David's Blog

Mentioning the possibility of it invites the label of “negative.” Seeking to understand more about the ramifications of it makes one an “alarmist.” Bringing the leading authority on it to our community, who will detail the difficulties associated with it, is being “politically motivated.”

The Duluth Area Chamber of Commerce has been called and labeled all of these things. Why? Simply because we seek to understand the possibility of, and the ramifications of, the City of Duluth declaring municipal bankruptcy. The Chamber believes community members should have the opportunity to better understand this possibility. It is understandable that community members may be confused regarding the likelihood of bankruptcy.

Mayor Bergson and other elected officials have repeatedly and publicly stated that there is no chance the city of Duluth is going to file bankruptcy. Conversely, the State of Minnesota’s leading authority on the subject, State Auditor Patricia Anderson, has publicly stated: “If Duluth does not act now, it is a matter of time before Duluth will be forced to significantly raise its property taxes, dramatically cut its budget, or go bankrupt.”

For over a decade, the state auditor’s office has advised Duluth city officials to take corrective action regarding its unfunded post-retirement health benefit for city employees. Yet, no decisive action has been taken and the problem continues to escalate. The city of Duluth has an estimated $290 million-plus unfunded obligation. Moreover, it is projected that the liability could grow to over $400 million in the next ten years.

The Chamber has arranged to have the state’s leading financial authority, State Auditor Patricia Anderson, address Duluth’s financial crisis in a presentation she will give at a luncheon Monday, June 19, in the Great Lakes Ballroom of the Holiday Inn Hotel & Suites, located at 200 West First Street. The luncheon begins at 11:30 a.m. with registration and lunch. Auditor Anderson’s keynote address will begin at noon.

Reservations for the June 19 luncheon can be made by calling the Chamber at 218.722.5501. Reservations are required for attendance and must be made by Thursday, June 15. Members of the media are welcome to attend the event.

Insightful Duluthians will understand that the Chamber’s effort to keep this issue before the community is a positive thing. The Chamber’s leadership believes our community will be better served if it is better informed. It is apparent that we can no longer ignore the challenge before us. Attend the June 19 luncheon to learn more about what declaring bankruptcy might mean for Duluth. Once educated, we will all be better equipped to encourage our elected officials to do what needs to be done to effectively address this concern.