Duluth presents $43 million proposed FY2027 budget; second public hearing set for June 8

Assistant City Manager/Finance Ken Sakmar presented the proposed FY2027 Annual Operating and Capital Projects Budget to the Duluth Mayor and Council on May 11. The proposed budget totals approximately $43 million and uses a modest amount of reserves to balance operations.

Sakmar described major revenue and expenditure drivers: property taxes are the largest revenue source and salaries are the biggest expenditure. He said the budget approach is conservative and that the proposed plan uses roughly $120,000 of reserves to balance this year's budget; by comparison, last year’s proposal planned to use about $921,000 of reserves. Sakmar noted an above‑normal increase in employee medical insurance costs and highlighted capital purchases (including software) and a separate TAD transfer.

The proposed budget was prepared assuming the millage rate remains unchanged, though the council must set the final rate. Sakmar said the proposal includes no new permanent full‑time or permanent part‑time positions, aside from potential summer 2027 stormwater interns. He also noted that some listed capital or maintenance items could be removed if completed before June 30, lowering the final budget need.

During public comment, Christine Gautreaux thanked the council for allocating $35,000 to public art but questioned whether duct cleaning costs should be higher than the public art allocation. The Mayor closed the hearing; a second public hearing is scheduled for the Mayor and Council meeting on June 8, 2026, and an adoption ordinance will be presented after that hearing.