Frequently Asked Questions

A local sales tax is collected within the geographic boundaries of a city or county. The local sales tax applies to the same items and services as the general state sales tax. Items exempt from regular state sales tax are also exempt from the local sales tax including many essential items such as groceries, prescription and over-the-counter medications, baby products and clothing.

Local governments in Minnesota use the local sales tax to fund capital projects such as public buildings, libraries, parks, and other amenities.

Complete list of non-taxable items from Minnesota Department of Revenue

Construction costs have risen significantly due to inflation since the approved Police and Public Works facility projects were first proposed. If approved by voters, the extension would allow the City to collect funds to cover the projects’ funding gaps caused by inflation.

The local sales tax rate would remain 0.5%, or $.50 on every $100 of taxable purchases. The period to collect the approved funds would extend an additional five years, a total of 30 years, to collect funds for the approved projects. The tax would remain in place until 2053 instead of 2048, or until funds are raised, whichever is sooner.

The additional funds that would be collected total $9 million – $3 million for the Police facility project and $6 million for the Public Works facility project. The total amount of funds to be collected would total $46 million – $18 million for the Police facility project and $28 million for the Public Works facility project.

No. Any additional funds collected through the local sales tax would only be used to cover inflationary costs of the projects approved to be funded by the sales tax in 2022. These projects include a remodel and expansion of the current Police facility and a new Public Works facility. 

Yes, on July 25, 2023, the City Council voted unanimously to approve a resolution allowing the City to increase the amount and duration of the approved local sales tax. On August 14, 2024, the City Council approved unanimously the local sales tax questions to present voters on the November 5, 2024 ballot.

In 2023, the Minnesota Legislature reviewed Oakdale’s request and granted the City authority to request additional funds for increased costs through 2023 Minnesota Laws Chapter 64, Article 10, Sections 20-24.

City staff, the City Council, and the project design teams have made numerous cost-saving adjustments to the projects. Further changes would impact the functionality and efficiency of the projects, such as eliminating an on-site fuel island at the Public Works facility, which is used daily by Police, Fire and other City employees for City work.

Voters will have two questions to respond either YES or NO to for the local sales tax. The ballot language is as follows for both questions: 

Question 1: Extend Police Facility Expansion Sales Tax Without Rate Increase 
Shall the City of Oakdale be authorized to extend the existing sales and use tax for inflationary costs of expanding and remodeling the Police Department Facility for an additional period of 5 years from 2048 to 2053 or until an additional $3 million plus the costs of collecting and administering the tax and the costs of issuing bonds including interest is collected? If this question is approved, the rate of the voter-approved sales tax will remain unchanged at 0.5% and will remain in place until 2053 or until enough sales tax revenue has been collected to pay for the costs of the project, administration, and financing.

Question 2: Extend New Public Works Facility Sales Tax Without Rate Increase 
Shall the City of Oakdale be authorized to extend the existing sales and use tax for inflationary costs of constructing a new Public Works Facility for an additional period of 5 years from 2048 to 2053 or until an additional $6 million plus the costs of collecting and administering the tax and the costs of issuing bonds including interest is collected? If this question is approved, the rate of the voter-approved sales tax will remain unchanged at 0.5% and will remain in place until 2053 or until enough sales tax revenue has been collected to pay for the costs of the project, administration, and financing.

The City would have to look to other funding sources to fill the funding gap, including but not limited to property tax increases. Approval of the local sales tax extension would mean approximately 50% of the funds raised will come from people outside of Oakdale who shop in our community. 

When voters approved the local sales tax in 2022, the increase of 0.5% brought the total sales tax for Oakdale to 7.875 %. However, on October 1, 2023, the State of Minnesota increased the state sales tax by 1% (0.75% for transportation and 0.25% for housing). The current sales tax rate for Oakdale is now 8.875%. The sales tax rate will remain 8.875% if the extension is approved.

The current breakdown of the Oakdale sales tax is: 

• 6.6875% – State Tax
• 0.75% – Metro Area Transportation Tax
• 0.5% – Washington County Transit Tax
• 0.5% – City of Oakdale Tax
• 0.25% – Metro Area Tax for Housing