Local government units levy limits establishment provision

A bill for an act

relating to taxation; property; establishing levy limits for local governmental units;

amending Minnesota Statutes 2024, section 275.71, subdivisions 2, 4.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

Section 1.

Minnesota Statutes 2024, section 275.71, subdivision 2, is amended to read:

Subd. 2.

Levy limit base.

deleted text begin

The levy limit base for a local governmental unit for taxes

levied in 2008 is its levy aid base from the previous year, subject to any adjustments under

section
275.72
. For taxes levied in 2009 and 2010, the levy limit base for a local

governmental unit is its adjusted levy limit base in the previous year, subject to any

adjustments under section
275.72
.

deleted text end

new text begin

The levy limit base for a local governmental unit is the final levy certified by the local

governmental unit in the preceding year under section 275.07, subject to adjustments for

consolidation and annexation under section 275.72.

new text end

new text begin

EFFECTIVE DATE.

new text end

new text begin

This section is effective for property taxes payable in 2027 and

thereafter.

new text end

Sec. 2.

Minnesota Statutes 2024, section 275.71, subdivision 4, is amended to read:

Subd. 4.

Adjusted levy limit base.

deleted text begin

For taxes levied in 2008 through 2010, the adjusted

levy limit base is equal to the levy limit base computed under subdivision 2 or section

275.72
, multiplied by:

deleted text end

deleted text begin

(1) one plus the percentage growth in the implicit price deflator, but the percentage shall

not be less than zero or exceed 3.9 percent;

deleted text end

deleted text begin

(2) one plus a percentage equal to 50 percent of the percentage increase in the number

of households, if any, for the most recent 12-month period for which data is available; and

deleted text end

deleted text begin

(3) one plus a percentage equal to 50 percent of the percentage increase in the estimated

market value of the jurisdiction due to new construction of class 3 property, as defined in

section
273.13, subdivision
24, except for state-assessed utility and railroad property, for

the most recent year for which data is available.

deleted text end

new text begin

(a) For taxes payable in 2027, the adjusted levy limit base for a local governmental unit

equals the levy limit base computed under subdivision 2, multiplied by:

new text end

new text begin

(1) one plus the greater of zero or the percentage change in the implicit price deflator

between the first quarter of the levy year and the first quarter of the preceding year; and

new text end

new text begin

(2) one plus the greater of zero or an amount equal to 50 percent of the percentage change

in the population of the local governmental unit over the most recent 12-month period for

which data is available.

new text end

new text begin

(b) For taxes payable in 2028 and thereafter, the adjusted levy limit base for a local

governmental unit under paragraph (a) is increased by the greater of zero or the difference

between:

new text end

new text begin

(1) the levy limit certified by the commissioner of revenue for the local governmental

unit in the preceding year under section 275.74; and

new text end

new text begin

(2) the final levy certified by the local governmental unit in the preceding year under

section 275.07, excluding any portion of the final levy approved by the local governmental

unit at a general or special election in the preceding year under section 275.73.

new text end

new text begin

EFFECTIVE DATE.

new text end

new text begin

This section is effective for property taxes payable in 2027 and

thereafter.

new text end