as introduced - 87th Legislature (2011 - 2012) Posted on 02/27/2012 01:11pm
A bill for an act
relating to economic development; providing for a new privately owned National
Football League stadium
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in Minnesota; authorizing the issuance of revenue
bonds; phasing out statewide business property tax; amending Minnesota Statutes
2010, sections 275.025, subdivision 1; 297A.71, by adding a subdivision;
Minnesota Statutes 2011 Supplement, section 340A.404, subdivision 1;
proposing coding for new law in Minnesota Statutes, chapter 116J; repealing
Minnesota Statutes 2010, section 275.025, subdivisions 2, 4.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:
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The purpose of this act is to assist the Minnesota
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in securing financing to
build a privately owned, privately operated
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as a venue for professional football.
This assistance includes: (1) issuing revenue bonds secured by and to be repaid with
revenues generated by user fees associated with attending games and events at the
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,
and (2) providing incentives for businesses to make contributions toward the expenses of
constructing a
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through reductions to the state general levy property tax and by
exempting construction materials used in construction of a
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from sales taxes. This
assistance is provided in exchange for an agreement with the Minnesota
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that the
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will be located in Minnesota, that the team will repay the financing, and will play
all home games in the
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until the bonds are repaid.
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Unless otherwise specified, "commissioner" in
sections 116J.6911 to 116J.699 means the commissioner of management and budget.
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"Public infrastructure" means all property,
facilities, and improvements determined by the state to facilitate the development and use
of the
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, including, but not limited to, property and improvements for drainage,
parking, roadways, walkways, skyways, pedestrian bridges, bicycle paths, lighting,
landscaping, utilities, streets, streetscapes, and transit improvements to facilitate public
access to the
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.
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"
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" means a facility suitable for National Football League
games constructed or renovated under this act.
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"Streetscape" means improvements to streets and sidewalks
or other public rights-of-way for the purpose of enhancing the movement, safety,
convenience, or enjoyment of
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patrons and other pedestrians, including decorative
lighting and surfaces, plantings, display and exhibit space, adornments, seating, and transit
and bus shelters, which are designated as streetscape by the state.
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"Team" means the owner and operator of the football team currently
known as the Minnesota
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or any team owned and operated by a person who
purchases or otherwise takes ownership or control of or reconstitutes a National Football
League team in Minnesota.
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This section is effective the day following final enactment.
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A fee is imposed on the sale or licensing of the
following, sold in the state or online, at the rate of ten percent:
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(1) a ticket to attend a game or event in the
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;
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(2) concessions sold at the
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;
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(3) any licenses or fees charged by the team or league to reserve seats, boxes,
suites or spaces including personal seat licenses, luxury box fees, club seating fees,
seat/suite/box maintenance fees, memberships, or the like in the
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;
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(4) sponsorships, including, but not limited to, naming rights for the
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or
parts of the
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;
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(5) signage in or on the
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;
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(6) charges for parking within one-half mile of the
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on days that Minnesota
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games are played at the
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;
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(7) the team's share of television and media revenue; and
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(8)
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rental fees.
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If the fee is not paid under subdivision 1, a
compensating fee is imposed on the possession for the sale or use of items used in
subdivision 1, clauses (1), (3) to (6), and (8). The rate of the fee equals the rate in
subdivision 1 and must be paid by the possessor or beneficiary of the item.
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The Minnesota
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, other vendors of
products subject to a fee under subdivision 1, or possessors of items subject to a user
fee under subdivision 2, must remit the fees to the state at the same time and in the
same manner as provided for payment of tax under chapter 289A. Revenue from the fee
imposed by this chapter must be remitted to the commissioner of revenue in a form and
manner prescribed by the commissioner.
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The audit, assessment, interest, appeal, refund, penalty,
enforcement, administrative, and collection provisions of chapters 270C and 297A, apply
to the fees imposed under this section.
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The commissioner of revenue shall deposit the
revenues from the fees under this section in the state treasury and credit them to a special
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revenue account dedicated to making debt service payments for bonds issued
under this section.
