No special session means no local sales taxes on the ballot this year
The funds may not have already been in the bank, but you’d never know it by the way 17 cities and counties talked about their plans to spend hundreds of millions of dollars in local sales tax revenue expected to be on the ballot for their constituents to vote on later this year. The Star Tribune rattled off a list of the pet projects essentially lined up for take-off.
New housing, streets, water projects and a recreation center in Rochester. Jails in Winona and Rice counties. A pedestrian bridge over Highway 36 in Roseville. Community buildings and park improvements in Bloomington, Brooklyn Center, Edina and Golden Valley. These are among nearly $1 billion in projects that cities and counties across Minnesota want to pay for using local sales taxes this year.
Lawmakers signed off on the local sales tax requests as required by law but the measure died when the House failed to vote on the overall tax package before the end of the legislative session. With a special legislative session evidently no longer in the cards, local governments are coming to the realization they’re flat out of luck for this year. Projects from playgrounds to fancy community centers and new city halls may just have to wait.
Bloomington seeks $150 million in local sales tax funding over the next 20 years to renovate the city’s Ice Garden, Dwan Golf Course and Center for the Arts, as well as build a health and wellness center. A city spokesperson said officials are “hopeful that that legislative leadership and the governor will come to agreement” so a referendum could go before voters in November.
In Rochester, the local sales tax dates to 1983. It was renewed in 2013 and expires in 2024. But the city wants to raise an additional $205 million over 16½ years to improve streets, water quality and housing stock, and build a $65 million recreation center.
As more communities have turned to the local sales tax to fund their needs and wants, lawmakers have clamped down on projects that are deemed eligible, giving voters the final say on each proposal. With no special session in sight, cities and counties will have to go back to the drawing board, making their case before a new cast of legislators next year.
“Frankly, we’re going to have at least 47 new legislators,” said Gary Carlson, a lobbyist with the League of Minnesota Cities. “About a quarter of the Legislature will be new, so it’s not clear that every proposal would be basically re-ratified next year the same way it was this year.”
In the meantime, the pause on the local sales tax option may present a valuable opportunity for local governments to prioritize.
Some communities can afford to wait. Although the south-central city of Henderson has requested $240,000 to make campground and trail improvements, that project would be done with flood control and street reconstruction work along Highway 93, which is still a few years off.
“It would be easier if (a tax bill) happened, but we can afford to wait,” Henderson City Administrator Lon Berberich said.