MANDAN, N.D. (AP) - Mandan officials could use tax incentives in an effort to draw in new restaurants.
The Mandan City Commission is set to meet Tuesday on a possible five-year rebate of its 1 percent local sales tax and $162,000 of funding for interest buydowns, The Bismarck Tribune (https://bit.ly/1Uw965J) reported.
Mandan business development director Ellen Huber said the proposal came from the Mandan Growth Fund Committee. The program would go for a year, with a review to follow for consideration of an extension.
Huber said Mandan still has significant service and retail gaps despite the city’s efforts. To match the per-capita restaurant density of Bismarck, Huber said Mandan would need nine more restaurants.
Commissioner Mike Braun said in statement that access to a variety of restaurants is important for residents’ quality of life and for the experience of visitors. He said it also draws in other kinds of businesses.
A restaurant would get $10,000 back for every $1 million in annual sales under the sales tax rebate.
“The more successful the restaurant, the more it would receive,” Huber said. “At the same time, the risk would be low, because, if the business doesn’t perform, the rebate would be minimal.”
The program’s interest buydown portion would come from Mandan Growth Fund’s $250,000 annual sales tax allocation and would be used with a Bank of North Dakota program. Huber said funding would be done on a first-come, first-served basis, and that it would probably be enough for three large projects or several smaller ones.
Letting go of some sales tax will mean a larger tax base long term, Huber said.
“It’s revenue we don’t have today,” she said.
The 1 percent local sales tax under proposal for rebate is the part of sales tax used now for property tax reduction, economic development, debt reduction and infrastructure. Property taxes and other local sales taxes would still be required.
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Information from: Bismarck Tribune, https://www.bismarcktribune.com
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