This bill proposes significant changes to Minnesota's taxation laws by repealing the sustainable aviation fuel income tax credit and the sales and use tax exemptions for data centers and the construction of sustainable aviation fuel facilities. The increased general fund revenue generated from these repealed tax provisions will be reallocated to enhance the renter's credit. Key amendments include a new subdivision in section 290.0693 that requires the commissioner of revenue to estimate the revenue increase from the repeal and adjust credit parameters accordingly. Additionally, section 297A.75 will be amended to remove specific exemptions related to data centers, including enterprise information technology equipment and computer software, with the repealed sections taking effect on July 1, 2025.

The bill also introduces definitions and criteria for "qualified data centers" and "qualified refurbished data centers," establishing requirements for size, construction costs, and operational features. A qualified data center must be at least 25,000 square feet and incur a minimum of $30 million in construction or refurbishment costs within 48 months, while a qualified refurbished data center must meet similar size requirements with a higher cost threshold of $50 million within 24 months. Furthermore, the bill establishes a new subdivision for "sustainable aviation fuel facilities," exempting materials and supplies used in their construction or improvement, with a tax refund mechanism similar to other projects. This subdivision will expire on July 1, 2034, but will not affect refunds for prior purchases, aiming to stimulate job creation in the construction and data center industries while promoting sustainable aviation fuel production.

Statutes affected:
Introduction: 290.0693, 297A.75