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HF 692

as introduced - 88th Legislature (2013 - 2014) Posted on 03/14/2013 05:14pm

KEY: stricken = removed, old language.
underscored = added, new language.

Bill Text Versions

Engrossments
Introduction Posted on 02/18/2013

Current Version - as introduced

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A bill for an act
relating to special assessments; defining unimproved property for purposes of
deferments; reorganizing provisions relating to the assessment hearing; making
conforming amendments; amending Minnesota Statutes 2012, sections 273.111,
subdivisions 3, 11; 273.114, subdivision 8; 429.061, subdivisions 1, 2, by adding
subdivisions.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

Section 1.

Minnesota Statutes 2012, section 273.111, subdivision 3, is amended to read:


Subd. 3.

Requirements.

(a) Real estate consisting of ten acres or more or a nursery
or greenhouse, and qualifying for classification as class 2a under section 273.13, shall be
entitled to valuation and tax deferment under this section if it is primarily devoted to
agricultural use, and either:

(1) is the homestead of the owner, or of a surviving spouse, child, or sibling of the
owner or is real estate which is farmed with the real estate which contains the homestead
property; or

(2) has been in possession of the applicant, the applicant's spouse, parent, or sibling,
or any combination thereof, for a period of at least seven years prior to application for
benefits under the provisions of this section, or is real estate which is farmed with the
real estate which qualifies under this clause and is within four townships or cities or
combination thereof from the qualifying real estate; or

(3) is the homestead of an individual who is part of an entity described in paragraph
(b), clause (1), (2), or (3); or

(4) is in the possession of a nursery or greenhouse or an entity owned by a proprietor,
partnership, or corporation which also owns the nursery or greenhouse operations on the
parcel or parcels, provided that only the acres used to produce nursery stock qualify
for treatment under this section.

(b) Valuation of real estate under this section is limited to parcels owned by
individuals except for:

(1) a family farm entity or authorized farm entity regulated under section 500.24;

(2) an entity, not regulated under section 500.24, in which the majority of the
members, partners, or shareholders are related and at least one of the members, partners,
or shareholders either resides on the land or actively operates the land; and

(3) corporations that derive 80 percent or more of their gross receipts from the
wholesale or retail sale of horticultural or nursery stock.

The terms in this paragraph have the meanings given in section 500.24, where
applicable.

(c) Land that previously qualified for tax deferment under this section and no longer
qualifies because it is not primarily used for agricultural purposes but would otherwise
qualify under Minnesota Statutes 2006, section 273.111, subdivision 3, for a period of at
least three years will not be required to make payment of the previously deferred taxes,
notwithstanding the provisions of subdivision 9. Sale of the land prior to the expiration
of the three-year period requires payment of deferred taxes as follows: sale in the year
the land no longer qualifies requires payment of the current year's deferred taxes plus
payment of deferred taxes for the two prior years; sale during the second year the land
no longer qualifies requires payment of the current year's deferred taxes plus payment of
the deferred taxes for the prior year; and sale during the third year the land no longer
qualifies requires payment of the current year's deferred taxes. Deferred taxes shall be
paid even if the land qualifies pursuant to subdivision 11a. When such property is sold or
no longer qualifies under this paragraph, or at the end of the three-year period, whichever
comes first, all deferred special assessments plus interest are payable in equal installments
spread over the time remaining until the last maturity date of the bonds issued to finance
the improvement for which the assessments were levied. If the bonds have matured, the
deferred special assessments plus interest are payable within 90 days. The provisions of
section 429.061, subdivision deleted text begin 2deleted text end new text begin 2enew text end , apply to the collection of these installments. Penalties
are not imposed on any such special assessments if timely paid.

(d) Land that is enrolled in the reinvest in Minnesota program under sections
103F.501 to 103F.535, the federal Conservation Reserve Program as contained in Public
Law 99-198, or a similar state or federal conservation program qualifies for valuation and
assessment deferral under this section if it was in agricultural use before enrollment and,
provided that, in the case of land enrolled in the reinvest in Minnesota program, it is not
subject to a perpetual easement.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment.
new text end

Sec. 2.

Minnesota Statutes 2012, section 273.111, subdivision 11, is amended to read:


Subd. 11.

