1.1 A bill for an act
1.2 relating to taxation; property; allowing property tax abatement for land bank
1.3 property; amending Minnesota Statutes 2024, sections 469.1812, by adding a
1.4 subdivision; 469.1813, subdivisions 1, 6, by adding a subdivision.
1.5BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:
1.6 Section 1. Minnesota Statutes 2024, section 469.1812, is amended by adding a subdivision
1.7to read:
1.8 Subd. 2a.Land bank organization."Land bank organization" means an organization
1.9that, at least in part, acquires, holds, or manages vacant, blighted, foreclosed, or tax-forfeited
1.10property for future development, redevelopment, or disposal, and that is either:
1.11 (1) a nonprofit organization exempt from federal income taxation under section 501(c)(3)
1.12of the Internal Revenue Code whose governing board members are elected or appointed by
1.13the state of Minnesota, any political subdivision of the state of Minnesota, or an agency of
1.14the state of Minnesota or its political subdivisions, or are elected or appointed officials of
1.15the state of Minnesota or any of its political subdivisions; or
1.16 (2) a limited liability company of which a nonprofit organization described in clause (1)
1.17is the sole member.
1.18 EFFECTIVE DATE.This section is effective the day following final enactment.
1.19 Sec. 2. Minnesota Statutes 2024, section 469.1813, subdivision 1, is amended to read:
1.20 Subdivision 1.Authority.The governing body of a political subdivision may grant a
1.21current or prospective abatement, by contract or otherwise, of the taxes imposed by the
1.22political subdivision on a parcel of property, which may include personal property and
1Sec. 2.
REVISOR MS/RC 25-0008711/19/24
State of Minnesota
This Document can be made available
in alternative formats upon request
HOUSE OF REPRESENTATIVES
H. F. No. 1006
NINETY-FOURTH SESSION
Authored by Norris, Davids, Gomez and Kozlowski02/17/2025
The bill was read for the first time and referred to the Committee on Taxes 2.1machinery, or defer the payments of the taxes and abate the interest and penalty that otherwise
2.2would apply, if:
2.3 (1) it expects the benefits to the political subdivision of the proposed abatement agreement
2.4to at least equal the costs to the political subdivision of the proposed agreement or intends
2.5the abatement to phase in a property tax increase, as provided in clause (2)(vii); and
2.6 (2) it finds that doing so is in the public interest because it will:
2.7 (i) increase or preserve tax base;
2.8 (ii) provide employment opportunities in the political subdivision;
2.9 (iii) provide or help acquire or construct public facilities;
2.10 (iv) help redevelop or renew blighted areas;
2.11 (v) help provide access to services for residents of the political subdivision;
2.12 (vi) finance or provide public infrastructure;
2.13 (vii) phase in a property tax increase on the parcel resulting from an increase of 50
2.14percent or more in one year on the estimated market value of the parcel, other than increase
2.15attributable to improvement of the parcel; or
2.16 (viii) stabilize the tax base through equalization of property tax revenues for a specified
2.17period of time with respect to a taxpayer whose real and personal property is subject to
2.18valuation under Minnesota Rules, chapter 8100.;
2.19 (ix) provide for the development of affordable housing to households at or below 80
2.20percent of area median income as estimated by the United States Department of Housing
2.21and Urban Development for the political subdivision in which the project is located; or
2.22 (x) allow the property to be held by a land bank organization for future development.
2.23 EFFECTIVE DATE.This section is effective the day following final enactment.
2.24 Sec. 3. Minnesota Statutes 2024, section 469.1813, subdivision 6, is amended to read:
2.25 Subd. 6.Duration limit.(a) A political subdivision may grant an abatement for a period
2.26no longer than 15 years, except as provided under paragraph paragraphs (b) and (c). The
2.27abatement period commences in the first year in which the abatement granted is either paid
2.28or retained in accordance with section 469.1815, subdivision 2. The subdivision may specify
2.29in the abatement resolution a shorter duration. If the resolution does not specify a period of
2.30time, the abatement is for eight years. If an abatement has been granted to a parcel of property
2.31and the period of the abatement has expired, the political subdivision that granted the
2Sec. 3.
REVISOR MS/RC 25-0008711/19/24 3.1abatement may not grant another abatement for eight years after the expiration of the first
3.2abatement. This prohibition does not apply to improvements added after and not subject to
3.3the first abatement. Economic abatement agreements for real and personal property subject
3.4to valuation under Minnesota Rules, chapter 8100, are not subject to this prohibition and
3.5may be granted successively.
3.6 (b) A political subdivision proposing to abate taxes for a parcel may request, in writing,
3.7that the other political subdivisions in which the parcel is located grant an abatement for
3.8the property. If one of the other political subdivisions declines, in writing, to grant an
3.9abatement or if 90 days pass after receipt of the request to grant an abatement without a
3.10written response from one of the political subdivisions, the duration limit for an abatement
3.11for the parcel by the requesting political subdivision and any other participating political
3.12subdivision is increased to 20 years. If the political subdivision which declined to grant an
3.13abatement later grants an abatement for the parcel, the 20-year duration limit is reduced by
3.14one year for each year that the declining political subdivision grants an abatement for the
3.15parcel during the period of the abatement granted by the requesting political subdivision.
3.16The duration limit may not be reduced below the limit under paragraph (a).
3.17 (c) An abatement under subdivision 1, clause (2), items (ix) and (x), may be granted for
3.18a period no longer than five years. This limit also applies if the resolution does not specify
3.19a period of time.
3.20 EFFECTIVE DATE.This section is effective for abatement resolutions approved after
3.21the day following final enactment.
3.22 Sec. 4. Minnesota Statutes 2024, section 469.1813, is amended by adding a subdivision
3.23to read:
3.24 Subd. 11.Repayment.A land bank organization receiving an abatement under
3.25subdivision 1, clause (2), item (ix) or (x), must repay the abatement with interest if the land
3.26for which the abatement was granted is used for a purpose other than the purpose given by
3.27the land bank organization prior to redevelopment, as determined by the governing body
3.28of the political subdivision that granted the abatement. This subdivision applies immediately
3.29after the abatement under this section expires and land is subject to repayment under this
3.30subdivision for the same number of years that the abatement was granted. Interest under
3.31this section is payable at the rate determined in section 270C.40, subdivision 5.
3.32 EFFECTIVE DATE.This section is effective the day following final enactment.
3Sec. 4.
REVISOR MS/RC 25-0008711/19/24