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OPENPUBLICA · PUBLIC MEETING RECORD

Record of Proceedings

Duluth City Council Meeting - August 24, 2026: Lester Park Golf Course, Appointments, and Ordinances

City Council — Monday, August 24, 2026

BodyDuluth, Minnesota

SessionCity Council

DateMonday, August 24, 2026

StatusFILED

Video Record

0:00 / 2:37:46

Transcript — VerbatimClick a timed line to jump · ⧉ to share it

0:48

Hello, Councillor Johnson, just want to confirm that you can hear us.

0:54

Can you hear me?

0:55

Yes, we can.

0:55

Loud and clear.

0:57

Thank you.

5:10

Oh yeah.

5:11

So we got the thing is when we when there's a couple of assignments I moved I didn't want to jump in the gun and you already answered it.

5:21

So I hope we guess how you're gonna do that.

5:26

What was that one again?

5:27

I read it.

5:30

Oh yeah, they reached out.

5:35

Yeah, they resort.

5:40

I don't have to answer that.

5:42

You know?

5:58

Well she wrote it, so I don't know.

6:01

Yeah, yeah, yeah.

6:03

I don't know if it's for clarity.

6:05

I don't know.

6:10

I'm okay as long as everyone just understands what it is.

6:39

Yeah, those are yours.

6:43

All right, good evening, everyone.

6:45

Um we will open with our finance committee meeting.

6:48

Good evening.

6:49

We'll uh begin with uh tourism tax one on one overview.

6:53

Uh and uh I hopefully we'll get a better understanding of how these revenues work, what they can be used for, what they can't be used for, and really their role in the city's overall financial plan.

7:02

Then we'll pivot into an update on where we stand with the twenty twenty-seven budget, including work underway to evaluate revenues, expenses, and various factors that'll shape the budget.

7:12

Dates to note that are coming up.

7:14

Councillors, uh September tenth, Thursday, after the agenda session, we have a max levy presentation, and then that immediately that next day at nine o'clock we'll meet at the deck for our budget retreat.

7:26

And with that, I'll turn it over to uh finance director Salinas.

7:30

Thank you, Finance Committee Chair Randor, uh counselors, thank you for being here.

7:34

This is I believe our fourth uh finance committee, and I'm usually accompanied by my one of my fabulous staff members, but I'm solo today.

7:43

And um as uh committee chair Randorf mentioned, today we're gonna cover tourism taxes.

7:51

This is an important part of our budgeting process, although not part of our general fund.

7:56

It is something that comes up regularly, so I'll we wanted to cover uh a good overview of the of the tourism taxes, and then I will get to a uh budget update and the next steps that we have for the general the general budget.

8:11

And then as always, um I leave time at the end for questions.

8:14

So all of you should have a presentation in front of you with the slides.

8:19

So I ask that you please note your questions and then we'll have time at the end for that.

8:28

So I'm gonna begin with an overview first of tourism taxes, and then I'll start getting into the sources and then I'll get in a little bit into the details to break down how we collect them, uh the numbers that we're collecting, the percentages, the dollars, and then the restrictions on the spending.

8:48

I've broken it down uh into smaller sections to layer it.

8:51

It's uh fairly complex after being here um almost nine months now.

8:57

Uh this is still something that I am learning the nuances and finding all the details.

9:02

So I'm hoping to share as much as I can if there's something that I don't share and we can't um get to at the end of today, then of course please feel free to reach out.

9:10

I some I had conversations with some of you around this, but I do think it's really important.

9:16

So hopefully um at the end you're not more confused, you're more enlightened about tourism taxes, and you can leave digesting it a little bit and understanding all of the all of the details.

9:28

So I'm gonna begin with what are tourism taxes.

9:33

And there's two components that we where we collect taxes from the customers at point of sale.

9:41

There's lodging and then there's food and beverage.

9:44

So what I do want to say is that tourism taxes are not sales tax except for one small component, which we'll get to.

