HF4789

Purpose

• Allow the city of Hermantown to create a local sales and use tax of 0.5% if voters approve it in a general election. The tax would be used for purposes described in the bill’s subdivision 2 (the specific purposes are defined in that section).

Main Provisions

• Local option tax: Hermantown may impose by ordinance a sales and use tax of one-half of one percent.
• Voter approval: The tax can be imposed only if approved by voters at a general election, as required under Minnesota law.
• Tax administration: The imposition, administration, collection, and enforcement of the tax are governed by Minnesota statutes related to local sales taxes, specifically Minnesota Statutes section 297A.99, unless this bill provides different rules.
• Relationship to other taxes: The new tax would be in addition to any local sales and use tax already imposed under other laws.
• Overrides of existing rules: The bill’s changes to subdivisions 2 and 3 apply even if other parts of state law would otherwise limit or affect them (notwithstanding provisions in Minnesota law and city charters).

Significant Changes / What the Bill Seeks to Accomplish

• Creates a new local revenue option for Hermantown by allowing a 0.5% sales and use tax, contingent on voter approval.
• Establishes that the tax would be managed according to state law on local taxes, while also allowing the bill’s amendments to take precedence over certain provisions.
• Clarifies that the tax works in addition to any other local taxes and that Hermantown would handle its own administration and enforcement under the specified statutes.

Potential Impacts

• Local government funding: Provides Hermantown with a new revenue stream for designated purposes (as described in subdivision 2).
• Fiscal planning: Requires a voter decision and, if approved, would enter into local budgeting and tax administration.
• Legal and regulatory alignment: The tax would be subject to state rules on local sales taxes, but with the bill’s specific amendments guiding how it is implemented.

Notable Terms from the Text (for clarity)

• sales and use tax
• Hermantown
• one-half of one percent (0.5%)
• general election
• Minnesota Statutes section 297A.99
• subdivision 1, 2, 3
• ordinance
• administration, collection, enforcement
• not notwithstanding
• 477A.016
• any other law, ordinance, or city charter

Relevant Terms - local sales tax - Hermantown - 0.5% tax - general election - ordinance - administration and enforcement - 297A.99 - subdivisions 2 and 3 - not withstanding - other local taxes