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Revenues received from the fees imposed under this section
must be used to pay, reimburse, or secure the payment of any principal of premium, or
interest on bonds issued in accordance with this act. If the revenues received from the user
fees of this section exceed the amount necessary for this purpose, remaining revenue shall
be deposited in the state treasury in the special
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debt service reserve account. If the
special
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debt service reserve account is fully funded, the remaining revenue shall
be applied toward payoff of the bonds issued under this act.
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This section expires when the bonds authorized under section
116J.699 have been repaid, as determined by the commissioner.
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No local sales or use tax may be imposed on sales at the
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site, except a
general sales tax permitted under section 297A.99.
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The city in which the
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is constructed or located shall issue intoxicating liquor
licenses that are reasonably requested for the premises of the
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. These licenses
are in addition to the number authorized by law. All provisions of chapter 340A not
inconsistent with this section apply to the licenses authorized under this subdivision.
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This section is effective the day following final enactment.
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The
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must be located in the state of
Minnesota.
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All home games of the team must be played in the
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for a period of 30 years, or until all bonds issued under this act are repaid, whichever
is longer.
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The team must provide access to the
commissioner of management and budget to annual audited financial statements of the
team and other financial books and records that the commissioner deems necessary to
determine compliance by the team with this act and to enforce the terms of any agreements
entered into under this act. Any financial information obtained by the commissioner under
this subdivision is nonpublic data under section 13.02, subdivision 9.
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The commissioner must negotiate a public sector
project labor agreement or other agreement to prevent strikes and lockouts that would halt,
delay, or impede construction of the
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and related facilities and public infrastructure.
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In the event of any dissolution or relocation of the
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franchise, the team must cease use of the name, logo, and colors of the Minnesota
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and must transfer to the state of Minnesota the Minnesota
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heritage and records,
including the name, logo, colors, history, playing records, trophies, and memorabilia.
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This section is effective the day following final enactment.
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$300,000,000 is
appropriated from the special
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revenue bond proceeds account to the team for
construction of a
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suitable for professional football games. This appropriation is
contingent upon execution of an agreement between the state and the team memorializing
the team's obligations, consistent with this act and other terms as decided during
negotiations. This appropriation is not available until the commissioner of management
and budget determines that an amount sufficient to construct and equip the
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is
available from nonstate sources and that all other criteria and conditions specified in this
act have been met.
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$........ is appropriated from the
general fund for public infrastructure.
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This section is effective the day following final enactment.
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The commissioner of management and budget
shall sell and issue state taxable revenue bonds in the amount up to $300,000,000, for
the following purposes:
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(1) to provide the money appropriated in this act;
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(2) to pay the costs of issuance, debt service, and bond insurance or other credit
enhancements, and to fund reserves; and
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(3) to refund bonds issued under this section.
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(a) The commissioner may sell and
issue the bonds on the terms and conditions the commissioner determines to be in the best
interest of the state. The bonds may be sold at public or private sale. The commissioner
may enter into any agreements or pledges the commissioner determines necessary or
useful to sell the bonds that are not inconsistent with sections 403.21 to 403.40. Sections
16A.672 to 16A.675, apply to the bonds. Except for amounts appropriated to pay the costs
of investment banking and banking services under section 16A.647, the proceeds of the
bonds issued under this section must be credited to a special
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bond proceeds
account in the state treasury.
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(b) Before the proceeds are received in the special
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bond proceeds account,
the commissioner of management and budget may transfer to the account from the special
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debt service reserve account amounts not exceeding the expected proceeds from
the next bond sale. The commissioner of management and budget shall return these
amounts to the special
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debt service account by transferring proceeds when
received. The amounts of these transfers are appropriated from the special
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debt
service reserve account and from the
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revenue bond proceeds account.
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The debt service on the bonds is payable only from the
following sources:
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(1) revenue credited to the special
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revenue account from the fees imposed
and collected under this act, or from any other source; and
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(2) other revenues pledged to the payment of the bonds.
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The commissioner may issue bonds to refund
outstanding bonds issued under subdivision 1, including the payment of any redemption
premiums on the bonds and any interest accrued or to accrue to the first redemption date
after delivery of the refunding bonds. The proceeds of the refunding bonds may, in the
discretion of the commissioner, be applied to the purchases or payment at maturity of the
bonds to be refunded, or the redemption of the outstanding bonds on the first redemption
date after delivery of the refunding bonds and may, until so used, be placed in escrow to
be applied to the purchase, retirement, or redemption. Refunding bonds issued under this
subdivision must be issued and secured in the manner provided by the commissioner.
