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TERC adopts updated procedures, repeals small alcohol-producer tax bundle and votes on multiple tax-expenditure actions
Summary
The Tax Expenditure Review Commission on June 17 adopted updated evaluation procedures, recommended repeal of the Small Alcohol Producers Credit bundle (leaving out the Small Winery Credit after a separate vote), modified the Data Center Equipment Exemption, and voted to continue other tax-expenditure bundles; roll-call tallies were recorded for each motion.
The Tax Expenditure Review Commission voted June 17 to adopt revised evaluation procedures and took a series of formal actions on tax-expenditure items brought by the Legislative Budget Office (LBO).
Co-Chair Greg Davids moved to adopt updated TERC evaluation procedures to replace the version adopted Dec. 10, 2025; the motion passed on a roll call with five AYES, zero NAYS and four members excused. Christian Larson, director with the LBO, presented the proposed procedural changes before the vote.
The commission then considered evaluations of alcohol-related credits. Christian Larson reviewed aggregated member evaluations of the Credit for Small Brewers (7.2.01) and the Microdistillery Credit (7.2.02). Co-Chair Esther Agbaje moved to remove the Small Winery Credit (7.2.03) from the Small Alcohol Producers Credit bundle because responses for that particular credit did not meet the quorum requirement in the TERC procedures; that motion carried 5–0 with four members excused. Agbaje renewed a motion to recommend repeal of the modified Small Alcohol Producers Credit bundle (retaining 7.2.01 and 7.2.02); the roll call was 4 AYES, 1 NAY (Commissioner Paul Marquart), and 4 EXCUSED, and the commission adopted the recommendation to repeal the bundle as modified.
On the Lawful Gambling bundle (including items 11.1.01–11.1.05 and 11.2.01), the commission voted to continue those tax expenditures under the duties established in Minnesota Statutes, section 3.8855; the motion, moved by Co-Chair Agbaje, passed 5–0 with four excused members.
The commission also voted to continue the Residential Utility Services bundle (Residential Heating Fuels 4.1.14, Residential Water Services 4.1.15, Sewer Services 4.1.16). Co-Chair Greg Davids moved to continue the bundle and the roll call recorded five AYES, zero NAYS and four members excused.
For the Data Center Equipment Exemption (4.2.12), Davids initially moved to continue the exemption but withdrew that motion and instead moved to recommend a modification; the commission approved the recommendation to modify the exemption by a 5–0 roll call (four excused).
The commission recorded roll-call tallies on each motion. Members recorded as voting AYE on the motions referenced above were Rep. Esther Agbaje (Co-Chair), Rep. Greg Davids (Co-Chair), Sen. Doron Clark (Vice Chair), Sen. Mark Koran and Commissioner Paul Marquart, except where an individual NAY was recorded (see vote details). Four members were excused: Sen. Matt Klein, Rep. Kristin Robbins, Rep. Andy Smith and Sen. Bill Weber.
Director Larson and LBO staff presented multiple evaluation reports and initial reviews during the meeting; the commission adopted proposed evaluation objectives for the Metropolitan Agricultural Preserves Land (13.2.05), the Metropolitan Agricultural Preserves Credit (13.3.03), and Special Use Valuation (3.1.01), directing the LBO to proceed with evaluations in accordance with Minnesota Statutes section 3.8855.
The meeting closed with a scheduling note: several evaluations (Mortgage Registration Tax evaluations for agricultural loans and government housing, and a set of DEED transfer items) were deferred to the July meeting due to time constraints. The commission adjourned at 1:32 PM.
