SF4749

Purpose

• Establish a Task Force on Housing Taxes and Fees to study how state, county, and local taxes, fees, and exactions affect the cost of developing and preserving housing in Minnesota.

Key Provisions

• Establishment: Creates a task force to study and analyze the impact of housing-related taxes and fees on development costs.
• Membership: The task force has 15 members, including:
  • 2 House of Representatives members (one from the majority, one from the minority)
  • 2 Senate members (one from the majority, one from the minority)
  • The commissioner of revenue or a designee
  • The commissioner of the Minnesota Housing Finance Agency or a designee
  • One member from the Association of Minnesota Counties
  • One member from the League of Minnesota Cities
  • One member from the Builders Association of Minnesota
  • One member from the Minnesota Realtors
  • One member representing a nonprofit affordable housing developer
  • One member representing a Tribal government
  • 3 public members with expertise in municipal finance or housing policy, appointed by the governor
  • Appointments must be completed by July 1, 2026.
• Duties: The task force must:
  • Inventory all current state and local taxes and fees on developing new housing, including building permit fees, park dedication fees, and infrastructure impact fees.
  • Analyze the combined effect of these taxes and fees on the final market price of housing.
  • Evaluate how housing-related taxes are allocated to state, county, and local governments.
  • Make recommendations for legislative or administrative changes to reduce the cost burden of taxes and fees on housing while keeping essential public services.
• Administration: The Legislative Coordinating Commission will provide staff and administrative support.
• Open Meetings: Meetings are subject to the Open Meeting Law (Minnesota Statutes chapter 13D).
• Report: By February 15, 2027, the task force must submit a report with findings and recommendations to the chairs and ranking minority members of the legislative committees that oversee housing and taxes.
• Expiration: The task force ends the day after it submits the required report.

Timeline & Process

• Appointments due by July 1, 2026.
• Open meetings ensure transparency.
• Final report due by February 15, 2027.
• Task force expires after submitting the report.

Significance and Impact

• Creates a focused, independent review of how taxes and fees affect housing costs, with the aim of identifying changes to reduce cost burdens without harming public services.
• Does not immediately change existing law; instead, it produces a report with recommendations that could inform future policy decisions.

Relationship to Existing Law

• Introduces a new advisory body and process focused on housing taxes and fees; no immediate statutory changes are enacted by this bill itself.

Key Terms (for quick reference)

• Task Force on Housing Taxes and Fees
• inventory all current state and local taxes and fees imposed on the development of new housing
• building permit fees
• park dedication fees
• infrastructure impact fees
• cumulative effect of state and local taxes and fees on the final market price of housing
• housing-related taxes
• state, county, and local governments
• Legislative Coordinating Commission
• Minnesota Open Meeting Law (chapter 13D)
• report by February 15, 2027
• appointment deadline July 1, 2026
• tribal government
• nonprofit affordable housing developer
• Association of Minnesota Counties
• League of Minnesota Cities
• Builders Association of Minnesota
• Minnesota Realtors
• municipal finance
• housing policy

Relevant Terms Task Force on Housing Taxes and Fees; inventory; building permit fees; park dedication fees; infrastructure impact fees; final market price of housing; housing-related taxes; Legislative Coordinating Commission; Open Meeting Law; February 15, 2027; July 1, 2026; Tribal government; nonprofit affordable housing developer; Association of Minnesota Counties; League of Minnesota Cities; Builders Association of Minnesota; Minnesota Realtors; municipal finance; housing policy.