Interview with Don Ness, Mayor of Duluth

We’ve always felt like strengthening the core city is really important to support those local businesses rather than spreading those amenities further out to the edges of the community, where you’re picking winners and losers a little bit more at that point because whatever neighborhood you’re going into, they’re going to have that benefit as well as greater logistical problems in terms of handling traffic and creating parking for events that may happen 20-30 times a year. Whereas in a core city, because you have the parking lots, the roads are built to accommodate larger numbers of cars, you put those amenities where the infrastructure can handle that volume.

Yordy: Right. Denver is very well organized, but the way Colorado Springs grew with the military bases being put on the outskirts of the city, we would get these massive growths from those sections of the military base, and the urban planning wasn’t very efficient. So of course you get these huge pockets of restaurants and entertainment venues in random parts of the city that aren’t centrally located in the downtown area.

Ness: The bases, are they about 15 minutes outside of the core city?

Yordy: It depends. We have Fort Carson on the south end, which is a large army base, and all the way on the north end you have the Air Force Academy, and then a few air bases out east, so the east side has grown, but that’s all it really is. It’s all expanding away from the central downtown area of Colorado Springs. It creates complications with businesses trying to expand in that central area because you only attract a certain amount of people. Not many people would come into the city from the east side when they have a stadium and all these other new amenities.

In reference to urban projects, I watched a hearing on one of our organizations, the Urban Renewal Project. They were attempting to assess a fee of $1.25 million from a $3.2 million project, and Mayor Bach had to go in, re-assess their fee, reduce it to $250,000, so I was curious if you’ve had examples of similar issues as Mayor of Duluth. Also, how do you deal with an organization’s possible self-serving motives or their inefficient allocation of funds?

Ness: So, this was some type of non-profit or development agency that had the ability to raise funds through assessment?

Yordy: It’s a development agency, and this was their fee for redesigning an older part of town, and this was what they assessed their fee to be over a span of 25 years.

Ness: Got it. Well, there’s no question that governments in particular have to be very vigilant in understanding what those fee structures are, and you get these private companies who will come in and promise the world, and they will tap into these resources and say, “Here’s the big vision,” but in the meantime, they’re padding their pockets or hoping that there isn’t scrutiny by government officials who will just kind of go along with whatever the fee structure is.

We did have something similar, not on the city side, but with the school district. They brought in Johnson Controls, which is based out of Milwaukee. They’re an international organization, and they did a facilities assessment of the school district and essentially came up with this massive plan to invest in the school facilities and did so without going to the voters on referendum.

They were successful with pushing this through, but the damage to the school district’s reputation and how voters feel about the school was very difficult to overcome. In fact, just last Tuesday, we passed the first operating referendum for the schools in the past 5-7 years, and it passed with a 51% vote. So, there’s still a lot of hard feelings about the school district, in large part because this private consultant came in, sold this plan, pushed it through, very expensive, top of the line, and meanwhile they’re getting a percentage of everything that’s brought up, so I think that’s the real key.

It sounds like your mayor did a good job of saying, “Hey, wait a minute. You guys shouldn’t be going with this.” And you know, any developer is going to come in, pad the numbers, put in the development fee, and try to get that top cost number as high as they can, and unless you’re providing resistance, unless you’re questioning why they’re getting that much, they will continue to push that, and sometimes communities can even get a reputation. Say, well, you know, here’s a city that doesn’t push back. They just accept these higher fees, especially from national organizations that provide expertise, and then you can develop a reputation as an easy market.

Yordy: It seems like in the long run, this would raise costs overall for the consumer.