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HF 5039

Champlin authorized to impose local sales tax.

2025-2026 Regular Session Introduced by Danny Nadeau

Champlin could add up to 0.5% sales tax to fund up to $18 million for a new indoor athletic facility, via voter-approved revenue and bonded financing.

Introduction and first reading, referred to Taxes
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Bill Summary · HF 5039

Summary of HF 5039 (2025-2026) – Champlin Local Sales Tax Authorization

Purpose and intent

  • The bill authorizes the City of Champlin to impose a local sales and use tax, contingent on voter approval.
  • If approved by voters, the tax would fund construction of a new indoor athletic facility, with up to $18 million in bonding potential and related costs.

Key provisions

Tax authorization and governance

  • Champlin may impose by ordinance a local sales and use tax of up to 0.5% (one-half of one percent).
  • Use of the tax revenues is governed by Minnesota Statutes section 297A.99, and the tax is in addition to any existing local sales and use taxes authorized under other laws.

Use of revenues

  • Revenues from the tax must first cover the costs of collecting and administering the tax.
  • After administration costs, the revenues may finance up to $18,000,000 in construction costs for a new indoor athletic facility.
  • Bonding for the project is allowed, with associated issuance costs included in the eligible financing.

Bonding authority

  • Champlin may issue bonds under Minnesota Statutes, chapter 475, to finance all or a portion of the project costs.
  • The total aggregate principal of bonds may not exceed $18,000,000, plus issuance costs.
  • Bond repayments may be funded from the tax revenue or other city funds; bonds are not counted toward certain debt limitations.
  • Levy of taxes under Minnesota Statutes, section 475.61, to pay debt service on these bonds is not subject to existing levy limitations.
  • A separate election to approve the bonds under section 475.58 is not required.

Term and termination

  • The local tax would expire no earlier than the earlier of: 1) 30 years after the tax is first imposed, or 2) when the city determines the tax revenues are sufficient to pay project/bond costs plus related issuance costs.
  • After termination, any remaining funds (subject to statutory rules) would be placed in the city’s general fund.
  • The city may specify an earlier termination date by ordinance.

Effective date

  • The act becomes effective the day after Champlin’s governing body and clerk comply with the state’s formal notification requirements (Minnesota Statutes, section 645.021, subdivisions 2 and 3).

Who is affected

  • Champlin residents and businesses: If the tax is approved, shoppers would pay an additional up to 0.5% on most sales in the city.
  • City of Champlin: Receives a new revenue stream dedicated to construction of an indoor athletic facility, with the ability to issue bonds to finance the project.
  • Bondholders: Would be repaid from tax revenues, with statutory protections that exclude the bonds from certain debt limitations.
  • Voters in Champlin: Must approve both the authorization of the tax and, separately, the bond issuance (though the bill states a separate bond election is not required under this statute, it requires voter approval under 297A.99, subdivision 3, paragraph (a)).

Procedural and timeline aspects

  • Legislative status: Referred to the House Committee on Taxes after its introduction (April 20, 2026).
  • Election prerequisite: Tax authorization requires voter approval at a city election as per Minnesota statutes.
  • Effective timing: Takes effect after local compliance with state public notice requirements (645.021).

If you’d like, I can add a concise pros/cons note or compare this proposal to similar local tax authorizations in Minnesota.

Compiled from official sources — confirm details with the bill’s official record.

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