East Grand Forks council members revisit proposed sales tax for city's recreational facilities
Conversations about the upgrades for the Civic Center, the baseball field at Itts Williams Park adjacent to the Civic Center and the VFW Memorial Arena have been ongoing since around 2018
EAST GRAND FORKS — Needed upgrades to the city’s aging recreation facilities and where that funding can come from was presented once again to East Grand Forks council members during their work session meeting Tuesday evening.
Conversations about the upgrades for the Civic Center, the baseball field at Itts Williams Park adjacent to the Civic Center and the VFW Memorial Arena have been ongoing since around 2018.
Earlier this year council members approved a 20-year, 1.25% sales tax, which would have generated around $21.5 million in project funding. A decision from the Minnesota Legislature on the sales tax ultimately wasn’t made before the session ended this summer.
During Tuesday’s meeting Parks and Recreation Superintendent Reid Huttunen presented council members with the option of submitting a sales tax request for the 2023 legislative session. Huttunen also showed council members how much the cost of those renovations are anticipated to increase in a few years.
While the total cost of the recreation improvement project was estimated to be $29,792,509 in 2023, Huttunen said in 2025 the total project cost is estimated to increase to $32,569,201.
Huttunen also presented council members with a list of other cities in the state where sales tax increases received approval from residents during November’s election. One recurring theme among those cities was that all the proposed increases to sales tax was at 1% or less.
Council member Brian Larson said he’s not comfortable with the currently proposed sales tax exceeding 1%.
“I’m concerned about the 1.25%,” Larson said. “I guess I wasn't super comfortable with it before. I voted in favor of it, the program is great and we need to make some generational investment here, but being the only city above 1% really makes us stick out on that spreadsheet.”
Since the sales tax would need to come back for a citywide vote if it receives approval from the Legislature, Larson said council members should rethink the sales tax rate in regards to what residents would be in favor of.
“I think we should really think hard about if we want to be an outlier, should we expect that vote would pass at that percentage?” Larson asked. “So that’s something that I’m still really concerned about… but if we set ourselves up for failure by asking for (a tax) too high, that’s really (a) shame on us.”
Lowering the sales tax rate would mean less revenue being generated, but Huttunen said additional funding could be requested from bonding.
Council member Tim Riopelle proposed lengthening the term of the sales tax, but Mayor Steve Gander said he’s not in favor of a longer term.
“I don’t like it,” Gander said. “I think it’s a waste actually.”
A 30-year, 1.25% sales tax was initially approved by council members in January, but was vetoed by Gander who was concerned about the 30-year term.
The timeline for submitting a local sales tax request to the legislature is the end of January. Council members will continue reviewing potential sales tax rates and terms in future council meetings.
In other news Tuesday, council members:
- Discussed the use of outdoor wood-burning furnaces within the city and implementing a potential ordinance regulating the use of these furnaces in yards.
- Continued reviewing the 2023 budget including the special revenue funds and enterprise funds after council members approved a 10% property tax levy last week. Council members will need to give final approval for the 2023 budget by the end of the month.