41 Minnesota cities are switched from urban to rural classification

LONSDALE, MINN. — This Rice County city of 4,700 is on the cusp where rural and urban meet.

The grain elevators and the giant "Live Bait" sign on Main Street are evidence of its farming past. The massage studio and the butcher shop selling Japanese Wagyu steaks for $130 a pound show the direction it's headed as a bedroom community for workers in the Twin Cities, about 45 miles away.

But for now, anyway, Lonsdale is officially rural. That's the opinion of the U.S. Census Bureau, which just announced the reclassification of Lonsdale and 40 other Minnesota cities from urban to rural after analyzing results of the 2020 census.

Nationwide, 1,140 cities with a population of about 4.2 million people were switched from urban to rural. Only 36 U.S. cities were changed from rural to urban, including one in Minnesota: Glenwood.

The new rural designation seemed to go down just fine with Lonsdale residents.

"That's hilarious, because we were never urban," said Erin Lunn, receptionist at the Pet Perfect grooming shop downtown. "We're rural and we want to keep it that way."

She's unlikely to get her wish. With its population growing about 28% over the past decade, Lonsdale should soon hit the threshold of 5,000 residents that's the new definition of urban. For more than a century — since 1910 — the bureau had classified areas as urban if they had a population of 2,500 or more and a meaningful amount of density. These areas also don't need to follow city boundaries.

But that holdover from the horse-and-buggy era no longer made sense in the digital age. In fact, the bureau seriously considered adopting an urban benchmark of 10,000 residents before lowering that target after public feedback.

"Part of the reason the Census Bureau made these changes is that they felt that 2,500 did not really match what people thought of when they thought of an urban area," said Eric Guthrie, a senior demographer with the Minnesota State Demographic Center. "Whether they're right or not, they changed a definition that had been in place for a long time."

An area also can be classified as urban with fewer than 5,000 people if it has at least 2,000 units of housing and meets a density threshold.

For example, one urban area in the state includes the cities of Spicer and New London. Collectively, the area has just over 3,300 people, but more than 2,200 housing units and more than 780 people per square mile.

'Urban doesn't fit what we are'

It's too soon to say what the potential impact will be on the cities that have been reclassified. Several city managers in smaller Minnesota cities said they weren't even aware of the change until asked about it.

It's possible that some cities could lose out on their share of federal and state money targeted to urban areas. On the other hand, they'll be newly eligible for rural aid. Several city leaders said they didn't expect any dramatic changes.

"We don't receive any kind of federal aid on a regular basis," said Todd Peterson, community development director in Roseau, population 2,700. "We don't qualify well for federal funding. We don't have a large minority population and we don't have a lot of low-income population.

"So when we look at aid, we typically look to the state level. If the state were to change its designations, that would concern us."

For example, Peterson said, Roseau gets money from the Federal Aviation Administration that's based simply on having an airport, no matter what the area's population is. Other aid programs don't necessarily follow Census Bureau classifications, he added. Some programs might be targeted at cities of under 20,000 population; some might have cutoffs at other population levels. So it's not easy to say what Roseau's new rural status might mean.

The new designation for Melrose sits fine with Colleen Winter, the city administrator of this community of 3,600 about 35 miles northwest of St. Cloud.

"There's many ways to look at rural," Winter said. "I think a lot of times when you say rural, it's someplace out in the middle of nowhere.

"We are a rural center. We are a self-sustaining community. We have a lot of industry in town; there are job opportunities. So we're different from a community that is, say, a bedroom community for St. Cloud. I think urban doesn't fit what we are."

Perham, with a population of about 3,500, is also newly classified as rural. But the thriving Otter Tail County city is a manufacturing hotbed that produces products ranging from potato chips to precision rocket parts. Every week, 1,000 trucks pull in to load up on cheese, candy, dog food and other products churned out by its sprawling factories.

In recent years, the city has aggressively courted new residents because it has more available jobs than its current population can fill. Rural? Sure, but it's livelier than many larger cities.

High-end hardware

Russ Sirek, owner of Lonsdale Hardware & Rental, has seen some changes in recent years as the city grew. When he bought the store in 2010, he said, the average age of his customers was around 50. Now, it's probably closer to 35.

His store carries everything from tools and home goods to ag supplies. But in recent years, he said, his customers have shown a taste for higher-end merchandise, such as top-of-the-line gas grills.

"We're a bedroom community," he said. "People drive to the Cities every day."

Joel Erickson, Lonsdale's city administrator, said the town hits the sweet spot for many new residents.

"Definitely, people move here because they want to live in a rural community that has most of the amenities you need," he said. "With the Cities 30 minutes away, it's kind of the best of both worlds."

He's looking forward to hitting that magic 5,000 population mark, he said, because that will allow the city to quality for Minnesota Department of Transportation aid for street maintenance.

Back at the pet salon, Tracy Salaba doesn't share his enthusiasm.

"I like cornfields," she said. "Give me 80 acres and I'm happy."

Data editor MaryJo Webster contributed to this report.