Subdivision 1. Authorized types. (a) The following types of tax reductions may be approved by the commissioner for businesses located in a border city enterprise zone, after the governing body of the border city has designated an area or areas, each consisting of at least 100 acres, of the city not in excess of a total of 400 acres in which the tax reductions may be provided:
(1) an exemption from the general sales tax imposed by chapter 297A for purchases of construction materials or equipment for use in the zone if the purchase was made after the date of application for the zone;
(2) a credit against the income tax of an employer for additional workers employed in the zone, other than workers employed in construction, up to a maximum of $3,000 per employee per year;
(3) an income tax credit for a percentage of the cost of debt financing to construct new or expanded facilities in the zone; and
(4) a state paid property tax credit for a portion of the property taxes paid by a new commercial or industrial facility or the additional property taxes paid by an expansion of an existing commercial or industrial facility in the zone.
(b) An application for a tax reduction under this subdivision may not be approved unless the governing body finds that the construction or improvement of the facility is not likely to have the effect of transferring existing employment from a location outside of the municipality but within the state.
Subd. 2. [Repealed, 2012 c 294 art 2 s 43]
Subd. 3. Commissioner of revenue action. Upon designation of an enterprise zone and approval by the commissioner of the tax reductions to be made available therein, the commissioner of revenue shall implement the tax reductions.
Subd. 4. Restriction. The tax reductions provided by this section shall not apply to (1) a facility the primary purpose of which is one of the following: the provision of recreation or entertainment, or a private or commercial golf course, country club, massage parlor, tennis club, skating facility including roller skating, skateboard, and ice skating, racquet sports facility, including any handball or racquetball court, hot tub facility, suntan facility, or racetrack; (2) property of a public utility; (3) property used in the operation of a financial institution; (4) property owned by a fraternal or veterans' organization; or (5) a retail food or beverage facility operating under a franchise agreement that requires the business to be located in this state.
Subd. 5. [Repealed, 2012 c 294 art 2 s 43]
Subd. 6. Additional border city tax reductions. In addition to the tax reductions authorized by subdivision 1, for a border city zone, the following types of tax reductions may be approved:
(1) a credit against income tax for workers employed in the zone and not qualifying for a credit under subdivision 1, clause (2), subject to a maximum of $1,500 per employee per year;
(2) a state paid property tax credit for a portion of the property taxes paid by a commercial or industrial facility located in the zone.
Subd. 6a. Additional border city allocations. The commissioner may allocate $2,000,000 for tax reductions pursuant to subdivision 9 to border city enterprise zones. This money shall be allocated among the zones on a per capita basis. Tax reductions authorized by this subdivision may not be allocated to any property which is:
(1) a facility the primary purpose of which is one of the following: the provision of recreation or entertainment, or a private or commercial golf course, country club, massage parlor, tennis club, skating facility including roller skating, skateboard, and ice skating, racquet sports facility, including any handball or racquetball court, hot tub facility, suntan facility, or racetrack;
(2) property of a public utility;
(3) property used in the operation of a financial institution;
(4) property owned by a fraternal or veterans' organization;
(5) property of a retail food or beverage service business operating under a franchise agreement that requires the business to be located in the state.
Subd. 6b. [Repealed, 2012 c 294 art 2 s 43]
Subd. 7. Duration. Each tax reduction provided to a business that is located in a border city enterprise zone may be provided until the allocations provided under subdivision 6a, and under section 469.169, have been expended. Subject to the limitation in this subdivision, the tax reductions may be provided after expiration of the zone's designation.
Subd. 7a. Property tax credit; appropriation. There is annually appropriated from the general fund to the commissioner of revenue the amounts required to reimburse taxing jurisdictions for the revenue lost due to the property tax credit provided in subdivision 1, clause (4). Payment shall be made to taxing jurisdictions in the same proportion that the ad valorem tax is distributed. Payment shall be made to taxing jurisdictions, other than school districts, at the time provided in section 473H.10, subdivision 3.
