HF 1222

1st Committee Engrossment - 85th Legislature (2007 - 2008) Posted on 12/22/2009 12:38pm

1.1A bill for an act

1.2relating to taxation; providing for homestead credit state refund; providing for
1.3aids to local governments; providing city foreclosure grants; changing and
1.4providing property tax exemptions and credits; modifying green acre eligibility
1.5requirements; providing for senior citizen and seasonal recreational property
1.6tax deferral programs; modifying transit taxing district; modifying levies,
1.7property valuation procedures, homestead provisions, property tax classes,
1.8and class rates; modifying, extending, and authorizing certain tax increment
1.9financing districts; authorizing and modifying local sales taxes; requiring
1.10studies; providing appointments; appropriating money;amending Minnesota
1.11Statutes 2006, sections 216B.1646; 270C.85, subdivision 2; 272.02, by adding
1.12subdivisions; 273.11, subdivisions 1, 1a, by adding subdivisions; 273.111,
1.13subdivisions 3, as amended, 4, 8, 9, 11, 11a, by adding a subdivision; 273.121, as
1.14amended; 273.124, subdivision 1; 273.13, subdivisions 23, as amended, 24, 25,
1.15as amended; 273.1384, subdivision 1; 274.14; 275.065, subdivisions 1c, 6, 8, 9,
1.1610, by adding subdivisions; 276.04, subdivision 2, as amended; 282.08; 290.01,
1.17subdivision 19a, as amended; 290A.03, subdivision 13; 290A.04, subdivisions
1.182h, 3, 4, by adding a subdivision; 290B.03, subdivision 1; 290B.04, subdivisions
1.193, 4; 290B.05, subdivision 1; 290B.07; 297A.99, subdivision 1, as amended;
1.20469.1813, subdivision 8; 473.446, subdivisions 2, 8; 477A.011, subdivisions 34,
1.2136, as amended, by adding subdivisions; 477A.0124, subdivision 5; 477A.013,
1.22subdivisions 1, 8, as amended, 9, as amended; 477A.03; Minnesota Statutes 2007
1.23Supplement, sections 273.124, subdivision 14; 273.1393; 275.065, subdivisions
1.241, 1a, 3; Laws 2008, chapter 154, article 2, section 11; proposing coding for
1.25new law in Minnesota Statutes, chapter 273; proposing coding for new law as
1.26Minnesota Statutes, chapter 290D; repealing Minnesota Statutes 2006, sections
1.27273.111, subdivision 6; 290A.04, subdivisions 2, 2b; 473.4461.
1.28 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

1.29ARTICLE 1

1.30HOMESTEAD CREDIT STATE REFUND

1.31    Section 1. Minnesota Statutes 2006, section 273.1384, subdivision 1, is amended to
1.32read:
2.1    Subdivision 1. Residential homestead market value credit. (a) Each county
2.2auditor shall determine a homestead credit for each class 1a, 1b, and 2a homestead
2.3property within the county equal to 0.4 percent of the first $76,000 of market value
2.4of the property minus .09 percent of the market value in excess of $76,000. The credit
2.5amount may not be less than zero. In the case of an agricultural or resort homestead, only
2.6the market value of the house, garage, and immediately surrounding one acre of land is
2.7eligible in determining the property's homestead credit. In the case of a property that
2.8is classified as part homestead and part nonhomestead, (i) the credit shall apply only
2.9to the homestead portion of the property, but (ii) if a portion of a property is classified
2.10as nonhomestead solely because not all the owners occupy the property, not all the
2.11owners have qualifying relatives occupying the property, or solely because not all the
2.12spouses of owners occupy the property, the credit amount shall be initially computed as
2.13if that nonhomestead portion were also in the homestead class and then prorated to the
2.14owner-occupant's percentage of ownership. For the purpose of this section, when an
2.15owner-occupant's spouse does not occupy the property, the percentage of ownership for
2.16the owner-occupant spouse is one-half of the couple's ownership percentage.
2.17    (b) For property taxes payable in 2009 and thereafter, the county auditor shall
2.18determine the amount of the homestead credit under paragraph (a) and this paragraph.
2.19The county auditor shall report the amount of the credit to the taxpayer on the property
2.20tax statement or in another manner, as authorized by the commissioner of revenue. The
2.21amount of the credit allowed for the property taxes payable year is to be computed as the
2.22following percentage of the credit amount under paragraph (a):
2.23    (1) for property taxes payable in 2009, 100 percent;
2.24    (2) for property taxes payable in 2010, 60 percent;
2.25    (3) for property taxes payable in 2011, 45 percent;
2.26    (4) for property taxes payable in 2012, 30 percent;
2.27    (5) for property taxes payable in 2013, 15 percent; and
2.28    (6) for property taxes payable in 2014 or thereafter, no credit is allowed.
2.29EFFECTIVE DATE.This section is effective beginning for property taxes payable
2.30in 2009.

