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Storm water plan funding debated

A move by the city of Jamestown to use part of the sales tax dedicated to economic development for a project that might be considered infrastructure development is drawing criticism.

The Jamestown Finance and Legal Committee approved a recommendation to the City Council this week to use about $350,000 from the economic development sales tax money to conduct a storm water master plan for parts of Jamestown and lands in surrounding townships that may see development in the future.

The request came from a subcommittee of the Stutsman County Water Resource Board which includes representatives of the city of Jamestown and surrounding townships.

The plan would determine the amount of storm runoff in the area around Jamestown and could be used to develop storm water mitigation plans. Currently each property developer is responsible for developing and implementing a storm water plan for his or her property.

The money would come from the half of 1 percent city sales tax dedicated to economic development. Requests to spend those funds have been made to the Jamestown/Stutsman Development Corp. in all previous cases. The JSDC then makes recommendations to the Jamestown City Council and the Stutsman County Commission. The process is governed by an agreement between the JSDC, city of Jamestown and Stutsman County.

The approval Tuesday by the Jamestown Finance and Legal Committee bypassed the JSDC and Stutsman County from the review process.

“That can’t happen,” said Jim Boyd, a former member of the JSDC Board of Directors. “I don’t understand how they can do that when we have agreements on how to handle those funds.”

Jamestown Mayor Katie Andersen, who is also a member of the JSDC board, said the use of the money is justified because the storm water plan would help facilitate economic development in the area around Jamestown.

“In order for development to happen, we have to know how to manage the storm water,” she said. “It will even be used to solve some drainage issues in already developed areas.”

What is economic development?

Joe Larson, attorney for the JSDC, said the storm water plan does not fall under the definition of economic development.

“The storm water study does not have the purpose of providing a business an economic incentive,” he said. “Essentially it is a public improvement. This is a study preliminary to doing public improvements. It doesn’t fall within the JSDC policy and procedures.”

Larson said the city of Jamestown did have the legal authority to spend the money generated by the city sales tax. He said it might be a better fit to use funds from the half of the city sales tax dedicated to infrastructure for the storm water master plan.

Prior to July 2010, the entire 1 percent sales tax went to economic development. Since 2010, half the tax has been dedicated to infrastructure. During hearings for the 2015 budget, the city approved transferring $800,000 from the sales tax infrastructure fund to the sewer utility fund to cover bond payments for the $10 million sewer and lift station project completed this year. In previous years, the city of Jamestown had used funds from the infrastructure sales tax fund to reduce the mill levy for the city share of special assessments.

Funding the plan

City Attorney Ken Dalsted said the Stutsman County Water Resource Board seeking funding from the city was the quickest way to get the storm water plan moving. Plans call for submitting a request for proposals from engineering and consulting firms as soon as the funding is finalized.

“Not a whole lot of time to look at funding,” he said. “We looked at the JSDC and were told it couldn’t consider it. First we were told the request had to come from the (Stutsman County) Water Board and then told the JSDC couldn’t fund it.”

Other sources of possible funding include the U.S. Department of Agriculture and the North Dakota Department of Commerce.

“Any answer from them would take a year,” Dalsted said.

JSDC reserves

Covering the cost of the plan from economic development funds will reduce the funds available for other projects.

Connie Ova, CEO of the JSDC, said the JSDC currently has about $3.8 million available in uncommitted funds.

Participation in the Flex Pace Affordable Housing program would earmark $640,000 for interest buy downs for multifamily housing. This proposal passed the Jamestown City Finance and Legal Committee, but was tabled by the Stutsman County Commission. Passage by the City Council and the County Commission is required to obligate the funds.

Ova said participation in the affordable housing program and funding the storm water plan would reduce the available funds for primary sector business incentives by $1 million. The amount of incentives for the proposed CHS nitrogen plant at Spiritwood has not been finalized by the JSDC board, but preliminary proposals made to CHS have exceeded $3 million.

Jamestown Councilman Charlie Kourajian said funding levels for the JSDC are a concern.

“We’ll have to look at their (JSDC) overall funds,” he said. “Maybe we need to take a second look at it if they can show a need for that money.”

A former City Council member and Boyd say managing economic development funds should be left to the JSDC.

“The city and county working together established procedures to determine how the economic development funds are used,” said Dwaine Heinrich, former city councilman. “We have a contract between the city and county and the people of those organizations, and they have thrashed those agreements with the Menards deal and with this issue.”

The city is using tax increment financing as an incentive to bring a Menards store to Jamestown.

Boyd said the city is abusing the economic development funds.

“The JSDC is supposed to be managing that account,” he said. “They can’t continue to rely on the account set up for economic development for general maintenance. It’s not proper. The voters put it in for economic development to have more jobs in the county. It should be taken seriously. If this is allowed it places serious doubt in the future of the JSDC.”

The storm water plan is on the agenda for the Sept. 2 City Council meeting.

Sun reporter Keith Norman can be reached at 701-952-8452 or by email at