DILWORTH, Minnesota – A proposed half-percent sales tax in Dilworth would split the cost of a new community center between residents and nonresidents.
In the Nov. 5 general election, Dilworth residents will vote on a local sales tax. If passed, the 25-year tax would be used to build a new community center in Dilworth. The town’s former community center was demolished in April to make way for construction of a new fire station.
The sales tax is expected to generate more than $6.1 million over 25 years. According to a University of Minnesota Extension study, 35% of taxable sales would be paid by visitors shopping in Dilworth, based on the city’s tax revenue in 2021.
Peyton Mastera, Dilworth’s city manager, said more than half of the leases for the community center came from outside Dilworth.
“Most of the people using the community center were not Dilworth residents, which is fine,” Mastera said. “But that just shows the regional significance that you have to demonstrate at the state level to get sales tax approval.”
Of the total $6.1 million, an estimated $2.25 million would come from spending by nonresidents, the study said.
The proposed community center would cost about $7.2 million, according to a 2022 estimate, Mastera said. The city is considering building the building on a field east of shopping centers in Dilworth’s railroad district.
The current sales tax in Dilworth is 7.375%, which includes the Minnesota sales tax of 6.875% and Clay County’s half-percent sales tax. If the half-percent sales tax for a community center is approved in November, Dilworth’s sales tax will be 7.875% starting in 2025.
In Moorhead the sales tax is 7.875%, in Fargo 7.5% and in West Fargo 8%.
Dilworth Mayor Chad Olson called the former community center the “heartbeat” of Dilworth.
“There are so many events, activities and opportunities going on,” Olson said. “We needed a plan not only to replace the existing community center, but to really offer a lot more.”
The city plans to build a community center in stages.
The original building would replace and modernize the former community center. It would include space for events and meetings, a commercial kitchen and bathrooms, and would be designed to allow for future expansion, Mastera said.
With room to grow on the eastern edge of Dilworth, Olson hopes the community center can grow into a larger recreational area for the community. The city is in talks with a health care provider about a clinic and with private investors about other facilities, he said.
“The community center is really the first step,” Olson said.
If voters approve the sales tax measure in November, the public will be asked to comment on the project and help determine the details of the building’s design, Mastera said.
There is a gap of about a million dollars between the expected tax revenue and the project costs. Mastera said additional funding sources for the project have yet to be identified, but the city is exploring options such as private partnerships, tax abatements or user fees for the facility.
There is no backup plan to fund a community center if voters do not approve the sales tax in November, Mastera said, but the city will talk to the public about next steps regardless of the outcome of the vote.
Olson said residents he has heard from seem to support a local sales tax to fund a community center.
“So far the support has been overwhelmingly positive – it’s fantastic,” he said.
For more information on the proposed sales tax, visit dilworthontrack.com.