Special local assessments.

The payment of special local assessments
levied after June 1, 1967, for improvements made to any real property described in
subdivision 3 together with the interest thereon shall, on timely application as provided
in subdivision 8, be deferred as long as such property meets the conditions contained in
subdivision 3 or 3a or is transferred to an agricultural preserve under sections 473H.02
to 473H.17. If special assessments against the property have been deferred pursuant to
this subdivision, the governmental unit shall file with the county recorder in the county in
which the property is located a certificate containing the legal description of the affected
property and of the amount deferred. When such property no longer qualifies under
subdivision 3 or 3a, all deferred special assessments plus interest shall be payable in
equal installments spread over the time remaining until the last maturity date of the bonds
issued to finance the improvement for which the assessments were levied. If the bonds
have matured, the deferred special assessments plus interest shall be payable within 90
days. The provisions of section 429.061, subdivision deleted text begin 2deleted text end new text begin 2enew text end , apply to the collection of these
installments. Penalty shall not be levied on any such special assessments if timely paid.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment.
new text end

Sec. 3.

Minnesota Statutes 2012, section 273.114, subdivision 8, is amended to read:


Subd. 8.

Special local assessments.

The payment of special local assessments
levied after June 1, 2011, for improvements made to any real property described in
subdivision 1 together with the interest thereon shall, on timely application as provided
in subdivision 6, be deferred as long as the property meets the conditions contained in
this section. If special assessments against the property have been deferred pursuant to
this subdivision, the governmental unit shall file with the county recorder in the county
in which the property is located a certificate containing the legal description of the
affected property and of the amount deferred. When the property no longer qualifies
under subdivision 1, all deferred special assessments plus interest shall be payable in
equal installments spread over the time remaining until the last maturity date of the bonds
issued to finance the improvement for which the assessments were levied. If the bonds
have matured, the deferred special assessments plus interest shall be payable within 90
days. The provisions of section 429.061, subdivision deleted text begin 2deleted text end new text begin 2enew text end , apply to the collection of these
installments. A penalty shall not be levied on these special assessments if timely paid.
This subdivision does not apply to special assessments levied at any time by a county or
district court under chapter 116A or by a watershed district under chapter 103D.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment.
new text end

Sec. 4.

Minnesota Statutes 2012, section 429.061, subdivision 1, is amended to read:


Subdivision 1.

Calculation, notice.

At any time after the expense incurred or to
be incurred in making an improvement shall be calculated under the direction of the
council, the council shall determine by resolution the amount of the total expense the
municipality will pay, other than the amount, if any, which it will pay as a property owner,
and the amount to be assessed. deleted text begin If a county proposes to assess within the boundaries of
a city for a county state-aid highway or county highway, including curbs, gutters, and
storm sewers, the resolution must include the portion of the cost proposed to be assessed
within the city. The county shall forward the resolution to the city and it may not proceed
with the assessment procedure nor may the county allocate any cost under this section
for property within the city unless the city council adopts the resolution approving the
assessment.
deleted text end Thereupon the clerk, with the assistance of the engineer or other qualified
person selected by the council, shall calculate the proper amount to be specially assessed
for the improvement against every assessable lot, piece or parcel of land, without regard
to cash valuation, in accordance with the provisions of section 429.051. The proposed
assessment roll shall be filed with the clerk and be open to public inspection. The clerk
shall thereupon, under the council's direction, publish notice that the council will meet to
consider the proposed assessment. deleted text begin Suchdeleted text end new text begin Thenew text end notice shall be published in the newspaper at
least once and shall be mailed to the owner of each parcel described in the assessment
roll. For the purpose of giving mailed notice under this subdivision, owners shall be
those shown to be such on the records of the county auditor or, in any county where tax
statements are mailed by the county treasurer, on the records of the county treasurer;
but other appropriate records may be used for this purpose. deleted text begin Suchdeleted text end new text begin Thenew text end publication and
mailing shall be no less than two weeks prior to such meeting of the council. Except as
to the owners of tax-exempt property or property taxes on a gross earnings basis, every
property owner whose name does not appear on the records of the county auditor or the
county treasurer shall be deemed to have waived such mailed notice unless the owner has
requested in writing that the county auditor or county treasurer, as the case may be, include
the name on the records for such purpose. deleted text begin Suchdeleted text end new text begin Thenew text end notice shall state the date, time, and
place of such meeting, the general nature of the improvement, the area proposed to be
assessed, the total amount of the proposed assessment, that the proposed assessment roll is
on the file with the clerk, and that written or oral objections thereto by any property owner
will be considered. The notice must also state that no appeal may be taken as to the amount
of any assessment adopted deleted text begin pursuant to subdivision 2deleted text end new text begin under this sectionnew text end , unless a written
objection signed by the affected property owner is filed with the municipal clerk prior to
the assessment hearing or presented to the presiding officer at the hearing. The notice shall
also state that an owner may appeal an assessment to district court pursuant to section
429.081 by serving notice of the appeal upon the mayor or clerk of the municipality
within 30 days after the adoption of the assessment and filing such notice with the district
court within ten days after service upon the mayor or clerk. The notice shall also inform
property owners of the provisions of sections 435.193 to 435.195 and the existence of any
deferment procedure established pursuant thereto in the municipality. In addition, the
notice mailed to the owner must state in clear language the following information:

