The Best Small City in America

City of Moorhead, MN
Written by Jessica Ferlaino

Moorhead, Minnesota is a city with something for everyone. Located on the Red River, which separates Moorhead from Fargo, North Dakota, the area is well-served by the intersection of Interstates 94 and 29, rail and air service, making it an ideal location for business.
Accessibility has long played a leading role in Moorhead’s growth. Founded in 1871 and incorporated in 1881, Moorhead was named after William G. Moorhead, a director for the National Pacific Railway. Transportation by rail and the Red River spurred growth in the area. The Homestead Act helped Moorhead become populated and laid its economic foundation.

Today, Moorhead boasts all the features that one would need to prosper and the city is doing all it can to deploy its greatest assets fully. Moorhead endeavors to develop an even stronger economy with a more vibrant community and is having great success in doing so.

In 2015, Moorhead was crowned the Best Small City in America by Nerdwallet. The recognition acknowledged a variety of Moorhead’s features including cost of living, safety and security, and the local housing market as well as its public education, quality of life, and pro-business climate.

“When I talk about what makes Moorhead great, it is how we have the best of both worlds. Moorhead is a small town. We have a population of 42,000 or so, but we’re located in a larger metro area that has a population of 224,000. So, while Moorhead retains the feel of a small-town America community, we have the amenities and the benefit of being part of a larger metropolis,” said Moorhead Economic Development Authority (EDA) Executive Director Cindy Graffeo.

The Moorhead EDA is at the forefront of economic development in Moorhead. The EDA works with numerous partners to make Moorhead a business- and development-friendly environment where businesses can thrive.

As a one-stop-shop for business resources, the EDA creates and manages many attraction, retention, expansion, planning, and forecasting efforts and has a team of experts to help.

The Moorhead EDA was founded in 1986, and as Graffeo explained, “was created to promote and assist industrial and commercial development and redevelopment in the city.” It markets Moorhead and communicates the advantages of living, working, and investing in the community.

“The City of Moorhead is located right across the bridge from Fargo, North Dakota, but we are two different cities, in two different states, that have two different tax and regulatory environments. So, we have unique challenges here,” Graffeo explained. “We are very fortunate that our leaders at the state level have recognized this, and they have enacted legislation to help us be competitive.”

Border Cities legislation constitutes a significant part of Moorhead’s competitive advantage. “Moorhead businesses pay an effective tax rate of 1.6 percent on their property tax; essentially, the State of Minnesota steps in and covers everything above and beyond 1.6 percent.”

“We make sure that there is healthy competition. Every city needs to look out for and represent their community to the best of its ability, but we also understand what’s good for Fargo isn’t necessarily bad for Moorhead. We are part of a metro, and we want to make sure that we support the organizations and work that serve our region as a whole.”

The Fargo-Moorhead Metropolitan Area is served by several region-wide organizations, such as the chamber of commerce, the area foundation, and convention and visitors bureau. “We need to help support those region-wide efforts, and be mindful that helping our metro grow is helping ourselves grow.”

Graffeo and the EDA work in partnership with local organizations to achieve this. Graffeo cited the Moorhead Business Association, the Greater Fargo-Moorhead Economic Development Corporation (a regional economic development organization of which the Moorhead EDA is a contributor), higher education partners, and the Small Business Development Center as some of the local stakeholders in Moorhead.

“If they are coming to the Small Business Development Center for help writing a business plan, we want to make sure that we have created an environment here in Moorhead where they can put down roots and grow. So, we’re looking to create more entrepreneurial support programs that not only attract them but keep them and help them grow during those early times,” said Graffeo of the EDA’s collaborative approach.

“We have a variety of organizations, who, at the heart of it, have one goal and one goal only: and that’s to make Moorhead the best it can be. So, relationships end up being absolutely vital to the work that the EDA does simply because we’ll get there a lot faster working together.”

Moorhead is home to several institutions of higher learning including Concordia College, Minnesota State Community and Technical College (M State), Minnesota State University Moorhead, and Rasmussen College. Each of these plays a role in workforce development in the community.

“Having so many higher education institutions is wonderful.” Graffeo credited the area’s educational institutions as important components of Moorhead. “If we have an employer who has a unique situation, we can refer them to M State for a customized training program.”

“When another company needs interns or help with workforce development, we have the tools and resources. We even have faculty who serve on the Economic Development Authority Board. We can really help connect any employer and their situation with the higher education resources we have.” This is ideal because Moorhead has a diverse economy.

“Moorhead is home to everything from agriculture to manufacturing. Our largest employers range from higher education institutions to American Crystal Sugar, which is a sugar beet processing facility on the edge of town,” said Graffeo.

“When we look at our industrial park, we are well situated for distribution centers and companies that specialize in logistics. We have the Moorhead Municipal Airport. Our industrial park is located on I-94. We are a rail community.”

Moorhead is, as Graffeo noted, “high and dry,” making it ideal for many industry sectors. “Permanent flood protection from the Red River is very important for our downtown and some of our residential areas. The good news is, our industrial park is completely out of the five-hundred-year floodplain so we would be very well situated for data centers and high-tech companies.”

Moorhead’s industrial park and its available land are wonderful assets. “The city owns over five hundred acres of industrial land on the edge of the city, connected to the industrial park. If we have a prospect or a business that is looking to come to Moorhead, they can work with a very small, dedicated team of EDA and city staff from start to finish.”

Abundant development potential also exists in downtown Moorhead. “Our downtown can be a blank canvas. We have empty lots; we have empty buildings, and sometimes people like to say that’s a negative for a downtown.” However, for Moorhead and Graffeo, “it’s a wonderful opportunity for the city and the EDA to make downtown Moorhead into whatever we want it to be. We, as a community, get to decide what we want to see in the heart of our city.”

Downtown revitalization and redevelopment is well underway in Moorhead. “We have a couple of large projects under construction right now in our downtown area, and we have a couple breaking ground this spring,” said Graffeo. “Things are starting to move and shake in terms of downtown development.”

Moorhead’s downtown is part of what is called an Urban Progress Zone (UP Zone), which Graffeo identified as, “a corridor that is the core of our city, where you will find a mix of historical buildings ready for renovation and empty lots ready for redevelopment. So, downtown Moorhead is prime for infill projects.” Development projects located in this zone qualify for extended property tax exemptions.

There are many resources and incentives available for businesses that choose to call Moorhead home. In addition to property tax exemptions and rebates, Moorhead enjoys the benefits of a state-funded enterprise tax zone, which offers a variety of economic development tools to improve competitiveness in the city.

Moorhead has the natural assets, the services, the leadership and the lifestyle that makes it attractive to residents and businesses alike. As a result, the population of Moorhead is growing, and has everything required by a growing population.

“We’re right on the Red River, so we have riverfront parks, outdoor trails and natural resources. And the city is dedicated to offering our residents high-quality city parks and resources. We’re very fortunate to be at the intersection of basically everything you could want,” said Graffeo. In Moorhead, residential developments are required to incorporate park space so that no one lives further than a half-mile away from a city park.

“It’s a good time to be in economic development in Moorhead. It’s a very easy time to be in economic development. This city is growing, so we get to do fun things like focusing on quality of life. We’re not focusing on growth for growth’s sake. We’re looking at opportunities and have the luxury of looking at things that improve quality over quantity,” concluded Graffeo.

As for the future, Moorhead will continue to make good on the many opportunities to retain its title as the Best Small Town in America.



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