This bill allows cities and counties in Minnesota to implement local sales taxes specifically for designated capital projects, such as convention centers, libraries, parks, sports complexes, and trails. It establishes a framework for the distribution of local sales tax revenues and mandates oversight by the state auditor. Key amendments include the addition of a new subdivision to Minnesota Statutes 2022, section 297A.99, which clarifies that these provisions apply only to taxes enacted by special law and outlines the process for amending or extending such taxes. The bill also repeals a previous subdivision that permitted certain political subdivisions to impose local sales taxes without a referendum under specific conditions.

Additionally, the bill introduces stringent requirements for voter approval and public hearings before local sales taxes can be imposed. It specifies that tax revenues can only fund projects approved by voters and mandates that any unspent funds be returned to the state. Political subdivisions are prohibited from using funds to promote tax referendums, and they must submit ballot language to the state auditor for approval. The bill also requires legislative approval for local sales taxes that do not meet specified criteria and establishes a local sales tax equalization distribution system for revenue sharing among qualified recipients. The effective date for these changes is the day following final enactment, and a temporary moratorium on local sales tax activities is repealed, effective July 1, 2024.

Statutes affected:
Introduction: 297A.99