New Duluth budget plan: Increase property taxes for public safety spending

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DULUTH – City leaders are proposing up to 15% raises for police officers, bigger training budgets for police and firefighters and permanent funding for a community crisis response team paid for with a much bigger property tax hike than the one presented earlier this month.

"One of our top priorities is public safety," Duluth City Council President Renee Van Nett. "Today we're going to go beyond saying those things ... and we're actually going to put things into action and into motion."

The budget plan unveiled at a news conference Thursday afternoon will add a nearly 4% increase to the 2022 levy on top of the 6% increase Mayor Emily Larson proposed earlier this month. In total that equates to about a $27 increase in yearly property tax payments for the owner of a median-priced home in Duluth, according to city estimates. The mayor's initial levy proposal would have seen a $3 increase for the average homeowner.

The updated plan would also address a looming city health care cost crisis stemming from unsustainable insurance rate increases over the next few years that would create a nearly $20 million budget deficit by 2026.

Raises for city employees — largely paid for with one-time American Rescue Plan money — are being offered in exchange for renegotiated health care plans that the unions representing city workers would have to agree to.

"The path we are on does not lead us toward maintaining levels of service, does not lead us to financial security; it leads us toward bankruptcy," Larson said. "This is one of the most robust and exciting financial plans we have for a sustainable, steady, solid future in this community."

The 2023 levy will likely increase more than it does next year to meet these goals, but Council Member Arik Forsman said taxpayers could see savings in future years.

Council Members Zack Filipovich and Janet Kennedy are proposing an additional $325,000 increase to the levy for a city housing trust fund.

State law says cities must set their maximum levy by the end of September each year. A final vote on the budget in December could see a smaller levy, but it can't grow beyond what the Duluth City Council will approve at its Monday meeting.

While it appeared likely that the $38.6 million levy would pass given council member support signaled at a Thursday night committee meeting, there remained uncertainty about the final makeup of the budget and the new proposals.

"Anything that has to do with wages and benefits is pending negotiations," Forsman said.

Police pay

Duluth police officer pay ranked last out of 33 Minnesota law enforcement agencies surveyed in a recent legislative audit. The proposed 15% increase in officer pay is meant to bring compensation in line with the size of the city and better compete for a dwindling pool of applicants.

"This is a critical time for recruitment and retention," said Sgt. Matt McShane, a member of the Duluth police union's executive board.

The budget plan also includes $100,000 for the Duluth Police Department and another $100,000 for the Duluth Fire Department specifically for training. Right now annual training budgets for those agencies are $15,000 and $7,000 respectively.

Crisis response

Originally intended to be a three-year pilot program paid for with $1.8 million in federal coronavirus relief money, the city is now proposing to permanently set aside $600,000 per year for a crisis response team that is still being developed.

The goal of that program is to send unarmed civilians to respond to situations that do not require a police response, be they mental health crises or addiction or housing issues.

"Everyone needs to feel confident they can safely reach out for help when they are in crisis," said Council Member Gary Anderson. "The model we are working on will be a valuable resource that will make Duluth safer for all."

Brooks Johnson • 218-491-6496

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