SF2824

Purpose of the Bill

The purpose of this legislative bill is to modify rules surrounding tax increment financing in Minnesota to support the conversion of vacant or underused commercial or industrial buildings into residential properties. This is aimed at revitalizing areas within cities, particularly Minneapolis and St. Paul, by making better use of properties that are currently underutilized.

Main Provisions

• Use of Tax Increment Financing: The bill authorizes the use of tax increment financing (TIF) to transform vacant or underused commercial and industrial sites into residential complexes.
• Redefined Redevelopment Districts: It updates the definition of redevelopment districts to include areas where 70% of the space is occupied by buildings and more than 50% are deemed structurally substandard, necessitating significant renovation or demolition.
• Inclusion of Special Areas: The bill includes underused railway yards and former tank facilities as eligible for redevelopment under TIF.
• Municipal Authority: Municipal authorities are given the power to determine if a building is structurally substandard, even without an interior inspection, under certain conditions such as being unable to gain access to the property.
• New Residential Uses: Specifically encourages redevelopment in the core cities of Minneapolis and St. Paul, making them focal points for converting non-residential properties into housing.

Significant Changes to Existing Law

• The bill amends the current statutes to expand the criteria and districts eligible for tax increment financing, specifically by including certain types of underused properties.
• Modifications allow municipalities greater flexibility in declaring buildings as substandard based on reliable evidence without needing comprehensive evaluations.

Relevant Terms

• Tax increment financing (TIF)
• Redevelopment district
• Structurally substandard
• Commercial/industrial to residential conversion
• Underused properties
• Minneapolis and St. Paul