Minnesota 2025-2026 Regular Session

Minnesota Senate Bill SF2754 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; economic development; increasing allocation to the border
3	3	1.3 city enterprise zones; modifying tax reduction authority; removing restrictions;
4	4	1.4 amending Minnesota Statutes 2024, sections 469.169, subdivision 21; 469.171,
5	5	1.5 subdivisions 1, 4, 6, 6a; 469.1731, subdivision 1.
6	6	1.6BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:
7	7	1.7 Section 1. Minnesota Statutes 2024, section 469.169, subdivision 21, is amended to read:
8	8	1.8 Subd. 21.Additional border city allocations.(a) In addition to the tax reductions
9	9	1.9authorized in subdivisions 12 to 20, the commissioner shall annually allocate $750,000
10	10	1.10$1,500,000 for tax reductions to border city enterprise zones in cities located on the western
11	11	1.11border of the state. The commissioner shall allocate this amount among cities on a per capita
12	12	1.12basis. Allocations made under this subdivision may be used for tax reductions under sections
13	13	1.13469.171, 469.1732, and 469.1734, or for other offsets of taxes imposed on or remitted by
14	14	1.14businesses located in the enterprise zone as provided by law, but only if the municipality
15	15	1.15determines that the granting of the tax reduction or offset is necessary to retain a business
16	16	1.16within or attract a business to the zone.
17	17	1.17 (b) The allocations under this subdivision do not cancel or expire, but remain available
18	18	1.18until used by the city.
19	19	1.19 EFFECTIVE DATE.This section is effective July 1, 2025.
20	20	1.20 Sec. 2. Minnesota Statutes 2024, section 469.171, subdivision 1, is amended to read:
21	21	1.21 Subdivision 1.Authorized types.(a) The following types of tax reductions may be
22	22	1.22approved by the commissioner for businesses located in a border city enterprise zone, after
23	23	1Sec. 2.
24	24	25-04805 as introduced03/12/25 REVISOR MS/ES
25	25	SENATE
26	26	STATE OF MINNESOTA
27	27	S.F. No. 2754NINETY-FOURTH SESSION
28	28	(SENATE AUTHORS: KUPEC)
29	29	OFFICIAL STATUSD-PGDATE
30	30	Introduction and first reading03/20/2025
31	31	Referred to Taxes 2.1the governing body of the border city has designated an area or areas, each consisting of at
32	32	2.2least 100 acres, of the city not in excess of a total of 400 acres in which the tax reductions
33	33	2.3may be provided:
34	34	2.4 (1) an exemption from the general sales tax imposed by chapter 297A for purchases of
35	35	2.5construction materials or equipment for use in the zone if the purchase was made after the
36	36	2.6date of application for the zone;
37	37	2.7 (2) a credit against the income tax of an employer for additional workers employed in
38	38	2.8the zone, other than workers employed in construction, up to a maximum of $3,000 $5,000
39	39	2.9per employee per year;
40	40	2.10 (3) an income tax credit for a percentage of the cost of debt financing to construct new
41	41	2.11or expanded facilities in the zone; and
42	42	2.12 (4) a state paid property tax credit for a portion of the property taxes paid by a new
43	43	2.13commercial or industrial facility or the additional property taxes paid by an expansion of
44	44	2.14an existing commercial or industrial facility in the zone.
45	45	2.15 (b) An application for a tax reduction under this subdivision may not be approved unless
46	46	2.16the governing body finds that the construction or improvement of the facility is not likely
47	47	2.17to have the effect of transferring existing employment from a location outside of the
48	48	2.18municipality but within the state.
49	49	2.19 EFFECTIVE DATE.This section is effective for taxable years beginning after December
50	50	2.2031, 2024.
51	51	2.21 Sec. 3. Minnesota Statutes 2024, section 469.171, subdivision 4, is amended to read:
52	52	2.22 Subd. 4.Restriction.The tax reductions provided by this section shall not apply to (1)
53	53	2.23a facility the primary purpose of which is one of the following: the provision of recreation
54	54	2.24or entertainment, or a private or commercial golf course, country club, massage parlor,
55	55	2.25tennis club, skating facility including roller skating, skateboard, and ice skating, racquet
56	56	2.26sports facility, including any handball or racquetball court, hot tub facility, suntan facility,
57	57	2.27or racetrack; (2) property of a public utility; (3) (2) property used in the operation of a
58	58	2.28financial institution; (4) or (3) property owned by a fraternal or veterans' organization; or
59	59	2.29(5) a retail food or beverage facility operating under a franchise agreement that requires the
60	60	2.30business to be located in this state.
