Jill Schramm/MDN Minot City Council member Mike Hayes speaks on an ordinance change to the city’s first penny of sales tax as council member Rob Fuller listens at left, Monday, Oct. 20.

Efforts to create more flexibility with Minot’s first penny of sales tax by allowing redirection of economic development money fell short of Minot City Council approval Monday, Oct. 20.

A proposal to allow a portion or all of the 15% allocation for economic development to be spent on flood control or property tax relief as well as the MAGIC Fund and various city economic development activities went down on a 3-4 vote.

“When we see the effects of what economic development has done within our community, the projects that these dollars fund … I believe that we had it right in the initial ordinance,” council member Paul Pitner said in voting against the change.

The ordinance amendment had been introduced during 2026 budget discussions and appeared to have support, with passage on first reading on Oct. 6. Mayor Mark Jantzer switched his vote on Monday’s second reading, joining council members Mike Hayes, Lisa Olson and Paul Pitner in opposition and leaving Mike Blessum, Rob Fuller and Scott Samuelson on the losing side.

In drafting the 2026 budget, a share of the 15% was held back for Minot Area Chamber EDC’s contract and to allow for closing out the Facade Improvement Program, but the council had been amenable to moving the remainder of the economic development allocation into the general fund for property tax relief.

The council’s decision to kill the proposal Monday prompted Blessum to voice frustration on the budget issue.

“Can I get a clarification from the finance director or the city attorney on what the heck we just did to our budget?” he said. “I think we’ve just flushed the whole portion of it.”

Finance Director David Lakefield said the expenses approved will remain in the budget, but the revenue from the extra sales tax dollars for property tax relief won’t be there.

“We would be short, essentially, just about a million dollars in the general fund on the revenue side. So, then it would be, I guess, our job to either find the cuts to offset that or it would be additional reserves that would be utilized,” he said.

Prior to the vote, council member Lisa Olson had offered an amendment to retain $900,000 from the 15% for the MAGIC Fund and job creation as well as other economic development initiatives.

Blessum opposed the motion as unnecessary.

“For me, there’s no reason to restrict our flexibility,” he said.

Olson’s motion failed 3-4, with dissent from Pitner, Blessum, Fuller and Samuelson.

Minot’s first penny of sales tax generated $13.9 million in 2024. City ordinance currently sets aside the first penny of sales tax for flood control, 50%; capital improvements, 25%; economic development or flood control, 15%; and property tax relief, 10%.