Purpose

• Establish a temporary refundable sales and use tax exemption for construction materials, supplies, and equipment used in specific renovation, expansion, and new-facility projects for Canby Independent School District No. 891 (Canby) in Minnesota.

Main Provisions

• Exemption and refund mechanism
  • Materials, supplies, and equipment used in and incorporated into construction projects for Canby’s elementary and high schools are exempt from sales and use tax under Minnesota law, for purchases made between December 31, 2023 and January 1, 2026.
  • The exemption is implemented as if the standard sales tax rate under Minnesota Statutes section 297A.62, subdivision 1 applied, but the tax is refunded in the manner provided for similar projects under Minnesota Statutes section 297A.75, subdivision 1, clause 17. This means taxes are charged at the point of sale and then refunded.
• Eligible projects
  • New gymnasium with improved community access
  • Career technical education (CTE) space addition
  • HVAC upgrades
  • New eight-lane track
  • Athletic field improvements and upgrades
  • Stadium seating and press box renovations
  • Secure entrance upgrades for both schools, with an associated administrative office
  • Relocations (as applicable)
  • Renovations to existing locker rooms
  • Classroom renovations
  • Site drainage
  • Other associated renovations
• Administration and funding
  • The refunds required to reimburse the exemption are to be paid from the general fund to the Commissioner of Revenue.
  • The appropriation to cover these refunds comes from the general fund, serving as a funding source for the tax refunds.

Signficant Changes to Existing Law

• Creates a temporary (through 2025) refundable sales and use tax exemption for specified Canby school construction activities, expanding the existing tax exemption/refund framework to support school facility projects.
• Requires the state to fund the refunds via an appropriation from the general fund to the Commissioner of Revenue.

Timing and Scope

• Applies only to purchases of materials, supplies, and equipment used in the described projects made between December 31, 2023 and December 31, 2025 (i.e., before January 1, 2026).

Beneficiaries

• Canby Independent School District No. 891 (Canby) and its students, staff, and community members who benefit from upgraded school facilities.

Relevant Terms - refundable exemption - sales and use tax - Minnesota Statutes 297A.62 and 297A.75 - Canby Independent School District No. 891 (Canby) - construction materials, supplies, equipment - gymnasium, community access - career technical education (CTE) space - HVAC upgrades - eight-lane track - athletic field improvements - stadium seating, press box renovations - secure entrances, administrative office - relocations - locker rooms renovations - classroom renovations - site drainage - other associated renovations - general fund appropriation - Commissioner of Revenue - refund process - purchases between December 31, 2023 and January 1, 2026