2.31    Sec. 2. Minnesota Statutes 2006, section 276.04, subdivision 2, as amended by Laws
2.322008, chapter 154, article 2, section 19, is amended to read:
2.33    Subd. 2. Contents of tax statements. (a) The treasurer shall provide for the
2.34printing of the tax statements. The commissioner of revenue shall prescribe the form
2.35of the property tax statement and its contents. The statement must contain a tabulated
3.1statement of the dollar amount due to each taxing authority and the amount of the state
3.2tax from the parcel of real property for which a particular tax statement is prepared. The
3.3dollar amounts attributable to the county, the state tax, the voter approved school tax, the
3.4other local school tax, the township or municipality, and the total of the metropolitan
3.5special taxing districts as defined in section 275.065, subdivision 3, paragraph (i), must
3.6be separately stated. The amounts due all other special taxing districts, if any, may be
3.7aggregated except that any levies made by the regional rail authorities in the county of
3.8Anoka, Carver, Dakota, Hennepin, Ramsey, Scott, or Washington under chapter 398A
3.9shall be listed on a separate line directly under the appropriate county's levy. If the county
3.10levy under this paragraph includes an amount for a lake improvement district as defined
3.11under sections 103B.501 to 103B.581, the amount attributable for that purpose must be
3.12separately stated from the remaining county levy amount. In the case of Ramsey County,
3.13if the county levy under this paragraph includes an amount for public library service
3.14under section 134.07, the amount attributable for that purpose may be separated from the
3.15remaining county levy amount. The amount of the tax on homesteads qualifying under the
3.16senior citizens' property tax deferral program under chapter 290B is the total amount of
3.17property tax before subtraction of the deferred property tax amount. The amount of the
3.18tax on contamination value imposed under sections 270.91 to 270.98, if any, must also
3.19be separately stated. The dollar amounts, including the dollar amount of any special
3.20assessments, may be rounded to the nearest even whole dollar. For purposes of this section
3.21whole odd-numbered dollars may be adjusted to the next higher even-numbered dollar.
3.22The amount of market value excluded under section 273.11, subdivision 16, if any, must
3.23also be listed on the tax statement.
3.24    (b) The property tax statements for manufactured homes and sectional structures
3.25taxed as personal property shall contain the same information that is required on the
3.26tax statements for real property.
3.27    (c) Real and personal property tax statements must contain the following information
3.28in the order given in this paragraph. The information must contain the current year tax
3.29information in the right column with the corresponding information for the previous year
3.30in a column on the left:
3.31    (1) the property's estimated market value under section 273.11, subdivision 1;
3.32    (2) the property's taxable market value after reductions under section 273.11,
3.33subdivisions 1a and 16 ;
3.34    (3) the property's gross tax, before credits; any items required by the commissioner
3.35of revenue under section 273.1384, subdivision 1, paragraph (b); and
4.1    (4) for homestead residential and agricultural properties, the credits under section
4.2273.1384;
4.3    (5) any credits received under sections 273.119; 273.123; 273.135; 273.1391;
4.4273.1398, subdivision 4; 469.171; and 473H.10, except that the amount of credit received
4.5under section 273.135 must be separately stated and identified as "taconite tax relief"; and
4.6    (6) (4) the net tax payable in the manner required in paragraph (a).
4.7    (d) If the county uses envelopes for mailing property tax statements and if the county
4.8agrees, a taxing district may include a notice with the property tax statement notifying
4.9taxpayers when the taxing district will begin its budget deliberations for the current
4.10year, and encouraging taxpayers to attend the hearings. If the county allows notices to
4.11be included in the envelope containing the property tax statement, and if more than
4.12one taxing district relative to a given property decides to include a notice with the tax
4.13statement, the county treasurer or auditor must coordinate the process and may combine
4.14the information on a single announcement.
4.15EFFECTIVE DATE.This section is effective for taxes payable in 2009 and
4.16thereafter.

