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0.5% sales tax allows JSDC to recruit companies to Jamestown area

Jamestown/Stutsman Development Corp. CEO Connie Ova said 80% of the funds for economic development are generated by the 0.5% sales tax in Jamestown.

JSDC Sales Tax 07282022
The 0.5% sales tax for economic development has allowed the Jamestown/Stutsman Development Corp. to recruit businesses such as Shocker Hitch LLC, which plans to locate in the Infinity Building Services building.
Kathy Steiner / The Jamestown Sun
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JAMESTOWN – The 0.5% sales tax for economic development has allowed the Jamestown/Stutsman Development Corp. to recruit businesses while also supporting companies and creating jobs to the Jamestown area, according to CEO Connie Ova.

“We have half a billion dollars of projects on the drawing board right now that will actually come to fruition and so that includes some matching investment of who knows how much and jobs of probably 400 to 500 that would not be possible without the Economic Development Corp.,” she said. “To level the playing field with other states and other communities, we do need economic development. If everybody else would quit, we could quit, but in the meantime, you are not going to get any of those companies or businesses to do business if you don't have some type of incentive to help them along.”

Corry Shevlin, JSDC business development director, said the JSDC has helped create more than 3,000 jobs in the Jamestown area.

Mayor Dwaine Heinrich said the JSDC deserves a lot of credit for the businesses and jobs that have been created in the Jamestown area. He said Jamestown is not the same community as it was in the early ’90s. He said the railroad had left the city as well as some other businesses and a drought in the ’80s put farms in desperate financial condition.

He also said the JSDC does not spend every penny it receives and likes the idea of having money in its reserve if an opportunity arises to bring a big business to the community.

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“We (JSDC Board of Directors) look for the good or the success of the long term,” he said. “If people look at how the sales tax fund has been spent over the years, they are going to see that.”

Ova said 80% of the funds for economic development are generated by the 0.5% sales tax in Jamestown with the remaining funds coming from a Stutsman County mill rate capped at 4 mills. The JSDC currently receives 3 mills from Stutsman County.

She said many of JSDC’s incentives that are made possible from the 0.5% sales tax help support local employers such as Agri-cover Inc., which is expanding its business, or Shocker Hitch LLC, which manufactures cushion and airbag-towing hitches for pickups and bumper-pull gooseneck trailers and will relocate to Jamestown.

The JSDC has been integral in bringing AVIKO, which is now Cavendish Farms, to the community as well as bringing businesses to the I-94 Business Park, Spiritwood Energy Park Association industrial park and the JMS Aviation Park, Ova said. The I-94 Business Park is located south of Interstate 94 and east of U.S. Highway 281, the SEPA industrial park is located near Spiritwood, and the JMS Aviation Park is located near Jamestown Regional Airport.

Ova said the 0.5% sales tax that is used to recruit businesses to the area creates and maintains local jobs.

“Those people have kids that go to school here that buy taxable goods here and contribute back to the local economy too,” she said.

Ova said Menards also received incentives that were needed because the big-box retail store knew it was still getting business from Jamestown-area customers at its locations in Fargo, Bismarck and Aberdeen, South Dakota.

“In order to convince them (Menards) to come, there had to be incentives given to them to make it a little more palatable for them to decide to put a building here and to continue to do business here in Jamestown,” she said.

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She said the 0.5% sales tax that is generated because of local shopping all helps the local economy and people.

“The more jobs that are available, the more competitive the employers have to be for salaries and wages so that goes up,” she said. “With that going up, people have more spendable income so they can spend more money on taxable things and contribute back to the economy.”

She also said the planned Bison World project wouldn’t be as far along as it is without the JSDC and the local sales tax.

Shevlin said the JSDC has helped businesses with one to two employees and others such as Collins Aerospace, Archer Daniels Midland Co. and Marathon Petroleum Corp.’s Green Bison Soy Processing plant.

“We try to leverage as much of the state’s money or federal money as we possibly can,” he said.

The 0.5% sales tax is also used as local matching dollars for the Bank of North Dakota’s Flex PACE and PACE programs. Shevlin said the JSDC has more than 50 Flex PACE and PACE loans still active that are in repayment to companies in Jamestown and Stutsman County.

He said the impact of the Flex PACE program is huge for small businesses.

“The difference between a $2,000 and a $3,000 payment on a mortgage or a commercial loan is another FTE (full-time equivalent) or another two FTEs or allows them to expand their business or pay down their debt sooner so they are more active and healthy,” he said.

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Shevlin said the Bank of North Dakota’s Flex PACE and PACE programs are invaluable and the best the state has to offer. He said Flex PACE is the avenue that JSDC chooses to participate in for the retail and service industries in Jamestown and Stutsman County.

The JSDC Board of Directors has approved a couple of requests for PACE funding this year to Shocker Hitch and Liechty International LLC.

“Those larger dollar amounts, we will look to leverage $1.5 million, $2 million depending on some things just in PACE funding that comes down as grant dollars from the Bank of North Dakota,” he said. “But we get it back because we provide that in the form of a loan so we get that working in our community, our companies can take advantage of that whether that is accelerating additional products or services or stabilizing in this economy or whatever it may be. For our manufacturers a lot of times it is expansion and new equipment, which means upskilling of employees and things of that nature, so it’s good for the whole economic climate of our community here.”

Ova said the JSDC used to do direct loans but doesn’t want the organization to compete with banks and credit unions.

“What we’re for is to help with gap financing and gap funding and things like that,” she said. “We would rather encourage businesses to use PACE and Flex PACE and then New Jobs Training Funds as well.”

She said JSDC doesn’t do outright grants for businesses because the JSDC board and employees recognize it’s taxpayer dollars that would be used and they would rather see the funds revolve and go back into the community. The JSDC also works with businesses to see what they need, which is why the Internship Reimbursement Program was created.

The Internship Reimbursement Program is designed to increase the number of local internships and help employers in workforce recruitment and retention, according to JSDC's website. The program contributes up to $3,500 to reimburse employers that are hiring university/college students to assist in payroll costs and is open to employers in Stutsman County.

Ova said the JSDC has purchased land and created the I-94 Business Park, Spiritwood Energy Park Association industrial park and the JMS Aviation Park where businesses can locate. She said the JSDC has realized over the years that it’s more advantageous to businesses to have the land with infrastructure already built provided to them.

Shevlin said the JSDC purchases the land, builds the infrastructure, and then sells the land to the appropriate owners when the parks get full.

“So it seems like that model has been what has kept us successful along the way rather than trying to figure out different incentives that might work, that might not work, it’s just that if you got a good location with infrastructure there and a company can get into it at basically cost, it’s more advantageous for them than,” Ova said.

She said the JSDC’s goal is not to own land but to support businesses and create jobs.

Masaki Ova joined The Jamestown Sun in August 2021 as a reporter. He grew up on a farm near Pingree, N.D. He majored in communications at the University of Jamestown, N.D.
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