(1) the amount to be specially assessed against that particular lot, piece, or parcel of
land;

(2) adoption by the council of the proposed assessment may be taken at the hearing;

(3) the right of the property owner to prepay the entire assessment and the person to
whom prepayment must be made;

(4) whether partial prepayment of the assessment has been authorized by ordinance;

(5) the time within which prepayment may be made without the assessment of
interest; and

(6) the rate of interest to be accrued if the assessment is not prepaid within the
required time period.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment.
new text end

Sec. 5.

Minnesota Statutes 2012, section 429.061, is amended by adding a subdivision
to read:


new text begin Subd. 1a. new text end

new text begin County assessment within city jurisdiction. new text end

new text begin If a county proposes to
assess within the boundaries of a city for a county state-aid highway or county highway,
including curbs, gutters, and storm sewers, the resolution must include the portion of the
cost proposed to be assessed within the city. The county shall forward the resolution to the
city and it may not proceed with the assessment procedure nor may the county allocate
any cost under this section for property within the city unless the city council adopts
the resolution approving the assessment.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment.
new text end

Sec. 6.

Minnesota Statutes 2012, section 429.061, is amended by adding a subdivision
to read:


new text begin Subd. 1b. new text end

new text begin When objections must be filed. new text end

new text begin No appeal may be taken as to the amount
of any assessment adopted under this section unless written objection signed by the
affected property owner is filed with the municipal clerk prior to the assessment hearing
or presented to the presiding officer at the hearing. All objections to the assessments
not received at the assessment hearing in the manner prescribed by this subdivision are
waived, unless the failure to object at the assessment hearing is due to a reasonable cause.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment.
new text end

Sec. 7.

Minnesota Statutes 2012, section 429.061, subdivision 2, is amended to read:


Subd. 2.

new text begin Hearing; consideration of objections; new text end adoptiondeleted text begin ; interestdeleted text end .

new text begin (a) new text end At deleted text begin such
deleted text end new text begin thenew text end meeting deleted text begin or at any adjournment thereofdeleted text end new text begin on the proposed assessment,new text end the council shall
hear and pass upon all objections to the proposed assessment, whether presented orally
or in writing. The council may amend new text begin by resolution new text end the proposed assessment as to any
parcel deleted text begin and by resolution adopt the same as the special assessment against the landsdeleted text end named
in the assessment roll. deleted text begin Notice of any adjournment of the hearing shall be adequate if the
minutes of the meeting so adjourned show the time and place when and where the hearing
is to be continued.
deleted text end

