CR 01-056 Food and Beverage Tax Legislation
April 27, 2001
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Council Report 2001-56
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FOOD AND BEVERAGE TAX LEGISLATION
Proposed Action
Staff recommends adoption of the following motion: Move to approve Resolution 2001-27 supportina
and reauestina passaae of specialleaislation authorizina the City of Hopkins to impose a food and
beveraae tax. after aOpropriate public notification and comment.
Adoption of this motion will result in the passage of a resolution intended to convey the City Council's
wish to the State Legislature and the Governor to pass legislation giving the City Council tne authority
to impose a food and beverage tax within the City of Hopkins.
Backaround
The Hopkins Center for the Arts was opened in 1997 and has become a focal point for arts and
cultural activities within the community. The Hopkins Center for the Arts is more that a city facility, it
is a regional facility that provides opportunities to residents and businesses throughout the western
suburbs and beyond.
As is the case with most community arts facilities, the Center is not self-sufficient and requires a
subsidy for its annual operating expenses. With the tools available today, the City Council has few
.options to consider in providing the subsidy, other than the property tax.
Given the regional nature of this facility and the knowledge that the facility generates a large number
of visitors to the community who not only visit the HopkiAs Center for the Arts, but also area food and
beverage establishments, the City Council is requesting the authority to open a dialogue with the
community about a food and beverage tax as a potential source of revenue to provide the subsidy.
Assuming passage of the authority by the State of Minnesota, this resolution requires the Council to
have open discussions with both residential and business community members prior to its imposition.
Supportina Information
Resolution 2001-27
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Steven C. Mielke
City Manager
Financial Impact: UP to $390.000annuallv (estimated) Budgeted: Y/N No Source:
elated Documents (CIP, ERP, etc.): N/A
Notes:
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City of Hopkins
Hennepin County, Minnesota
RESOLUTION NO. 2001-27
Resolution Requesting Authority to Impose a Food and Beverage Sales Tax
WHEREAS, the Hopkins community has adopted the Hopkins Center for the Arts as a
community gathering place to celebrate and participate in the arts; and
WHEREAS, the City Council is interested in furthering the arts in Hopkins; and
WH EREAS, the Hopkins Center for the Arts has an operating budget shortfall that will need to
be subsidized; and
WHEREAS, the Hopkins Center for the Arts is a regional facility benefiting an area much larger
than the corporate boundaries of Hopkins; and
WHEREAS, the City Council is desirous of finding sources of revenue other than the property
tax to fund the budget short fall.
NOW, THEREFORE, be it resolved by the City Council of the City of Hopkins, Minnesota that
the Hopkins City Council request that the State Legislature and the Governor authorize the City
of Hopkins to impose a food and beverage sales tax in an amount determined by the City
Council to be reasonable and necessary to meet the needs stated in this resolution; and
BE IT FURTHER RESOLVED that the City Council pledges not to impose such a tax until
Hopkins businesses and residents are notified and provided an opportunity to discuss and
provide comments to the City Council on this tax.
Adopted by the City Council of the City of Hopkins this 1 st day of May 2001.
By
Gene Maxwell, Mayor
ATTEST:
Terry Obermaier, City Clerk