Subd. 8. Refundable credits. The income tax credits provided pursuant to subdivisions 1 and 6 may be refundable.
Subd. 9. Recapture. Any business that (1) receives tax reductions authorized by subdivisions 1 to 8; and (2) ceases to operate its facility located within the border city enterprise zone shall repay the amount of the tax reduction or local contribution received during the two years immediately before it ceased to operate in the zone.
The repayment must be paid to the state to the extent it represents a tax reduction under subdivisions 1 to 8 and to the municipality to the extent it represents a property tax reduction or other local contribution. Any amount repaid to the state must be credited to the amount certified as available for tax reductions in the zone pursuant to the city's allocation. Any amount repaid to the municipality must be used by the municipality for economic development purposes. The commissioner of revenue may seek repayment of tax credits from a business ceasing to operate within an enterprise zone by utilizing any remedies available for the collection of tax.
Subd. 10. Interest. When tax credits allowed under subdivisions 1 to 8 result in an overpayment within the meaning of section 289A.50, the excess to be refunded to the taxpayer shall bear interest at the amount specified in section 270C.405, computed from 90 days after (1) the due date of the return or (2) the date on which the return is filed, whichever is later, to the date the refund is paid.
Subd. 11. Limitations; last eight months of duration. This subdivision applies only to state tax reductions first authorized by the municipality to be provided to a business within eight months of the expiration of the border city enterprise zone's designation.
Before agreeing with a business to provide tax reductions, the municipality must submit the proposed tax reductions to the commissioner for approval. The commissioner shall review and analyze the proposal in light of, at least: (1) the proposed investment that the business will make in the zone, (2) the number and quality of new jobs that will be created in the zone, (3) the overall positive impact on economic activity in the zone, and (4) the extent to which the impacts in clauses (1) to (3) are dependent upon providing the state tax reductions to the business. The commissioner shall disapprove the proposal if the commissioner determines the public benefits of increased investment and employment resulting from the tax reductions is disproportionately small relative to the cost of the state tax reductions. If the commissioner disapproves of the proposal, the tax reductions are not allowed to the business.
If the municipality submits the proposal to the commissioner before expiration of the zone designation, the authority to grant the tax reductions continues until the commissioner acts on the proposal.
1987 c 268 art 10 s 3-6; 1987 c 291 s 172,243; 1Sp1989 c 1 art 9 s 64; art 17 s 15; 1990 c 480 art 1 s 46; 1990 c 604 art 3 s 41; art 10 s 19; 1991 c 291 art 21 s 15; 1998 c 389 art 12 s 5; 2005 c 151 art 2 s 17; 2012 c 294 art 2 s 25-30; 1Sp2019 c 6 art 5 s 4
Structure Minnesota Statutes
Chapters 466A - 470 — Local Economic Development
Chapter 469 — Economic Development
Section 469.002 — Definitions.
Section 469.003 — City Housing And Redevelopment Authority.
Section 469.004 — County And Multicounty Authorities.
Section 469.005 — Area Of Operation.
Section 469.006 — Appointment, Qualifications, Tenure Of Commissioners.
Section 469.007 — Powers Of County And Multicounty Authorities.
Section 469.008 — Effect Upon City Housing And Redevelopment Authorities.
Section 469.009 — Conflict Of Interest; Penalties For Failure To Disclose.
Section 469.010 — Removal; Hearing; Notice.
Section 469.011 — Authority Operations.
Section 469.012 — Public Body; Powers, Duties, Programs; Taxes Limited.
Section 469.014 — Liable In Contract Or Tort.
Section 469.015 — Letting Of Contracts; Performance Bonds.
Section 469.016 — Low-rent Housing.
Section 469.017 — Housing Development Projects.
Section 469.0171 — Housing Plan, Program, And Review.
Section 469.019 — Rentals, Tenant Admissions.
