Subdivision 1. Authority. The governing body of a political subdivision may grant a current or prospective abatement, by contract or otherwise, of the taxes imposed by the political subdivision on a parcel of property, which may include personal property and machinery, or defer the payments of the taxes and abate the interest and penalty that otherwise would apply, if:
(1) it expects the benefits to the political subdivision of the proposed abatement agreement to at least equal the costs to the political subdivision of the proposed agreement or intends the abatement to phase in a property tax increase, as provided in clause (2)(vii); and
(2) it finds that doing so is in the public interest because it will:
(i) increase or preserve tax base;
(ii) provide employment opportunities in the political subdivision;
(iii) provide or help acquire or construct public facilities;
(iv) help redevelop or renew blighted areas;
(v) help provide access to services for residents of the political subdivision;
(vi) finance or provide public infrastructure;
(vii) phase in a property tax increase on the parcel resulting from an increase of 50 percent or more in one year on the estimated market value of the parcel, other than increase attributable to improvement of the parcel; or
(viii) stabilize the tax base through equalization of property tax revenues for a specified period of time with respect to a taxpayer whose real and personal property is subject to valuation under Minnesota Rules, chapter 8100.
Subd. 1a. Use of term. As used in this section and sections 469.1814 and 469.1815, "abatement" includes a deferral of taxes with abatement of interest and penalties unless the context indicates otherwise.
Subd. 2. Abatement resolution. (a) The governing body of a political subdivision may grant an abatement only by adopting an abatement resolution, specifying the terms of the abatement. In the case of a town, the board of supervisors may approve the abatement resolution. The resolution must also include a specific statement as to the nature and extent of the public benefits which the governing body expects to result from the agreement. The resolution may provide that the political subdivision will retain or transfer to another political subdivision the abatement to pay for all or part of the cost of acquisition or improvement of public infrastructure, whether or not located on or adjacent to the parcel for which the tax is abated. The abatement may reduce all or part of the property tax amount for the political subdivision on the parcel. A political subdivision's maximum annual amount for a parcel equals its total local tax rate multiplied by the total net tax capacity of the parcel.
(b) The political subdivision may limit the abatement:
(1) to a specific dollar amount per year or in total;
(2) to the increase in property taxes resulting from improvement of the property;
(3) to the increases in property taxes resulting from increases in the market value or tax capacity of the property;
(4) in any other manner the governing body of the subdivision determines is appropriate; or
(5) to the interest and penalty that would otherwise be due on taxes that are deferred.
(c) The political subdivision may not abate tax attributable to the areawide tax under chapter 276A or 473F, except as provided in this subdivision.
Subd. 3. School district abatements. An abatement granted under this section is not an abatement for purposes of state aid or local levy under sections 127A.40 to 127A.51.
Subd. 4. Property located in tax increment financing districts. The governing body of a political subdivision may not enter into a property tax abatement agreement under sections 469.1812 to 469.1815 that provides for abatement of taxes on a parcel, if the abatement will occur while the parcel is located in a tax increment financing district.
Subd. 5. Notice and public hearing. (a) The governing body of the political subdivision may approve an abatement under sections 469.1812 to 469.1815 only after holding a public hearing on the abatement.
(b) Notice of the hearing must be published in a newspaper of general circulation in the political subdivision at least once more than ten days but less than 30 days before the hearing. The newspaper must be one of general interest and readership in the community, and not one of limited subject matter. The newspaper must be published at least once per week. The notice must indicate that the governing body will consider granting a property tax abatement, identify the property or properties for which an abatement is under consideration, and the total estimated amount of the abatement.
Subd. 6. Duration limit. (a) A political subdivision may grant an abatement for a period no longer than 15 years, except as provided under paragraph (b). The abatement period commences in the first year in which the abatement granted is either paid or retained in accordance with section 469.1815, subdivision 2. The subdivision may specify in the abatement resolution a shorter duration. If the resolution does not specify a period of time, the abatement is for eight years. If an abatement has been granted to a parcel of property and the period of the abatement has expired, the political subdivision that granted the abatement may not grant another abatement for eight years after the expiration of the first abatement. This prohibition does not apply to improvements added after and not subject to the first abatement. Economic abatement agreements for real and personal property subject to valuation under Minnesota Rules, chapter 8100, are not subject to this prohibition and may be granted successively.
(b) A political subdivision proposing to abate taxes for a parcel may request, in writing, that the other political subdivisions in which the parcel is located grant an abatement for the property. If one of the other political subdivisions declines, in writing, to grant an abatement or if 90 days pass after receipt of the request to grant an abatement without a written response from one of the political subdivisions, the duration limit for an abatement for the parcel by the requesting political subdivision and any other participating political subdivision is increased to 20 years. If the political subdivision which declined to grant an abatement later grants an abatement for the parcel, the 20-year duration limit is reduced by one year for each year that the declining political subdivision grants an abatement for the parcel during the period of the abatement granted by the requesting political subdivision. The duration limit may not be reduced below the limit under paragraph (a).
Subd. 6a. Deferment payment schedule. When the tax is deferred and the interest and penalty abated, the political subdivision must set a schedule for repayments. The deferred payment must be included with the current taxes due and payable in the years the deferred payments are due and payable and must be levied accordingly.
Subd. 6b. Extended duration limit; utilities. Notwithstanding the provisions of subdivision 6, a political subdivision may grant an abatement for a period of up to 20 years, if the abatement is for a taxpayer whose real and personal property is subject to valuation under Minnesota Rules, chapter 8100.
Subd. 7. Review and modification of abatements. The political subdivision may provide in the abatement resolution that the abatement may not be modified or changed during its term. If the abatement resolution does not provide that the abatement may not be modified or changed, the governing body of the political subdivision may review and modify the abatement every second year after it was approved.
Subd. 8. Limitation on abatements. In any year, the total amount of property taxes abated by a political subdivision under this section may not exceed (1) ten percent of the net tax capacity of the political subdivision for the taxes payable year to which the abatement applies, or (2) $200,000, whichever is greater. The limit under this subdivision does not apply to:
(i) an uncollected abatement from a prior year that is added to the abatement levy; or
(ii) a taxpayer whose real and personal property is subject to valuation under Minnesota Rules, chapter 8100.
Subd. 9. Consent of property owner not required. A political subdivision may abate the taxes on a parcel under sections 469.1812 to 469.1815 without obtaining the consent of the property owner. This subdivision does not apply to abatements granted to a taxpayer whose real and personal property is valued under Minnesota Rules, chapter 8100.
Subd. 10. Applicability to utility properties. When this statute is applied or utilized with respect to a taxpayer whose real and personal property is subject to valuation under Minnesota Rules, chapter 8100, the provisions of this section and sections 469.1814 and 469.1815 shall apply only to property specified or described in the abatement contract or agreement.
1997 c 231 art 2 s 46; 1998 c 397 art 11 s 3; 1999 c 243 art 10 s 8-14; 1999 c 248 s 19; 2000 c 490 art 11 s 33-35; 1Sp2001 c 5 art 15 s 26; 2002 c 377 art 7 s 5; 2003 c 127 art 10 s 26; art 12 s 19; 1Sp2003 c 21 art 10 s 11; 2005 c 152 art 1 s 17; 2006 c 259 art 4 s 14-19; 2008 c 366 art 6 s 43; 2012 c 294 art 2 s 41
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.