61	61	2.31 EFFECTIVE DATE.This section is effective the day following final enactment.
62	62	2Sec. 3.
63	63	25-04805 as introduced03/12/25 REVISOR MS/ES 3.1 Sec. 4. Minnesota Statutes 2024, section 469.171, subdivision 6, is amended to read:
64	64	3.2 Subd. 6.Additional border city tax reductions.In addition to the tax reductions or
65	65	3.3reimbursements authorized by subdivision 1, for a border city zone, the following types of
66	66	3.4tax reductions may be approved:
67	67	3.5 (1) a credit against income tax for workers employed in the zone and not qualifying for
68	68	3.6a credit under subdivision 1, paragraph (a), clause (2), subject to a maximum of $1,500 per
69	69	3.7employee per year;
70	70	3.8 (2) a state paid property tax credit for a portion of the property taxes paid by a commercial
71	71	3.9or industrial facility located in the zone.; and
72	72	3.10 (3) reimbursement of land acquisition costs for business expansion within the zone if
73	73	3.11the municipality determines that expansion was necessary to prevent relocation outside the
74	74	3.12state.
75	75	3.13 EFFECTIVE DATE.This section is effective the day following final enactment.
76	76	3.14 Sec. 5. Minnesota Statutes 2024, section 469.171, subdivision 6a, is amended to read:
77	77	3.15 Subd. 6a.Additional border city allocations.The commissioner may allocate $2,000,000
78	78	3.16for tax reductions pursuant to subdivision 9 to border city enterprise zones. This money
79	79	3.17shall be allocated among the zones on a per capita basis. Tax reductions authorized by this
80	80	3.18subdivision may not be allocated to any property which is:
81	81	3.19 (1) a facility the primary purpose of which is one of the following: the provision of
82	82	3.20recreation or entertainment, or a private or commercial golf course, country club, massage
83	83	3.21parlor, tennis club, skating facility including roller skating, skateboard, and ice skating,
84	84	3.22racquet sports facility, including any handball or racquetball court, hot tub facility, suntan
85	85	3.23facility, or racetrack;
86	86	3.24 (2) (1) property of a public utility;
87	87	3.25 (3) (2) property used in the operation of a financial institution; or
88	88	3.26 (4) (3) property owned by a fraternal or veterans' organization;.
89	89	3.27 (5) property of a retail food or beverage service business operating under a franchise
90	90	3.28agreement that requires the business to be located in the state.
91	91	3.29 EFFECTIVE DATE.This section is effective the day following final enactment.
92	92	3Sec. 5.
93	93	25-04805 as introduced03/12/25 REVISOR MS/ES 4.1 Sec. 6. Minnesota Statutes 2024, section 469.1731, subdivision 1, is amended to read:
94	94	4.2 Subdivision 1.Designation.To encourage economic development, to revitalize the
95	95	4.3designated areas, to expand tax base and economic activity, and to provide job creation,
96	96	4.4growth, and retention, the following border cities may designate, by resolution, areas of the
97	97	4.5city as development zones after a public hearing upon 30-day notice.
98	98	4.6 (a) The city of Breckenridge may designate all or any part of the city as a zone.
99	99	4.7 (b) The city of Dilworth may designate between one and six areas of the city as zones
100	100	4.8containing not more than 100 acres in the aggregate all or any part of the city as a zone.
101	101	4.9 (c) The city of East Grand Forks may designate all or any part of the city as a zone.
102	102	4.10 (d) The city of Moorhead may designate between one and six areas of the city as zones
103	103	4.11containing not more than 100 acres in the aggregate all or any part of the city as a zone.
104	104	4.12 (e) The city of Ortonville may designate between one and six areas of the city as zones
105	105	4.13containing not more than 100 acres in the aggregate all or any part of the city as a zone.
106	106	4.14 EFFECTIVE DATE.This section is effective the day following final enactment.
107	107	4Sec. 6.
108	108	25-04805 as introduced03/12/25 REVISOR MS/ES