The Duluth City Council unanimously approved a proposed 2.98% increase in the levy Monday night, as they adopted a final budget for 2021. But city officials say the increase won't translate into a higher tax rate, as the value of Duluth's property tax base grew by more than 6.6% from 2020 to 2021, with about 1% of that increase coming from new construction.
All told, the city's property tax collections are expected to grow by about $1 million next year to about $37.4 million. The city's share of property taxes next year will account for about 28% of what the county collects in 2021.
Councilor Joel Sipress pointed to health care costs as one of the primary factors that continues to drive Duluth's budget higher year after year. He also noted that the Local Government Aid the city receives from the state has failed to keep pace with inflation. Nevertheless, Sipress said the levy increase proposed next year is "significantly less that the past two years," as it should be at a time when many residents are struggling with the economic repercussions of the COVID-19 pandemic.
At large Councilor Zack Filipovich praised city administration and staff for putting together a conservative budget, saying that the setting of the levy is "the most important thing this council does every year."
