Katherine Grandstrand, Published February 03 2014
Taxable sales show hard evidence of economic pull in DickinsonDICKINSON, N.D. – As new stores announce their plans to build in Dickinson and begin to open their doors, it’s hard to ignore the economic pull North Dakota’s sixth largest city is beginning to have.
From the beginning of the oil boom in 2008 to 2012 – the latest year full data was available – taxable sales and purchases in Dickinson increased 185 percent from $362 million to more than $1 billion. The city’s official population increased by 11 percent – from 16,000 in 2000 to officially around 18,000 in 2010, and that’s not counting the city’s transient population. The city’s website now estimates a population of between 25,000 and 30,000.
“That’s a huge factor,” Cooper Whitman, executive director of the Dickinson Area Chamber of Commerce, said of the taxable sales numbers. “That’s something that not a lot of people know.”
Much of the growth in taxable sales in Dickinson can be credited to construction, North Dakota Tax Commissioner Ryan Rauschenberger said.
“What you’re seeing from 2008 to 2012 is really the effects of growth across the entire state,” Rauschenberger said. “You have some good years in agriculture, you have strong retail across the state, including the Red River Valley. But, of course, that was really the time frame when you see the Bakken oil boom revving up.”
When ordering items – whether online as an individual or through a vendor as a contractor – the shipping destination is credited with sales tax dollars, Rauschenberger said.
“It really should be sourced to where it ends up and is installed,” Rauschenberger said.
Any good sold – from clothing at a store to parts for a pump jack or materials to build a road – is counted as taxable sales or purchases, Rauschenberger said.
“What you have embedded in a lot of those sales when you see these huge increases over those years are a lot of infrastructure spending,” Rauschenberger said. “Whether it’s oil, your large intrastate pipelines, a lot of your gathering lines – oil and water gathering lines are all large, one-time taxable expenditures – and those are all embedded in those numbers, and it is why you see some of those huge increases in the western part of the state from 2008 to 2012.”
While the last few years have been full of growing pains, with jobs followed by people followed by housing, the retail and service sectors should begin to catch up, Whitman said.
“We’ll have many more choices as citizens of the county to fill our needs,” said Gaylon Baker, executive vice president of the Stark Development Corp. “When we need something done, we will have more choices as far as we want to go to one store or another or whether we want to call one contractor or another. The growth in the overall economy allows us to have those choices.”
The biggest thing residents can do to ensure developers are able bring the stores the city demands is shopping locally, Whitman said.
“When I talk to these national chains and regional chains, and talk to them about what it would take to get them here, there are certain factors they all look at, and they all have their own criteria on what it would take to get them here,” Whitman said. “The one factor that is common among all of them is taxable sales for the county.”
For many in Dickinson, driving 100 miles east to Bismarck has become routine, Whitman said.
“Every dollar we spend outside of Stark County doesn’t get counted on those takes numbers,” Whitman said. “That then negatively affects whether or not a business decides to come into town because that’s what they look at.”
The state’s capitol saw a modest increase in taxable sales and purchases from 2008 to 2012, 41 percent, with an official population increase of 10 percent.
“That is fantastic,” Whitman said upon hearing of Dickinson’s substantial increase. “We’re getting so much here that it’s coming to the point where there’s very little that you can get in Bismarck that you can’t get in Dickinson.”