Senator Tina Smith (DFL) on Rural Coops and Hospitals/Clinics

Apr 5, 2019

Senator Tina Smith told us about some of the bills she's working on that affect rural Minnesotans. 

Coop Tax Fix Bill: Sen. Smith has been contacted by several Minnesota cooperatives that are at risk of losing their tax-exempt status due to an error in the 2017 tax law. The error is making it difficult for coops to accept grants to expand broadband access, and it’s putting the coops that do accept grants, including those who accept emergency relief grants, at risk of losing their tax-exempt status. This problem is occurring because coops must obtain at least 85% of their income from members, and the government entity making grants isn’t usually a member. Under prior law, government grants weren’t taken into account for determining the member income percentage, but the 2017 tax law required them to be taken into account. Sen. Smith’s bill with Senator Rob Portman of Ohio would fix this problem by ensuring that broadband expansion grants and FEMA emergency relief grants aren’t counted against the member income limit, and otherwise reverting the treatment of tax issue back to pre-2017 tax bill rules (which make clear that most government grants shouldn’t be treated as income for a coop’s membership test, ensuring that coops can retain their tax exemptions). 

Rural Health Clinics Bill: Sen. Smith and Republican Sen. of Wyoming will introduce the Rural Health Clinic Modernization Act of 2019. This bill would update rules governing Rural Health Clinics (RHCs). These clinics provide out-patient primary care services, including basic laboratory testing and emergency services, helping to ensure that people in rural areas have basic access to health care. Despite significant changes in the health system, many of the laws regulating RHCs have not been updated since the RHC program was created in the late 1970’s. Sen. Smith’s bill would update rules and guidelines that regulate RHCs. This legislation is supported by the National Association of Rural Health Clinics and has been vetted by the Minnesota Department of Health (DHS).