Timber Bulletin May/Jun - Minnesota Forest Industries

valuation of lands with conservationeasements with the exception ofcertain easement lands in DakotaCounty.Sales Tax on Capital Equipment:Converting the refund program toan up-front exemption for the salestax on capital equipment passed andwill be effective in the third quarterof 2014.Payment In Lieu of Taxes (PILT):PILT payments to local unitsof government for state-ownedlands were increased. Countyadministered lands were increasedfrom $1.283 to $1.50/acre; “otherlands” were increased from $0.642to $1.50/acre; and “land utilizationproject lands were established at$5.133/acre which is the same rateset for various other lands.Utility Personal Property Taxes:Proposals to remove certain utilitypersonal property tax exemptions,including the exemption onpollution control equipment, didnot pass. The elimination of theseexemptions would have ultimatelycost the forest products industryseveral million dollars per yearwhen they worked their waythrough the rate-making system.Fuel Tax: Proposals to increase thefuel tax and charge a 5.5% salestax at the wholesale level were notenacted.Sales Tax - Warehousing: The salestax is extended to “warehousing.”It will take some time to determinewhere, to what and how the tax willbe implemented. It does appear thatthe tax will not apply to goods youown stored in facilities that you own.Sales Tax - Machinery Repair: Thesales tax was extended to labor onmachinery repair. Again, it will takesome time to sort out the applicationand impact of this provision.EnergySolar Mandate: Papermills,sawmills, oriented strand boardplants and other wood productsfacilities are exempt from payingthe cost of the new solar mandate.Electrical usage by these facilitieswill not be used to determine howmuch solar energy an investorowned utility must have. Electricityprovided by co-ops and municipalutilities are also exempt.Cost-Based Electrical Rates: Afterbeing part of the final negotiationsin two different bills, the phasedinnorthern MN provision did notpass.OtherMade in Minnesota Paper: Aprovision to require the State ofMinnesota to purchase papermade on paper machines locatedin Minnesota wherever practicablepassed.Permanent School Trust Fund:Funding was not provided for thetrust fund oversight position thatwas established in legislation passedin 2012 due to opposition from theDNR.Bonding: The bare bones bondingbill that passed did not include anyfunds for reforestation or forestroads.Truck Weights: A provisionto expand current truck weightprovisions for forest andagricultural products to certaindistribution centers in westernMinnesota passed. Provisions toalso extend this to aggregate and allfreight did not pass.Timber Bulletin May/June 2013 25