9:52

But generally, when you're paying sales tax on goods and services that are not lodging and food and beverage, those are not tourism taxes.

10:03

So how do we collect these?

10:04

Who gave us permission and under what authority do we collect these taxes?

10:10

So we have authority under the city through charter code and ordinances, as well as laws and statutes given from the state of Minnesota allowing us to collect these.

10:27

Okay, now we're gonna start getting in a little bit into the details.

10:32

So what do we collect?

10:35

On the lodging side, there are two different uh two different taxes that we collect.

10:41

On all hotels, we collect a three percent hotel motel excise lodging tax.

10:48

There is a regular sales tax that City of Duluth imposes on goods and services that are taxable of one and a half percent.

10:55

When you pay the sales tax at any place that you stay, that one percent is not does not go to the general fund like the regular sales tax.

11:04

That's considered a tourism tax, and we collect that on the tourism side.

11:11

On hotels over 30 units, we collect an additional 2.5%.

Discussion Breakdown — Share of Meeting

Land Use Planning███████████████████████████27%

Procedural████████████████████20%

Tourism Management█████████████13%

Budget████████8%

Boards And Commissions███████7%

Parks and Recreation██████6%

Education Funding██████6%

Public Engagement█████5%

Short Term Rentals████4%

Summary of Proceedings

Duluth City Council Meeting - August 24, 2026

The Duluth City Council met at 6:00 PM on Monday, August 24, 2026, with all nine members present (Councilor Johnson participating remotely via Microsoft Teams). The meeting covered a finance committee presentation on tourism taxes and the 2027 budget, public comments on short-term rentals and the Lester Park Golf Course, a consent agenda of 21 items, a major discussion on the Lester Park Golf Course land use study and amendments, appointments to boards and commissions, and first and second readings of ordinances.

Consent Calendar

Approved unanimously (9-0) the Consent Agenda, which included 21 resolutions covering: retaining Community Investment Trust Fund interest earnings; amending a professional services agreement with Resolute Law (increase of $100,000, new total $149,000); confirming Cari Pedersen as Director of Public Works and Utilities; amending the comprehensive plan for the Becks Road Land Use Study area; sole source purchase of water meters ($99,540); municipal consent for Rice Lake Road Corridor Phase I; accepting a $750,000 EPA Great Lakes Restoration Initiative grant for the Cody Street Stormwater Filtration Basin; amending a contract for 4th Street Reconstruction engineering services (increase of $115,477.75, new total $1,465,417.75); engineering agreements for 2027 Street Preservation projects in Gary/Piedmont/Duluth Heights ($235,808.70) and Oneota to Lakeside-Lester Park ($121,543); accepting a $1,750,000 HUD grant for library and community health services planning; amending a lease with One Roof Community Housing; authorizing an exclusive use permit for the Bentleyville Tour of Lights 2026 holiday season; amending an EDA grant for DECC seawall reconstruction; amending the Lakewalk project contract with LHB (increase of $239,634, new total $1,358,783); accepting the updated Magney-Snively Natural Area management plan; accepting real property donation from ISD No. 709 for Hillside Sport Court; accepting tax forfeited land in Duluth Heights and Irving neighborhoods for trail purposes; awarding a contract for Morgan Park Community Center roof improvements ($270,835.44); and amending an archaeological services contract for Priley Circle Restoration (increase of $6,159, new total $390,294).

