BEMIDJI -- The Bemidji City Council took steps Tuesday to push for a 1/2% sales tax increase during the 2020 legislative session.

If approved by the Legislature, and by Bemidji voters through a referendum, the funds generated would go toward three capital needs. Two are related to the city's water infrastructure and the third is for capital investment costs at the Sanford Center.

One of the two water infrastructure projects is a new treatment facility at the city's water wells near the Bemidji Regional Airport. The plant will treat chemicals known as perfluorocarbons, or PFCs, that have been found in the wells.

The estimated cost of the plant is $16.3 million, and the city is hoping at least $8 million is covered through state bonding funds. However, the remaining amount is still substantial.

The other project is at the wastewater treatment facility, which is operating at capacity. On top of needing to accommodate the city's growth, the city is also seeking a new license from the Minnesota Pollution Control Agency that could require treatment for nitrogen and ammonia. The estimated cost of these improvements is at least $10 million.

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At the Sanford Center, the city currently budgets $230,000 for annual capital improvement costs. However, staff at the facility have capital requests closer to $750,000. The building, which houses a 4,373-seat arena and attached conference space, opened in 2010.

For all three of these issues, the city is looking to implement a 1/2% sales tax over a 10-year period. The city already has a 1/2% sales tax in place for bonding costs used in the Sanford Center's construction.

According to city documents, $10 million of the proposed sales tax would go toward the wastewater treatment plant, $8 million would be used for the water chemicals treatment facility and $9 million would be invested at the Sanford Center.

The City Council voted unanimously to support the 1/2% sales tax option at its meeting Tuesday. The Legislature is scheduled to convene on Tuesday, Feb. 11.

Annexation moves forward

Another approval made by the council Tuesday was a resolution initiating the annexation of Northern Township. The orderly annexation agreement between Bemidji and Northern Township initially had the land change set for June.

However, it was moved to a sooner date because of the upcoming U.S. Census. According to City Manager Nate Mathews, the changes now have to be approved by the Minnesota Municipal Boundary Adjustment Office.

The area to be annexed extends northward from Anne Street, up Lakewood Drive Northwest, and westward to U.S. Highway 71 and the Bemidji Regional Airport. The city is expected to see an estimated $300,000 increase in property taxes from the annexation.

The upcoming annexation is the third and final phase agreed to between the city and the township, with the others taking place in 2010 and 2015. Originally, the annexation agreement had included Bemidji Township, but the government unit later filed a pair of lawsuits to exit.

In 2017, a settlement was reached with all parties, which included the withdrawal of Bemidji Township from the annexation agreement and the Greater Bemidji Area Joint Planning Board.

The future of the TIC

In another decision Tuesday, the council consented to allow the Bemidji Area Chamber of Commerce to leave the Tourist Information Center, which the city owns, in February. Located at 300 Bemidji Ave. N, near the Paul Bunyan and Babe the Blue Ox statues, the TIC has been home to the Chamber since the mid 1990s.

On Dec. 21, the Chamber entered into a sublease with Visit Bemidji, as the community's visitors and convention bureau moved into the building at that time. As part of moving out of the TIC, the Chamber requested to assign the Visit Bemidji sublease to the city, which the council agreed to.

The Chamber is planning to move into the Mayflower Building, which has been owned and occupied by Greater Bemidji Economic Development since 2015. The Mayflower Building is also home to the LaunchPad, a program providing flexible co-working space for startup businesses.

As part of its departure, the Chamber will no longer staff and operate the information center. As a result, Mathews said the city will work with Visit Bemidji on the building's future.

"We're going to work closely with Visit Bemidji on this conversation," Mathews said. "They're the most realistic entity that has enough capacity to help the community."