Frequently Asked Questions
Find answers to questions about the plan, the process, the sales tax, and voting.
General Questions about the Plan
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The City of Rochester is a growing and welcoming community that is a sought-after place to live, work, raise children and retire. The City is committed to providing a wide range of services and support to enhance the quality of life of all residents.
With a 36% population increase since 2000, the City of Rochester is making important community investments to address an increasing demand for workforce and housing, repair aging streets, reinvest in the flood control and water quality system, and expand the City’s offerings for sports and recreation.
Visit our Challenges page to learn more about the need.
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After several years of research, planning and community engagement, the City of Rochester developed a long-term plan to invest $205 million in public projects that will enhance the quality of life for all residents. These projects include: an economic vitality fund, street reconstruction, flood control and water quality, a regional sports and recreation complex.
To learn more about the plan, visit our Plan page.
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Renewed by voters on November 7, 2023, the half-percent sales tax will generate a total of $205 million to support four projects:
Economic vitality fund: $50 million
Street reconstruction: $50 million
Flood control and water quality: $40 million
Regional sports and recreation complex: $65 million
The sales tax will remain in effect for 24 years or until the funding obligations of the projects have been met, whichever comes sooner. To learn more about the cost and finances, visit our Cost page.
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Investments funded by the renewed half-cent sales tax will address challenges in four main areas. Specifically:
Workforce and housing needs: All Rochester residents need affordable housing and approximately 30% of residents are considered very to extremely low income, meaning a significant portion or our residents have a heightened need for affordable living.
Aging city streets: 24% of the City’s streets are 50 years or older and 23% are rated as being in poor or fair condition. With the growing needs, Rochester faces an annual shortfall of $20 million to adequately address current and future street needs across our city.
Flood control and water quality protections: The current flood control system is a vital component of the City. Built in the 1980s and early 1990s, the current system protects over $1.5 billion in assets and requires continued investment to protect the City and surrounding areas by mitigating flood waters. Changes in weather patterns demonstrate that the system must be expanded and enhanced to address localized flooding areas. However, previously approved funding for the flood control system will be depleted in 2029. The system can only operate at full capacity when properly funded and maintained.
Growing demand for recreation and sports facilities: Rochester residents have expressed that the City lacks adequate facilities to provide access to fitness and recreational activities that they desire. An analysis by Sports Facilities Companies in early 2023 identified gaps in the following:
Outdoor multi-purpose turf and grass fields for –soccer and lacrosse
Flexible community space
Indoor multi-purpose courts and fields for sports such as basketball, volleyball and pickleball
Facilities with ADA accessible features and functions, restrooms, concessions and seating
Walking track
Children’s indoor play area
To learn more about the needs, visit our Challenges page.
Economic Vitality Fund
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The Economic Vitality Fund will focus on key components of economic development strategies, such as housing, regional revitalization, workforce development and infrastructure. This initiative aims to support the growth and prosperity of the community by:
Investing in missing middle- and low-income housing
Preserving existing affordable housing options in our neighborhoods
Developing workforce programs that will help create more job opportunities for residents.
Street Reconstruction
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The street reconstruction project will address the deteriorating streets by repairing and rebuilding the existing stretches of roadway needing attention.
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The Public Works team has been evaluating potential street projects that would likely be pursued with the renewal of half-percent local sales tax. The following criteria are what the PW team will use to prioritize street improvements under this program:
Pavement age and condition
Coordination with public utility needs
Distribution across the community
Public improvement in proximity to planned development
Public improvements connected with projects not eligible for Sales Tax
View the 2019 Citywide Pavement Condition Summary for additional information on road conditions.
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Almost a quarter of all city streets are currently in fair and poor condition. While federal funding might address some needs in the years ahead, funding is based on each roadway’s functional classification and may not apply to all city roadways in need of repair. Additionally, the funds currently available to the Rochester-Olmsted Council of Governments (ROCOG) planning area are shared across the City, Olmsted County, and the smaller cities in the area. Generally speaking, approximately 80% of the road miles in Rochester are not strong candidates for state or federal funding.
Flood Control and Water Quality
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The initiative includes integrated projects such as regional detention for additional rate control and sediment removal, reinvestment and enhancement of existing floodwalls, and riverbank stabilization measures.
Reinvestment in the existing system will:
Improve overall performance
Add floodwater storage capacity
Expand our capacity to protect our developed areas
Enhance water quality for the Zumbro River and its tributaries
By mitigating flood potential and maintaining water quality, these projects safeguards the community and environment.
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Even if your home isn’t impacted during a major flood, you will likely still be affected as major arterial roads would be closed which would disrupt traffic, including mail delivery, utilities, emergency services, and more. The economic impact of a major flood event is significant and directly affects the community and region.
In addition, bike trails, lighting, park amenities, and recreational opportunities in and around the reservoirs and river systems make up a large part of the flood control system. Many residents rely on these areas for transportation and recreational opportunities. A lack of funding could result in less access to recreational areas, lower quality paved trails, and diminished amenities. Over $1.5 billion in property value is directly protected and many more receive indirect benefits.
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The existing flood control system has utilized past sales tax funds for maintenance and annual operations. The previously set aside funding that has sustained the system for the last 40 years is estimated to be depleted by 2029. Reinvestment is now necessary to maintain and improve the levels of protection associated with the existing system for the next 40 years.
