The proposed bill establishes a "redevelopment area homestead credit" designed to provide tax relief for properties classified as 1a or 1b located in designated redevelopment areas recognized by the U.S. Department of Commerce. The credit will be calculated at 70% of the property's net tax capacity multiplied by the city capital debt tax rate. County auditors will be responsible for determining the tax reductions and certifying these amounts to the commissioner of revenue, who will reimburse local taxing jurisdictions for the reductions granted. An annual appropriation from the general fund is mandated to cover these reimbursements, with the program set to take effect for taxes payable in 2027.

Additionally, the bill amends several sections of the Minnesota Statutes to integrate the new homestead credit into existing tax frameworks, ensuring it is included in the computation of net property taxes. It requires cities with eligible properties to certify the portion of their levies used for capital improvement bonds and enhances transparency in tax statements by mandating the inclusion of the redevelopment area homestead credit in taxpayer notices. The bill also updates property tax statement requirements to provide clearer information to taxpayers, including details such as estimated market value and applicable credits, and allows counties to include notices from taxing districts about upcoming budget deliberations in property tax statement envelopes. These changes will also take effect for taxes payable in 2027.

Statutes affected:
Introduction: 273.1392, 273.1393, 275.065, 275.07, 275.08, 276.04