Park Rapids sales tax proposal sent back to city staff
City council members lean toward a 0.5% local sales tax but want to earmark the revenue for street improvements city voters can get behind.
The Park Rapids City Council on Dec. 28 tabled action regarding a proposed local option sales tax and an update of the fire department’s handbook.
Local sales tax
City Administrator Angel Weasner presented two options for a sales tax proposal to submit to the State Legislature for consideration and, upon approval, a local election.
According to estimates by the Minnesota Department of Revenue, a 0.5% sales tax would generate approximately $440,000 in annual revenue, or $8.8 million over 20 years. A full 1% tax rate would raise about $880,000 per year, or $17.6 million over 20 years.
Because the proposal submitted to the state must identify a specific project to be funded by the sales tax, Weasner suggested the following:
For the 0.5% option, improvements on Main Avenue north and south of the downtown area at an estimated cost of $4,365,000, and on 8th Street from Western Avenue to Forest Avenue for about $3,298,000, a total estimated cost of $7,663,000.
For the 1% option, the same plus improvements on Central Avenue, Kaywood Drive, Forest Avenue, 12th Street, Fish Hook Avenue and Eastern Avenue, bringing the total cost to about $17.5 million.
Council members formed a consensus supporting the 0.5% sales tax. However, they challenged the identified street improvements, noting they are not on the city’s capital improvement plan.
Weasner said state law requires improvements to be funded by a local sales tax to be of “regional significance.” She stressed that the Main Avenue and 8th Street improvements would improve visitors’ access to the downtown area and the hospital.
State Sen. Paul Utke, who would be asked to introduce the city’s request to the Legislature’s taxes committees, pointed out that parts of the identified roads, including South Main, are still gravel.
Council member Erika Randall said it should be up to the council to decide what street improvements are regionally significant – such as Huntsinger Avenue, which goes by the high school. She said city voters will only support the tax if it funds a street project they feel is needed.
Council members discussed re-ordering the priorities for the funded improvements. For example, Liz Stone suggested paving the south end of Main Ave. and select portions of Forest Ave., Fish Hook Ave. and 12th St., and giving needed attention to Central Ave.
Asked how urgent it is to approve a proposal, Weasner said the desired sales tax percentage, dollar amount and scope of the project need to be approved by the council and submitted to the Legislature by Jan. 31.
Erika Randall suggested having a work session in January to discuss what projects need to be done with city engineer Jon Olson and public works superintendent Scott Burlingame, who could not attend the Dec. 28 meeting.
Tom Conway made a motion to refer the matter back to staff to prepare a council workshop before their regular Jan. 11 meeting, and a resolution for the council to approve at that meeting. The motion passed unanimously.
Randall also questioned proposed updates to the Park Rapids Fire Department’s organizational handbook, which were previously brought forward for consideration and tabled in 2019.
New handbook language changes the percentage of annual calls volunteer firefighters are expected to attend from 75% to 45%, adding “teeth” to the requirement by creating consequences for firefighters failing to meet it, up to losing a year of pension service.
Fire Chief Terry Long said the 45% figure came out of discussions with firefighters, who felt it was a reasonable expectation to hold themselves to but still high compared to similar fire departments in the area.
However, Randall said that according to the council’s 2019 minutes on the matter, she and other council members had wanted to see specific numbers regarding the call percentage expected of firefighters in other districts. Randall said she still wants to see those numbers so the council can make an informed decision.
Another issue with the handbook update involved the three classes of honorary members – fire, social and lifetime members – which Randall felt was unnecessarily complex.
The only change in that section was a brief addition prohibiting “non-personal” use of the fire hall. Randall said that due to liability concerns, who has access to the building needs to be clearly defined.
Conway made a motion to refer the matter back to staff for report and action at the council’s Jan. 25 meeting. The motion passed unanimously.
In consent items and general business, the council:
Approved a leave of absence of up to 12 weeks for volunteer firefighter Jim Preston. Long said this would probably not affect his ability to attend the required percentage of calls for the year.
Authorized Weasner to look into dissolving the Park Rapids Housing and Redevelopment Authority (HRA) and handing off oversight of the River Heights Apartments, 500 Riverside Ave., to the Hubbard County HRA. Council member Tom Conway, who sits on the city HRA board, said he feels the county HRA is better equipped to oversee a housing project.
Paid the Hubbard County Housing and Redevelopment Authority $216,000 for the second payment of a pass-through Minnesota Housing grant for the completed Meadow’s Edge apartment building.
Made $193,141 in tax increment financing payments for the second half of 2021 as recommended by David Drown Associates, Inc. The payments include a $68,135 return to Hubbard County, $57,462 to KI Senior Living, $24,349 to Larmac Industries, $24,141 to Pleasant Court of Park Rapids and $19,054 to SDG Properties.
Paid Heiman Inc. $1,041 for the purchase of five coupled hoses for the fire department.
Paid Leading Edge Mechanical Inc. $2,998 to replace the burner assembly for a radiant heat system at the municipal airport.
Paid Lexipol $5,813 for an annual law-enforcement policy manual update and daily training bulletins. According to the staff request in the council’s agenda packet, the price for last year was $6,368.
Paid TKDA $7,226 for work on the airport terminal taxilanes construction project.
Disbursed $6,500 in aquatic invasive species funds to Hubbard County Environmental Services for AIS inspection hours in 2022.
Reappointed LuAnn Hurd-Lof to a two-year term on the Arts and Culture Advisory Commission, Gail Leverson to a three-year term on the Library Board and Elmer Schoon to a three-year term on the Parks and Beautification Board.
Designated city hall as the combined polling place for both Park Rapids city election precincts.
Scheduled a public hearing for 6 p.m. Jan. 11 for the first reading of a proposed drug paraphernalia ordinance.
Scheduled city council meetings for 2022. Regular meeting times are 6 p.m. the second and fourth Tuesday of each month except the first meeting date of November, which is to be determined.
Acknowledged donations to the city up to Dec. 14 totaling $3,020, including two donations on Aug. 16 that were not previously approved due to a bookkeeping error. These include $2,500 toward the Depot Park tennis courts replacement project.
Approved payables totaling $231,965 and prepaids totaling $880,199.
The city council’s next meeting is scheduled for 6 p.m. Tuesday, Jan. 11 at city hall.