This bill (S.F. No. 1757) proposes an amendment to Minnesota Statutes 2024, section 275.025, introducing a new subdivision that provides for the distribution of a portion of the state general levy to certain municipalities classified as "low-aid municipalities" in Anoka County.

Key Provisions:

• Eligibility Criteria for Low-Aid Municipality:

  1. It must be located wholly or partially within the metropolitan area as defined in Minn. Stat. § 473F.02, subd. 2.
  2. It must not receive distributions from the Municipal State-Aid Street Fund.
  3. It must not receive Local Government Aid (LGA) under Minn. Stat. §§ 477A.011-477A.03.
  4. Its fiscal disparities contribution tax capacity must exceed its fiscal disparities distribution tax capacity.
  5. It must have a population of fewer than 5,000 residents.
  6. It must be located in Anoka County.

• Distribution Amount:

  • The distribution is calculated by multiplying the municipality’s net tax capacity tax rate by its net fiscal disparities contribution.
  • However, the total amount provided cannot exceed the state general levy revenue collected from taxpayers within the municipality.

• Administration & Payment:

  • The commissioner of revenue determines and certifies the distribution amount by September 1 of the tax payable year.
  • Payment to the qualifying municipality must be made by the home county’s treasurer by December 1 of the tax payable year.
  • The distributed amounts will be deducted from the settlement of the state general levy.

• Definitions:

  • A "municipality" refers to a home-rule or statutory city or a town.
  • "Net fiscal disparities contribution" is defined as the municipality's fiscal disparities contribution net tax capacity minus its distribution net tax capacity.

Purpose:

This bill aims to provide financial relief to smaller municipalities in Anoka County that do not receive other forms of state aid and contribute more to the regional fiscal disparities pool than they receive in return.