SF 1701 authorizes the delegation of powers agreement between the Commissioner of Health and local governments to specify the fees to be charged by the designated agent for delegated licensing duties. This bill also reduces certain license fees for individual private sewer and water. It also requires gratuities to be included in calculating minimum wage and not be included in the calculation of unemployment. It also expands the tax exemption for capital equipment to include machinery and equipment purchased by restaurants.
Section 1 (145A.07, subdivision 3) permits the agreements between the Commissioner of Health and local governments or designated agents to perform certain licensing, inspection, and enforcement duties under chapter 157 (food, beverage, and lodging establishments) and sections 327.14 to 327.28 (manufactured homes), to specify the fees to be charged by the designated agent states that the fees must not exceed the costs, including overhead costs, to the designated agent for the performance of the delegated duties, and the fees collected must not be used for any other purpose than the purpose for which the fee is collected.
Section 2 (157.16, subdivison 3) reduces the fee for individual private sewer to $30, and individual private water to $30.
Sections 3 and 4 (177.24) establish a tip credit by allowing large employers to use tip amounts received by employees to offset the minimum wage paid to a tipped employee. The minimum wage paid to a tipped employee would either be $6.55 per hour as long as a tipped employee's wage, plus tips, totals at least $12 per hour, or at least $7.25 (the current federal minimum wage) if the tipped employee earns less than $12 per hour in wages, plus tips. Currently, Minnesota does not allow a "tip credit" for tipped employees, meaning the minimum wage rate is the same for tipped and nontipped emplyees.
Section 5 (268.035, subdivision 24) makes a change in the unemployment insurance taxable wages calculation for tipped employees, in that taxable wages would not include income from tips greater than or equal to two times the applicable minimum wage rate.
Sections 6 and 7 (297A.68, subdivisions 42 and 43) create a use tax exemption to restaurants for complimentary meals and alcoholic and nonalcoholic beverages provided to a customer (section 6) and to a restaurant employee (section 7). Under Minnesota sales tax law, taxable foods and services are subject to either sales or use tax, but not both. While the complimentary meal would not be subject to sales tax by the customer, the preparation of food for consideration is a taxable service subject to use tax by the restaurant that prepares the food. While a complimentary meal would not be subject to sales tax, the complimentary food prepared by a restaurant would be subject to use tax. These sections exempt this from the use tax.
Section 8 (297A.68, subdivision 5) exempts machinery and equipment purchased by restaurants to furnish, prepare, or serve prepared foods from sales tax and adds them to the definition of capital equipment. Capital equipment purchases are exempt from sales tax.
Section 9 (327.15, subdivision 3) reduces the fees for manufactured home parks and recreational camping areas in the fee category for individual private sewer to $30, and individual private water to $30.