HF 1062

as introduced - 84th Legislature (2005 - 2006) Posted on 12/15/2009 12:00am

A bill for an act
relating to economic development; creating the airport
areas development fund; proposing coding for new law
in Minnesota Statutes, chapter 116J.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

AIRPORT AREAS DEVELOPMENT FUND

Section 1.

new text begin [116J.582] CREATION OF ACCOUNT.
new text end

new text begin (a) An airport areas development account is created in the
general fund. Money in the account may be used, as appropriated
by law, to make grants as provided in section 116J.585 and to
pay for the commissioner's costs in reviewing applications and
making grants.
new text end

new text begin (b) Notwithstanding anything to the contrary in section
297A.94, to the extent revenues in any fiscal year derived from
sales taxes imposed under chapter 297A, on airport sales exceed
the level of revenue for the fiscal year ending in 2005, the
excess revenues up to $4,000,000 are appropriated annually to
the airport areas development account beginning in the fiscal
year ending in 2007 and ending in 2026. The percentage of
excess revenues to be paid by individual qualified airports in
each year must equal the percentage of total excess revenues at
that qualified airport compared to the total excess revenues at
all qualified airports for that year. The legislature may
appropriate additional funds to the airport areas development
account in order to meet the needs of the statewide aviation
transportation plan.
new text end

Sec. 2.

new text begin [116J.583] DEFINITIONS.
new text end

new text begin Subdivision 1. new text end

new text begin Scope of application. new text end

new text begin For purposes of
sections 116J.582 to 116J.587, the following terms have the
meanings given.
new text end

new text begin Subd. 2. new text end

new text begin Airport area economic development
zone. new text end

new text begin "Airport area economic development zone" means an area
adjacent to or within two miles of an existing airport in which
the existing land uses are deemed by the commissioner to be
incompatible with airport activity.
new text end

new text begin Subd. 3. new text end

new text begin Airport sales. new text end

new text begin "Airport sales" mean sales that
are taxable under chapter 297A, and vending, merchandise, and
pay telephones. Airport sales do not include the sales of goods
or taxable services purchased by persons or entities conducting
a private trade or business on airport property or by airport
owners or operators, including the Metropolitan Airports
Commission.
new text end

new text begin Subd. 4. new text end

new text begin Development authority. new text end

new text begin "Development authority"
includes a statutory or home rule charter city, county, housing
and redevelopment authority, economic development authority, and
a port authority.
new text end

new text begin Subd. 5. new text end

new text begin Development costs. new text end

new text begin "Development costs" or
"costs" means the costs of developing and implementing an
economic development plan.
new text end

new text begin Subd. 6. new text end

new text begin High wage jobs. new text end

new text begin "High wage jobs" means new jobs
paying a wage that exceeds $15 per hour in the metropolitan area
and $12 per hour outside the metropolitan area.
new text end

new text begin Subd. 7. new text end

new text begin Metropolitan area. new text end

new text begin "Metropolitan area" means
the seven-county metropolitan area, as defined in section
473.121, subdivision 2.
new text end

new text begin Subd. 8. new text end

new text begin Municipality. new text end

new text begin "Municipality" means the
statutory or home rule charter city, town, or, in the case of
unorganized territory, the county in which the site is located.
new text end

new text begin Subd. 9. new text end

new text begin Project costs. new text end

new text begin "Project costs" includes
economic development costs for the site and the cost of related
site acquisition, demolition of existing improvements, and
installation of public improvements necessary for the
development authority to implement the economic development plan.
new text end

new text begin Subd. 10. new text end

new text begin Qualified airport. new text end

new text begin "Qualified airport" means
an airport that meets the Federal Aviation Administration's
definition of a commercial service airport. In addition, upon
application by an airport that does not currently meet the
definition of a commercial service airport, the commissioner of
transportation may designate that airport as a qualified
airport. In making the decision to designate, the commissioner
shall consider the priorities set forth in section 116J.586.
new text end

Sec. 3.

new text begin [116J.584] GRANT APPLICATIONS.
new text end

new text begin Subdivision 1. new text end

new text begin Application required. new text end

new text begin To obtain an
airport area development grant, the development authority shall
apply to the commissioner. The governing body of the
municipality must approve, by resolution, the application.
new text end

new text begin Subd. 2. new text end

new text begin Required content. new text end

new text begin The commissioner shall
prescribe and provide the application form. The application
must include at least the following information:
new text end

new text begin (1) identification of the site;
new text end

new text begin (2) an economic development plan for the site, including
any specific commitments from third parties to construct
improvements on the site;
new text end

new text begin (3) a detailed estimate, along with necessary supporting
evidence, of the total costs for the proposed development on the
site;
new text end

new text begin (4) an appraisal of the current market value of the
property prepared by a qualified independent appraiser using
accepted appraisal methodology;
new text end

new text begin (5) the manner in which the municipality will meet the
local match requirement in section 116J.587; and
new text end

new text begin (6) any additional information or material that the
commissioner prescribes.
new text end

Sec. 4.

