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Bismarck commission considers proposing sales tax hike for police, public health buildings
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Bismarck commission considers proposing sales tax hike for police, public health buildings

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City/County Office Bldg.

City and county officials are based in the City County Building in downtown Bismarck.

Bismarck city commissioners are considering proposing a quarter-cent sales tax increase to fund the relocation of the police department and the Bismarck-Burleigh Public Health Department.

A final decision will be made later. The discussion comes less than a year after residents last June voted down a half-cent sales tax measure to fund a proposed indoor recreation complex. The Bismarck Park Board is conducting a survey to get more information on why the measure failed.

The city sold the public health department building in 2019, and the department is now leasing its space in the same location. The police department's building is about 40 years old with limited parking.

The commission is looking at options that would enable the public health department to move into the police headquarters, and either relocate the police to an existing building or construct one. Consulting firm Leo A. Daly previously told the commission that doing so would cost between $43.6 million and $57.6 million.

To fully fund the move, the city would need to finance a bond by either raising the mill levy or bringing a quarter-cent sales tax increase to voters. Commissioners were wary Tuesday of raising property taxes; last year the board implemented a plan to significantly increase property taxes in 2021 and 2022 to ensure city services remain fully funded. However, the commission will not vote on a property tax increase for 2022 until later this year.

"After our last budget discussion, what we're looking at, I have a hard time swallowing under any circumstances increasing mills for this," Mayor Steve Bakken said.

The next opportunity for residents to vote on a sales tax measure is June 2022. Finance Director Dmitriy Chernyak told the commission that the bond market currently has low interest rates and the cost of building materials will increase.

The city has the ability to call a special election but would keep a measure on the June 2022 ballot, spokeswoman Gloria David said, citing the financial impact of a special election and a desire to keep things predictable for voters.

Bakken wondered if a bond could be financed via the mill levy until voters decided if they wanted to raise the sales tax, which Chernyak said is a possibility. Commissioner Nancy Guy also spoke of the need for a "Plan B" for funding in case a sales tax measure failed.

The quarter-cent sales tax would last for 20 years and raise about $80 million. Leftover money from the police and public health project would go to the construction of a new fire station some time in the future.

The commission voted Tuesday night to have city staff begin looking for a piece of property for the police department, and Commissioner Greg Zenker said any land acquired could be an asset.

"It gives us the opportunity to have some forward thinking," he said. "Let's go find a piece of property that's going to fit what we want it to do. Doesn't mean we have to do it right away, but it means we have a vision."

The commission did not vote on a funding option for the full project.

The public works building also will undergo some expansion as part of the city's plan to address space needs, but the cost for that project has already been included in utility fees.

Reach Sam Nelson at 701-250-8264 or sam.nelson@bismarcktribune.com.

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