Public Comments & Testimony

Short-Term Rental Ordinance (26-038-O): Jessica Boehland and Pat Sterner, representing Park Point Community Club and Minnesota Point 50, expressed strong support for the proposed ordinance, emphasizing that it balances tourism with housing affordability and community cohesion. They urged rigorous enforcement and a first-year check-in review.
Lester Park Golf Course (26-0761R): Nine speakers addressed the council. Chris Cole argued that a Planning Commission amendment (passed 3-2) would allow disposal of all 270 acres, contradicting public input. James Hansen (Natural Resources Commission) supported preserving upper two-thirds and expanding natural areas, suggesting a city-run campground could boost tourism revenue. Hadrian DeMaioribus criticized the process, calling the December 2025 conveyance of parkland premature and coercive. Ansel Schimpff thanked councilors for amendments that would protect the upper 207 acres and follow the land use study. Denise VoieDeVie urged voting no on one appointment and recommended that housing development be directed to entities focused on affordable housing. Mae Gackstetter, Alec Cadlec, Jill Crawford-Nichols (representing the Isaac Walton League), and Lisa Fitzpatrick all supported the land use study recommendations and amendments to preserve 207 acres as parkland.
Non-Agenda Items: Allie Tibbetts spoke about the Lakewalk closure, criticizing the length of the project, lack of public notification, and impact on families and natural features. Loren Martell spoke against the school district's handling of the Red Plan debt, alleging misleading information about tax impacts.

Discussion Items

Tourism Tax and Budget Overview (Finance Committee): Finance Director Salinas presented a detailed overview of tourism taxes (lodging and food/beverage), noting that total collections average about $14.6 million annually. She explained the different tax rates (3% lodging on all units, additional 2.5% on hotels over 30 units, 2.25% on food/beverage) and spending restrictions, including a discretionary component. She emphasized that discretionary funds are often used to supplement other obligations. Councillors asked about exemptions for smaller hotels, the sunset for DECC funding, and the need for a clear definition of "promotion." Director Salinas noted that a policy on definitions is being developed. She also updated on the 2027 budget: no reductions in core services, using historical averages for expenses, and recognizing vacancy savings. Next steps include a max levy presentation on September 10 and a budget retreat on September 11.
Lester Park Golf Course Land Use Study (Resolution 26-0761R): The main resolution proposed amending the comprehensive plan to reclassify areas of the golf course. Two amendments were offered and debated:
- Amendment by Councilor Nephew and Vice President Kennedy: To adopt the land use study without the Planning Commission's additional recommendation (which would have allowed development of the entire property). This amendment passed 9-0.
- Amendment by Councilor Randorf: To initiate the process to remove the upper 207 acres (identified as open space by the study) from the development agreement with DEDA, retain them in city ownership, and rezone them as P-1 park and open space. After discussion about timing, protections, and future steps, this amendment also passed 9-0. Councilors emphasized that this does not add permanent supermajority protection (a future step) but clarifies intent and follows the agreed-upon process. The final resolution, as amended, passed 9-0.
Appointments (Previously Tabled): Resolutions confirming appointments were removed from the table:
- Brianna Gunderson to the DECC Authority: Approved 9-0.
- Ginka Tarnowski to the Sanitary Sewer Board of WLSSD: Approved 9-0.
- Luke Medis to the Building Appeal Board: A motion to table failed 2-7. The resolution was then approved 7-2, with Councilors Clanaugh and Durrwachter voting no.
Ordinance Reducing Building Appeal Board Membership (26-037-O): Second reading and vote. The ordinance reduces the board from 9 members (8 voting) to 7 members (6 voting). Councilor Durrwachter argued against the reduction, claiming it weakens oversight and that recruitment efforts are insufficient. Administrator Cohane stated it was a recommendation from the board itself. Councilor Clanaugh expressed concerns about outreach and consistency with other boards. The ordinance passed 7-2, with Councilors Clanaugh and Durrwachter voting no.
First Readings of Ordinances: Three ordinances were read for the first time:
- 26-029-O: Rezoning Piedmont Trail parcels from RR-1 to P-1.
- 26-038-O: Regulating short-term rental licensing and permitting. President Nephew announced a companion resolution will be brought at the next meeting to establish a one-year check-in.
- 26-036-O: Amending the Home Rule Charter regarding vacancies of Mayor and Councilor.

