Fargo's Future: Proposed Convention Center
Learn About the Lodging Tax Vote and Its Impact
Fargo voters are set to decide on November 5, 2024, on a proposal to double the city's lodging tax from 3% to 6%. The increase is intended to generate funding for a future convention center in Fargo. The tax, which would be paid almost entirely by visitors staying in local hotels, aims to create a public-private partnership for the development of the convention center, ultimately boosting Fargo's ability to host large-scale events and attract more visitors to the area.
Why a Convention Center?
Fargo-Moorhead is missing out on numerous large-scale events and conventions because it lacks the necessary meeting and exhibit spaces to attract these gatherings. Organizations interested in hosting events in Fargo have had to look elsewhere due to the city's insufficient facilities. As a result, Fargo is losing potential economic benefits to nearby cities like Bismarck, Grand Forks, and others in the region.
By providing the appropriate spaces, Fargo could attract a significant portion of the conventions and events it currently misses, leading to increased visitor spending and a boost to the local economy. Adding a convention center would not only retain local events that have outgrown existing spaces but also draw new ones, bringing more business and activity to the area.
The upcoming November 5th vote in Fargo stems from previous efforts to secure funding for Fargodome upgrades and a new convention center. A significant attempt took place in December of 2023 when a special election sought to pass a combined measure for both projects. However, this effort fell short, receiving 52% approval, below the 60% threshold needed to pass.
In response to this failure, the groups advocating for these improvements separated the two issues and asked voters to decide on each one individually in the upcoming election. This November, Fargo voters will be asked to approve two separate tax increases: a 20-year, quarter-cent sales tax to fund Fargodome improvements and a doubling of the city's lodgings tax from 3% to 6% for 25 years to help finance a future convention center.
These measures were approved by the Fargo City Commission on August 5, 2024, to be placed on the ballot. The hope is that by providing voters with more information and separating the issues, they will gain the necessary support to pass this time.
How the Lodging Tax Works
Lodging Tax
What is a Lodging Tax?
A lodging tax is a locally imposed tax that guests pay when they stay at hotels, short-term rentals (such as Airbnb and Vrbo), or other lodging accommodations for less than 30 days. This tax is typically calculated as a percentage of the cost of the stay and is added to the guest's bill at checkout.
How is the Lodging Tax Collected?
The city collects the lodging tax from hotels, motels, and short-term rental hosts. Once collected, these funds support the region's destination marketing organization (DMO), Visit Fargo-Moorhead.
How Are the Funds Used?
The majority of the current lodging tax in Fargo is allocated to Visit Fargo-Moorhead, which promotes the city as an attractive destination for various visitors, including youth sports participants and attendees, convention attendees, and families traveling through the area.
A portion of the existing lodging tax is also used to fund capital projects for local non-profits, such as building or enhancing sports venues, museums, and other attractions that boost tourism and benefit the community.
Economic Benefits of a Convention Center
Job Creation
A convention center in Fargo would stimulate job creation by attracting a diverse range of events and visitors. The increased demand for accommodations, dining, transportation, and entertainment services would require additional staffing in local businesses. This influx of visitors would create new employment opportunities across various sectors, from hospitality and retail to event management and transportation, contributing to a more robust local job market.
Business Opportunities
The convention center would provide local business owners valuable networking opportunities, allowing them to connect with visitors and event organizers. The steady stream of visitors drawn by events would increase business revenue, helping them expand and grow. This sustained economic activity can foster partnerships and collaborations that boost the local economy.
Convention Center Benefits
Enhanced Community Profile
A convention center would elevate Fargo's profile as a destination for large-scale events, positioning the city as a hub for conventions, conferences, and exhibitions. This recognition could attract investments and developments, enhancing the city's infrastructure and amenities. The increased business activity and influx of visitors would contribute to higher property values and a stronger local tax base, ultimately benefiting the community.
Examples from Other Communities
Cities like Rochester, MN, and Madison, WI, have successfully leveraged convention centers to boost local economies. Rochester, MN, has demonstrated how a well-developed convention center can positively impact the local economy. According to STR data, Rochester's hotel industry not only recovered from the pandemic but surpassed pre-pandemic levels in 2023, with total market hotel revenue increasing from $155 million in 2019 to $157 million in 2023. This growth highlights the strength of Rochester's tourism and hospitality sector, driven in part by the city's ability to attract large-scale events through its convention facilities.
Madison, WI, offers another compelling example. When Madison built its 250,000-square-foot convention center, the city booked 30 national events within the first 24 months of operation—this influx of events brought in an additional $4 million in direct visitor spending to the community. If Fargo follows a similar path, it could expect a significant economic boost. Estimates suggest that Fargo could generate an additional $3 million per year in direct visitor spending on top of the conventions already taking place in the city.
Community Impact
Get Involved
Proposed Convention Center Presentation and Open House
Join us for an informative presentation and open house at the Delta Hotel in the Symphony Ballroom on Thursday, October 10th. Attendees can expect an overview of Fargo's proposed convention center and answers to frequently asked questions about the proposed convention center's purpose, funding, and potential economic impact.
Thursday, October 10 from 4-5:30 pm | Delta Hotel's Symphony Ballroom
Request a Presentation for Your Audience
Are you interested in having Visit Fargo-Moorhead speak about the proposed Convention Center at your business or event? Submit an inquiry here.
What You Can Do
Visit Fargo-Moorhead does not take a position as to how residents should vote on these ballot measures. However, we encourage all residents to become informed on these issues and to make your wishes known by voting on November 5, 2024.