4.17    Sec. 3. Minnesota Statutes 2006, section 290.01, subdivision 19a, as amended by Laws
4.182008, chapter 154, article 3, section 2, and Laws 2008, chapter 154, article 4, section 3,
4.19is amended to read:
4.20    Subd. 19a. Additions to federal taxable income. For individuals, estates, and
4.21trusts, there shall be added to federal taxable income:
4.22    (1)(i) interest income on obligations of any state other than Minnesota or a political
4.23or governmental subdivision, municipality, or governmental agency or instrumentality
4.24of any state other than Minnesota exempt from federal income taxes under the Internal
4.25Revenue Code or any other federal statute; and
4.26    (ii) exempt-interest dividends as defined in section 852(b)(5) of the Internal Revenue
4.27Code, except the portion of the exempt-interest dividends derived from interest income
4.28on obligations of the state of Minnesota or its political or governmental subdivisions,
4.29municipalities, governmental agencies or instrumentalities, but only if the portion of the
4.30exempt-interest dividends from such Minnesota sources paid to all shareholders represents
4.3195 percent or more of the exempt-interest dividends that are paid by the regulated
4.32investment company as defined in section 851(a) of the Internal Revenue Code, or the
4.33fund of the regulated investment company as defined in section 851(g) of the Internal
4.34Revenue Code, making the payment; and
5.1    (iii) for the purposes of items (i) and (ii), interest on obligations of an Indian tribal
5.2government described in section 7871(c) of the Internal Revenue Code shall be treated as
5.3interest income on obligations of the state in which the tribe is located;
5.4    (2) the amount of (i) income or sales and use taxes paid or accrued within the
5.5taxable year under this chapter and the amount of taxes based on net income paid or sales
5.6and use taxes paid to any other state or to any province or territory of Canada, and (ii)
5.7the amount of real and personal property taxes paid or accrued within the taxable year,
5.8to the extent allowed as a deduction under section 63(d) of the Internal Revenue Code,
5.9but the addition may not be more than the amount by which the itemized deductions as
5.10allowed under section 63(d) of the Internal Revenue Code exceeds the amount of the
5.11standard deduction as defined in section 63(c) of the Internal Revenue Code. For the
5.12purpose of this paragraph, the disallowance of itemized deductions under section 68 of the
5.13Internal Revenue Code of 1986, income or sales and use tax is the last itemized deduction
5.14disallowed, real property tax is the second to last itemized deduction disallowed, and
5.15personal property tax is the third to last itemized deduction disallowed;
5.16    (3) the capital gain amount of a lump sum distribution to which the special tax under
5.17section 1122(h)(3)(B)(ii) of the Tax Reform Act of 1986, Public Law 99-514, applies;
5.18    (4) the amount of income taxes paid or accrued within the taxable year under this
5.19chapter and taxes based on net income paid to any other state or any province or territory
5.20of Canada, to the extent allowed as a deduction in determining federal adjusted gross
5.21income. For the purpose of this paragraph, income taxes do not include the taxes imposed
5.22by sections 290.0922, subdivision 1, paragraph (b), 290.9727, 290.9728, and 290.9729;
5.23    (5) the amount of expense, interest, or taxes disallowed pursuant to section 290.10
5.24other than expenses or interest used in computing net interest income for the subtraction
5.25allowed under subdivision 19b, clause (1);
5.26    (6) the amount of a partner's pro rata share of net income which does not flow
5.27through to the partner because the partnership elected to pay the tax on the income under
5.28section 6242(a)(2) of the Internal Revenue Code;
5.29    (7) 80 percent of the depreciation deduction allowed under section 168(k) of the
5.30Internal Revenue Code. For purposes of this clause, if the taxpayer has an activity that
5.31in the taxable year generates a deduction for depreciation under section 168(k) and the
5.32activity generates a loss for the taxable year that the taxpayer is not allowed to claim for
5.33the taxable year, "the depreciation allowed under section 168(k)" for the taxable year is
5.34limited to excess of the depreciation claimed by the activity under section 168(k) over the
5.35amount of the loss from the activity that is not allowed in the taxable year. In succeeding
6.1taxable years when the losses not allowed in the taxable year are allowed, the depreciation
6.2under section 168(k) is allowed;
6.3    (8) 80 percent of the amount by which the deduction allowed by section 179 of the
6.4Internal Revenue Code exceeds the deduction allowable by section 179 of the Internal
6.5Revenue Code of 1986, as amended through December 31, 2003;
6.6    (9) to the extent deducted in computing federal taxable income, the amount of the
6.7deduction allowable under section 199 of the Internal Revenue Code;
6.8    (10) the exclusion allowed under section 139A of the Internal Revenue Code for
6.9federal subsidies for prescription drug plans;
6.10    (11) the amount of expenses disallowed under section 290.10, subdivision 2;
6.11    (12) for taxable years beginning after December 31, 2006, and before January 1,
6.122008, the amount deducted for qualified tuition and related expenses under section 222 of
6.13the Internal Revenue Code, to the extent deducted from gross income; and
6.14    (13) for taxable years beginning after December 31, 2006, and before January 1,
6.152008, the amount deducted for certain expenses of elementary and secondary school
6.16teachers under section 62(a)(2)(D) of the Internal Revenue Code, to the extent deducted
6.17from gross income.
6.18EFFECTIVE DATE.This section is effective for taxable years beginning after
6.19December 31, 2008.

