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Tax Base Change for Low-Income Rental Property — Effective for assessment years 2022 and 2023,
<br /> the first-tier limit for class 4d low-income rental property is reduced from $174,000 to $100,000, with
<br /> class rates remaining at 0.75 percent on the first$100,000 and 0.25 percent on the remaining balance. The
<br /> tier limit will once again be adjusted annually after assessment year 2023.
<br /> Local Sales Tax Projects Defined—Minnesota cities are authorized to include up to five capital projects
<br /> in proposals for local sales taxes. The definition of a capital project for this purpose was updated to
<br /> include: a single building or structure, including associated infrastructure; improvements within a single
<br /> park or recreation area,or; a contiguous trail.
<br /> Tax Increment Financing (TIF) Flexibility — The Legislature enacted several measures that provide
<br /> additional flexibility for TIF spending,including:
<br /> • Allowing unobligated TIF to be used to provide loans, interest rate subsidies, or other assistance
<br /> to private developers for the construction or substantial rehabilitation of buildings and ancillary
<br /> facilities, if doing so will create jobs. Transfer authority expires on December 31, 2022, and all
<br /> transferred increment must be spent by December 31,2025,or returned to the TIF district.
<br /> • Allowing TIF districts that have elected to increase pooling by 10 percent to use the increment for
<br /> owner-occupied housing that meets the requirements of a housing TIF district, in addition to
<br /> current low-income rental housing.
<br /> • Providing three-year extensions of the five-year and six-year rules for redevelopment districts
<br /> created after December 31,2017,but before June 30,2020,thereby extending their duration.
<br /> • Creating a three-city pilot program, giving temporary authority to transfer unobligated housing
<br /> TIF district increment to the cities affordable housing trust funds.
<br /> Sales and Use Tax Refund Process — Effective for purchases made after June 30, 2021, cities and other
<br /> local governments are allowed to utilize a streamlined process to secure a sales tax refund on construction
<br /> materials purchased by a contractor on behalf of the city for construction, remodeling, expansion, or
<br /> improvement of public safety facilities owned by local governments, such as police and fire stations. The
<br /> process also applies to materials used in related facilities, such as access roads, lighting, sidewalks, and
<br /> utility components. Under the process, local governments would continue to initially pay sales tax on
<br /> these materials, but would then be allowed to file for a refund of the sales tax paid. Contractors would be
<br /> required to provide the local government with the information necessary to file for the refund.
<br /> Fire Protection Special Taxing District Authority — Effective for property tax levies payable in 2023
<br /> and thereafter,the current law giving emergency medical districts taxing authority is expanded to include
<br /> fire protection districts. Two or more local units of government are now permitted to establish a special
<br /> taxing district to provide fire protection, emergency medical services, or both. The special taxing district
<br /> will have authority to levy property taxes to finance district operations, spread either across the entire
<br /> district at a set rate, or allocated to each participating jurisdiction based on factors, such as population or
<br /> service calls. Districts will also have authority to issue debt related to the function of the district. The
<br /> property tax and debt issuance authority also apply to existing districts established prior to June 30,2021.
<br /> Open Meeting Law—The Legislature made several pandemic-related changes to the Open Meeting Law,
<br /> including removing the statutory cap of three times per year for elected officials to utilize a medical
<br /> exception for attending meetings remotely between January 1, 2021, and July 1, 2021, and removing the
<br /> requirement for elected officials participating in public meetings remotely, due to military service or
<br /> medical exceptions, to disclose their remote locations. The law changes also updated the definition of
<br /> "interactive technology"to replace "interactive television"throughout the text of the Open Meeting Laws,
<br /> and added requirements for public bodies meeting remotely to enable remote participation by the public
<br /> free of charge and enable public comment from remote locations,when practical.
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