Former Duluth Mayor Don Ness's Facebook post on our city's retiree health care obligation – "What happens to a problem once it’s solved? Twenty years ago, the City of Duluth was featured by the New York Times as a city on the brink of bankruptcy due to the $280 million (and growing rapidly) unfunded liability for retiree health care benefits. The State Auditor made a public presentation stating that the burdens on property taxpayers would crush Duluth’s real estate values and economic development efforts. It was an unthinkable burden that threatened to devastate our city.
Conventional wisdom at the time was that bankruptcy was the only way out – resulting in retirees losing the benefit they had been promised.
What happened?
I’m proud to say, that problem has been solved. City retirees have the security knowing that the benefit will remain for the rest of their lives. Taxpayers will see a massive DECREASE in the costs of providing this benefit from this day forward.
A previous actuarial study projected that those costs would be over $25 million this year and rising to $40 million by 2040. Instead, those costs will be $3.5 million.
The difference between the projected costs and the actual cost to taxpayers, just in the next decade will be around $190 million. That’s over $2,000 for every man, woman, and child in Duluth.
Earlier this week, the City Council passed an ordinance that enshrines the final solution into city code. You may have missed the news.
There are so many people to recognize and thank for this historic accomplishment. Dedicated city staff, union leaders, attorneys, and five volunteers (led by Sandy Sandbulte) who wrote a task force report that became our roadmap. Without a doubt, that was THE most important volunteer effort in our city’s history.
I’m not one of dwell on my past service… but this is my proudest accomplishment in public life – a problem that no longer exists. I started this effort as a 20-something city councilor by conducting a study with CSS econ professor Rob Hoffman and his intern. Solving a problem like this requires sacrifice and conflict and the most controversial and unpopular decisions you can imagine – at times resulting in vague but unmistakable threats to my safety and constant animosity that exists to this day.
There are so many stories, so many twists and turns. There wasn’t one decision made that wasn’t painful. There wasn’t a single benefit realized during my time in office – everything was in service of a better future for Duluth.
It’s not a comfortable thing for me to share like this. But it is important. It’s important to me and the dozens of people who put in the hard work. There’s nothing to point to as our accomplishment. Once the problem is solved, it no longer exists in the public mind. Which is wonderful, it is beautiful.
In politics, all of the incentives are to build and create – for obvious reasons. There are lasting reminders of those accomplishments. But what’s most desperately needed in politics are leaders who are focused on solving problems – especially those most impossible problems, especially those which take decades to solve, especially those that the future will benefit by being free from a burden that they never knew once existed."
