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<br /> ;: '�4, In 1999,the State Legislature adopted new regulations for the granting of business -4,, ,�
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<br /> subsidies by state and local government. These requirements replace the current ll ,-
<br /> "Xotowage and job goal reporting. The Business Subsidies Statutes are codified as t
<br /> ���,. NAel Minnesota Statutes, Section 116J.993 through 116J.995. This summary highlights
<br /> L$014..?,,,, ' . the statutory requirements for business subsidies as amended by the Legislature in the 4$ `,,� ,w 7r
<br /> .� '�,, 2000 session.
<br /> ''s' 4' The regulation of business subsidies adds new complexities to the development process. Make sure that you
<br /> ,, understand the statutory requirements before providing direct or indirect assistance to any for-profit or
<br /> Y , , non-profit entity. If in doubt, ask questions. Many of these provisions are subject to interpretation.
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<br /> }, k h Who is subject to the Business Subsidy Statutes?
<br /> • g,;'tom A, Any state or local government agency or public entity may be a "Grantor" under the.Statutes. Potential
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<br /> Grantors include cities,counties,school districts,townships,economic development authorities,housing and
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<br /> redevelopment authorities, port authorities, and municipal utilities. Multiple grantors may exist within a
<br /> n ; , single jurisdiction. Each Grantor must comply with the Statutes.
<br /> P- '� What is a business subsidy?
<br /> MA4� , ,�e't The Statutes set forth a definition and the specific exclusions for business subsidies. Both must be considered
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<br /> `• , A �� 9 in determining if a specific action is a business subsidy and subject to the Statutes.
<br /> • ',A-, A business subsidy is defined as"grant contribution of personal property,real property,infrastructure, the
<br /> ,, ' principal amount of a loan at rates below those commercially available to the recipient, any reduction or
<br /> ` '9gA deferral of any tax or any fee,any guarantee of any payment under any loan,lease,or other obligation,or any
<br /> 1,` $$1preferential use of government facilities given to a business". This definition covers many different forms of
<br /> ` , ���' ' economic assistance.
<br /> ",M�' �� The Statutes specifically excludes twenty-two items from the definition. The followingare not business
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<br /> ' "' 4'w subsidies: y
<br /> • e y Fk; (a) a business subsidy of less than$25,000;
<br /> , ''c -4 f (b) assistance that is generally available to all businesses or to a general class of similar businesses,
<br /> ,Ai,h�� ''� such as a line of business, size,location, or similar general criteria;
<br /> , � ? r (c) public improvements to buildings or lands owned by the state or local government that serve a
<br /> " 'A- r,',-P ,,, public purpose and do not principally benefit a single business or defined group of businesses at
<br /> , }, : 'q-,� 4 the time the improvements are made;
<br /> h5 o (d) redevelopment property polluted by contaminants as defined in section 116J.552, subdivision 3;
<br /> t , -" ,t„',- (e) assistance provided for the sole purpose of renovating old or decaying building stock or bringing
<br /> hr K, z7 it up to code and assistance provided for designated historic preservation districts, provided that
<br /> ,:' x� ''' €'"''' , the assistance is equal to or less than 50% of the total cost;
<br /> J d- (f) assistance to provide job readiness and training services if the sole purpose of the assistance is to
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<br /> ;,- , X1 4 , *, provide those services;
<br /> ” 7 (g) assistance for housing;
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<br /> r� ‘'''',,,,'',:e;�.,� ��;'',�� (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 /> � ,� n�f��i�,��,x�� (i) assistance for energy conservation;
<br /> ,,,,,,4-'N.i � ,7 (j) tax reductions resulting from conformity with federal tax law;
<br /> I,.1 ' 4 (k) workers' compensation and unemployment compensation;
<br /> ,t-,,, A , , 4,-,,,,' (1) benefits derived from regulation;
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<br /> u EHLERS&ASSOCIATES, INC. 3060 Centre Pointe Drive, Roseville, Minnesota 55113 651.6978500
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