover all of the different types of funds that we manage here.

6:05

We'll do, and then we'll move on to a high level preview of the general fund and the next steps.

6:11

We're going to end our presentation with the capital budgeting process, and that's this will be followed by questions.

6:18

To make sure that we're able to get through all of our materials, we're going to ask that you please note down the title of the slide, and we will take all your questions.

6:26

If you can just please hold those until the end.

6:34

Before I turn it over to Missy, as uh as was mentioned, we're gonna have these meetings on a monthly basis, and you have a schedule schedule in front of you that has all of the different topics, and those are going to be aligned with what the actual timeline of the budgeting process looks like.

6:52

So the top bar that you see on this slide is we will have these committee meetings starting, of course, this month all the way through the end of the year, and these will take place before the last Monday council, and the two exceptions are that the May meeting will be held in on a Tuesday because of the observance of Memorial Day, and then in September we're gonna have uh the budget retreat on the 11th.

Discussion Breakdown — Share of Meeting
Economic Development███████████████████████████27%
Procedural█████████████████████21%
Engineering And Infrastructure█████████████13%
Budget Equity Analysis████████████12%
Historic Preservation███████7%
Parks and Recreation████4%
Public Engagement████4%
Property Tax██2%
Healthcare Access██2%
Summary of Proceedings

Duluth City Council Meeting - April 27, 2026

The Duluth City Council met on Monday, April 27, 2026, in Council Chambers. Before the regular meeting, the Finance Committee held a 2027 budget working session. The Council approved a consent calendar with one item pulled for separate vote, established Tax Increment Financing (TIF) District No. 39 for the Duluth Armory, approved a Morgan Park housing TIF plan, approved a demolition change order for the Shoppers' Ramp, and acted on street preservation engineering contracts, a Oneota property purchase, and the Hillside Sport Court contract.

Finance Committee Working Session

  • Finance Committee Chair Randorf framed the 2027 budget challenge as a "five million dollar funding gap" and stressed the need to evaluate priorities and trade-offs; Finance Director Nina Salinas and Budget Manager Missy Harrell presented a "Budget 101" overview.
  • The projected general fund deficit was later stated as $5.5 million, with revenues expected to grow 1.5% and expenses 5.9%.
  • The 2026 total city budget is $519.3 million; the general fund is $113 million, with 72% of ongoing general fund revenues from local government aid, property taxes, and city sales tax, and 83% of general fund expenses going to salaries, benefits, and retiree medical/life insurance.
  • The budget timeline includes a tentative August 24 property tax levy/budget presentation, a September 11 budget retreat, a November 24 capital plan presentation, a December 7 truth-in-taxation hearing, and December 14 final levy/appropriation approvals.
  • Property tax allocation was presented as 26% City of Duluth, 2% parks, 43% St. Louis County, 25% school district, and 5% special taxing districts.
  • Councilors asked for deeper dives on employee medical benefits (Tomanek), revenue assumptions and sales tax (Forsman), and slides/agenda copies (Kennedy).

Consent Calendar

  • Councilor Tomanek moved and Councilor Johnson seconded approval. Councilor Durrwachter pulled Item 9 (26-0348R) for separate consideration; the pull and the amended consent agenda passed unanimously by voice vote.
  • Adopted consent items included a five-year Pitney Bowes mail machine lease totaling $40,231.20; election polling pads for $68,160; appointments/reappointments to the Library Board, Parks and Recreation Commission, Community Development Committee, Commission on Disabilities, and Public Arts Commission; $22,500 agreements with the HRA and ONE Roof Community Housing for the Tenant Landlord Connection Program; a West Niagara Street no-parking zone; numerous street preservation, water/utility, stormwater, truck/equipment, water tower, and construction contracts; a Duluth Police Foundation gift; City Hall Attorneys and Clerks office remodel ($210,500); Hawk Ridge Trail accessibility upgrade ($137,200); and a $36,000 St. Louis County aquatic invasive species grant.

Public Comments & Testimony

  • No one spoke at the public hearing on TIF District No. 39.
  • Derek Pederson (Business Manager, Laborers Local 1081) expressed support for the TIF districts and project labor agreements, citing jobs and economic development.
  • Dan Collison (Sherman Associates) expressed support for the Armory TIF, describing the $47 million project and its expected benefits, including up to 300+ jobs and removal of blight.
  • Carolyn Sundquist expressed support, noting the Armory has been blighted for 26 years and that the community is asking only for a TIF district.
  • Deb Schaber (Executive Director, New Duluth Armory) described the planned community gathering space, arts/cultural hub, youth education, and free/low-cost programming.
  • Josie LaPorte spoke in support of her reappointment to the Parks and Recreation Commission, pledging to represent District 3.
  • Matt Baumgartner (President, Duluth Area Chamber of Commerce) expressed support for TIF District 39, the Armory, library appointees, the Tenant Landlord Connection Program, and the Hillside Sport Court project.
  • Roy Hamlin (Hamlin Music Academy) raised concerns about a vape shop sign next to his daughter's business, mentioning 151 days, 10 council appearances, and contacts with multiple city and state offices.
  • Dillon Messick, a UMD senior, thanked the Council for its public service.

