HF 650

1st Engrossment - 89th Legislature (2015 - 2016) Posted on 03/23/2015 03:52pm

A bill for an act
relating to taxation; minerals; distributing the proceeds of production taxes on
taconite and iron sulphides and merchantable iron ore concentrate produced
therefrom; amending Minnesota Statutes 2014, section 298.28, subdivision 2.

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

Section 1.

Minnesota Statutes 2014, section 298.28, subdivision 2, is amended to read:

Subd. 2.

City or town where quarried or produced.

(a) 4.5 cents per gross ton of
merchantable iron ore concentrate, hereinafter referred to as "taxable ton," plus the amount
provided in paragraph deleted text begin (c) deleted text end new text begin (d) new text end , must be allocated to the city or town in the county in which
the lands from which taconite was mined or quarried were located or within which the
concentrate was produced. If the mining, quarrying, and concentration, or different steps
in either thereof are carried on in more than one taxing district, the commissioner shall
apportion equitably the proceeds of the part of the tax going to cities and towns among
such subdivisions upon the basis of attributing 50 percent of the proceeds of the tax to
the operation of mining or quarrying the taconite, and the remainder to the concentrating
plant and to the processes of concentration, and with respect to each thereof giving due
consideration to the relative extent of such operations performed in each such taxing
district. The commissioner's order making such apportionment shall be subject to review
by the Tax Court at the instance of any of the interested taxing districts, in the same
manner as other orders of the commissioner.

(b) Four cents per taxable ton shall be allocated to cities and organized townships
affected by mining because their boundaries are within three miles of a taconite mine pit
that has been actively mined in at least one of the prior three years. If a city or town is
located near more than one mine meeting these criteria, the city or town is eligible to
receive aid calculated from only the mine producing the largest taxable tonnage. When
more than one municipality qualifies for aid based on one company's production, the
aid must be apportioned among the municipalities in proportion to their populations.
The amounts distributed under this paragraph to each municipality must be used for
infrastructure improvement projects. new text begin The following unorganized territories in St. Louis
County qualify for allocations under this paragraph:
new text end

new text begin (1) 56-17;
new text end

new text begin (2) 58-22;
new text end

new text begin (3) 59-16;
new text end

new text begin (4) 59-21;
new text end

new text begin (5) 60-18; and
new text end

new text begin (6) 60-19.
new text end

new text begin Allocations to an unorganized territory must be based on the production of the taconite
mine pit nearest to that unorganized territory, provided that the total allocation based on
production of that taconite mining pit must be increased in an amount sufficient to prevent
the allocation for an unorganized territory from reducing the allocation to any other
municipality. Allocations for an unorganized territory are made to the county, which must
use the amount allocated for public infrastructure for the unorganized territory.
new text end

(c) new text begin Unless otherwise receiving an allocation under paragraph (b), four cents per
taxable ton shall be allocated to cities and organized townships affected by the production
of merchantable iron ore concentrate because their boundaries are within three miles of
a scram iron ore concentrate facility engaged in production of merchantable iron ore
concentrate that has been actively producing or otherwise engaged in the production of
merchantable iron ore concentrate in at least one of the prior three years. If a city or town
is located near more than one merchantable iron ore concentrating facility meeting these
criteria, the city or town is eligible to receive aid calculated from only the merchantable
iron ore concentrating facility producing the largest taxable tonnage. When more than
one municipality qualifies for aid based on one company's production, the aid must be
apportioned among the municipalities in proportion to their populations. The amounts
distributed under this paragraph to each municipality must be used for infrastructure
improvement projects.
new text end

new text begin (d) new text end The amount that would have been computed for the current year under Minnesota
Statutes 2008, section 126C.21, subdivision 4, for a school district shall be distributed to
the cities and townships within the school district in the proportion that their taxable net
tax capacity within the school district bears to the taxable net tax capacity of the school
district for property taxes payable in the year prior to distribution.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective beginning with the 2016 distribution.
new text end