6.20    Sec. 4. Minnesota Statutes 2006, section 290A.03, subdivision 13, is amended to read:
6.21    Subd. 13. Property taxes payable. "Property taxes payable" means the property
6.22tax exclusive of special assessments, penalties, and interest payable on a claimant's
6.23homestead after deductions made under sections 273.135, 273.1384, 273.1391, 273.42,
6.24subdivision 2 , and any other state paid property tax credits in any calendar year, and
6.25after any refund claimed and allowable under section 290A.04, subdivision 2h, that is
6.26first payable in the year that the property tax is payable. Beginning for property taxes
6.27payable in 2009, the amount of the credit under section 273.1384, subdivision 1, must
6.28not be deducted in computing property taxes payable. In the case of a claimant who
6.29makes ground lease payments, "property taxes payable" includes the amount of the
6.30payments directly attributable to the property taxes assessed against the parcel on which
6.31the house is located. No apportionment or reduction of the "property taxes payable" shall
6.32be required for the use of a portion of the claimant's homestead for a business purpose if
6.33the claimant does not deduct any business depreciation expenses for the use of a portion
6.34of the homestead in the determination of federal adjusted gross income. For homesteads
6.35which are manufactured homes as defined in section 273.125, subdivision 8, and for
7.1homesteads which are park trailers taxed as manufactured homes under section 168.012,
7.2subdivision 9 , "property taxes payable" shall also include 19 percent of the gross rent paid
7.3in the preceding year for the site on which the homestead is located. When a homestead
7.4is owned by two or more persons as joint tenants or tenants in common, such tenants
7.5shall determine between them which tenant may claim the property taxes payable on the
7.6homestead. If they are unable to agree, the matter shall be referred to the commissioner of
7.7revenue whose decision shall be final. Property taxes are considered payable in the year
7.8prescribed by law for payment of the taxes.
7.9    In the case of a claim relating to "property taxes payable," the claimant must have
7.10owned and occupied the homestead on January 2 of the year in which the tax is payable
7.11and (i) the property must have been classified as homestead property pursuant to section
7.12273.124 , on or before December 15 of the assessment year to which the "property taxes
7.13payable" relate; or (ii) the claimant must provide documentation from the local assessor
7.14that application for homestead classification has been made on or before December 15
7.15of the year in which the "property taxes payable" were payable and that the assessor has
7.16approved the application.
7.17EFFECTIVE DATE.This section is effective beginning for refund claims based on
7.18property taxes payable in 2009.

