This bill modifies the eligibility criteria for redevelopment districts under tax increment financing (TIF) in Minnesota by introducing new definitions and conditions. It specifies that a redevelopment district must consist of parcels with at least 70% of the area occupied by buildings, with a required percentage of those buildings being structurally substandard or in need of substantial renovation. The bill also repeals provisions related to renewal and renovation districts, streamlining the types of districts eligible for TIF. Additionally, it increases the maximum duration for redevelopment districts from 15 to 20 years while maintaining a 25-year limit for other types of districts. It mandates that at least 75% of the revenue from tax increments must be spent on activities within the district.

Furthermore, the bill establishes a pooling percentage of 20% for districts, excluding redevelopment districts certified after June 30, 1995, and allows for an increase in expenditures for housing outside the district under specific low-income criteria. It clarifies that administrative expenses are generally considered expenditures outside the district unless they pertain to activities described in the bill. The effective date for these changes is set for districts requesting certification after June 30, 2025. Overall, the amendments aim to enhance the flexibility and effectiveness of TIF in supporting housing projects and addressing deficits within districts.

Statutes affected:
Introduction: 469.174, 469.175, 469.176, 469.1763, 273.1382, 469.177