Blue-collar Duluth transformed by outdoor tourism economy

Outdoor adventurers in Duluth capitalize on everything from Great Lakes surfing to mountain biking to whitewater kayaking, as pictured here. (Photo by Hansi Johnson)

In the early 1980s, someone hung a billboard outside downtown Duluth, with a bleak request: “Will the last one leaving Duluth please turn out the light.”

The dark humor was understandable, given how far this Minnesota community had fallen.

Built on the west shore of Lake Superior on the shoulders of timber, shipping and steel production, blue-collar Duluth began to slide in the 1950s as high-grade iron ore gave out on Minnesota's Iron Range. In 1981, U.S. Steel Duluth Works shut down, as unemployment approached 20 percent. Other factory closings followed.

But as it turned out, the seeds for a new Duluth were always there – naturally.

Perched on steep hills that rise 800 feet above Lake Superior, Duluth is home to more than a dozen trout streams, waterfalls, nearly 7,000 acres of park land and terrain perfectly matched for hiking, trail running and mountain biking. Locals have skied at 700-foot vertical Spirit Mountain since 1974. And hard-core adventurers have long surfed the waves of Lake Superior – even in the dead of winter.

“Duluth is a traditional Rust Belt city,” said former Duluth Mayor Don Ness, who served this city of 86,000 residents from 2008 to this year.

“We were built on heavy industry and shipping,” said Ness. “But in comparing ourselves to other cities, what we have is a unique sense of place and we have unique natural assets. The thinking was, 'What can we do to start developing those and promoting those?'”

In 2011, voters approved a property tax that raises $2.6 million a year to support parks and recreation development. It cost the owner of an average-priced home of $158,000 about $60 a year.

In 2014, the city council passed a 0.5 percent tax on lodging, restaurants and bars that will generate $18 million over 15 years to add trails for hiking, mountain biking, cross country skiing and horseback riding. The revenue will also establish a launch center for canoes and kayaks and add further park improvements. Officials expect another $32 million from state, federal and private sources.

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If there is a lesson for Michigan, it is that significant public investment in outdoor recreation can pay dividends in long-term development.

Today, within Duluth’s city limits are 40 miles of cross country ski trails and more than 60 miles of mountain bike trails, the latter expected to reach 100 miles by next year. Plans are in the works to develop an old quarry into a rock and ice climbing venue.

Publications took notice, with Outdoor Magazine naming Duluth number one in its 2014 list of “Best Places to Live.”

These investments have come alongside an economic turnaround, as Duluth unemployment dipped as low as 3 percent in October 2015 before climbing to 4.1 percent in April.

Laura Mullen, co-owner of Bent Paddle Brewing Company in Duluth, said the city's outdoor lifestyle was a primary reason the craft beer firm located there. (Courtesy photo)

Firms like Ikonics Corp. are writing a new economic future. The high-tech imaging firm broke ground in 2015 on a $4.3 million expansion to accommodate its growth into aerospace. Completed earlier this year, the expansion was built on remnants of Duluth's industrial past, the former site of the Universal Atlas Cement Company, a subsidiary of U.S. Steel.

West of downtown, Bent Paddle Brewing Co. is seeing growth of another kind. It's on target to churn out 20,000 barrels of craft beer in 2016 – nearly three times what it produced in 2014, its first full year of operation.

The founders – two couples with a fondness for beer and wilderness canoeing - chose Duluth for a couple reasons: The brewery could tap Lake Superior as a pure source of water. But Laura Mullen, one of Bent Paddle's four co-owners, said they also saw a community of like-minded inhabitants.

“Duluth is the gateway to the north shore and the north woods,” Mullen said. “We wanted to live here and raise our families here.

“We are seeing a lot of young professionals attracted to the city, who are just over the congestion and traffic of the larger urban areas. They just like it that when they are done working, they can go out their back door and enjoy the lifestyle.”