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Osseo seeks 0.5% local sales tax to fund new community center and city‑hall renovations
Summary
House File 3873 would allow the city of Osseo to ask voters to adopt a 0.5% local sales and use tax to fund a $7 million community center and $3 million renovations to city hall; mayor and city staff argued the projects serve a regional user base while at least one resident opposed the measure as unaffordable.
Representative Momani Hilsley presented House File 3873 as amended, a bill that would authorize the City of Osseo to hold a referendum asking voters to approve a 0.5% local sales and use tax restricted to two capital projects: $7,000,000 for the Bora Boom Park community center and $3,000,000 for renovation and accessibility improvements at Osseo City Hall. The author's amendment narrowed the bill to those two projects, specified permissible bonding and established a 20‑year sunset (or earlier termination when revenues cover project costs).
Duane Poppe, mayor of Osseo (population ~2,600), testified that Osseo functions as a regional service center and that nearly 60% of current community‑center users live outside city limits. City staff explained the municipal budget and limited bonding capacity (bonding capacity cited as about $13,000,000) and said a local sales tax distributes costs across users, including many nonresident visitors. The city estimated the proposal would raise about $10,000,000 over the tax life and would include public engagement prior to any ballot question.
Kenny Nelson, testifying by Zoom, opposed the proposal on equity and affordability grounds, argued Osseo already collects more local taxes than nearby cities, noted available community centers within five miles, and questioned the city's projections and prior investment choices.
Committee members pressed the city on the incidence of the tax and the Department of Revenue reference; the city cited a University of Minnesota study showing an estimated 55% of the taxable sales would be paid by residents and 45% by nonresidents. With a quorum present, members adopted the A26/A01 amendment and laid HF 3873 over for possible inclusion in the 2026 tax bill.
Next steps: the amendment was adopted in committee and staff recorded that HF 3873 will be laid over for possible inclusion in the tax omnibus; the city signaled it will conduct further public engagement and provide more detailed projections to interested members.