Section 469.020 — Discrimination Prohibited, Displaced Families.
Section 469.021 — Preferences.
Section 469.022 — Establishment Of Income Restriction.
Section 469.023 — Periodic Investigation Of Tenant.
Section 469.024 — Power Of Authority.
Section 469.025 — Demolition Of Unsafe Or Unsanitary Buildings.
Section 469.026 — Existing Buildings; Acquisition, Repair.
Section 469.027 — Redevelopment Plan.
Section 469.028 — Municipal Governing Body.
Section 469.029 — Disposal Of Property.
Section 469.030 — Temporary Relocation Of Displaced Families.
Section 469.0305 — Report On Loss Of Housing.
Section 469.031 — Provisional Acceptance By Authority Of Fund, Property.
Section 469.033 — Public Redevelopment Cost; Proceeds; Financing.
Section 469.034 — Bond Issue For Corporate Purposes.
Section 469.035 — Manner Of Bond Issuance; Sale.
Section 469.036 — When Bond Allocation Act Applies.
Section 469.037 — Enforcement By Obligee Of Contracts.
Section 469.038 — Bonds, A Legal Investment.
Section 469.039 — Exemption From Process.
Section 469.041 — State Public Bodies, Powers As To Projects.
Section 469.042 — Agreement On Tax Increments; Equivalents.
Section 469.044 — Bond Pending Litigation.
Section 469.045 — Appearance Of Public Corporation; Bond.
Section 469.046 — Advance Of Litigation On Calendar.
Section 469.047 — Suit For Civil Damages.
Section 469.048 — Definitions.
Section 469.049 — Establishment; Characteristics.
Section 469.050 — Commissioners; Terms, Vacancies, Pay, Continuity.
Section 469.051 — Officers; Duties; Organizational Matters.
Section 469.052 — Depositories; Default; Collateral.
Section 469.0521 — Liable In Contract Or Tort.
Section 469.053 — Tax Levies; Fiscal Matters.
Section 469.054 — Use Of City Property, Services By Authority.
Section 469.055 — Powers And Duties.
Section 469.056 — Employees; Contracts; Audits.
Section 469.057 — Port Control By Others; Petition; Intervention.
Section 469.058 — Industrial Development Districts.
Section 469.059 — Development District Powers.
Section 469.060 — General Obligation Bonds.
Section 469.061 — Revenue Bonds; Pledge; Covenants.
Section 469.062 — Other Bonds.
Section 469.063 — When Bond Allocation Act Applies.
Section 469.064 — Port Authority Activities.
Section 469.065 — Sale Of Property.
Section 469.066 — Advances By Port Authority.
Section 469.067 — Finding Land Is Marginal Is Prima Facie Evidence.
Section 469.0671 — No State Bailout Of Port Authorities.
Section 469.068 — Bid Law For Construction Contracts.
Section 469.071 — Bloomington.
Section 469.072 — Breckenridge.
Section 469.0721 — Cannon Falls; Redwood Falls; Port Authority.
Section 469.0722 — Limitation Of Powers.
Section 469.0723 — Procedural Requirement.
Section 469.0724 — General Obligation Bonds.
Section 469.0726 — Removal Of Commissioners For Cause.
Section 469.073 — Detroit Lakes.
Section 469.075 — Fergus Falls.
Section 469.076 — Granite Falls.
Section 469.0772 — Koochiching County; Port Authority.
Section 469.0775 — Mankato; Port Authority.
Section 469.078 — Minneapolis.
Section 469.079 — North Mankato.
Section 469.0813 — Rosemount; Port Authority.
Section 469.082 — Roseville; Port Authority.
Section 469.085 — South Saint Paul.
Section 469.0856 — Ortonville.
Section 469.088 — White Bear Lake.
Section 469.090 — Definitions.
Section 469.091 — Economic Development Authority.
Section 469.092 — Limit Of Powers.
