While the mayor says the case is over, the board members say until they have proof in hand, they're still very much concerned.
"That's the way its been for 100 years. 100 years of mayors, 100 years of council, 100 years of assessors, no one's thought of this before," says Bart Carrig, YMCA board member.
Bart Carrig is on the YMCA board. He says the city of Little Falls and the YMCA have been working together for a long time and they never saw this coming.
"It's disgruntling because the YMCA and the city pretty much grew up together. To all of a sudden have this thing happen not only does it create financial strain for us. But it creates a lot of discord in the community," says Carrig.
The question surrounds the taxation of the YMCA's residential housing and a Community Co-Op specializing in nutrition. Some city leaders say it should be taxed, but others say the people have spoken and they want the properties to stay tax-exempt.
"Petitions were presented to common council members, some 1100 of them and it sent a clear message to us that the YMCA is an integral part of our community," says Jeff Gressler, Little Falls councilman (D-1).
"It means a lot, it helps a lot of people out, it helps me out at least once a month as far as getting food, they even help out as far as the kids out having a place to play," says Nolan Carter, Little Falls resident.
The mayor says they weren't going after the YMCA, but rather taking a closer look at its finances.
"The city went on a course to tax them because of the possibility of having a retail store. We were under the assumption that if its a retail store, they should be taxed like anyone else in the city," says Mayor Robert Peters, city of Little Falls.
But after the city council voted unanimously to withdraw litigation, the mayor says the investigation has been interrupted.
"Is it enough money that they make to be taxed or claim as a retail store? Well we won't know that answer because we didn't get into the situation where we could get the facts and it didn't get that far and there's nothing I can do about that," says Mayor Peters.
The mayor says at this point, the city has ended its pursuit. And as long as the case falls under state regulation guidelines, that will be the end. Still, the council says this battle is not over until they have those discontinuance documents in-hand.