7.19    Sec. 5. Minnesota Statutes 2006, section 290A.04, subdivision 2h, is amended to read:
7.20    Subd. 2h. Additional refund. (a) If the gross property taxes payable on a
7.21homestead increase more than 12 percent over the property taxes payable in the prior year
7.22on the same property that is owned and occupied by the same owner on January 2 of both
7.23years, and the amount of that increase is $100 or more, a claimant who is a homeowner
7.24shall be allowed an additional refund equal to 60 percent of the amount of the increase
7.25over the greater of 12 percent of the prior year's property taxes payable or $100. This
7.26subdivision shall not apply to any increase in the gross property taxes payable attributable
7.27to improvements made to the homestead after the assessment date for the prior year's
7.28taxes. This subdivision shall not apply to any increase in the gross property taxes payable
7.29attributable to the termination of valuation exclusions under section 273.11, subdivision
7.3016 , or to the reduction in and elimination of the homestead market value credit under
7.31section 273.1384, subdivision 1, paragraph (b).
7.32    The maximum refund allowed under this subdivision is $1,000.
7.33    (b) For purposes of this subdivision "gross property taxes payable" means property
7.34taxes payable determined without regard to the refund allowed under this subdivision.
8.1    (c) In addition to the other proofs required by this chapter, each claimant under
8.2this subdivision shall file with the property tax refund return a copy of the property tax
8.3statement for taxes payable in the preceding year or other documents required by the
8.4commissioner.
8.5    (d) Upon request, the appropriate county official shall make available the names and
8.6addresses of the property taxpayers who may be eligible for the additional property tax
8.7refund under this section. The information shall be provided on a magnetic computer
8.8disk. The county may recover its costs by charging the person requesting the information
8.9the reasonable cost for preparing the data. The information may not be used for any
8.10purpose other than for notifying the homeowner of potential eligibility and assisting the
8.11homeowner, without charge, in preparing a refund claim.
8.12EFFECTIVE DATE.This section is effective for claims based on property taxes
8.13payable in 2009 and thereafter.

8.14    Sec. 6. Minnesota Statutes 2006, section 290A.04, is amended by adding a subdivision
8.15to read:
8.16    Subd. 2k. Homestead credit state refund. (a) A claimant who is a homeowner
8.17is entitled to a state refund of the amount of the property taxes payable in excess of two
8.18percent of the claimant's household income, based on the percentage and maximum for the
8.19appropriate household income level shown below. The refund amount determined from the
8.20table must be reduced further by the amount of the homestead market value credit under
8.21section 273.1384, subdivision 1, paragraph (b), but not to an amount that is less than zero.

8.22	Household Income	Refund Percentage	Maximum State Refund
8.23	0 to $5,399	90 percent	$2,500
8.24	5,400 to 18,899	85 percent	2,500
8.25	18,900 to 26,999	80 percent	2,500
8.26	27,000 to 32,399	70 percent	2,500
8.27	32,400 to 37,799	65 percent	2,500
8.28	37,800 to 45,899	60 percent	2,500
8.29	45,900 to 64,699	55 percent	2,500
8.30	64,700 to 80,899	50 percent	2,300
8.31	80,900 to 94,399	45 percent	2,100
8.32	94,400 to 99,299	40 percent	1,900
8.33	99,300 to 104,099	35 percent	1,700
8.34	104,100 to 115,599	30 percent	1,500
8.35	115,600 to 127,199	25 percent	1,250
8.36	127,200 to 134,099	25 percent	1,000
8.37	134,100 to 138,799	25 percent	750
9.1	138,800 to 144,399	25 percent	500
9.2	144,400 to 200,000	25 percent	250

9.3    (b) No payment is allowed under paragraph (a) if the claimant's household income
9.4is more than $200,000.
9.5EFFECTIVE DATE.This section is effective beginning for claims based on
9.6property taxes payable in 2009.

