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<br /> '4 In 1999,the State Legislature adopted new regulations for the granting of business r . 3�,:
<br /> 0 - „.4, % subsidies by state and local government. These requirements replace the current 1 ,1.- -
<br /> '4, ' _ ` , wage and job goal reporting. The Business Subsidies Statutes are codified as i, i
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<br /> Minnesota Statutes, Section 116J.993 through 116J.995. This summary highlightsekionti wte
<br /> c ;,k, r the statutory requirements for business subsidies as amended by the Legislature in the - a _ a ,,',
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<br /> I ,n� , "4` 2000 session.
<br /> },'hri �`} The regulation of business subsidies adds new complexities to the development process. Make sure that you
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<br /> - understand the statutory requirements before providing direct or indirect assistance to any for-profit or
<br /> d k ' non-profit entity. If in doubt, ask questions. Many of these provisions are subject to interpretation.
<br /> : f'V ,,q, [ Who is subject to the Business Subsidy Statutes?
<br /> �� Any state or local government agency or public entity may be a "Grantor" under the Statutes. Potential
<br /> 4, Grantors include cities,counties,school districts,townships,economic development authorities,housing and
<br /> - '£ ' 5 redevelopment authorities, port authorities, and municipal utilities. Multiple grantors mayexist within a
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<br /> ' �N 4 single jurisdiction. Each Grantor must comply with the Statutes.
<br /> ' ; 'v What is a business subsidy?
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<br /> ` The Statutes set forth a definition and the specific exclusions for business subsidies. Both must be considered
<br /> �t- in determining if a specific action is a business subsidy and subject to the Statutes.
<br /> 'l- - A business subsidy is defined as "grant,contribution of personal property,real property,infrastructure, the
<br /> 93.E g w principal amount of a loan at rates below those commercially available to the recipient, any reduction or
<br /> `" deferral of any tax or any fee,any guarantee of any payment under any loan,lease,or other obligation,or any
<br /> 4 4 preferential use of government facilities given to a business". This definition covers many different forms of
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<br /> '":',,,'N', �' �>�� economic assistance.
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<br /> � ' ;;_, � The Statutes specifically excludes twenty-two items from the definition. The following are not business
<br /> « isr,IVu�.�,Q4, subsidies:
<br /> rte (a) a business subsidy of less than$25,000;
<br /> ,P ',...:.1-r,--,7;i44,"-,%',''14 (b) assistance that is generallyavailable to all businesses or to a general class of similar businesses,
<br /> -'.�°'re,- s4.t;,, such as a line of business, size,location, or similar general criteria;
<br /> �,, ,�,'4 ''�� (c) public improvements to buildings or lands owned by the state or local government that serve a
<br /> f� � public purpose and do not principally benefit a single business or defined group of businesses at
<br /> A , .� the time the improvements are made;
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<br /> - , 'f';'" (d) redevelopment property polluted by contaminants as defined in section 116J.552, subdivision 3;
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<br /> „ �,� }� , (e) assistance provided for the sole purpose of renovating old or decaying building stock or bringing
<br /> � p•si it up to code and assistance provided for designated historic preservation districts, provided that
<br /> r 'S,',„,',. '4','1.,,,,(,, , the assistance is equal to or less than 50% of the total cost;
<br /> T �grau�4,,A "A, (f) assistance to provide job readiness and training services if the sole purpose of the assistance is to
<br /> , ,,,ki,'�', provide those services;
<br /> "���� (g) assistance for housing;
<br /> '� � (h) assistance for pollution control or abatement, including assistance for a tax increment financing
<br /> hazardous substance subdistrict as defined under 469.174, subdivision 23;
<br /> "^ , (i) assistance for energy conservation;
<br /> -r,, 4` (j) tax reductions resulting from conformity with federal tax law;
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<br /> v ,` i. (k) workers' compensation and unemployment compensation;
<br /> , , T - (1) benefits derived from regulation;
<br /> {q) ?.< Sw � '„s ;, EHLERS&ASSOCIATES, INC. 3060 Centre Pointe Drive, Roseville, Minnesota 55113 651.697.8500
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