new text begin (b) The council may continue the hearing at a later date. Notice of the continuance
is adequate if the council meeting minutes state the time and place where the hearing
will be continued.
new text end The council may consider any objection to the amount of a proposed
assessment as to a specific parcel of land at deleted text begin an adjourneddeleted text end new text begin the continuednew text end hearing upon
further notice to the affected property owner as it deems advisable. At the deleted text begin adjourned
deleted text end new text begin continuednew text end hearing the council or a committee of it may hear further written or oral
testimony on behalf of the objecting property owner and may consider further written or
oral testimony from appropriate city officials and other witnesses as to the amount of the
assessment. The council or committee shall prepare a record of the proceedings at the
deleted text begin adjourneddeleted text end new text begin continuednew text end hearing and written findings as to the amount of the assessment. The
amount of the assessment as finally determined by the council shall become a part of the
adopted assessment roll. deleted text begin No appeal may be taken as to the amount of any assessment
adopted under this section unless written objection signed by the affected property owner
is filed with the municipal clerk prior to the assessment hearing or presented to the
presiding officer at the hearing. All objections to the assessments not received at the
assessment hearing in the manner prescribed by this subdivision are waived, unless the
failure to object at the assessment hearing is due to a reasonable cause.
deleted text end

deleted text begin If the adopted assessment differs from the proposed assessment as to any particular
lot, piece, or parcel of land, the clerk must mail to the owner a notice stating the amount of
the adopted assessment. Owners must also be notified by mail of any changes adopted
by the council in interest rates or prepayment requirements from those contained in the
notice of the proposed assessment
deleted text end .

deleted text begin The assessment, with accruing interest, shall be a lien upon all private and public
property included therein, from the date of the resolution adopting the assessment,
concurrent with general taxes; but the lien shall not be enforceable against public property
as long as it is publicly owned, and during such period the assessment shall be recoverable
from the owner of such property only in the manner and to the extent provided in section
435.19. Unless otherwise provided in the resolution, all assessments shall be payable in
equal annual installments extending over such period, not exceeding 30 years, as the
resolution determines, payable on the first Monday in January in each year, but the number
of installments need not be uniform for all assessments included in a single assessment
roll if a uniform criterion for determining the number of installments is provided by
the resolution. Assessments on property located in a targeted neighborhood as defined
in Laws 1987, chapter 386, article 6, section 4, may be payable in variable annual
installments if the resolution provides for a variable payment. The first installment of each
assessment shall be included in the first tax rolls completed after its adoption and shall be
payable in the same year as the taxes contained therein; except that the payment of the
first installment of any assessment levied upon unimproved property may be deferred
until a designated future year, or until the platting of the property or the construction of
improvements thereon, upon such terms and conditions and based upon such standards
and criteria as may be provided by resolution of the council. If special assessments against
the property have been deferred pursuant to this subdivision, the governmental unit shall
record with the county recorder in the county in which the property is located a certificate
containing the legal description of the affected property and of the amount deferred. In any
event, every assessment the payment of which is so deferred, when it becomes payable,
shall be divided into a number of installments such that the last installment thereof will
be payable not more than 30 years after the levy of the assessment. All assessments
shall bear interest at such rate as the resolution determines. To the first installment of
each assessment shall be added interest on the entire assessment from a date specified in
the resolution levying the assessment, not earlier than the date of the resolution, until
December 31 of the year in which the first installment is payable, and to each subsequent
installment shall be added interest for one year on all unpaid installments; or alternatively,
any assessment may be made payable in equal annual installments including principal and
interest, each in the amount annually required to pay the principal over such period with
interest at such rate as the resolution determines, not exceeding the maximum period and
rate specified above. In the latter event no prepayment shall be accepted under subdivision
3 without payment of all installments due to and including December 31 of the year of
prepayment, together with the original principal amount reduced only by the amounts of
principal included in such installments, computed on an annual amortization basis. When
payment of an assessment is deferred, as authorized in this subdivision, interest thereon for
the period of deferment may be made payable annually at the same times as the principal
installments of the assessment would have been payable if not deferred; or interest for this
period may be added to the principal amount of the assessment when it becomes payable;
or, if so provided in the resolution levying the assessment, interest thereon to December
31 of the year before the first installment is payable may be forgiven
deleted text end .

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment.
new text end

Sec. 8.

Minnesota Statutes 2012, section 429.061, is amended by adding a subdivision
to read:


new text begin Subd. 2a. new text end

new text begin Notice of changes adopted. new text end

new text begin If the adopted assessment differs from the
proposed assessment as to any particular lot, piece, or parcel of land, the clerk must mail
to the owner a notice stating the amount of the adopted assessment. Owners must also be
notified by mail of any changes adopted by the council in interest rates or prepayment
requirements from those contained in the notice of the proposed assessment.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment.
new text end

Sec. 9.