9.7    Sec. 7. Minnesota Statutes 2006, section 290A.04, subdivision 3, is amended to read:
9.8    Subd. 3. Table. The commissioner of revenue shall construct and make available
9.9to taxpayers a comprehensive table showing the property taxes to be paid and refund
9.10allowed at various levels of income and assessment. The table shall follow the schedule
9.11of income percentages, maximums and other provisions specified in subdivision 2 this
9.12section, except that the commissioner may graduate the transition between income
9.13brackets. All refunds shall be computed in accordance with tables prepared and issued
9.14by the commissioner of revenue.
9.15    The commissioner shall include on the form an appropriate space or method for the
9.16claimant to identify if the property taxes paid are for a manufactured home, as defined in
9.17section 273.125, subdivision 8, paragraph (c), or a park trailer taxed as a manufactured
9.18home under section 168.012, subdivision 9.

9.19    Sec. 8. Minnesota Statutes 2006, section 290A.04, subdivision 4, is amended to read:
9.20    Subd. 4. Inflation adjustment. (a) Beginning for property tax refunds payable in
9.21calendar year 2002 2010, the commissioner shall annually adjust the dollar amounts of the
9.22income thresholds and the maximum refunds under subdivisions 2 and 2a subdivision 2k
9.23for inflation. The commissioner shall make the inflation adjustments in accordance with
9.24section 1(f) of the Internal Revenue Code, except that for purposes of this subdivision
9.25the percentage increase shall be determined from the year ending on June 30, 2000 2008,
9.26to the year ending on June 30 of the year preceding that in which the refund is payable.
9.27The commissioner shall use the appropriate percentage increase to annually adjust the
9.28income thresholds and maximum refunds under subdivisions 2 and 2a subdivision 2k for
9.29inflation without regard to whether or not the income tax brackets are adjusted for inflation
9.30in that year. The commissioner shall round the thresholds and the maximum amounts,
9.31as adjusted to the nearest $10 amount. If the amount ends in $5, the commissioner shall
9.32round it up to the next $10 amount.
10.1    The commissioner shall annually announce the adjusted refund schedule at the same
10.2time provided under section 290.06. The determination of the commissioner under this
10.3subdivision is not a rule under the Administrative Procedure Act.
10.4    (b) Beginning for property tax refunds payable in calendar year 2002, the
10.5commissioner shall annually adjust the dollar amounts of the income thresholds and
10.6the maximum refunds under subdivision 2a for inflation. The commissioner shall make
10.7the inflation adjustments in accordance with section 1(f) of the Internal Revenue Code,
10.8except that for purposes of this subdivision the percentage increase shall be determined
10.9from the year ending on June 30, 2000, to the year ending on June 30 of the year
10.10preceding that in which the refund is payable. The commissioner shall use the appropriate
10.11percentage increase to annually adjust the income thresholds and maximum refunds under
10.12subdivision 2a for inflation without regard to whether or not the income tax brackets are
10.13adjusted for inflation in that year. The commissioner shall round the thresholds and the
10.14maximum amounts, as adjusted to the nearest $10 amount. If the amount ends in $5, the
10.15commissioner shall round it up to the next $10 amount. The commissioner shall annually
10.16announce the adjusted refund schedule at the same time provided under section 290.06.
10.17The determination of the commissioner under this subdivision is not a rule under the
10.18Administrative Procedure Act.
10.19EFFECTIVE DATE.This section is effective beginning for claims based on
10.20property taxes payable in 2010.

10.21    Sec. 9. REPEALER.
10.22Minnesota Statutes 2006, section 290A.04, subdivisions 2 and 2b, are repealed.
10.23EFFECTIVE DATE.This section is effective for claims based on property taxes
10.24payable in 2009 and thereafter.

