If approved, the total cost of the investment plan for Braemar Arena and Park and Fred Richards Park would be $64.6 million, which would be funded by a half-percent sales tax increase.
The Edina City Council concluded that a sales tax option was the best choice to finance this investment plan because the cost is spread among residents and nonresidents. According to research by the University of Minnesota, 60 percent of the half-percent sales tax increase would be paid by nonresidents as they visit local businesses.
If the projects were funded through a property tax increase, then the cost burden would fall to Edina residents who own or rent commercial and residential property.
If approved by Edina voters, collections from the sales tax would be used to make the bond payments for financing the project over a 17-year period. During that time, consumers would pay an additional 50 cents per $100 taxable purchase in Edina. The tax expires in 17 years. If an amount sufficient to pay the bonds for the Fred Richards Park, Braemar Park and Braemar Arena projects is raised before then, the sales tax would fund general Parks & Recreation capital improvements for the remainder of the term.
The average cost per resident of the sales tax would be $2.62 per month, or $31.48 per year, according to an analysis by the University of Minnesota. In contrast, the City estimates that supporting this level of investment using property taxes could mean the owner of a median value home of $571,800 would pay an additional $190.37 per year.
As part of the general election on Nov. 8, Edina voters will consider two ballot questions:
Voters can approve question one, question two, both questions or neither question.
If the 2022 Legislature approves the City’s request during the current session, Edina voters would also get to decide whether to use the sales tax option to finance an additional $25.3 million for the Braemar Arena expansion.