new text begin [116J.585] GRANTS.
new text end

new text begin Subdivision 1. new text end

new text begin Authority. new text end

new text begin (a) The commissioner may make
a grant to an applicant development authority to pay for up to
75 percent of the project costs for a qualifying site.
new text end

new text begin (b) The commissioner may also make a grant to an applicant
to fill a site that would represent more than 50 percent of the
remaining land in a city suitable for industrial development if
it were properly filled.
new text end

new text begin (c) The determination of whether to make a grant for a
qualifying site is within the sole discretion of the
commissioner, subject to the process provided by this section,
and available unencumbered money in the appropriation. The
commissioner's decisions and application of the priorities under
section 116J.586 are not subject to judicial review, except for
abuse of discretion.
new text end

new text begin Subd. 2. new text end

new text begin Metropolitan livable communities. new text end

new text begin The
commissioner may not make a grant to a municipality in the
metropolitan area unless it is participating in the local
housing incentives program under section 473.254.
new text end

new text begin Subd. 3. new text end

new text begin Qualifying sites. new text end

new text begin A site qualifies for a grant
under this section, if the following criteria are met:
new text end

new text begin (1) the site is in an airport area economic development
zone;
new text end

new text begin (2) the economic development plan sets forth a future use
for the site that is compatible with current and anticipated
future airport operations;
new text end

new text begin (3) if the proposed economic development project is
completed, it is expected that the site will be improved with
buildings or other improvements and these improvements will
provide a substantial increase in the property tax base within a
reasonable period of time or the site will be used for an
important publicly owned or tax-exempt facility; and
new text end

new text begin (4) the proposed use is consistent with sections 360.061 to
360.074.
new text end

Sec. 5.

new text begin [116J.586] PRIORITIES.
new text end

new text begin Subdivision 1. new text end

new text begin Priorities. new text end

new text begin (a) The legislature expects
that applications for grants will exceed the available
appropriations and the agency will be able to provide grants to
only some of the applicant development authorities.
new text end

new text begin (b) If applications for grants for qualified sites exceed
the available appropriations, the agency shall make grants for
sites that, in the commissioner's judgment, provide the highest
return in public benefits for the public costs incurred and that
meet all the requirements provided by law. In making this
judgment, the commissioner shall consider the following factors:
new text end

new text begin (1) the severity of existing or potential impacts on public
health and quality of life;
new text end

new text begin (2) the effect of the economic development project on
reducing existing or potential threats to public health or
quality of life, including the adverse effects of environmental
noise and aircraft-related pollution, that would be reduced or
eliminated by completion of each of the economic development
plans;
new text end

new text begin (3) the potential increase in the property tax base of the
local taxing jurisdictions, considered relative to the fiscal
needs of the jurisdictions, that will result from developments
that will occur because of completion of each of the economic
development plans;
new text end

new text begin (4) the social value to the community of the redevelopment
of the site, including the importance of development of the
proposed public facilities on each of the sites;
new text end

new text begin (5) the probability that each site will be redeveloped
without use of government money in the reasonably foreseeable
future;
new text end

new text begin (6) the economic development plan anticipates the creation
of high-wage jobs;
new text end

new text begin (7) the amount of the commitment of municipal or other
local resources to pay for the economic development costs;
new text end

new text begin (8) the future uses described in the economic development
plan are related to airport operations or the aviation industry
or are uses that will benefit from close proximity to an
airport; and
new text end

new text begin (9) compatibility with statewide aviation plans developed
by the Department of Transportation.
new text end

new text begin The factors are not listed in a rank order of priority;
rather the commissioner may weigh each factor, depending upon
the facts and circumstances, as the commissioner considers
appropriate. The commissioner may consider other factors that
affect the net return of public benefits for completion of the
economic development plan. The commissioner, notwithstanding
the listing of priorities and the goal of maximizing the return
of public benefits, shall make grants that distribute available
money to sites both within and outside of the metropolitan
area. The commissioner shall provide a written statement of the
supporting reasons for each grant. Unless sufficient
applications are not received for qualifying sites outside of
the metropolitan area, at least 35 percent of the money provided
as grants must be made for sites located outside of the
metropolitan area.
new text end

new text begin Subd. 2. new text end

new text begin Application cycles; reporting to legislature.
new text end

new text begin (a) In making grants, the commissioner shall establish
semiannual application deadlines in which grants will be
authorized from all or part of the available appropriations of
money in the account.
new text end

new text begin (b) After each semiannual cycle in which grants are
awarded, the commissioner shall report to the appropriation and
policy committees of the senate and house of representatives
with jurisdiction over transportation and economic development
the grants awarded and appropriate supporting information
describing each grant made. This report must be made within 30
days after the grants are awarded.
new text end

new text begin (c) The commissioner shall annually report to the
legislative committees in paragraph (b) on the status of the
economic development projects undertaken under grants made under
the programs. The commissioner shall include in the annual
report information on the economic development activities
undertaken for the grants made in that and previous fiscal
years. The commissioner shall make this report no later than
120 days after the end of the fiscal year.
new text end

Sec. 6.

new text begin [116J.587] LOCAL MATCH REQUIREMENT.
new text end

new text begin (a) In order to qualify for a grant under sections 116J.582
to 116J.586, the municipality must pay for at least one-quarter
of the project costs as a local match. The local match may be
paid with money from the municipality's general fund, a property
tax levy for that purpose, tax increments, regional, state, or
federal money available for the economic development, or any
other money available to the municipality.
new text end

new text begin (b) If the development authority establishes a tax
increment financing district or hazardous substance subdistrict
on the site to pay for part of the local match requirement, the
district or subdistrict is not subject to the state aid
reductions under section 273.1399. In order to qualify for the
exemption from the state aid reductions, the municipality must
elect, by resolution, on or before the request for certification
is filed that all tax increments from the district or
subdistrict will be used exclusively to pay (1) for project
costs for the site and (2) administrative costs for the district
or subdistrict. The district or subdistrict must be decertified
when an amount of tax increments equal to no more than three
times the costs of implementing the response action plan for the
site and the administrative costs for the district or
subdistrict have been received, after deducting the amount of
the state grant.
new text end