City officials tout sales tax

By CHRIS VETTER

Journal Staff Writer

NEW ULM -- Dan Beranek says a new ice rink facility would have a profound impact on New Ulm.

"This can make us a first class city. This is such a grand opportunity," Beranek told a group Friday morning at the New Ulm Country Club.

Beranek, city council president, is trying to persuade New Ulm residents to vote for a half-percent local sales tax. If the referendum passes Nov. 7, the city would be able to finance some $9 million in bonds to build a new ice and exhibition facility at Brown County Fairgrounds, renovate Vogel Arena and expand the senior center.

The city would like to move the ice sheets out of Vogel and into a new building because the current system is old and a new building gives the city more options, Beranek said. The city would spend $700,000 on replacing the refrigeration system at Vogel Arena in two or three years, Beranek said.

The audience, comprised of Chamber of Commerce members, quizzed city officials about the effects of the tax. New Ulm residents who purchase big-ticket items, such as a vehicle, would only pay an additional $20 flat fee, Beranek said.

And, farm machinery will not face the additional tax if the buyer's home address is not in New Ulm, Beranek added.

Beranek admitted he is not clear on how the tax would affect other items, such as boat purchases.

The sales tax proposal is preferred to property tax hikes because visitors to town would help pay the tab, Beranek said. When out-of-town guests come to town to use the ice rinks, they would buy gas, eat at restaurants and stay at hotels, meaning they would pay sales tax.

The average family in New Ulm would only spend $40-60 a year more because of the new tax, Beranek said.

One audience member asked if the city has a plan to build the new facilities without the sales tax. Beranek said it is unlikely the buildings could be constructed without bonding.

"If you put it on the back of city budgets, it's not going to happen... not right away, anyways," he said.

Beranek acknowledges the referendum is a tough sell, especially after voters rejected a school referendum earlier this year. He said the goal is to separate the school issues from city business, and explain to voters that the two are not connected.

The city still must iron out a contract with the Brown County Agricultural Society to use the land at the fairgrounds. While Beranek declined to delve into lease numbers, he said the city is close to a deal on a 20-year lease for the property's southeast corner.

"The ag society is very eager for this to happen," Beranek said.

New Ulm City Councilor Denis Warta said the new facilities could attract new people to town, while keeping youth in New Ulm.

"This project is more economic development than anything," Warta said. "Our students are leaving for better amenities elsewhere."

Brian Kief, the administrator of the New Ulm Medical Center, said he frequently drives physicians around town, trying to sell a doctor on moving to the city.

"The competition is incredibly stiff," Kief said. The new or improved facilities could draw those people to New Ulm.

While bonds would pay for the $9 million project, Beranek acknowledged that maintenance of the facility would be the city's responsiblity, and new workers would be required.

The city is still waiting to see a scaled-back proposal from the architect. The cost for the project currently sits at $11.7 million, and must be scaled back 25 percent to fit under the $9 million cap.

Beranek said he was pleased with the overall discussion.

"If this group here voted today, we'd get a 'yes' vote," Beranek contends. "We need to do more of this in front of large crowds."