David's Blog

Friday, May 27, 2005

Bringing More than Attention to the City’s Financial Challenges

Community members are becoming increasingly aware of the City of Duluth’s ominous, expanding financial dilemma being fueled by the City’s employee retirement benefit package liability. Simply defined, it is an unfunded, compounding debt that will soon come due. The retirement benefit package liability is the single greatest financial challenge confronting Mayor Bergson and the city councilors.

Individuals and various interest groups are drawing more and more attention to the liability. There is a growing drumbeat calling for the Mayor and the Council to address and correct the situation. Exasperated voices – voices that are becoming less patient, more demanding, and shrill – ask: “Why doesn’t the Mayor take care of the problem?” At a minimum, community members are perplexed by the apparent lack of progress in addressing and resolving the concern.

I understand and appreciate the challenge. The Duluth Area Chamber of Commerce fully comprehends the issue and the need for action. Yet, we also understand the monumental challenge the Mayor faces in addressing the problem.

Change means movement. Movement means friction. Margaret Atwood, a Canadian poet and novelist said it well: “Better never means better for everyone…It always means worse for some.” The existing retiree benefit was negotiated into the city employee contract several years ago. The city’s leadership must now negotiate with five separate bargaining groups in order to make a change in this package. Yet, the union’s leadership will not give up an employee benefit unless it is in the union’s best interest to do so.

Clearly, the Mayor has his hands full.

The Chamber understands the challenge confronting the mayor and the city council. I recently read the book Changing for Good. The title is telling, as it implies that change might occur for the better or the long-term. While change may be necessary and lead to a positive outcome, it does not often come about easily. On the inside cover of the book is a simple quotation, which reads, “For every complex problem there is a simple solution…and it is wrong.”

There is no simple solution to the retiree benefit liability.

The Chamber’s leadership has offered to assist the Mayor and the Council in addressing the problem. We are willing to make the business community’s finest leaders available to the mayor and the council, volunteers who will invest their time and talent to review the City’s retiree benefit liability and develop proposals for addressing the concern. The offer was extended to the Mayor early after he assumed his mayoral duties. The same offer was made to Council President Donny Ness shortly after his recent election to the president position.
We stand prepared to be a part of the solution. I hope we are called into service.

posted by David Ross at

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