HF 4265

as introduced - 93rd Legislature (2023 - 2024) Posted on 02/26/2024 02:21pm

A bill for an act
relating to taxation; property; allowing property tax abatement for land bank
property; amending Minnesota Statutes 2022, sections 469.1812, by adding a
subdivision; 469.1813, subdivisions 1, 6.

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

Section 1.

Minnesota Statutes 2022, section 469.1812, is amended by adding a subdivision
to read:

new text begin Subd. 2a. new text end

new text begin Land bank organization. new text end

new text begin "Land bank organization" means an organization
that, at least in part, acquires, holds, or manages vacant, blighted, foreclosed, or tax-forfeited
property for future development, redevelopment, or disposal, and that is either:
new text end

new text begin (1) a nonprofit organization exempt from federal income taxation under section 501(c)(3)
of the Internal Revenue Code whose governing board members are elected or appointed by
the state of Minnesota, any political subdivision of the state of Minnesota, or an agency of
the state of Minnesota or its political subdivisions, or are elected or appointed officials of
the state of Minnesota or any of its political subdivisions; or
new text end

new text begin (2) a limited liability company of which a nonprofit organization described in clause (1)
is the sole member.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment.
new text end

Sec. 2.

Minnesota Statutes 2022, section 469.1813, subdivision 1, is amended to read:

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; deleted text begin or
deleted text end

(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 new text begin ;
new text end

new text begin (ix) provide for the development of affordable housing to households at or below 80
percent of area median income; or
new text end

new text begin (x) allow the property to be held by a land bank organization for future development new text end .

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment.
new text end

Sec. 3.

Minnesota Statutes 2022, section 469.1813, subdivision 6, is amended to read:

Subd. 6.

Duration limit.

(a) A political subdivision may grant an abatement for a period
no longer than 15 years, except as provided under deleted text begin paragraph deleted text end new text begin paragraphs new text end (b) new text begin and (c) new text end . 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).

new text begin (c) An abatement under subdivision 1, clause (2), items (ix) and (x), may be granted for
a period no longer than five years. This limit also applies if the resolution does not specify
a period of time.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for abatement resolutions approved after
the day following final enactment.
new text end