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SF2727 (Legislative Session 94 (2025-2026))

City of St. Cloud redevelopment districts construction projects materials refundable exemption provision and appropriation

Related bill: HF3028

AI Generated Summary

Purpose of the Bill

The bill aims to incentivize redevelopment projects in certain areas of St. Cloud, Minnesota, by providing a sales and use tax exemption for materials used in construction. This exemption is intended to support economic development and encourage investment in these designated redevelopment districts.

Main Provisions

  • Tax Exemption: The bill provides an exemption from sales and use taxes for materials, supplies, and equipment used in private redevelopment projects on specific parcels in St. Cloud, as long as these developments are subject to property taxes.

  • Applicable Areas: The exemption targets specific areas known as the "Catalyst Sites" in Stearns and Benton counties, which include notable locations such as the Lady Slipper, North Riverfront, Empire, Swan Lot, Riverboat Lot, Former Herberger's sites, and others.

  • Refund Process: A refund is available for the tax paid on exempt items. The owner of the development must apply for this refund, and the application requires documentation to verify the taxes paid. If taxes were initially paid by a contractor or subcontractor, they must provide a statement detailing the costs and taxes to the developer.

  • Duration and Limitations: The tax exemption applies to sales and purchases occurring after July 1, 2025, and before December 31, 2040. There is a cap of $13,000,000 on the total amount of refunds available, with funds appropriated from the general fund for this purpose. Refunds are processed on a first-come, first-served basis determined by the order of complete application receipt.

Significant Changes to Existing Law

This bill modifies the current application of Minnesota's sales and use tax laws by introducing specific tax benefits for development projects in designated areas of St. Cloud, a measure not previously applied to these districts.

Relevant Terms

  • Sales and Use Tax
  • Redevelopment Districts
  • Tax Exemption
  • Catalyst Sites
  • Refund Process
  • Economic Development

Bill text versions

Actions

DateChamberWhereTypeNameCommittee Name
March 19, 2025SenateFloorActionIntroduction and first reading
March 19, 2025SenateFloorActionReferred toTaxes

Citations

 
[
  {
    "analysis": {
      "added": [
        "A refundable exemption for materials used in specific construction projects."
      ],
      "removed": [],
      "summary": "The bill provides an exemption from sales and use tax for certain materials used in redevelopment projects under chapter 297A.",
      "modified": []
    },
    "citation": "297A"
  },
  {
    "analysis": {
      "added": [],
      "removed": [],
      "summary": "The exemption is applied as if the tax rate under section 297A.62 subdivisions 1 and 1a were applied.",
      "modified": []
    },
    "citation": "297A.62"
  },
  {
    "analysis": {
      "added": [],
      "removed": [],
      "summary": "The refund provisions under this bill apply provisions of section 289A.40.",
      "modified": []
    },
    "citation": "289A.40"
  },
  {
    "analysis": {
      "added": [],
      "removed": [],
      "summary": "The refund provisions under this bill apply provisions of section 289A.50.",
      "modified": []
    },
    "citation": "289A.50"
  }
]

Sponsors