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SF 5229

St. Paul local sales tax use modification

2025-2026 Regular Session Introduced by Foung Hawj and 2 co-sponsors

The bill directs St. Paul local sales tax revenues to fund $738M for streets/bridges and $246M for parks/recreation, plus debt service, with amended resolutions and voter-approval

Referred to Taxes
#citiesandtowns-specific #taxation #taxation-salesanduse
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Bill Summary · SF 5229

Summary of SF 5229 (2025-2026) — St. Paul Local Sales Tax Use Modification

Jurisdiction: Minnesota | Session: 2025-2026 | Bill Type: Senate

Authors: Pappas, Hawj, and Oumou Verbeten

Status: Introduced and referred to Taxes on 04/27/2026

Effective Date Note: The bill includes a retroactive provision to May 24, 2023, without local approval, pursuant to Minnesota Statutes, section 645.023, subdivision 1.

1) Purpose and Intent

  • The bill modifies how revenues from the City of St. Paul’s local sales tax (as authorized by state law) may be used.
  • It specifies funding allocations for capital projects and updates to debt service related to those projects.
  • The changes are framed as amendments to the use of revenues from the local sales tax (as defined in the city’s voter-approved tax under Minnesota Statutes).

2) Key Provisions

A. Use of Local Sales Tax Revenues (Subd. 2b)

  • Revenues from the local sales tax authorized under subdivision 1a must be used by the City of St. Paul for: 1) Costs of collecting and administering the tax. 2) Financing all or part of the following city projects (including debt service on bonds under subdivision 3a):
    • (i) Improvements to streets and bridges, with a specified funding amount:
      • $738,000,000 for streets and bridges, plus associated bonding costs.
      • This use is stated “notwithstanding” certain provisions of Minnesota Statutes (297A.99, subd. 2, cl. (a)(2), and (d)).
    • (ii) Capital improvements to St. Paul parks and recreation facilities, with a specified funding amount:
      • $246,000,000, plus associated bonding costs.
      • This use is stated “notwithstanding” certain provisions of Minnesota Statutes (297A.99, subd. 2, par. (a), cl. (2), (c), and (d)).
  • In short, the bill earmarks substantial sums (and bonding considerations) for street/bridge work and for parks/recreation capital improvements, potentially superseding certain statutory constraints.

B. Amended Resolution Requirement (Subd. 2b(c) and 2b(b))

  • The City must adopt an amended resolution authorizing the use of the revenues for the purposes listed in paragraph (a), clause (1), item (ii) (i.e., parks and recreation facilites), and submit the amended resolution to the state auditor by August 31 of the year the city presents the tax for voter approval under Minnesota Statutes, section 297A.99, subdivision 3.
  • The ballot question for voter approval must indicate the purposes for which the revenues must be used, as included in the amended resolution.
  • If the city does not adopt and submit the amended resolution, the ballot question must not include, and revenues must not be used for, the purpose specified in paragraph (a), clause (1), item (ii) (parks and recreation facilities).

C. Effective Date Clause

  • The section is made effective retroactively from May 24, 2023, without local approval, as permitted by Minnesota Statutes, section 645.023, subdivision 1.

3) Who Is Affected

  • City of St. Paul (and its residents): Directly affected by how local sales tax revenues are allocated, especially for:
    • Street and bridge improvements
    • Parks and recreation facilities capital improvements
    • Debt service on related bonds
  • State Auditor: Involvement in reviewing/receiving the amended resolution proposed by the city.
  • Taxpayers and voters within St. Paul: Ballot decisions and the purposes disclosed in the voter-approved tax question.

4) Procedural and Timeline Aspects

  • Legislative Path: Introduced in the Minnesota Senate and referred to the Committee on Taxes for first reading (04/27/2026).
  • Resolution and Ballot: Requires the City of St. Paul to adopt an amended resolution and submit it to the state auditor by August 31 of the year the city presents the tax for voter approval, as per statutory framework.
  • Voter Approval: The ballot question must reflect the amended purposes for revenue use, per the amended resolution.
  • Retroactivity: The bill contains a retroactive effective date to May 24, 2023, applying without local approval for its provisions.

5) Notable Details

  • Specific funding amounts:
    • Streets and bridges: $738,000,000 (plus bonding costs)
    • Parks and recreation facilities: $246,000,000 (plus bonding costs)
  • Provisions reference potential overrides to certain existing state statutes (297A.99), indicating the bill configures funding outside standard limitations.
  • The bill emphasizes both operating (collection/administration) and capital (infrastructure and parks) uses of the revenues, with debt service explicitly contemplated.

If you’d like, I can provide a side-by-side comparison with current law or draft a plain-language voter summary for outreach materials.

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

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