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HF1547 (Legislative Session 94 (2025-2026))

Refundable sales and use tax exemption provided for materials and equipment used in the construction of the Stearns County Justice Center.

Related bill: SF1077

AI Generated Summary

Purpose

Create a temporary, refundable sales and use tax exemption for certain construction materials, supplies, and equipment used in building, upgrading, or remodeling facilities at the Stearns County Justice Center. The exemption targets components used in a jail, a law enforcement center, and a judicial center within the Stearns County Justice Center project.

Main Provisions

  • Exemption scope: Materials, supplies, and equipment used in the construction, reconstruction, upgrade, expansion, renovation, or remodeling of the jail and the associated law enforcement and judicial centers are exempt from sales and use tax to the extent they are not already exempt under another provision (Minnesota Statutes section 297A.71, subdivision 3).
  • Timeframe: The exemption applies only to purchases made after January 1, 2025 and before January 1, 2031.
  • Administration and refunds: The tax is initially collected as if the standard rate applies and then refunded in the same manner as refunds for certain projects under Minnesota Statutes section 297A.75, subdivision 1, clause 17. No refunds may be issued before July 1, 2025.
  • Projects covered: The exemption applies to construction activities for the jail, the law enforcement center, and the judicial center at the Stearns County Justice Center.

How It Works

  • Tax collection and refund flow: Purchase taxed at the normal rate, then eligible for a refund once the project qualifies and the refund process under the referenced statutes is used.
  • Timing of refunds: No refunds before July 1, 2025.
  • Limitations: The exemption is limited to purchases within the 2025–2031 window and to items not already exempt under other parts of statute.

Financing

  • Funding for refunds: The general fund provides an appropriation to the commissioner of revenue to pay the refunds.

Effective Period and Scope

  • Geographic and project scope: Applies specifically to Stearns County Justice Center construction activities (jail, law enforcement center, and judicial center).
  • Legislative status: Tax-related bill directing a temporary exemption with an appropriation to cover refunds.

Summary of Impact

  • Local construction cost relief: Potential reduction in sales and use taxes for materials and equipment used in the Stearns County Justice Center project.
  • Budgetary impact: Requires a general fund appropriation to fund refunds to taxpayers who paid the tax upfront.

Relevant Terms - sales tax exemption - use tax exemption - refundable exemption - Stearns County Justice Center - jail - law enforcement center - judicial center - construction materials - equipment - reconstruction - upgrade - expansion - renovation - remodeling - Minnesota Statutes chapter 297A - 297A.71(3) - 297A.62 - 297A.75(1) clause 17 - July 1, 2025 - January 1, 2031 - general fund - commissioner of revenue - appropriation - refunds

Bill text versions

Actions

DateChamberWhereTypeNameCommittee Name
February 26, 2025HouseActionIntroduction and first reading, referred toTaxes
March 03, 2025HouseActionAuthor added
March 10, 2025HouseActionAuthor added

Citations

 
[
  {
    "analysis": {
      "added": [],
      "removed": [],
      "summary": "Cites the existing exemption in Minnesota Statutes 297A.71, subd. 3 for materials and supplies used or consumed and equipment incorporated into the construction of the Stearns County jail, exempt from sales and use tax.",
      "modified": []
    },
    "citation": "297A.71",
    "subdivision": "subd. 3"
  },
  {
    "analysis": {
      "added": [],
      "removed": [],
      "summary": "References Minnesota Statutes chapter 297A, the state's sales and use tax law.",
      "modified": []
    },
    "citation": "297A",
    "subdivision": ""
  },
  {
    "analysis": {
      "added": [],
      "removed": [],
      "summary": "Uses the rate provisions of Minnesota Statutes 297A.62, subdivisions 1 and 1a, to apply and then refund the tax for the exempt construction materials at Stearns County Justice Center.",
      "modified": []
    },
    "citation": "297A.62",
    "subdivision": "subd. 1, subd. 1a"
  },
  {
    "analysis": {
      "added": [],
      "removed": [],
      "summary": "References the refunds mechanism in Minnesota Statutes 297A.75, subd. 1, clause (17) for project refunds, as part of the exemption process.",
      "modified": []
    },
    "citation": "297A.75",
    "subdivision": "subd. 1, clause 17"
  }
]

Progress through the legislative process

17%
In Committee

Sponsors

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