Data centers sales and use tax exemption modified.

HF 1277 modifies Minnesota's sales and use tax exemption for data centers, providing a tax break on purchases of qualifying equipment and software. It creates three categories of qualifying data centers (standard, refurbished, and large-scale) with specific size, investment, and operational requirements - such as a minimum 25,000 square feet, $30 million in investments within 48 months, and features like backup power and security systems. The bill requires tax to be collected at standard rates but refunded later, applying to equipment like servers, cooling systems, and power infrastructure used in these facilities. This directly benefits data center operators investing in Minnesota facilities that meet the defined thresholds.