Purpose

Authorizes the city of Audubon to adopt a local sales and use tax with voter approval, to fund the construction of a new fire station and to cover the costs of collecting and administering the tax.

Main provisions

• Subdivision 1 — Sales and use tax authorization

  • Audubon may impose a local sales and use tax of up to 0.5% (one-half of one percent) if voters approve, under the rules in Minnesota law (section 297A.99) and related voter requirements.
  • The tax is in addition to any other local sales and use taxes.

• Subdivision 2 — Use of revenues

  • Revenues from the tax must first cover the costs of collecting and administering the tax.
  • The remaining funds may be used to finance up to $3,000,000 plus related bonding costs for constructing a new fire station.

• Subdivision 3 — Bonding authority

  • Audubon may issue bonds (under Minnesota Statutes chapter 475) to finance all or part of the fire station project, with voter approval as required by law.
  • The total principal for bonds cannot exceed $3,000,000 plus the costs of issuing the bonds.
  • Bonds may be paid from the tax revenues or other funds available to the city.
  • Bond issuance is not subject to certain debt statutes (275.60 and 275.61) and the bonds are not counted against the city’s debt limit.
  • Any levy to pay principal and interest on the bonds is not subject to levy limitations.
  • A separate election to approve the bonds under section 475.58 is not required.

• Subdivision 4 — Termination of taxes

  • The tax expires at the earlier of: (a) 20 years after the tax is first imposed, or (b) when the city determines the tax revenues are sufficient to pay project costs (including bond issuance costs and interest) as approved by voters, plus any remaining costs.
  • Any money left after paying approved costs goes to the city’s general fund.
  • The tax may end earlier by city ordinance.

Significant changes to existing law

• Creates a new local option sales tax for the City of Audubon up to 0.5%, contingent on voter approval.
• Allows the city to bond up to $3,000,000 (plus issuance costs) to finance the fire station project, with several debt-related protections:
  • Bonds not counted toward the usual city debt limit.
  • Levy to repay bonds not subject to standard levy limits.
  • No separate bond election required beyond existing statutory requirements.
• Directs that tax revenues fund both the project (fire station) and the costs of administering and collecting the tax.

Potential impacts

• A new funding mechanism for a fire station in Audubon, funded by local tax revenues.
• The city gains borrowing flexibility for the project, with protections around debt and levies.
• Tax receipts are time-limited to up to 20 years (or shorter if funded earlier).

Notes

• The tax must follow state election and voter-approval requirements and related sections (297A.99).
• The proposal references specific Minnesota statutes and debt rules (e.g., Chapter 475, 275.60, 275.61, 297A.99, 475.58).

Relevant Terms local sales tax, use tax, Audubon, voter approval, Minnesota Statutes 297A.99, 475 bonding, fire station, bonding costs, bond issuance, debt limit, levy limitation, tax termination, termination date, general fund, collection and administration costs, project costs, separate election, not subject to 275.60, not subject to 275.61