SF1155

Purpose

Explain and authorize a temporary sales and use tax relief for building materials and equipment used in constructing an ice rink in the city of Delano. The bill creates a refundable exemption so eligible purchases are taxed upfront and then refunded.

Main Provisions

• Exemption for construction materials and equipment
  • Materials, supplies, and equipment used in the construction, reconstruction, upgrade, expansion, renovation, or remodeling of an ice rink in Delano are exempt from sales and use tax.
  • Eligibility requires purchase between November 30, 2023 and December 31, 2025 (i.e., before January 1, 2026).
• How the exemption works
  • Taxes are charged as if at the normal rate under Minnesota law, and then refunded to the purchaser under the same process used for eligible projects.
  • Refunds for eligible purchases are issued after June 30, 2025.
• Funding
  • The money to pay these refunds comes from an appropriation from the general fund to the commissioner of revenue.

Scope and Criteria

• What is covered
  • Construction materials, supplies, and equipment used or consumed in the listed construction activities for the Delano ice rink.
• Where it applies
  • Only for the city of Delano.
• Time period
  • Purchases must occur between November 30, 2023 and December 31, 2025 (before January 1, 2026).

Funding and Administration

• Financing
  • An appropriation from the general fund covers the refunds.
• Administration
  • Refunds are processed using the existing refund framework described in Minnesota statutes (referenced provisions 297A.75, etc.).

Notable Changes to Law

• Creates a temporary, refundable sales and use tax exemption specifically for a Delano ice rink project.
• Establishes a formal funding mechanism to reimburse the refunded amounts.
• Sets explicit administrative timing for when refunds will be issued (on or after June 30, 2025).

Likely Impact

• Reduces the effective cost of constructing the Delano ice rink by offsetting sales tax through refunds.
• Provides a clearly defined budgetary and administrative path for issuing refunds.

Implementation Notes

• The exemption is not permanent and ends for purchases after the eligibility window.
• Purchasers must follow the established refund process; refunds are contingent on the appropriation and the state budget.

Relevant Terms - sales tax - use tax - exemption - refundable exemption - refunds - construction materials - ice rink - Delano - Minnesota Statutes 297A - 297A.62 - 297A.75 - general fund - commissioner of revenue - appropriation - eligibility window - purchase date window - refunds after June 30, 2025