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SF1981 (Legislative Session 94 (2025-2026))

Construction materials used in certain projects in the city of Ramsey sales and use tax exemption modification

Related bill: HF2638

AI Generated Summary

Purpose

Adjusts a sales and use tax exemption related to construction materials for a Ramsey water project, clarifying how the exemption works and when it applies.

What the bill covers

  • Exemption from sales and use tax for materials, supplies, and equipment used in the construction, reconstruction, upgrade, expansion, renovation, or remodeling of:

    • a new water treatment plant, and
    • trunk water main improvements in the city of Ramsey.

  • Eligibility window for purchases: only those bought after December 31, 2022 and before July 1, 2027 qualify.

How the tax and refunds work

  • The exemption applies, but the tax is still collected as if the standard rate (under Minnesota Statutes section 297A.62, subdivisions 1 and 1a) applied, and then the tax is refunded in the same manner used for eligible projects under Minnesota Statutes section 297A.75, subdivision 1, clause 17.
  • Refunds for eligible purchases may begin after June 30, 2023 and must be issued before July 1, 2027.

Scope and intent

  • Applies specifically to materials, supplies, and equipment used in the Ramsey water project described above.
  • Creates a targeted, temporary sales tax exemption with a prescribed refund process and timeframe.

Significance and changes to law

  • codifies a time-limited exemption for construction materials tied to Ramsey’s water infrastructure projects,
  • clarifies that the exemption operates through a tax-imposed-then-refunded process, using the existing refund framework in the state tax code (297A.62 and 297A.75),
  • sets explicit purchase date window and refund period.

Effective dates (summary)

  • Eligible purchases must occur in the window: after 12/31/2022 and before 7/1/2027.
  • Refunds may be issued from after 6/30/2023 up to 7/1/2027.

Relevant Terms - sales and use tax - exemption - exemption refund - construction materials - materials and supplies - equipment - water treatment plant - trunk water main improvements - city of Ramsey - Minnesota Statutes 297A.62 - Minnesota Statutes 297A.75 - December 31, 2022 - July 1, 2027 - refund window - clause 17

Bill text versions

Past committee meetings

  • Taxes on: March 26, 2025 09:00

Actions

DateChamberWhereTypeNameCommittee Name
February 27, 2025SenateActionIntroduction and first reading
February 27, 2025SenateActionReferred toTaxes

Citations

 
[
  {
    "analysis": {
      "added": [],
      "removed": [],
      "summary": "This bill references Minnesota Statutes chapter 297A as the governing framework for the sales and use tax exemption related to construction materials used in the Ramsey project.",
      "modified": []
    },
    "citation": "Minnesota Statutes chapter 297A",
    "subdivision": ""
  },
  {
    "analysis": {
      "added": [],
      "removed": [],
      "summary": "The bill indicates that the tax on eligible Ramsey project purchases is to be imposed and collected as if the rate under 297A.62, subdivisions 1 and 1a applied, for the purpose of applying and refunding the exemption.",
      "modified": [
        "Uses existing rate provisions in 297A.62, subdivisions 1 and 1a, to govern the Ramsey exemption."
      ]
    },
    "citation": "Minnesota Statutes section 297A.62",
    "subdivision": "subdivisions 1 and 1a"
  },
  {
    "analysis": {
      "added": [],
      "removed": [],
      "summary": "The refund mechanism for eligible purchases is described as being in the same manner as projects under 297A.75, subdivision 1, clause 17.",
      "modified": [
        "References refund mechanism in 297A.75, subdivision 1, clause 17 to refund eligible Ramsey exemption purchases."
      ]
    },
    "citation": "Minnesota Statutes section 297A.75",
    "subdivision": "subdivision 1, clause 17"
  }
]

Progress through the legislative process

17%
In Committee

Sponsors

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