NRABC proposes city lodging tax for tourism

New Rockford appears to be heading the same direction as many other North Dakota communities. Amanda Hegland, Executive Director of the New Rockford Area Betterment Corporation, appealed to the city commission Monday, Feb. 6 to impose a new tax to support tourism.

Hegland proposed that the city impose a lodging tax, which will be added to all hotel, motel and lodge accommodations within the city for periods of fewer than 30 consecutive calendar days, or one month. Payment of fees for extended stays longer than one month is considered rent, Hegland explained, and therefore not taxed. The city can impose up to 2 percent, she added.

The proceeds from the tax would be deposited into a visitor promotion fund to promote tourism in New Rockford. This includes advertising, the development of materials such as brochures, and other promotion of the community. Almost every city has this tax, Hegland said.

According to the North Dakota Tax Commissioner’s website, more than 50 North Dakota communities impose a lodging tax, including Minnewaukan, Carrington and Harvey.

“It is only affecting visitors who are reserving hotel rooms,” Hegland said, noting that the advertising paid for by the tax will encourage more visitors to come to New Rockford.

“We are doing it to help the hotels, to bring people into town to stay there,” Hegland said.

The commission directed city attorney Travis Peterson to draw up a city ordinance for review and reading. Two readings of the ordinance are required before the tax would go into effect.

Hegland also proposed some changes to the city’s Housing Incentive Program, which provides perks to residents who purchase, renovate or build homes in city limits. The program was established in 2007 to encourage people to move to the community and spur investment in housing. After some discussion, the commission asked Hegland to make some additional adjustments and bring the revisions back for review and vote at the next meeting. In the meantime, the program will remain in effect in its current form. Anyone considering the purchase of a home, renovation of their current home, or building a new home is encouraged to contact the NRABC at (701) 947-2205 for more details and to fill out an application.

Travis Dillman of Interstate Engineering brought final closeout paperwork for the water plant project. He explained that they had negotiated with Sentry Crane, the project’s lead contractor, on a final change order. The original request from Sentry included payment of 16 items totaling just under $300,000. Through negotiation, the total was reduced to $40,484.31, covering four of those items.

“The water quality is where we want to be,” Dillman said, and encouraged the commission to approve the final change order and close out the project.

“I think this is a good move for us, to be done,” President Stu Richter noted. He added that the city would use Prairie Dog infrastructure funds from the state legislature to cover the added costs.

The final payment approved by commissioners Monday totaled $162,924.04. This includes the final retainage of $120,000 and the $40,000 change order. The total project cost came in 4.3 percent lower than the original estimate of $2.8 million, Dillman said.

The 1-year warranty period for the water plant improvements began in September 2022, per Dillman, which is the point the project reached “substantial completion” and the new water treatment equipment was in service for beneficial use by the city.

The city also approved a payment to Bituminous Paving for $493,606.14, which covered their final week of work for the 2022 season, October 30 – Nov. 5. The project is 66 percent complete by dollar value, Dillman said.

Commissioners then passed a resolution regarding replacement of lead service lines in the city. Dillman told commissioners that drinking water SRF funds through the state will be made available in the near future to replace lead lines. Since the city has identified the majority of lead service lines through the water main replacement project, they are in position to access grant funds to pay a significant portion of the cost for replacing those private lead lines.

“I think it’s a good deal. It opens the door for grant money if you so choose to use it,” Dillman said.

Later in the meeting, Richter brought a proposal from NR-S school board president Mike Jacobson to use the Brown Memorial for archery. Commissioners raised concerns about the cost of insurance and the need for the users to take responsibility for any damages to the building, but ultimately approved the usage pending an insurance review and signed damage waiver.

Commissioners also reviewed certificate of deposit (CD) options available through local institutions, as the city has five CDs that have matured or are nearing maturity. The $75,000 CD at Community Credit Union was renewed at 4.1 percent. After discussion, the four others at Bank Forward were approved for deposit into the bank’s CDARS program, which offers 4 percent interest, upon clarification that the bonds are investment grade.

The next city commission meeting is set for Monday, March 6 at 7 p.m.