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Bonds issued under this section are not public
debt and are not to be backed by the full faith and credit of the state. Debt service
payments on bonds issued under this section will be made from the special
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revenue fund. The state will, however, maintain a special
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debt service reserve
account having a balance equal to the annual debt service payment owed on these bonds.
The special
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debt service reserve account will be funded by contributions from
private parties and from revenues as provided in section 116J.694. If the special
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revenue fund has a shortfall in any year, the commissioner may request appropriation from
the special
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debt service reserve account to cover the shortfall.
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The legislature finds and declares the state's role in
issuing revenue bonds and making debt service payments under this act are for a necessary
and public purpose by adding value to the culture of the state; providing a valuable
recreational opportunity for residents to feel connected to and take pride in a professional
team bearing the name of the state; and providing the state visibility and a prestigious
marker to those outside of the state and thereby serves as a marketing vehicle for tourism
in the state and for recruitment of employees.
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The legislature finds and declares that any provision in any statute, local law, or
agreement with a professional football team or league that requires the team to play all
of its home games in the
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constructed using funds appropriated under this act for
a period of 30 years or until the bonds have been repaid, whichever is longer, serves a
unique public purpose for which the remedies of specific performance and injunctive relief
are essential to its enforcement and to obtaining the benefits of the state's consideration.
The legislature further finds and declares that government assistance to facilitate the
presence of professional football provides to the state of Minnesota, its residents, and its
businesses highly valued, intangible benefits that are virtually impossible to quantify and,
therefore, not recoverable even if the government receives monetary damages in the event
of a team's breach of contract. Minnesota courts are, therefore, charged with protecting
those benefits through the use of specific performance and injunctive relief as provided in
this chapter and in any agreements.
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The commissioner may contract with and appoint a trustee for
bondholders. The trustee has the powers and authority vested in it by the commissioner
under the bond and trust indentures.
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Any pledge made by the commissioner is valid and binding
from the time the pledge is made. The money or property pledged and later received by
the commissioner is immediately subject to the lien of the pledge without any physical
delivery of the property or money or further act, and the lien of any pledge is valid and
binding as against all parties having claims of any kind in tort, contract, or otherwise
against the commissioner, whether or not those parties have notice of the lien or pledge.
Neither the order nor any other instrument by which a pledge is created need be recorded.
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The commissioner, subject to
agreements with bondholders that may then exist, may, out of any money available for the
purpose, purchase bonds of the commissioner at a price not exceeding: (1) if the bonds are
then redeemable, the redemption price then applicable plus accrued interest to the next
interest payment date thereon; or (2) if the bonds are not redeemable, the redemption price
applicable on the first date after the purchase, upon which the bonds become subject to
redemption plus accrued interest to that date.
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The state pledges and
agrees with the holders of any bonds that the state will not limit or alter the rights vested in
the commissioner to fulfill the terms of any agreements made with the bondholders, or
in any way impair the rights and remedies of the holders until the bonds, together with
interest on them, with interest on any unpaid installments of interest, and all costs and
expenses in connection with any action or proceeding by or on behalf of the bondholders,
are fully met and discharged. The commissioner may include this pledge and agreement
of the state in any agreement with the holders of bonds issued under this section.
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This section is effective the day following final enactment.
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Minnesota Statutes 2010, section 297A.71, is amended by adding a subdivision
to read:
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Materials and supplies used or
consumed in, and equipment incorporated into, the construction or improvement of
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and public infrastructure constructed pursuant to this act are exempt. This
subdivision expires one year after the date that the first professional football game is
played in the
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and applies to materials, supplies, and equipment used in the
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, and five years after the issuance of the first bonds under this act for materials,
supplies, and equipment used in the public infrastructure.
