City of Park Rapids shares rationale for local sales tax
Park Rapids bases its appeal to the State Legislature on the hope of stimulating economic growth and ensuring the satisfaction of residents and visitors.
The city of Park Rapids shared documentation last week to explain why certain street improvements, to be funded by a proposed local sales tax, should be regarded as regionally significant.
The city council agreed Jan. 11 to submit a request to the State Legislature for authority to fund the projects with a 0.5% local sales tax. The deadline for a request to be considered this year was Jan. 31.
The proposed tax is estimated to generate about $440,000 in annual revenue or $8.8 million over 20 years.
Meantime, city engineers Apex Engineering provided a list of six projects estimated to cost a total of $9.5 million, including portions of 8th Street, Forest Avenue, Fish Hook Avenue, Huntsinger Avenue, Main Avenue South, 12th Street, Eastern Avenue and Kaywood Drive.
Minnesota Statute requires projects funded by a local sales tax to be of either regional significance or to have an economic impact on the community.
At the time of the Jan. 11 meeting, City Administrator Angel Weasner told the Enterprise that documentation of the projects’ regional significance, mentioned in the resolution, was still undergoing legal review and would be provided later. The materials became available on Feb. 22.
One of the documents contained tables of traffic counts on U.S. Hwy. 71 from 2017 through November 2021, based on automatic traffic recorders (ATR) data.
The first table showed 12-month traffic totals declining from more than 720,000 vehicles in 2017 and 2018 to less than 700,000 in 2019 and about 528,000 in 2020, but rebounding to over 780,000 vehicles in just the first 11 months of 2020.
The table also showed monthly averages for the highway traffic in the 60,000 range in 2017-18, about 58,000 in 2019, about 44,000 in 2020 and over 71,000 last year.
A second table showed the same statistics, omitting the summer months from May through August. During the remaining months, averages ranged from the low 40,000s each year from 2017 to 2020, but jumped to more than 50,000 in 2021.
Regional and economic benefit
Also included was a document describing the community with emphasis on the tourism economy and the central role of Park Rapids in area government, health care and education.
It states that Park Rapids “would like to ensure citizens, residents of the region, and tourists their satisfaction by improving the traffic arteries to the highest possible condition for travel” while in the city.
After listing the proposed road projects, the document says they benefit the region as a whole, “serving as routes of regional significance by providing connections to the many regional destinations” within the city and in the state and county road network.
“Improvements to these roads will provide an economic benefit to the region at large,” it says, adding that by “encouraging more efficient traffic movements, continued economic growth for existing business is expected and opportunities for new economic benefits are anticipated.”
Also, the document says, residents and visitors who see improvement to the streets will have a more positive view of the area.
Timetable of the planThe narrative document goes on to lay out a 20-year plan for road improvements funded by the local sales tax, broken up into five phases.
The plan estimates:
- It will take seven years to collect enough sales tax revenue to complete the 12th Street and Eastern Avenue project, costing an estimated $3.2 million.
- Phase 2, 8th Street and Fish Hook Avenue, will cost about $2.38 million, taking over 5.5 years to collect at the estimated revenue rate of $440,00 per year.
- Phase 3, Kaywood Drive, will cost about $1.3 million, over three years worth of sales tax revenue.
- Phase 4, Huntsinger Avenue, will cost about $1.26 million, or over three years of revenue.
- Phase 5, Main Avenue South, will cost about $650,000, or over 1.5 years of sales tax funding, assuming the same rate of revenue.
The document ends with an appeal to Park Rapids’ “small town feel” and the many recreational and tourist attractions in the surrounding area. It concludes, “Park Rapids City Council feels strongly about the benefits of a local general rate sales tax to provide a more welcoming and stress-free vacation or hometown.”