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Transportation Sales Taxes

Metropolitan Transportation Area Sales Tax

Initially authorized Laws 2008, ch. 152, art. 4, § 2 (Minn. Stat. § 297A.992)
Date imposed July 1, 2008, for Anoka, Dakota, Hennepin, Ramsey, and Washington counties. This tax expired on September 30, 2017, after the five counties voted to terminate the joint power agreement.
Amount collected in CY 2013 $114,309,615
Additional legislative action Laws 2009, ch. 88, art. 8, sec. 53; Laws 2011, 1st spec. sess., ch. 3, art. 2, sec. 1-2
Tax authorized A transportation sales and use tax of one-quarter of 1 percent on retail sales and uses; also a $20 per vehicle excise tax on motor vehicles sold by licensed dealers within the taxing authority.
Required county action to impose the tax The tax was imposed by resolution after the eligible county becomes part of the metropolitan transportation area via declaration of resolution by the county board and subsequently entering into a joint powers agreement.
Allowed uses of the tax proceeds

Transportation improvements including capital costs and capital improvements to transit ways such as commuter rail rolling stock, light rail vehicles, transit way buses, and park-and-ride facilities. Other allowed uses include studies to determine feasibility, planning, alternatives analysis, environmental impact, engineering, property acquisition for transit way purchases, construction of transit ways, and operating assistance for transit ways. Up to 1.25 percent of the total awards may be annually allocated for planning, studies, design, construction, maintenance, and operation of pedestrian programs and bicycle programs and pathways.

The 2014 law required that for fiscal years 2012 and 2013, the Metropolitan Council receives at least 75 percent of the amount of revenue it received for operating transitways that it received under a June 30, 2011, operating grant agreement. It also established that the priority of the fund use to be (1) payment of debt issued prior to January 1, 2011, and then (2) other authorized projects.

Tax expiration The tax is terminated when a county withdraws from the joint powers agreement and after it has satisfied its portion of all outstanding bonds or obligations entered into while the county was a member of the agreement. If the joint powers agreement is terminated altogether, the taxes will terminate when all outstanding bonds or obligations are satisfied. The auditors of the counties in which the taxes are imposed will determine when termination is finalized. The tax terminated for all counties September 30, 2017.
Miscellaneous If a county's proportion of the sales tax revenues collected under this section is 3 percent or less, the joint powers board must make annual grants to the county equal to at least the amount of revenue collected in the county. After termination of the tax all five counties imposed separate taxes under the Greater Minnesota Transportation Sales Tax authority.

Greater Minnesota Transportation Area Sales Tax

Initially authorized Laws 2008, ch. 152, art. 4, § 3 (Minn. Stat. § 297A.993)
Date imposed

Any county that is not part of the Metropolitan Transportation Area, which is now all 87 counties in the state, may singly or through a joint powers agreement, impose a local sales and use tax of up to one-half of 1 percent and a $20 excise tax on commercial sales of motor vehicles to fund a transportation or transit project. The following counties impose taxes under this authority:

County Date Tax Imposed Tax Rate Also Imposes a $20/
Vehicle Excise Tax
Anoka* 10/1/2017 0.25% Yes
Becker 7/1/2014 0.50% No
Beltrami 4/1/2014 0.50% Yes
Blue Earth 4/1/2016 0.50% No
Brown 4/1/2016 0.50% No
Carlton 4/1/2015 0.50 % Yes
Carver 10/1/2017 0.50 % Yes
Cass 4/1/2016 0.50% No
Chisago 4/1/2016 0.50 % No
Cook 1/1/2017 0.50 % No
Crow Wing 4/1/2016 0.50 % No
Dakota* 10/1/2017 0.25% Yes
Douglas 10/1/2014 0.50% No
Fillmore 1/1/2015 0.50% No
Freeborn 1/1/2016 0.50% No
Hennepin* 10/1/2017 0.50% Yes
Hubbard 7/1/2015 0.50% No
Kandiyohi 4/1/2018 0.50% Yes
Lake 4/1/2017 0.50 %
Lyon 10/1/2015 0.50% No
Mille Lacs 1/1/2017 0.50 % No
Morrison 1/1/2018 0.50 % No
Mower 1/1/2018 0.50 % No
Nicollet 1/1/2018 0.50 % No
Olmsted** 7/1/2017 0.50 % No
Ottertail 1/1/2016 0.50 % Yes
Pine 1/1/2017 0.50 % No
Polk 1/1/2018 0.25% No
Ramsey* 10/1/2017 0.50% Yes
Rice 1/1/2014 0.50% No
St. Louis 4/1/2015 0.50% Yes
Scott 10/1/2015 0.50% Yes
Stearns 1/1/2018 0.25 % No
Steele 4/1/2015 0.50% No
Todd 1/1/2015 0.50% No
Wabasha 4/1/2016 0.50% No
Wadena 4/1/2014 0.50% No
Washington* 10/1/2017 0.25 % Yes
Winona 1/1/2017 0.50% No
Wright 10/1/2017 0.50 % No

*One of the counties that was part of the now defunct Metropolitan Transportation Area.

**Olmsted County originally imposed a tax of 0.25% on 1/1/14 under Minn. Stat. sec. 469.46 to fund improvements related to the Destination Medical Center. The tax was increased to 0.5% in 2017 under the general law.
Tax authorized A transportation sales and use tax of up to one-half of 1 percent on retail sales and uses; also the county may impose a $20 per vehicle excise tax on motor vehicles sold by licensed dealers within the taxing authority.
Additional legislative action Laws 2009, ch. 88, art. 8, sec. 4 Laws 2013, ch. 117, art. 3, sec. 25-26
Required county action to impose the tax Originally, the tax had to be approved by voters in the county in a general election. The 2013 law allowed a county to impose the tax by resolution after a public hearing.
Allowed uses of the tax proceeds The tax proceeds must exclusively pay for the cost of a specific transportation project or improvement designated by the board of the county or more than one county acting under a joint powers agreement. The 2013 law expanded the allowed uses to include payment of transportation and operating costs of transit projects, transit operating costs, and payment of capital costs related to the safe routes to school program.
Tax expiration The tax will expire following completion or termination of the authorized specific project. There is no required expiration date if the tax is being used to fund transit operations or improvements.

August 2018

Topics

Local Sales Taxes

For additional information:

See the publication Local Sales Taxes in Minnesota