Fargo, West Fargo, Moorhead and Dilworth all have local sales taxes, but where do they go?

FARGO — Residents of Fargo, West Fargo, Moorhead and Dilworth all pay roughly the same amount of taxes, but where those taxes go varies state by state and city by city.

In North Dakota, Fargo has a 7.5% sales tax and West Fargo has an 8% sales tax. That number is broken down between the city, county and the state.

Cass County currently has a 0.5% local sales tax authorized by county voters for flood control measures , whereas North Dakota imposes an average tax rate of 5% for most retail sales . The rest goes to Fargo and West Fargo.

Clay County has a 0.5% tax on the books to pay for the County Jail and Law Enforcement Center, according to Lisa Bode, Moorhead's governmental affairs director, while Minnesota's tax rate sits at 6.875%, according to the Minnesota Department of Revenue .

Fargo has a 2% local sales tax that is broken down into two categories, according to City Auditor Steven Sprague. A large chunk, 1.25%, goes to the diversion and flood control. The remaining 0.75% is split evenly between water treatment, sewer water reclamations and street projects.

“We’ve had sales tax in one form or another for quite some time,” Sprague said. Existing sales taxes have been extended quite a few times and approved through a city wide vote. Next up for renewal is the infrastructure sales tax, according to Sprague.

Fargo has no new sales taxes in the works.

West Fargo, on the other hand, boasts a collective local sales tax of 2.5%. Within that number the city has three separate sales taxes on the books, including a 1.5% capital improvement sales tax, 0.5% tax for economic development and 0.5% tax for public safety.

The city needs to put any local sales tax changes to a citywide vote. The city has had a 1% sales tax running since 1994, according to West Fargo’s City Administrator Tina Fisk, which was amended in 2014 to add another cent.

The capital improvement sales tax is used for a variety of projects, said Fisk, including roads, water, sewer, water towers and buying down the cost of special assessments for such projects.

Economic development helps the city grow, said Fisk, by bringing in new businesses, helping existing businesses expand and creating jobs.

The newly created public safety sales tax, which was approved by voters in the November election , helps alleviate the tax pressure from the growth of the police and fire departments in the city through funding for operations and capital improvements. The sales tax likely won't go into effect until May, Fisk said.

West Fargo currently has no other sales taxes in the works.

On the other side of the river, Moorhead and Dilworth are going through a few changes to their sales taxes. Both currently have a sales tax rate of 7.375%, the entirety of which is going to the county and state.

Both municipalities, however, are pursuing local option sales taxes, a levy that first must be voted upon by its residents.

Moorhead’s rate will rise to 7.875% on April 1, following a recently approved 0.5% sales tax to fund the city's new library and community center .

The city is planning to reach out to area businesses to let them know about the tax, Bode said. Moorhead has no other sales taxes in the works.

Dilworth hopes to also increase theirs to 7.875% in an effort to fund a new Community Recreation Center, but residents will first have to vote on that in the 2024 general election.

“It'd be a great project for the city,” Lorsung said. While the project is still in its initial planning stages, the new center could include a gathering space, youth programming, day care and facilities for recreation and exercise.

The current recreation center is being torn down as part of the Dilworth Fire Hall expansion .

In addition to its neighbor, Dilworth does not currently have any local sales taxes on the books, according to Don Lorsung, Dilworth’s community development director.