HF156

Purpose

This bill creates a temporary, refundable exemption from Minnesota sales and use tax for construction materials used on a specific project: a regional exhibition center at Graham Park in Olmsted County. The goal is to reduce the upfront cost of building this facility by allowing the project to recover the sales tax paid on eligible materials.

What is exempt

• Materials and supplies used or consumed in, and equipment incorporated into, the construction, reconstruction, upgrade, expansion, renovation, or remodeling of the regional exhibition center at Graham Park in Olmsted County.
• These items must be purchased within the eligible time window (see Timing) to qualify for the exemption.
• The exemption applies as a refundable tax mechanism instead of a direct tax break.

Timing and eligibility window

• The exemption applies to materials and equipment purchased after December 31, 2024 and before January 1, 2028.
• The exemption is available only for the Olmsted County regional exhibition center project at Graham Park.

How the refund works

• The bill changes how tax is collected and refunded for these purchases. The tax is imposed and collected as if the standard rate under Minnesota law applies (the rate described in Minnesota Statutes section 297A.62, subdivisions 1 and 1a).
• After collection, the tax is refunded using the same process that applies to other qualified projects under Minnesota Statutes section 297A.75, subdivision 1, clause 17. This means the project ends up getting the sales tax back through a refund rather than paying it.

Funding and administration

• The money needed to pay the refunds is appropriated from Minnesota’s general fund to the commissioner of revenue.
• The commissioner of revenue will handle and process the refunds, using the existing statutory framework for project refunds.

Significant changes to existing law

• Introduces a temporary, refundable sales and use tax exemption specifically for construction materials for the Graham Park regional exhibition center in Olmsted County.
• Uses the normal tax collection process followed by a subsequent refund, rather than a direct exemption at the point of sale.
• Allocates funds from the general fund to reimburse this refund, placing the cost of the exemption in the state budget.

Relevant Terms - sales and use tax - refundable exemption - construction materials - regional exhibition center - Graham Park - Olmsted County - Minnesota Statutes chapter 297A - 297A.62 (subdivisions 1 and 1a) - 297A.75 (subdivision 1, clause 17) - appropriation - general fund - commissioner of revenue - refund process - purchase window (after 12/31/2024 and before 1/1/2028)