Hermantown Council adopts 2025 levy and budget, approves hires, contracts and cannabis regulations

Hermantown City Council approved the final property tax levy collectible in 2025 and adopted the city's 2025 general fund budget at its meeting, alongside a package of staffing moves, contracts and ordinances.

The council adopted a $9,408,324 levy collectible in 2025 and a 2025 general fund budget of $8,891,017 as part of an overall $25,878,402 city budget. "The proposed levy is $9,408,324," said Mr. Mulder, a city staff member, while introducing the Truth in Taxation public hearing and urging residents the council could delay final action until year-end if desired. No members of the public spoke during the hearing.

The council also approved personnel measures, including authorization to hire two additional police officers in the third quarter of 2025 and authorization to hire a full-time administrative assistant for 2025; the administrative assistant motion passed with two dissenting 'Nay' votes from Councillor Jones and Councillor LeBlanc.

On regulatory policy, the council approved on second reading two ordinances to regulate tetrahydrocannabinol sales and cannabis-related land uses. "This first ordinance has to do with section 405," said Mister Johnson of the planning staff, describing provisions that establish fees and licensing, limit retail cannabis businesses to one per 12,500 residents, create buffers from schools, daycares and parks, specify allowable zoning districts and hours of operation, and regulate low-potency hemp edibles (sales to people 21 and older and behind-the-counter requirements). Planning and Zoning recommended approval following its November 19 meeting.

Councilors sought and received a procedural clarification about state licensing: Mr. Johnson said the city's process first determines whether a proposed operation meets city zoning and district requirements; thereafter the applicant pursues state licensing and returns for final city approval.

The meeting also cleared several capital and procurement items. Mr. Mulder told the council the city has received just over $1 million in ARPA funds, has spent approximately $920,000 on prior projects and recommended allocating roughly $47,000 toward the comprehensive plan and about $85,000 for "thickener field" improvements. The council approved the recommended ARPA allocations.

The council approved a final pay request of $154,846.56 to Viton Company for a water-main replacement project along Trunk Highway 53 and approved contracting and change orders for the North Star Ford Arena, including a net reduction on a placeholder joint-sealant allowance and additions for pathway lighting and protective ballguards around arena equipment. A request for payment tied to two road improvement districts was tabled for two weeks to allow staff to provide additional change-order details.

A major capital item passed: the council authorized entering into a construction grant agreement with the Minnesota Department of Employment and Economic Development for the Hermantown Ice Arena, reflecting a $7,400,000 state capital improvement award. "The state did approve a capital improvement request of $7,400,000 for the ice arena," Mr. Mulder said. Council also approved a $45,513.23 contract for security cameras and network hardware for the North Star Ford Arena, to be executed by the school district and later reimbursed by the city, and a $12,300 trailer purchase for public works to transport the wide-area mower.

Votes at a glance: - Resolution 2024-229 — Adopt final 2024 property tax levy collectible in 2025, $9,408,324. Motion: Councillor Geissler; second: Councillor Gelli. Outcome: Approved (roll call recorded unanimous 'Aye'). - Resolution 2024-230 — Adopt final 2025 city general fund budget, $8,891,017 (overall budget $25,878,402). Motion: Councillor Jelley; second: Councillor LeBlanc. Outcome: Approved (roll call recorded unanimous 'Aye'). - Resolution 2024-231 — Authorize hire of two police officers in 2025 (Q3). Motion: Councillor LeBlanc; second: Councillor Geissler. Outcome: Approved (roll call recorded unanimous 'Aye'). - Resolution 2024-232 — Authorize hire of full-time administrative assistant in 2025. Motion: Councillor Geisler; second: Councillor Gelli. Outcome: Approved (roll call recorded mixed votes; Jones and LeBlanc 'Nay'). - Ordinance 2024-10 (second reading) — Amend and restate section 405 to regulate sale of tetrahydrocannabinol products (fees, licensing, buffers, zoning, hours, hemp edibles). Outcome: Approved on second reading (roll call 'Aye'). - Ordinance 2024-11 (second reading) — Amend chapter 2 (definitions) and chapter 5 (land use) to regulate cannabis businesses (cultivation, transport, retail; special use permits where required). Outcome: Approved on second reading (roll call 'Aye'). - Resolution 2024-233 — ARPA fund usage (designation of remaining funds, ~ $47,000 for comprehensive plan, ~$85,000 for thickener field). Outcome: Approved. - Resolution 2024-234 — Adopt assessment roll for delinquent stormwater utility charges (to add unpaid stormwater fees to property taxes). Outcome: Approved. - Resolution 2024-235 — Approve final pay request to Viton Company for water main replacement, $154,846.56. Outcome: Approved. - Resolution 2024-236 — Pay request #7 for Road Improvement Districts 541 & 542 to Northland Constructors, $132,024.58. Outcome: Tabled for two weeks (requested additional change-order information). - Resolution 2024-237 — Enter construction grant agreement with Minnesota DEED for Hermantown Ice Arena, $7,400,000 state award (conditions apply). Outcome: Approved. - Resolution 2024-238 — Award contract for security cameras and network hardware (North Star Ford Arena) to Sikon Computer Corporation, $45,513.23 (city to reimburse school district). Outcome: Approved. - Resolution 2024-239 — Approve change orders 7, 8, 9 and KA change order #2 for North Star Ford Arena (net adjustments, lighting and protective guards). Outcome: Approved. - Resolution 2024-240 — Award contract for trailer for wide area mower to Widice Trailer Sales, $12,300 plus applicable taxes/fees. Outcome: Approved. - Resolutions 2024-241 and 2024-242 — Authorize publishing summaries of Ordinances 2024-10 and 2024-11 instead of full ordinance text. Outcome: Approved.

What happens next: The council recessed, planning and zoning's procedures (special-use permits and state licensing for cannabis operations) remain in place for applicants, and staff will follow up on the tabled road improvement pay request and the public comments on roadway "soft spots."