SF2803

Purpose of the Bill

The bill relates to taxation and specifically authorizes special rules for tax increment financing (TIF) within the city of Minneapolis. The aim is to facilitate redevelopment efforts in downtown Minneapolis by allowing the city to use TIF to fund significant redevelopment projects that might not qualify under current state laws.

Main Provisions

• Establishment of TIF Districts: The Minneapolis housing and redevelopment authority is permitted to establish up to three new redevelopment tax increment financing districts. These districts must be located entirely within the downtown area as defined by previous laws.

• Special Rules for Redevelopment:

  • Before establishing these districts, the authority must find that at least 50% of the buildings in the proposed district require significant renovation or clearance.
  • Properties within the district can be nonadjacent, which is an exception to usual state law regarding contiguous properties.
  • Tax increment generated can be used for the clearance of buildings to create open spaces or public parks.

• Exemptions from Existing Restrictions:

  • Certain requirements and restrictions under Minnesota Statutes will not apply to spending and bond payments related to activities in these newly established districts.
  • The city auditor is allowed to set the original tax capacity of land parcels within the districts in a manner not typically permitted under current law.

Significant Changes to Existing Law

• Exemptions: This bill provides specific exemptions from statewide TIF regulations, allowing Minneapolis more flexibility in using TIF for redevelopment projects in the designated downtown area.
• Certification Expiration: The authority to request the certification of new districts will expire on June 30, 2030, unless at least one district certification has already been requested by then. The ability to request certifications will completely expire by June 30, 2034.

Relevant Terms

tax increment financing, Minneapolis, redevelopment, downtown, renovation, noncontiguous parcels, exemption, public parks, certification expiration.