Minneapolis local sales tax use of revenue modification

A bill for an act

relating to taxation; modifying local sales tax use of revenue in the city of

Minneapolis; modifying Minneapolis downtown taxing area; amending Minnesota

Statutes 2024, section 297A.994, subdivision 4; Laws 1986, chapter 400, section

44, as amended.

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

Section 1.

Minnesota Statutes 2024, section 297A.994, subdivision 4, is amended to read:

Subd. 4.

General fund allocations.

(a) The commissioner must retain and deposit to

the general fund the following amounts, as required by subdivision 3, clause (3):

(1) for state bond debt service support beginning in calendar year 2021, and for each

calendar year thereafter through calendar year 2046, periodic amounts so that not later than

December 31, 2046, an aggregate amount equal to a present value of $150,000,000 has been

deposited in the general fund. To determine aggregate present value, the commissioner must

consult with the commissioner of management and budget regarding the present value dates,

discount rate or rates, and schedules of annual amounts. The present value date or dates

must be based on the date or dates bonds are sold under Minnesota Statutes 2022, section

16A.965
, or the date or dates other state funds, if any, are deposited into the construction

fund. The discount rate or rates must be based on the true interest cost of the bonds issued

under Minnesota Statutes 2022, section
16A.965
, or an equivalent 30-year bond index, as

determined by the commissioner of management and budget. The schedule of annual amounts

must be certified to the commissioner by the commissioner of management and budget and

the finance officer of the city;

(2) for the capital improvement reserve appropriation to the Minnesota Sports Facilities

Authority beginning in calendar year 2021, and for each calendar year thereafter through

calendar year 2046, an aggregate annual amount equal to the amount paid by the state for

this purpose in that calendar year under section
473J.13, subdivision 4
;

(3) for the operating expense appropriation to the Minnesota Sports Facilities Authority

beginning in calendar year 2021, and for each calendar year thereafter through calendar

year 2046, an aggregate annual amount equal to the amount paid by the state for this purpose

in that calendar year under section
473J.13, subdivision 2
;

(4) to capture increases in taxes imposed under the special law, for the benefit of the

Minnesota Sports Facilities Authority, beginning in calendar year 2013 and for each calendar

year thereafter through 2046, there shall be deposited to the general fund in proportionate

periodic payments in the following year, an amount equal to the lesser of
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the amounts as

calculated under item (i) or (ii), not to exceed $2,300,000
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:

(i)(A) 50 percent of the difference, if any, by which the amount of the net annual taxes

for the previous year exceeds the sum of the net actual taxes in calendar year 2011 plus

$1,000,000, inflated at two percent per year since 2011, minus

(B) 25 percent of the difference, if any, by which the amount of the net annual taxes for

the preceding year exceeds the sum of the net actual taxes in calendar year 2011 plus

$3,000,000, inflated at two percent per year since 2011; or

(ii) the amount of the net annual taxes for the preceding year multiplied by three percent;

and

(5) if the bonds under section
16A.965
are defeased, redeemed, or paid in full, the

commissioner of management and budget and finance officer of the city must agree to a

revised schedule of annual amounts under clause (1). The revised schedule of annual amounts

must factor in a discount rate equal to zero percent and otherwise consistent with the

methodology previously agreed upon by the parties.

(b) The Minnesota Sports Facility Authority must use the amounts available from the

deposits under paragraph (a), clause (4), for capital repairs, replacements, and improvements

for the stadium and stadium infrastructure.

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EFFECTIVE DATE.

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This section is effective the day following final enactment.

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Sec. 2.

Laws 1986, chapter 400, section 44, as amended by Laws 1995, chapter 264, article

2, section 39, and Laws 2009, chapter 88, article 4, section 13, is amended to read:

Sec. 44.
DOWNTOWN TAXING AREA.

If a bill is enacted into law in the 1986 legislative session which authorizes the city of

Minneapolis to issue bonds and expend certain funds including taxes to finance the

acquisition and betterment of a convention center and related facilities, which authorizes

certain taxes to be levied in a downtown taxing area, then, notwithstanding the provisions

of that law "downtown taxing area" shall mean the geographic area bounded by the portion

of the Mississippi River between I-35W and Washington Avenue, the portion of Washington

Avenue between the river and I-35W, the portion of I-35W between Washington Avenue

and
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8th Street
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Portland Avenue
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South, the portion of 8th Street South between I-35W and

Portland Avenue South, the portion of Portland Avenue South between 8th Street South

and I-94, the portion of I-94 from the intersection of Portland Avenue South to the

intersection of I-94 and
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the Burlington Northern Railroad tracks
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Plymouth Avenue North
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,

the portion of
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the Burlington Northern Railroad tracks from I-94
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Plymouth Avenue North

to the Mississippi River from Plymouth Avenue North and the Mississippi River south
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to

Main Street and including Nicollet Island, and the portion of Main Street to Hennepin

Avenue and the portion of Hennepin Avenue between Main Street and 2nd Street S.E., and

the portion of 2nd Street S.E. between Main Street and Bank Street, and the portion of Bank

Street between 2nd Street S.E. and University Avenue S.E., and the portion of University

Avenue S.E. between Bank Street and I-35W, and by I-35W from University Avenue S.E.,

to the river. The downtown taxing area excludes the area bounded on the south and west

by Oak Grove Street, on the east by Spruce Place, and on the north by West 15th Street.

The downtown taxing area also excludes any property located in a zone that is contained

in chapter 546 of the Minneapolis Zoning Code of Ordinances on which a restaurant with

a wine license is operated.

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EFFECTIVE DATE.

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This section is effective for sales and purchases made after

September 30, 2026.

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