This bill amends Minnesota Statutes to provide market value exclusions for certain railroad properties, specifically targeting improvements made for public transit, safety, and environmental safety. It introduces new subdivisions under sections 270.84 and 273.11, which outline the criteria for these exclusions. For instance, improvements must have been made after January 1, 2016, and must meet specific conditions related to public transit programs, safety enhancements funded by state or federal programs, and emission reduction efforts. The commissioner of revenue is tasked with estimating the market value of the railroad property in the assessment year following the notification of improvements, and applications for these exclusions must be submitted by December 31 each year to be effective for the following tax year.

Additionally, the bill modifies the calculation of the yield capitalization rate for determining the unit value of railroad property, requiring the commissioner to compare rates with neighboring states and adjust accordingly. The effective date for the yield capitalization rate adjustment is set for taxes payable in 2025, while the valuation exclusions for improvements are effective retroactively for the assessment year 2024. This legislative change aims to incentivize improvements in railroad infrastructure that align with public transit goals, safety standards, and environmental regulations.

Statutes affected:
Introduction: 270.84, 273.11