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HF1456 (Legislative Session 94 (2025-2026))

Austin; local sales and use tax authorized.

Related bill: SF1005

AI Generated Summary

This bill, H.F. No. 1456, introduced in the Minnesota House of Representatives by Representative Mueller, seeks to authorize the city of Austin, Minnesota, to impose a local sales and use tax of 0.5% if approved by voters. The revenue generated from this tax would be used to finance up to $25 million, plus associated bonding costs, for the construction and operation of a law enforcement center.

Key Provisions:

  1. Sales and Use Tax Authorization:

    • The city of Austin may impose a 0.5% local sales and use tax, subject to voter approval.
    • This tax would be in addition to any other local sales taxes.
    • The tax will be administered and enforced according to Minnesota Statutes, section 297A.99.

  2. Use of Tax Revenue:

    • The tax revenue will be used to cover:
      • Costs of collecting and administering the tax.
      • Up to $25 million for constructing and operating a law enforcement center.
      • Bonding costs associated with financing the project.

  3. Bonding Authority:

    • Austin may issue bonds (under Minnesota Statutes, chapter 475) to fund the law enforcement center.
    • The principal amount of bonds cannot exceed $25 million, plus costs related to issuance.
    • The city can use the sales tax revenue to repay the bonds.
    • These bonds are not subject to state-imposed debt limitations or levy restrictions.
    • No separate election is required to approve the issuance of bonds.

  4. Termination of the Tax:

    • The tax will end at the earlier of:
      1. 14 years after it is first imposed.
      2. When tax revenues have sufficiently covered the $25 million project cost and all related bonding expenses.
    • Any remaining funds after project completion will go to the city's general fund.
    • The city may choose to end the tax earlier by passing an ordinance.

Summary:

This bill allows Austin, MN, to implement a temporary 0.5% sales tax (upon voter approval) to fund a new law enforcement center, with the ability to issue bonds for financing. The tax will expire after 14 years or when the necessary funds are raised, whichever comes first.

Bill text versions

Actions

DateChamberWhereTypeNameCommittee Name
February 23, 2025HouseFloorActionIntroduction and first reading, referred toTaxes
February 23, 2025HouseFloorActionIntroduction and first reading, referred toTaxes

Citations

 
[
  {
    "analysis": {
      "added": [
        "Allows the city of Austin to impose additional sales and use taxes under specified conditions."
      ],
      "removed": [
        ""
      ],
      "summary": "This bill references the authorization for local sales and use taxes as per Minnesota Statutes section 297A.99.",
      "modified": [
        "Provides an exception to certain subdivisions of section 297A.99 regarding imposition and use of taxes."
      ]
    },
    "citation": "297A.99",
    "subdivision": "subdivisions 1, 2, and 3a"
  },
  {
    "analysis": {
      "added": [
        ""
      ],
      "removed": [
        ""
      ],
      "summary": "References limitations on local taxes in relation to the implementation of a sales and use tax.",
      "modified": [
        "References with conditions under which the local sales tax can be implemented."
      ]
    },
    "citation": "477A.016",
    "subdivision": ""
  },
  {
    "analysis": {
      "added": [
        ""
      ],
      "removed": [
        ""
      ],
      "summary": "This bill refers to exceptions to the normal bond approval process under Minnesota Statutes section 475.58.",
      "modified": [
        "Specifies that a separate election is not required for bond approval for the city of Austin."
      ]
    },
    "citation": "475.58",
    "subdivision": ""
  },
  {
    "analysis": {
      "added": [
        ""
      ],
      "removed": [
        ""
      ],
      "summary": "Relates to the use of revenues derived from imposed taxes under section 297A.99, subdivision 3.",
      "modified": [
        "Dictates how the city of Austin can use revenues derived from the sales and use tax."
      ]
    },
    "citation": "297A.99",
    "subdivision": "subdivision 3"
  },
  {
    "analysis": {
      "added": [
        ""
      ],
      "removed": [
        ""
      ],
      "summary": "Relates to the termination of taxes under section 297A.99, subdivision 12.",
      "modified": [
        "Specifies conditions under which the imposed tax will expire for the city of Austin."
      ]
    },
    "citation": "297A.99",
    "subdivision": "subdivision 12"
  },
  {
    "analysis": {
      "added": [
        ""
      ],
      "removed": [
        ""
      ],
      "summary": "Mentions debt and levy limits applicable to the issuance of bonds under section 475.61.",
      "modified": [
        "Excludes the bonds issued for this project from debt and levy limits."
      ]
    },
    "citation": "475.61",
    "subdivision": ""
  }
]

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