Regional Sports and Recreation Complex (RSRC)
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We envision the use of this facility to be a mix of local leagues, regional tournaments and public drop-in programming. These types of activities would be available in the indoor and outdoor spaces. While the City will continue to engage residents to gather their input as it further develops plans for the complex, the initial concept includes:
Facilities with ADA accessible features and functions, restrooms, concessions and seating
Synthetic turf and multi-purpose fields
A tournament-quality pickleball complex
Indoor multi-purpose courts - basketball/volleyball/pickleball/walking track
Indoor children’s play areas
Flexible community spaces
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Now that the sales tax has been approved by voters, the City will continue to work with an architecture, engineering, environmental and planning firm, to identify the best location that fits the budget, sizing, scale and scope of the project.
A site of 75-90 acres will be required for the proposed outdoor spaces and indoor building. A larger site will allow for future expansion. A preferred site will be located near other entertainment, dining and hospitality amenities. The site will also have access to existing infrastructure, including transit, roadways, trails, utilities, etc.
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Yes, the amenities at the RSRC will be available to the public. We envision the use of this facility to be a mix of local leagues, regional tournaments and public drop in programming. These types of activities would be available in the indoor and outdoor spaces including the turf fields, pickleball courts and multi-purpose indoor courts.
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Expense areas will include staffing and personnel, supplies and equipment, cost of goods sold, and capital improvement allocations.
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Based on the research and comparable facilities’ history, Sports Facilities Companies concluded this facility will be a near break-even operation. There are several revenue opportunities that would be pursued, including: tournament and program facility rental, event admission revenue, drop-in program fees, concessions sales, advertising and sponsorship revenue, and possibly some space available for lease revenue.
Questions about the process
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Over the last several years, the City conducted an extensive planning process to identify which projects to pursue. Between conducting research, reviewing needs assessments, soliciting feedback from community members, and collaborating with experts, the City determined its top priorities are in the areas of flood control and water quality, economic vitality, street reconstruction, and sports and recreation. As it explored various options to pay for the investments, the City chose to propose renewing the local sales tax as opposed to an increased property tax to help spread the cost between residents and nonresidents
Further, in order to receive authorization from the Minnesota Legislature to propose a sales tax, the legislature requires that the plan provide a regional benefit since nonresidents and residents share the cost. Each of these projects will support a strong quality of life for those who live, work, and play in Rochester.
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The City has conducted an extensive planning process for these projects, relying on feedback from community members and collaborating with experts to determine the top priorities and the best way to pay for the investments. The following were included in these efforts:
Analysis of the sales tax conducted by the University of Minnesota
National Community Survey (NCS) conducted March 9, 2022 – April 27, 2022
Olmsted County Comprehensive Housing Needs Assessment (2020)
Pavement Management Report
Local gaps and Regional Sports Tourism Facility research conducted by Sports Facilities Companies (2023)
Inventory of Rochester and the area’s sporting facility assets
Community engagement about a potential sports complex, including:
1,900 responses to the Polco community-wide survey
3 open houses
7 outreach events with over 1,000 combined attendees
10+ Focus group sessions
A community working group with 8 major groups
The City has hosted, answered questions at and listened to the community at numerous Town Halls, public forums, and City events.
Questions about the sales tax
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Unlike a property tax option, the half-percent sales tax ensures that both residents and nonresidents share in the cost to reinvest in the city – not solely Rochester residents who own residential or commercial property.
According to research by the University of Minnesota, 43% of the sales tax in Rochester is paid by nonresidents. This means approximately $88 million of the project costs will be paid by nonresidents who purchase goods and services within Rochester’s city limits. For residents of Rochester, the estimated cost of the half-percent sales tax is about $4.64 per month.
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The half-percent sales tax will be extended for a maximum of 24 years or until $205 million to cover the cost of the projects has been collected, whichever comes sooner.
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The half-percent sales tax adds half of one penny for every $1 spent. In other words, an additional 5 cents will be added to a $10 purchase, or 50 cents for a $100 purchase.
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The local option sales tax has the same exemptions for purchases as the state sales tax, including groceries, clothing, prescription and over-the-counter drugs, feminine hygiene products and taxable baby products.
For more information, view this list of taxable items and this list of most nontaxable items from the Minnesota Department of Revenue.
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The state law authorizing the City of Rochester to present the sales tax renewal to voters clearly states that the City must use the funds solely for the projects that are on the ballot. The only way the City could use collections from the sales tax on something else would be if the state legislature authorized it and local voters approved it in another election.
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Over the past five years, local option sales taxes have gained traction in the rest of the state as an investment tool for cities and counties to fund major public projects. Several cities have approved a local option sales tax in recent years to support community investments, including Edina (parks and recreation improvements), Mankato (Regional Airport and Civic Center), St. Peter (Fire Station) and West St. Paul (road projects).
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The University of Minnesota analyzed the economic effects of a local sales tax increase in several Minnesota cities and found little evidence that overall sales growth for businesses was impacted. Further, the sales tax proposal seeks to renew the existing half-percent sales tax, not increase it.
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Rochester has utilized a local option sales tax to provide regional benefits since 1983. The most recent general local option sales tax was approved by local voters in 2012 and is projected to meet all of its funding obligations by 2024.
Over the past five years, local option sales taxes have become a popular investment tool for cities and counties to fund major public projects.
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Past items that have been funded through the sales tax:
The existing flood control system
Regional recreation/senior center
City of Rochester transportation projects
Olmsted County transportation infrastructure improvements
University of Minnesota Rochester academic and complementary facilities
Rochester Community and Technical College/Winona State University career technical education, science, and math facilities
Regional public safety and 911 dispatch center facilities
Rochester Community and Technical College regional recreation facilities at University Center Rochester
Initial funding related to parts of the Destination Medical Community Initiative
Economic Development Fund
Note: State law around allowable uses for local sales tax project and number of projects that can be funded at a single time have changed over time.