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Minnesota Statutes 2011 Supplement, section 340A.404, subdivision 1,
is amended to read:
(a) A city may issue an on-sale intoxicating liquor license to
the following establishments located within its jurisdiction:
(1) hotels;
(2) restaurants;
(3) bowling centers;
(4) clubs or congressionally chartered veterans organizations with the approval of
the commissioner, provided that the organization has been in existence for at least three
years and liquor sales will only be to members and bona fide guests, except that a club
may permit the general public to participate in a wine tasting conducted at the club under
section 340A.419;
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(5) sports facilities hosting National Football League games;
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deleted text begin (5)deleted text end new text begin (6)new text end sports facilities located on land owned by the Metropolitan Sports
Commission; and
deleted text begin (6)deleted text end new text begin (7)new text end exclusive liquor stores.
(b) A city may issue an on-sale intoxicating liquor license, an on-sale wine license,
or an on-sale malt liquor license to a theater within the city, notwithstanding any law, local
ordinance, or charter provision. A license issued under this paragraph authorizes sales on
all days of the week to persons attending events at the theater.
(c) A city may issue an on-sale intoxicating liquor license, an on-sale wine license,
or an on-sale malt liquor license to a convention center within the city, notwithstanding
any law, local ordinance, or charter provision. A license issued under this paragraph
authorizes sales on all days of the week to persons attending events at the convention
center. This paragraph does not apply to convention centers located in the seven-county
metropolitan area.
(d) A city may issue an on-sale wine license and an on-sale malt liquor license to
a person who is the owner of a summer collegiate league baseball team, or to a person
holding a concessions or management contract with the owner, for beverage sales at a
ballpark or
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located within the city for the purposes of summer collegiate league
baseball games at the ballpark or
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, notwithstanding any law, local ordinance, or
charter provision. A license issued under this paragraph authorizes sales on all days of the
week to persons attending baseball games at the ballpark or
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.
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The purpose of this article is to provide an incentive through property tax relief to
Minnesota businesses to contribute to a fund for construction of a
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stadium and for
repayment of bonds issued under this act.
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Minnesota Statutes 2010, section 275.025, subdivision 1, is amended to read:
The state general levy is levied against
commercial-industrial property and seasonal residential recreational property, as defined
in this section. The state general levy base amount is $592,000,000 for taxes payable
in 2002. For taxes payable in subsequent yearsnew text begin before 2014new text end , the levy base amount is
increased each year by multiplying the levy base amount for the prior year by the sum
of one plus the rate of increase, if any, in the implicit price deflator for government
consumption expenditures and gross investment for state and local governments prepared
by the Bureau of Economic Analysts of the United States Department of Commerce for
the 12-month period ending March 31 of the year prior to the year the taxes are payable.
The tax under this section is not treated as a local tax rate under section 469.177 and is not
the levy of a governmental unit under chapters 276A and 473F.
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The state general levy base is $42,000,000 for seasonal residential recreational
property for taxes payable in 2014 and thereafter. The state general levy base is
$717,300,000 for commercial-industrial property for taxes payable in 2014; $637,600,000
for taxes payable in 2015; $557,900,000 for taxes payable in 2016; $478,200,000 for taxes
payable in 2017; $398,500,000 for taxes payable in 2018; $318,800,000 for taxes payable
in 2019; $239,100,000 for taxes payable in 2020; $159,400,000 for taxes payable in 2021;
and $79,700,000 for taxes payable in 2022.
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The commissioner shall increase or decrease the preliminary or final rate for a year
as necessary to account for errors and tax base changes that affected a preliminary or final
rate for either of the two preceding years. Adjustments are allowed to the extent that the
necessary information is available to the commissioner at the time the rates for a year must
be certified, and for the following reasons:
(1) an erroneous report of taxable value by a local official;
(2) an erroneous calculation by the commissioner; and
(3) an increase or decrease in taxable value for commercial-industrial or seasonal
residential recreational property reported on the abstracts of tax lists submitted under
section 275.29 that was not reported on the abstracts of assessment submitted under
section 270C.89 for the same year.
The commissioner may, but need not, make adjustments if the total difference in the tax
levied for the year would be less than $100,000.
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This section is effective for taxes levied in 2013, payable in
2014 and thereafter.
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Minnesota Statutes 2010, section 275.025, subdivisions 2 and 4,
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are repealed.
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This section is effective for taxes levied in 2022, payable in
2023 and thereafter.
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