Nancy Edmonds Hanson
hansonnanc@gmail.com

The MCCARA Industrial Park in south Moorhead is picking up steam.
That’s according to Moorhead economic development consultant Derrick LaPoint, who announced three key sales to the City Council at its last meeting. And, he says, those are just the first results of a critical step by the Minnesota Legislature to improve Moorhead’s position in competing for new and expanding businesses.
“The Border Cities Enterprise Zone program that they enacted into law this year is monumental,” he says. “It’s a big part of the reason why we now have a level of activity in MCCARA that we haven’t seen for years. Now businesses can put it in their projections and count on it being there … rather than us having to look them in the eye and say, ‘Just trust the state.’”
That certainty, he says, helped lead to the sale of four of the long-languishing six lots that abut Interstate 94 just north of RDO Equipment at 34th Street. Two have been purchased by RDO for expansion of their $15 million facilities over the next two years. A third will be Pifer Auction and Realty’s new headquarters. ISR Homes, a growing Moorhead-based home builder headed by developer Dan Parrow. Pifer and ISR plan to build next summer.
LaPoint hints at other businesses’ plans still in the discussion stage. “We hadn’t seen a lot of growth there in years. Was it the uncertainty? History? I’m not sure. What I do know we’re receiving more inquiries today.”
MCCARA – the name is an abbreviation of Moorhead-Clay County Area Redevelopment Association – is in the southeast quadrant of Interstate 94 and US Highway 52. Open lots are owned by the city. The acreage was formerly part of the home farm of business magnate Ron Offutt.
Minnesota’s Border Cities Enterprise Zone Program provides business tax credits – property tax credits, debt financing credit on new construction, sales tax credit on construction equipment and materials, and new or existing employee credits — to qualifying businesses that are the source of investment, development, and job creation or retention in the cities along the North and South Dakota borders – including Moorhead and Breckenridge, Dilworth, East Grand Forks and Ortonville – as well as Taylor Falls abutting Wisconsin.
It’s not new – in fact, the program dates back to 1983, according to city economic development planner Amy Thorpe. But until now, allocations have been made on a year-to-year basis and have varied widely. Now, as part of the state’s budget, Moorhead (the largest border city) is assured of receiving $525,000 of the budgeted $750,000 per year. The funds are used to help Minnesota-based businesses overcome disparities with North Dakota laws and levies, which are generally lower. The largest portion of the appropriations, which have brought $16 million to Moorhead in the 35 years since inception, is dedicated to the workers compensation rebate program, which offers businesses a credit for 25% of the higher fees charged in Minnesota up to a cap of $25,000, totaling between $350 and $400 thousand in 2019. The funding is also used to support other initiatives to modify disparities between the two states.
LaPoint concedes that some of MCCARA’s doldrums could be due to lack of active marketing over the years. He hopes that will change: “As we become much more forward in telling our story, it gets better and better.” He attributes the low level of interest at least in part as due to the widespread assumption that Minnesota’s higher income tax rates means that everything is more expensive on the right side of the Red River. “As we get deeper into it, that’s just not the whole story.”
Take, for example, the Shovel-Ready certification awarded late last year by the Minnesota Department of Employment and Economic Development. What that means to businesses looking to build or expand is that the time-consuming legal, technical and regulatory aspects are already complete. Thorpe’s office compiled the massive amount of data to satisfy MnDEED’s requirements.
Nearly 200 acres of MCCARA lots have been certified under theShovel-Ready program. All of the heavy lifting has been done to bring them up to that standard – the planning, zoning, surveys, title work, environmental studies, soils analysis and public infrastructure engineering. Land cost is perhaps the most affordable among publicly owned sites in the metro area, at $3 per square foot – including specials.
“We have the largest compilation of sites in the state of Minnesota and the only ones in the Fargo-Moorhead area,” LaPoint says. Lots vary from a few acres to huge chunks, with another 500 acres to the east potentially available as well. “There’s no need to subdivide,” he adds, “until we know who’s coming.
“Everything’s ready. The utilities are stubbed in. They don’t need to bring in large service lines for power or water and sewer. We already have the capacity for large industrial users. They don’t need fill or flood protection. A business can come in here and break ground immediately.”
The Economic Development Authority now has some compelling answers when inquiries roll in from companies looking to locate or expand in the Upper Midwest. Realistically, though, few are likely to pan out, no matter what Moorhead has to offer. “Our development base is pretty regional,” LaPoint concedes.
“To be successful in Moorhead, we know we have to build from within. We have a lot of successful businesses here in the metro area, and they may need space. We don’t want to lose them out of the region.” He points to Rigel’s as one example. The venerable downtown Moorhead appliance store, which dates back to 1947, now also occupies an enormous warehouse in the industrial park, where it handles inventory serving residential and commercial clients throughout a multi-state area.
Developers who contact the city ask four predictable questions, he observes: Available land, local and state incentives, transportation (rail, highway and air), and the work force. Can the employment market absorb their needs? That’s a big one. Is this a community that people want to come to and work in?
“We’re breaking down historic barriers that led to a historic reluctance among developers to attempt projects in Moorhead. I heard about it all the time when I was starting out” [as director of Downtown Moorhead Inc., a position he assumed 18 months ago]. “I’m really excited about the growth we’re seeing now – 10 new businesses and big expansions in 2019,” he says. “Moorhead is finally willing to stand up and say, ‘We can be more here.’”