Section 469.093 — Procedural Requirement.
Section 469.094 — Transfer Of Authority.
Section 469.095 — Commissioners; Appointment, Terms, Vacancies, Pay, Removal.
Section 469.096 — Officers; Duties; Organizational Matters.
Section 469.097 — Employees; Services; Supplies.
Section 469.098 — Conflict Of Interest.
Section 469.099 — Depositories; Default; Collateral.
Section 469.100 — Obligations.
Section 469.102 — General Obligation Bonds.
Section 469.103 — Revenue Bonds; Pledge; Covenants.
Section 469.104 — Sections That Apply If Federal Limit Applies.
Section 469.105 — Sale Of Property.
Section 469.106 — Advances By Authority.
Section 469.107 — City May Levy Taxes For Economic Development Authority.
Section 469.108 — Special Law; Optional Use.
Section 469.1081 — Liable In Contract Or Tort.
Section 469.110 — Definitions.
Section 469.111 — Local Or Area Agencies; Establishment.
Section 469.112 — Municipalities May Join Together.
Section 469.113 — Conflict Of Interest.
Section 469.114 — Agencies; Meetings, Expenses.
Section 469.115 — Powers Of Agencies.
Section 469.116 — Bond Issue For Redevelopment Purposes.
Section 469.117 — Eminent Domain Proceedings.
Section 469.118 — Loans To Redevelopment Agencies.
Section 469.119 — Loan Application Requirements.
Section 469.122 — Limitation Of Powers.
Section 469.123 — Examination And Audit Of Local Agency.
Section 469.125 — Definitions.
Section 469.126 — Authority Granted.
Section 469.130 — Maintenance And Operation.
Section 469.131 — Administration.
Section 469.132 — Advisory Board.
Section 469.141 — Regulation To Protect Mined Underground Space.
Section 469.143 — Definitions.
Section 469.144 — Establishment; Board.
Section 469.145 — Financing Projects And Facilities.
Section 469.146 — Issuance Of Bonds And Notes.
Section 469.147 — Processing Agreement.
Section 469.148 — Applications For Loan Guaranties.
Section 469.149 — Agreements For Reservation Of Tax Increments.
Section 469.151 — State And County Not Liable On Bonds.
Section 469.153 — Definitions.
Section 469.154 — Department Of Employment And Economic Development Duties.
Section 469.156 — Authorization Of Projects And Bonds.
Section 469.157 — Determination Of Cost Of Project.
Section 469.158 — Manner Of Issuance Of Bonds; Interest Rate.
Section 469.159 — Temporary Loans.
Section 469.160 — Validity Of Bonds; Presumption.
Section 469.161 — Limitation Of Powers By Resolution Or Ordinance.
Section 469.162 — Source Of Payment For Bonds.
Section 469.163 — Bondholders' Rights And Remedies.
Section 469.164 — Powers Added To Application Of Existing Laws And Rules.
Section 469.165 — Applicability Of Hra Provisions.
Section 469.1655 — Qualified Green Building And Sustainable Design Projects.
Section 469.166 — Definitions.
Section 469.167 — Border City Enterprise Zone; Duration.
Section 469.169 — Additional Border City Zone Allocations.
Section 469.171 — Border City Enterprise Zones; State Tax Reductions.
Section 469.172 — Development And Redevelopment Powers.
Section 469.173 — Administration.
Section 469.1731 — Border City Development Zones.
Section 469.1732 — Tax Incentives Within Development Zones.
Section 469.1733 — Disqualified Taxpayers.
Section 469.1734 — Tax Incentives Outside Zones.
Section 469.1735 — Limit On Tax Reductions; Applications Required.
Section 469.174 — Definitions.
Section 469.175 — Establishing, Changing Plan, Annual Accounts.
Section 469.176 — Limitations.
Section 469.1761 — Income Requirements; Housing Districts.
Section 469.1762 — Arbitration Of Disputes Over County Costs.