Key Outcomes

Consent Agenda: Approved 9-0 (all 21 items).
Lester Park Golf Course Resolution (26-0761R): Adopted with two amendments (both passed 9-0) that accept the land use study (develop 63 acres for mixed-use, preserve 207 acres as open space) and initiate the process to retain city ownership of the 207 acres. Final resolution passed 9-0.
Appointments: Brianna Gunderson (DECC Authority) approved 9-0; Ginka Tarnowski (WLSSD) approved 9-0; Luke Medis (Building Appeal Board) approved 7-2.
Building Appeal Board Membership Reduction (26-037-O): Passed 7-2 on second reading, reducing from 9 to 7 members.
First Readings: Three ordinances read; will return for second readings at a future meeting.
Public Comments: No official action taken, but council noted support for a future review of short-term rental ordinance.
Adjournment: Motion carried unanimously by voice vote.

Meeting Transcript

Hello, Councillor Johnson, just want to confirm that you can hear us. Can you hear me? Yes, we can. Loud and clear. Thank you. Oh yeah. So we got the thing is when we when there's a couple of assignments I moved I didn't want to jump in the gun and you already answered it. So I hope we guess how you're gonna do that. What was that one again? I read it. Oh yeah, they reached out. Yeah, they resort. I don't have to answer that. You know? Well she wrote it, so I don't know. Yeah, yeah, yeah. I don't know if it's for clarity. I don't know. I'm okay as long as everyone just understands what it is. Yeah, those are yours. All right, good evening, everyone. Um we will open with our finance committee meeting. Good evening. We'll uh begin with uh tourism tax one on one overview. Uh and uh I hopefully we'll get a better understanding of how these revenues work, what they can be used for, what they can't be used for, and really their role in the city's overall financial plan. Then we'll pivot into an update on where we stand with the twenty twenty-seven budget, including work underway to evaluate revenues, expenses, and various factors that'll shape the budget. Dates to note that are coming up. Councillors, uh September tenth, Thursday, after the agenda session, we have a max levy presentation, and then that immediately that next day at nine o'clock we'll meet at the deck for our budget retreat. And with that, I'll turn it over to uh finance director Salinas. Thank you, Finance Committee Chair Randor, uh counselors, thank you for being here. This is I believe our fourth uh finance committee, and I'm usually accompanied by my one of my fabulous staff members, but I'm solo today. And um as uh committee chair Randorf mentioned, today we're gonna cover tourism taxes. This is an important part of our budgeting process, although not part of our general fund. It is something that comes up regularly, so I'll we wanted to cover uh a good overview of the of the tourism taxes, and then I will get to a uh budget update and the next steps that we have for the general the general budget. And then as always, um I leave time at the end for questions. So all of you should have a presentation in front of you with the slides. So I ask that you please note your questions and then we'll have time at the end for that. So I'm gonna begin with an overview first of tourism taxes, and then I'll start getting into the sources and then I'll get in a little bit into the details to break down how we collect them, uh the numbers that we're collecting, the percentages, the dollars, and then the restrictions on the spending. I've broken it down uh into smaller sections to layer it. It's uh fairly complex after being here um almost nine months now. Uh this is still something that I am learning the nuances and finding all the details. So I'm hoping to share as much as I can if there's something that I don't share and we can't um get to at the end of today, then of course please feel free to reach out. I some I had conversations with some of you around this, but I do think it's really important. So hopefully um at the end you're not more confused, you're more enlightened about tourism taxes, and you can leave digesting it a little bit and understanding all of the all of the details. So I'm gonna begin with what are tourism taxes. And there's two components that we where we collect taxes from the customers at point of sale. There's lodging and then there's food and beverage. So what I do want to say is that tourism taxes are not sales tax except for one small component, which we'll get to. But generally, when you're paying sales tax on goods and services that are not lodging and food and beverage, those are not tourism taxes. So how do we collect these?

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