Minnesota 2025-2026 Regular Session

Minnesota Senate Bill SF1422 Compare Versions

Only one version of the bill is available at this time.

Old	New	Differences
1	1	1.1 A bill for an act
2	2	1.2 relating to taxation; property; authorizing cities to create land-value taxation
3	3	1.3 districts; proposing coding for new law in Minnesota Statutes, chapter 428A.
4	4	1.4BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:
5	5	1.5 Section 1. [428A.30] DEFINITIONS.
6	6	1.6 Subdivision 1.Scope.For purposes of sections 428A.30 to 428A.34, the terms defined
7	7	1.7in this section have the meanings given them, unless the context indicates otherwise.
8	8	1.8 Subd. 2.City."City" means a statutory or home rule charter city.
9	9	1.9 Subd. 3.District."District" means a land-value taxation district established under section
10	10	1.10428A.31.
11	11	1.11 Subd. 4.Ordinance."Ordinance" means the ordinance establishing a land-value taxation
12	12	1.12district under section 428A.31.
13	13	1.13 EFFECTIVE DATE.This section is effective beginning with property taxes payable
14	14	1.14in 2026.
15	15	1.15 Sec. 2. [428A.31] ESTABLISHMENT OF LAND-VALUE TAXATION DISTRICT.
16	16	1.16 Subdivision 1.Ordinance.(a) The governing body of a city may adopt an ordinance
17	17	1.17establishing a land-value taxation district. The ordinance must describe:
18	18	1.18 (1) the parcels of property constituting the district, either by specific identification of
19	19	1.19each parcel, or by defining a geographic area or areas within the city, and then within that
20	20	1Sec. 2.
21	21	25-01714 as introduced01/13/25 REVISOR MS/VJ
22	22	SENATE
23	23	STATE OF MINNESOTA
24	24	S.F. No. 1422NINETY-FOURTH SESSION
25	25	(SENATE AUTHORS: FATEH, Gruenhagen and Dibble)
26	26	OFFICIAL STATUSD-PGDATE
27	27	Introduction and first reading02/17/2025
28	28	Referred to Taxes 2.1area or those areas, identifying the specific types of property, as defined under section
29	29	2.2273.13, to be included in the district; and
30	30	2.3 (2) the procedure for reallocating the collective property tax of all parcels within the
31	31	2.4district.
32	32	2.5 (b) In addition, the ordinance must provide an evaluation of the economic effects of the
33	33	2.6district, including the impact on redevelopment of and investment in the district, within a
34	34	2.7specified period of time, but not less than 15 years after the date the district becomes
35	35	2.8effective.
36	36	2.9 Subd. 2.Hearing; notice.Before adopting an ordinance, the governing body of the city
37	37	2.10must hold a public hearing on the question. Notice of the hearing must include the time and
38	38	2.11place of the hearing, a description of the parcels to be included in the district, a description
39	39	2.12of the procedure for reallocating the tax burden among the parcels, and the duration of the
40	40	2.13district. Each person owning property in the proposed district must be given the opportunity
41	41	2.14to be heard at the hearing. The governing body must publish notice of the hearing on the
42	42	2.15city's website and in at least two issues of the official newspaper of the city. The two
43	43	2.16publications must be two weeks apart and the hearing must be held at least three days after
44	44	2.17the last publication. Not less than ten days before the hearing, the governing body must mail
45	45	2.18notice to the owner of each parcel proposed to be included in the district. For the purpose
46	46	2.19of the mailed notice, owners are those shown on the records of the county auditor. Other
47	47	2.20records may be used to supply the necessary information. At the public hearing, a person
48	48	2.21affected by the proposed district may testify on any issues relevant to the proposed district.
49	49	2.22The governing body may adjourn the hearing from time to time and may adopt the ordinance
50	50	2.23establishing the district at any time within six months after the date of the conclusion of the
51	51	2.24hearing by a vote of the majority of the governing body of the city. Within 30 days after
52	52	2.25adoption of the ordinance, the governing body shall send a copy of the ordinance to the
53	53	2.26commissioner of revenue.
54	54	2.27 EFFECTIVE DATE.This section is effective beginning with property taxes payable
55	55	2.28in 2026.
56	56	2.29 Sec. 3. [428A.32] RESTRICTIONS ON TAX REALLOCATION PROCEDURE.
57	57	2.30 A tax reallocation procedure under section 428A.31, subdivision 1, paragraph (a), clause
58	58	2.31(2), must distribute taxes on taxable properties in the district by applying uniform rates to
59	59	2.32one or more of the following tax bases:
60	60	2.33 (1) the net tax capacity, as defined under section 273.13, subdivision 21b;
61	61	2Sec. 3.
62	62	25-01714 as introduced01/13/25 REVISOR MS/VJ 3.1 (2) the referendum market value, as defined under section 126C.01, subdivision 3;
63	63	3.2 (3) a tax base consisting of each property's estimated market value excluding the market
64	64	3.3value attributable to improvements; or
65	65	3.4 (4) a tax base consisting of each property's estimated market value excluding the market
66	66	3.5value attributable to improvements made after a date specified in the ordinance.
67	67	3.6 EFFECTIVE DATE.This section is effective beginning with property taxes payable
68	68	3.7in 2026.
69	69	3.8 Sec. 4. [428A.33] TAXATION WITHIN DISTRICT.
70	70	3.9 Subdivision 1.Initial taxation within district.For each property taxes payable year, a
71	71	3.10city must compile the total property taxes imposed upon all properties within the district
72	72	3.11for each taxing jurisdiction after final property tax statements are issued under section
73	73	3.12276.04. For the purposes of this section, the areawide taxes under chapters 276A and 473F,
74	74	3.13and the state general levy under section 275.025, are considered to be taxing jurisdictions.
75	75	3.14 Subd. 2.Final taxation within district.A city must allocate the tax, as determined
76	76	3.15under subdivision 1, among all properties in the district according to the terms of the
77	77	3.16ordinance so the entire amount of tax payable to each taxing jurisdiction under subdivision
78	78	3.171 is allocated among the properties constituting the district. The city must report the revised
79	79	3.18property tax amounts for each parcel of property to the county treasurer by April 30 of the
80	80	3.19year the tax is payable. The city must mail revised property tax statements to all properties
81	81	3.20within the district by April 30 of the year the tax is payable. Taxpayers must make payments
82	82	3.21according to the dates specified in section 279.01 as if the property tax statements were
83	83	3.22mailed 21 days prior to May 15 of the year the taxes are payable.
84	84	3.23 Subd. 3.Report to commissioner of revenue.By September 1 of each year, the county
85	85	3.24treasurer must report the initial and final distribution of the net tax for each parcel of property
86	86	3.25in the district to the commissioner of revenue on a form prescribed by the commissioner of
87	87	3.26revenue.
88	88	3.27 EFFECTIVE DATE.This section is effective beginning with property taxes payable
89	89	3.28in 2026.
90	90	3.29 Sec. 5. [428A.34] APPEAL OF LAND VALUE.
91	91	3.30 The owner of any property included in a land-value taxation district under section
92	92	3.31428A.31 may appeal the valuation attributable to land separately from the valuation
93	93	3Sec. 5.
94	94	25-01714 as introduced01/13/25 REVISOR MS/VJ 4.1attributable to improvements upon the land under sections 274.01 and 274.13 or chapter
95	95	4.2271.
96	96	4.3 EFFECTIVE DATE.This section is effective beginning with property taxes payable
97	97	4.4in 2026.
98	98	4Sec. 5.
99	99	25-01714 as introduced01/13/25 REVISOR MS/VJ