Minnesota Statutes 2012, section 429.061, is amended by adding a subdivision
to read:


new text begin Subd. 2b. new text end

new text begin Payment in installments. new text end

new text begin Unless otherwise provided in the resolution, all
assessments shall be payable in equal annual installments extending over such period, not
exceeding 30 years, as the resolution determines, payable on the first Monday in January
in each year, but the number of installments need not be uniform for all assessments
included in a single assessment roll if a uniform criterion for determining the number of
installments is provided by the resolution. Assessments on property located in a targeted
community as defined in section 469.201, subdivision 10, may be payable in variable
annual installments if the resolution provides for a variable payment. The first installment
of each assessment shall be included in the first tax rolls completed after its adoption and
shall be payable in the same year as the taxes contained therein.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment.
new text end

Sec. 10.

Minnesota Statutes 2012, section 429.061, is amended by adding a subdivision
to read:


new text begin Subd. 2c. new text end

new text begin Interest. new text end

new text begin All assessments shall bear interest at such rate as the resolution
determines. To the first installment of each assessment shall be added interest on the entire
assessment from a date specified in the resolution levying the assessment, not earlier than
the date of the resolution, until December 31 of the year in which the first installment is
payable, and to each subsequent installment shall be added interest for one year on all
unpaid installments; or alternatively, any assessment may be made payable in equal annual
installments including principal and interest, each in the amount annually required to pay
the principal over such period with interest at such rate as the resolution determines, not
exceeding the maximum period and rate specified above. In the latter event no prepayment
shall be accepted under subdivision 3 without payment of all installments due to and
including December 31 of the year of prepayment, together with the original principal
amount reduced only by the amounts of principal included in such installments, computed
on an annual amortization basis.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment.
new text end

Sec. 11.

Minnesota Statutes 2012, section 429.061, is amended by adding a subdivision
to read:


new text begin Subd. 2d. new text end

new text begin Lien. new text end

new text begin The assessment, with accruing interest, shall be a lien upon all
private and public property included therein, from the date of the resolution adopting the
assessment, concurrent with general taxes. However, the lien shall not be enforceable
against public property as long as it is publicly owned, and while the property is publicly
owned the assessment shall be recoverable from the owner of the property only in the
manner and to the extent provided in section 435.19.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment.
new text end

Sec. 12.

Minnesota Statutes 2012, section 429.061, is amended by adding a subdivision
to read:


new text begin Subd. 2e. new text end

new text begin Deferred payment for certain properties. new text end

new text begin (a) "Unimproved property"
for the purposes of this subdivision means:
new text end

new text begin (1) unplatted property;
new text end

new text begin (2) platted property with no buildings, landscaping, or other betterments; or
new text end

new text begin (3) property located in a redevelopment district, as defined in section 469.174, that is
not yet developed at the likely level of use of or benefit from the improvements to be paid
from the special assessments imposed on the property, as planned by the municipality or
the owner, and that is consistent with the adopted local comprehensive plan, if there is one.
new text end

new text begin (b) The payment of the first installment of any assessment levied upon unimproved
property may be deferred until a designated future year upon such terms and conditions
and based upon such standards and criteria as may be provided by resolution of the council.
If special assessments against the property have been deferred pursuant to this subdivision,
the governmental unit shall record with the county recorder in the county in which the
property is located a certificate containing the legal description of the affected property and
of the amount deferred. In any event, every assessment the payment of which is so deferred,
when it becomes payable, shall be divided into a number of installments such that the last
installment thereof will be payable not more than 30 years after the levy of the assessment.
When payment of an assessment is deferred, as authorized in this subdivision, interest
thereon for the period of deferment may be made payable annually at the same times as
the principal installments of the assessment would have been payable if not deferred; or
interest for this period may be added to the principal amount of the assessment when it
becomes payable; or, if so provided in the resolution levying the assessment, interest
thereon to December 31 of the year before the first installment is payable may be forgiven.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment.
new text end