HF4008 (Legislative Session 94 (2025-2026))
Alexandria; city authorized to impose a local sales tax.
Related bill: SF4314
AI Generated Summary
Purpose
- Allow the city of Alexandria to choose, by voter approval, to impose a local sales and use tax of up to 0.25% (one-quarter of one percent) to fund the expansion and renovation of the PrimeWest Health Runestone Community Center. The tax would also cover the costs of collecting and administering the tax.
Main Provisions
Local sales tax authorization
- The city may impose the tax by ordinance, if approved by voters as required by law.
- The tax would be in addition to any other local sales or use taxes.
Use of tax revenues (Subdivision 2)
- Revenues collected would pay the costs of administering and enforcing the tax.
- The funds would also finance up to $30,000,000 plus related bonding costs for the Runestone Community Center project.
Bonding authority (Subdivision 3)
- The city may issue bonds under the state’s bonding law (Chapter 475) to finance all or part of the project.
- The total principal of bonds may not exceed $30,000,000 plus the costs of issuing bonds.
- Bond proceeds can be paid from or secured by any money available to the city, including tax revenues.
- Bond issuance is not subject to certain debt statutes (275.60 and 275.61) and these bonds are not counted in the city’s debt limit.
- Any statewide tax levy to pay bond principal and interest under Chapter 475.61 is not subject to levy limits.
- A separate election to approve the bonds under 475.58 is not required.
Termination of the tax (Subdivision 4)
- The tax would expire no later than 20 years after it is first imposed, or earlier if the city determines the project costs (plus related bond costs) are fully funded.
- After expiration, any remaining money would go to the city’s general fund, unless other law provides otherwise.
- The city may set an earlier expiration by ordinance.
Notable Changes to Law
- Creates a local option for Alexandria to levy a specific sales and use tax for a defined capital project.
- Establishes a capped bonding amount linked to the project (up to $30,000,000 plus issuing costs) with special debt and tax treatment.
- Removes the need for a separate bond election and provides a fixed expiration timeline tied to funding milestones.
How it Works in Practice
- Voters in Alexandria would decide whether to allow the tax.
- If approved, the city would collect the tax to fund project costs and repay bonds.
- The city could issue bonds without being counted in its debt limit and without following some standard debt-levy rules.
- The tax would end once the project costs (and bond costs) are covered, up to a maximum of 20 years.
Relevant Terms - local sales and use tax - city of Alexandria - one-quarter of one percent (0.25%) - voter approval / election under 297A.99 - PrimeWest Health Runestone Community Center - expansion and renovation - bonding costs - Minnesota Statutes chapter 475 - bond issuance costs - 275.60 and 275.61 (debt statutes not applicable) - debt limit - 475.61 levy - 475.58 (bond election not required) - termination / expiration after 20 years - general fund - administration and collection costs
Bill text versions
- Introduction PDF PDF file
Actions
| Date | Chamber | Where | Type | Name | Committee Name |
|---|---|---|---|---|---|
| March 05, 2026 | House | Action | Introduction and first reading, referred to | Taxes |
Citations
[
{
"analysis": {
"added": [
"Creates local sales and use tax authority for the city of Alexandria up to 0.25%.",
"Requires compliance with applicable Minnesota statutes (e.g., 297A.99) for administration, collection, and enforcement."
],
"removed": [],
"summary": "Allows the city of Alexandria to impose a local sales and use tax up to 0.25% for designated purposes, subject to voter approval and compliance with applicable statutes (e.g., 297A.99).",
"modified": []
},
"citation": "477A.016",
"subdivision": ""
},
{
"analysis": {
"added": [
"Bonding authority to finance project costs up to $30,000,000; includes costs of issuing bonds.",
"Bonds may be issued under Minnesota Statutes chapter 475; not subject to 275.60 and 275.61.",
"Bonds may be repaid from the tax revenues authorized by subdivision 1."
],
"removed": [],
"summary": "Authorizes bonding to finance the project; total principal up to $30,000,000 plus issuance costs; bonds may be issued under chapter 475 and are not counted toward city debt limits; levy constraints and related provisions are specified.",
"modified": []
},
"citation": "297A.99",
"subdivision": "subdivision 3"
},
{
"analysis": {
"added": [
"Requires voter-approved bonds for the project per 297A.99(1)(a)."
],
"removed": [],
"summary": "Cites voter approval requirements for the bonds as provided by 297A.99 subdivision 1, paragraph a.",
"modified": []
},
"citation": "297A.99",
"subdivision": "subdivision 1, paragraph a"
},
{
"analysis": {
"added": [
"Tax expiration timing aligned with 297A.99 subdivision 12."
],
"removed": [],
"summary": "Sets the termination timing for the tax per 297A.99 subdivision 12 (earliest of 20 years after first imposition or when funds suffice to pay project costs plus bond costs).",
"modified": []
},
"citation": "297A.99",
"subdivision": "subdivision 12"
},
{
"analysis": {
"added": [
"Disposition of excess bond proceeds to the city general fund as required by 297A.99(3)(f)."
],
"removed": [],
"summary": "Requires any remaining funds after paying bond costs to be placed into the city’s general fund per 297A.99 subdivision 3, paragraph f.",
"modified": []
},
"citation": "297A.99",
"subdivision": "subdivision 3 paragraph f"
},
{
"analysis": {
"added": [
"Exempts bond issuance from 275.60."
],
"removed": [],
"summary": "Bonds issued under this subdivision are not subject to the levy restrictions of 275.60 (debt levy limitations).",
"modified": []
},
"citation": "275.60",
"subdivision": ""
},
{
"analysis": {
"added": [
"Exempts bond issuance from 275.61."
],
"removed": [],
"summary": "Bond issuance is not subject to 275.61 (additional levy limitations).",
"modified": []
},
"citation": "275.61",
"subdivision": ""
},
{
"analysis": {
"added": [
"Exempts bond debt service levy from levy limits under 475.61."
],
"removed": [],
"summary": "Levy to pay principal and interest on bonds is not subject to levy limitations under 475.61.",
"modified": []
},
"citation": "475.61",
"subdivision": ""
},
{
"analysis": {
"added": [
"Acknowledges that no separate election under 475.58 is required for bond approval."
],
"removed": [],
"summary": "Not required: a separate election to approve the bonds under 475.58.",
"modified": []
},
"citation": "475.58",
"subdivision": ""
},
{
"analysis": {
"added": [
"Bonds may be issued under Minnesota Statutes chapter 475."
],
"removed": [],
"summary": "References Minnesota Statutes chapter 475 as the authority for issuing bonds.",
"modified": []
},
"citation": "475",
"subdivision": ""
}
]Progress through the legislative process
In Committee