Refundable sales and use tax credit proposed for conversion of underutilized buildings, grants in lieu of the credit allowed, credit sunset proposed, and reports required.

HF 457 proposes a refundable tax credit of up to 30% of qualifying conversion costs for developers converting underutilized buildings in Minnesota. Eligible projects must convert buildings first placed in service at least 15 years ago, either by changing to a new commercial use (not previously intended for that purpose) or by restoring at least 50% of vacant space to income-producing use, while retaining 75% of external walls and internal structure. Applicants must apply for an allocation certificate before starting work and can choose a credit, a grant, or both. The credit is claimable in the year the project is completed, with annual reporting required to the state.