Senate Taxes Committee hears TIF-extension and sales-tax exemption requests; bills laid over

The Minnesota Senate Taxes Committee heard a slate of tax-related bills on March 26 that would extend deadlines for tax-increment financing (TIF) districts or create/refine sales- and use-tax exemptions for construction materials and public infrastructure. Committee members laid each bill over for further consideration.

The largest development discussed was Senate File 2,407, a measure to extend a statutory five-year rule for a single TIF district covering the Highland Bridge (formerly the Ford Site) in St. Paul. Melanie McMahon, deputy director of the Department of Planning and Economic Development for the City of St. Paul, told the committee the site’s plan “supports nearly 4,000 housing units, 20% of which will be affordable,” and said the site’s horizontal infrastructure work — streets, utilities and stormwater systems for 120 acres — began before the COVID-19 pandemic and slowed because of higher construction costs and market conditions. McMahon said the bill would extend the 5-year rule by an additional five years and applies only to that one TIF district.

Also before the committee were several smaller TIF-extension requests from cities seeking more time to use unobligated TIF increment created or extended by a 2021 session law. Senator Shaw presented Senate File 2,083 on behalf of the City of Oakdale; John Stark, special projects manager for the City of Oakdale, said the Tanner’s Lake redevelopment would include “26 apartment units and 12 townhomes” with trails and lakeshore amenities and that “this project would not be feasible without the use of tax increment financing.”…