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HF 3359

Wayzata; refundable sales and use tax exemption provided for construction materials for certain projects.

2025-2026 Regular Session Introduced by Patty Acomb

Wayzata receives a refundable sales tax exemption for construction materials and equipment on specific redevelopment projects from Jan 1, 2026 to Jun 30, 2030, with refunds issued

Introduction and first reading, referred to Taxes
#citiesandtowns-specific #taxation-salesanduse
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Bill Summary · HF 3359

Summary of HF 3359 (2025-2026) – Wayzata; refundable sales and use tax exemption for construction materials

Purpose and intent

HF 3359 provides a targeted, refundable sales and use tax exemption for construction materials, supplies, and equipment used in specific redevelopment and infrastructure projects within the city of Wayzata. The exemption is designed to reduce project costs and spur redevelopment and environmental improvements by delaying tax revenue collection and then refunding eligible purchases.

Key points:
- Applies to projects in Wayzata between January 1, 2026 and June 30, 2030.
- Materials must be purchased after December 31, 2025 and before July 1, 2030.
- The exemption is refundable rather than a direct exemption at the point of sale.

What the bill would change (substantive provisions)

Section: City of Wayzata – Sales Tax Exemption for Construction Materials

  • Establishes a refundable exemption from Minnesota sales and use tax (chapter 297A) for:
    1) Expansion and remodeling of Depot Park
    2) Construction of community docks providing access to Lake Minnetonka
    3) Shoreline restoration, including installation of native plants, trees, and natural habitat
    4) Restoration of the Section Foreman House, including a learning center for indoor/outdoor classrooms and community space
    5) Construction of Eco Park, featuring shoreline restoration, marsh and water quality improvements, a pier extension of the lakeside boardwalk, and eco-living classrooms
    6) Construction of a regional multiuse trail

  • The exemption applies to materials, supplies, and equipment used in these projects and only for purchases made within the specified date window.

  • Tax treatment: The tax is collected as if the standard rate applied, but then refunded to the purchaser following the process used for other projects under Minnesota statute 297A.75, subdivision 1, clause (17). In practice, refunds are not issued until after June 30, 2026.

Subdivision 2 – Appropriation

  • Funding for refunds to eligible purchases is provided by a general fund appropriation to the Minnesota Department of Revenue (the commissioner of revenue).

Effective date

  • Retroactive applicability: Applies to sales and purchases made after December 31, 2025 and before July 1, 2030.

Who/what is affected

  • Geography: City of Wayzata, Minnesota.
  • Projects affected: Depot Park expansion/remodeling, community docks, shoreline restoration, Section Foreman House restoration, Eco Park development, and a regional multiuse trail.
  • Taxpayers: Purchasers of construction materials, supplies, and equipment for the listed Wayzata projects.
  • Agencies: Minnesota Department of Revenue administers refunds; general fund provides funding for refunds.

Procedural and timeline notes

  • Purchase window: December 31, 2025 → June 30, 2030.
  • Refunds: Eligible purchases will be refunded after June 30, 2026 (refund timing follows the existing statute's process for similar refundable exemptions).
  • Retroactive effective date: The policy is effective for eligible transactions occurring after the end of 2025.
  • Introduction and references: HF 3359 was introduced and referred to the Taxes committee on February 17, 2026, with Patty Acomb as a co-sponsor.

Practical implications

  • The exemption lowers the after-tax cost of eligible construction materials for the specified Wayzata projects, potentially accelerating redevelopment and improvements.
  • Because refunds are paid after June 30, 2026, upfront project budgeting should account for temporary cash flow needs, if applicable.
  • The measure requires tracking and documentation to certify eligibility and process refunds through the Department of Revenue.

If you’d like, I can compare HF 3359 to related Minnesota tax exemption mechanisms or outline potential revenue impacts for the state treasury.

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

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