Purpose

To provide a temporary sales and use tax exemption for construction materials used in specific projects in Hills-Beaver Creek Independent School District No. 671, reducing the cost of building and renovating facilities.

What is exempt and which projects it covers

• Exemption applies to materials and supplies used or consumed in and equipment incorporated into the construction, reconstruction, upgrade, expansion, renovation, or remodeling of the following projects:
  • A new elementary school and parking lot
  • Repairs to a gymnasium
  • Locker rooms
  • A vehicle garage
  • A bus garage building
• The exemption only applies if the materials are purchased after February 29, 2024 and before January 1, 2026.
• The exemption is applied by treating the tax as if the standard rate under Minnesota Statutes section 297A.621 and 1a applied, and then refunded in the same manner provided for projects under Minnesota Statutes section 297A.75 subdivision 1 clause 17.

How refunds work (mechanism)

• The tax that would have been collected is refunded, following the same procedures used for other eligible projects under the specified statute.
• The refunds are paid from the general fund to cover the tax that would have been collected.

Funding and administration

• An appropriation is made from the general fund to the commissioner of revenue to pay the refunds.

Timeline and scope

• Date window for purchases: after February 29, 2024 and before January 1, 2026.
• Scope is limited to the named projects within Hills-Beaver Creek Independent School District No. 671.

Significance and what changes in practice

• Creates a temporary, targeted sales and use tax exemption for construction materials used in specified district projects.
• Uses an intermittent exemption/refund framework rather than a permanent exemption, with funding for refunds provided from the general fund.

Key terms repeated from the bill

• sales and use tax exemption
• construction materials
• materials and supplies
• equipment incorporated
• construction, reconstruction, upgrade, expansion, renovation, remodeling
• Hills-Beaver Creek Independent School District No. 671
• new elementary school and parking lot
• gymnasium repairs
• locker rooms
• vehicle garage
• bus garage building
• purchased after February 29, 2024 and before January 1, 2026
• tax imposed and collected as if rate under 297A.621 and 1a applied
• refunded
• refunds
• general fund
• commissioner of revenue
• Minnesota Statutes chapter 297A
• Minnesota Statutes section 297A.62
• Minnesota Statutes section 297A.75 subdivision 1 clause 17

Relevant Terms sales and use tax exemption construction materials materials and supplies equipment incorporated construction reconstruction upgrade expansion renovation remodeling Hills-Beaver Creek Independent School District No. 671 new elementary school parking lot gymnasium locker rooms vehicle garage bus garage purchased after February 29, 2024 before January 1, 2026 tax imposed and collected refunded general fund commissioner of revenue Minnesota Statutes chapter 297A 297A.62 297A.75 clause 17