Section 469.1763 — Restrictions On Pooling; Five-year Limit.
Section 469.177 — Computation Of Tax Increment.
Section 469.1771 — Violations.
Section 469.178 — Tax Increment Bonding.
Section 469.1781 — Required Spending For Neighborhood Revitalization.
Section 469.1782 — Special Law Provisions.
Section 469.179 — Existing Projects; Effective Dates Of Amendments.
Section 469.1792 — Special Deficit Authority.
Section 469.1793 — Developer Obligations Continued.
Section 469.1794 — Duration Extension To Offset Deficits.
Section 469.180 — Development Pacts With Entities Of Other States.
Section 469.1811 — Property Tax Exempt; Agricultural Processing Facility.
Section 469.1812 — Definitions.
Section 469.1813 — Abatement Authority.
Section 469.1814 — Bonding Authority.
Section 469.1815 — Administrative.
Section 469.182 — Employment Bureaus; First Class Cities.
Section 469.183 — Bonds For Municipal Market; First Class Cities.
Section 469.1831 — Neighborhood Revitalization Program; First Class City.
Section 469.184 — Municipal Commercial Rehabilitation Loan Program.
Section 469.185 — Conveying Land To Promote Industry, Employment.
Section 469.186 — Bureau Of Information And Publicity; Statutory Cities.
Section 469.187 — First Class City Spending For Publicity; Publicity Board.
Section 469.188 — 2nd, 3rd Class City May Levy To Advertise Its Resources.
Section 469.189 — Spend To Advertise City; Statutory, 2nd, 3rd, 4th Class City.
Section 469.190 — Local Lodging Tax.
Section 469.191 — Contributions To Regional Or Local Organizations.
Section 469.192 — Economic Development Loans.
Section 469.193 — Foreign Trade Zones.
Section 469.194 — Lewis And Clark Water Project Bonding.
Section 469.201 — Definitions.
Section 469.202 — Designation Of Targeted Communities.
Section 469.203 — Targeted Community Revitalization And Financing.
Section 469.204 — Payment; Revolving Fund.
Section 469.205 — City Powers; Uses Of Targeted Community Money.
Section 469.206 — Hazardous Property Penalty.
Section 469.207 — Annual Audit And Report.
Section 469.309 — Rural Job Creation Grants.
Section 469.310 — Definitions.
Section 469.311 — Development Plan.
Section 469.312 — Job Opportunity Building Zones; Limitations.
Section 469.313 — Application For Designation.
Section 469.314 — Designation Of Job Opportunity Building Zones.
Section 469.315 — Tax Incentives Available In Zones.
Section 469.316 — Individual Income Tax Exemption.
Section 469.317 — Corporate Franchise Tax Exemption.
Section 469.318 — Jobs Credit.
Section 469.3181 — Create Automotive Recovery Jobs Credit.
Section 469.319 — Repayment Of Tax Benefits By Businesses That No Longer Operate In A Zone.
Section 469.3191 — Breach Of Agreements By Businesses That Continue To Operate In Zone.
Section 469.3192 — Prohibition Against Amendments To Business Subsidy Agreement.
Section 469.3193 — Certification Of Continuing Eligibility For Jobz Benefits.
Section 469.320 — Zone Performance; Remedies.
Section 469.35 — Transit Improvement Area Accounts.
Section 469.351 — Transit Improvement Area Loan Program.
Section 469.41 — Destination Medical Center Corporation Established.
Section 469.42 — Officers; Duties; Organizational Matters.
Section 469.43 — Development Plan.
Section 469.44 — City Powers, Duties; Authority To Issue Bonds.
Section 469.45 — City Tax Authority.
Section 469.46 — County Tax Authority.
Section 469.47 — State Infrastructure Aid.
Section 469.51 — Regional Exchange District.
Section 469.52 — City Powers; Duties.
Section 469.53 — Regional Exchange District Public Infrastructure Projects.