Discussion Items

  • DEDA Financial Consulting Agreement (Item 9, 26-0348R): Councilor Durrwachter said she would vote no, questioning an annual financial advisory contract and citing a past project concern. Councilor Clanaugh echoed process questions. Councilor Johnson clarified the $300,000 is over three years ($100,000/year), and Councilor Forsman defended Ehlers as a reputable firm. The resolution passed 7-2, with Durrwachter and Clanaugh opposed.
  • TIF District No. 39 - Duluth Armory (26-0335R): Supporters called it a transformative adaptive-reuse project; Councilor Desotelle raised concerns about the 10-foot Chester Creek culvert under the site. Councilor Durrwachter sought a more robust pro forma, but-for analysis, and development agreement before voting, and Councilor Clanaugh supported more time; others noted the vote was only to establish the district, with a development agreement expected later. Motion passed 7-2, with Clanaugh and Durrwachter opposed.
  • Orchard at Morgan Park TIF Housing Plan (26-0346R): The HRA-proposed plan supports 12 single-family homes. Councilor Durrwachter voted no based on her earlier process concerns; the resolution passed 8-1.
  • Shoppers' Ramp Demolition Change Order (26-0349R): The resolution authorized a change order with Carleton Companies for a new total not to exceed $3,045,430.84 and up to $400,000 transfer to DEDA. Durrwachter and Clanaugh voted no, citing change-order percentages and wanting rebids; administration and others cited discovered buried materials, brownfield funds, and the cost/complexity of rebidding. Motion carried 7-2 after a motion to call the question passed.
  • Street Preservation Engineering Amendments: The Council approved a $273,930 increase (new total $367,542) for MSA on Gary/New Duluth and a $128,615 increase (new total $352,390) for SEH on Lincoln Park. Both passed 9-0, though Durrwachter noted the high percentage increases.
  • Oneota Property Purchase (26-0332R): Council approved purchasing property from Knife River Properties LLC for $1,175,000 plus associated costs, unanimously.
  • Hillside Sport Court Park Site Improvement (26-0249R): Removed from the table and approved unanimously. Councilors highlighted the adjoining giving garden, community benefits, and funding tied to a prior Cirrus/incubator building sale.

Key Outcomes

  • Minutes of the April 13, 2026 Council meeting were accepted without objection.
  • The amended consent agenda, excluding pulled Item 9, was approved unanimously.
  • Item 9 (Ehlers/DEDA financial consulting) passed 7-2.
  • Resolution 26-0335R (TIF District No. 39) passed 7-2.
  • Resolution 26-0346R (Orchard at Morgan Park TIF) passed 8-1.
  • Resolution 26-0349R (Shoppers' Ramp change order) passed 7-2.
  • Resolutions 26-0333R and 26-0339R passed 9-0.
  • Resolution 26-0332R passed 9-0.
  • Resolution 26-0249R passed 9-0.
  • The meeting adjourned after Councilor/administration comments.

Meeting Transcript

There were so many of them. That will always be my favorite. We'll begin in one minute. I don't know. Is this recorder? All right, good evening, everyone. We'll begin the finance committee meeting. Welcome. I want to welcome uh Director Salinas and Manager Harrell here tonight. And uh I want to take a moment just to frame the work ahead of us because I know this series of finance committee meetings is different than what we've done in past years. But as we look ahead to 2027, we're facing that five million dollar funding gap. It's not a small adjustment, it's a structural challenge that's going to require us to really do a lot of evaluating on our priorities, understanding our trade-offs, making you know, at times difficult choices and decisions. So we want to make a shift. So you'll see two documents in front of you, counselors. One is the dates of all of the committee meetings and the topics the finance department will be providing for us. We'll have a chance for a presentation and then always a QA at the end. And then you'll also see just meeting at a glance, the calendar, so you can make sure to mark those down. Hopefully, these are going to be working sessions. Again, we'll meet one time a month. They're designed to give us a longer runway as we prepare for the 2027 budget presentation. These sessions are not about making final decisions, they're about building a shared understanding. Um hopefully we'll be able to, you know, dive deeper into some uh yep, those are the two. Um dates are wrong. Which date is wrong? June. June 22nd to 29. We'll check on it. It's Monday, the 29th. I think that's the council date, isn't it? Okay, we'll check on this one. I think this sheet's wrong. We'll check on that. Um, these are all council Mondays, and they are correct on your counselor calendar, so sorry for the confusion on that one. Okay, um, and again, our budget presentation is uh September 11th from 9 uh to hopefully we'll get out of three. It says to four, but we're gonna try to get out of it as soon as we can. So mark your calendars. That was the date that worked best for both for most counselors. So sorry if it doesn't work for you. I'll turn it over now to Director Salinas. Thank you, Finance Committee Chair Randor, committee members Decatel Enforcement, President Nephew, Vice President Kennedy, and Councillors. I am Nina Salinas, I'm the finance director, and today with me is our city budget manager, Missy Harold. And we welcome the opportunity to present at these monthly meetings, our process and information related to the city budget and to collaborate with this committee as well as with the councilors. The City of Duluth identified five strategic priorities housing at all income levels, growing our commercial tax base, the core services of streets and utilities, downtown Duluth, and affordable property taxes. And we'll have to tackle this in the short term, and we will also be needing to consider any current maintenance, deferred maintenance, as well as any future maintenance for items that get placed in service. Our focus today is around the introductory budget 101, is what we're calling our presentation today. And it's going to be mostly focused around item five, the property tax, and we'll touch a little bit on how growing the commercial tax base affects the our different taxpayers. The finance department plays a critical role in leading or supporting these strategic priorities, and we closely collaborate and support administration and all the other city departments. Throughout these monthly committee meetings, we'll cover the stress points in our budget. We'll look at options and scenarios, and as mentioned, the trade-offs of these different options and scenarios. Our goal will be to provide as much information as possible so that we can make well-informed decisions, not only for this 2027 budget cycle, but for the coming years as well.

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