10.25ARTICLE 2

10.26AIDS AND CREDITS

10.27    Section 1. Minnesota Statutes 2006, section 477A.011, subdivision 34, is amended to
10.28read:
10.29    Subd. 34. City revenue need. (a) For a city with a population equal to or greater
10.30than 2,500, "city revenue need" is the sum of (1) 5.0734098 times the pre-1940 housing
10.31percentage; plus (2) 19.141678 times the population decline percentage; plus (3)
10.322504.06334 times the road accidents factor; plus (4) 355.0547; minus (5) the metropolitan
10.33area factor; minus (6) 49.10638 times the household size.
11.1    (b) For a city with a population less than 2,500, "city revenue need" is the sum of
11.2(1) 2.387 times the pre-1940 housing percentage; plus (2) 2.67591 times the commercial
11.3industrial percentage; plus (3) 3.16042 times the population decline percentage; plus (4)
11.41.206 times the transformed population; minus (5) 62.772.
11.5    (c) For a city with a population of 2,500 or more and a population in one of the most
11.6recently available five years that was less than 2,500, "city revenue need" is the sum of (1)
11.7its city revenue need calculated under paragraph (a) multiplied by its transition factor;
11.8plus (2) its city revenue need calculated under the formula in paragraph (b) multiplied
11.9by the difference between one and its transition factor. For purposes of this paragraph, a
11.10city's "transition factor" is equal to 0.2 multiplied by the number of years that the city's
11.11population estimate has been 2,500 or more. This provision only applies for aids payable
11.12in calendar years 2006 to 2008 to cities with a 2002 population of less than 2,500. It
11.13applies to any city for aids payable in 2009 and thereafter. The city revenue need under
11.14this paragraph may not be less than 290.
11.15    (d) The city revenue need cannot be less than zero.
11.16    (e) For aids certified in 2010 and subsequent years, the city revenue need is equal
11.17to the average of (1) the city's revenue need calculated under paragraphs (a) to (d)
11.18based on data available by January 1 in the year the aid is certified, and (2) its revenue
11.19need calculated under paragraphs (a) to (d) based on data available by January 1 in the
11.20previous year.
11.21    (e) (f) For calendar year 2005 and subsequent years, the city revenue need for a city,
11.22as determined in paragraphs (a) to (d) (e), is multiplied by the ratio of the annual implicit
11.23price deflator for government consumption expenditures and gross investment for state
11.24and local governments as prepared by the United States Department of Commerce, for
11.25the most recently available year to the 2003 implicit price deflator for state and local
11.26government purchases.
11.27EFFECTIVE DATE.This section is effective for aids payable in calendar year
11.282010 and thereafter.

11.29    Sec. 2. Minnesota Statutes 2006, section 477A.011, subdivision 36, as amended by
11.30Laws 2008, chapter 154, article 1, section 1, is amended to read:
11.31    Subd. 36. City aid base. (a) Except as otherwise provided in this subdivision,
11.32"city aid base" is zero.
11.33    (b) The city aid base for any city with a population less than 500 is increased by
11.34$40,000 for aids payable in calendar year 1995 and thereafter, and the maximum amount
12.1of total aid it may receive under section 477A.013, subdivision 9, paragraph (c), is also
12.2increased by $40,000 for aids payable in calendar year 1995 only, provided that:
12.3    (i) the average total tax capacity rate for taxes payable in 1995 exceeds 200 percent;
12.4    (ii) the city portion of the tax capacity rate exceeds 100 percent; and
12.5    (iii) its city aid base is less than $60 per capita.
12.6    (c) The city aid base for a city is increased by $20,000 in 1998 and thereafter and
12.7the maximum amount of total aid it may receive under section 477A.013, subdivision 9,
12.8paragraph (c), is also increased by $20,000 in calendar year 1998 only, provided that:
12.9    (i) the city has a population in 1994 of 2,500 or more;
12.10    (ii) the city is located in a county, outside of the metropolitan area, which contains a
12.11city of the first class;
12.12    (iii) the city's net tax capacity used in calculating its 1996 aid under section
12.13477A.013 is less than $400 per capita; and
12.14    (iv) at least four percent of the total net tax capacity, for taxes payable in 1996, of
12.15property located in the city is classified as railroad property.
12.16    (d) The city aid base for a city is increased by $200,000 in 1999 and thereafter and
12.17the maximum amount of total aid it may receive under section 477A.013, subdivision 9,
12.18paragraph (c), is also increased by $200,000 in calendar year 1999 only, provided that:
12.19    (i) the city was incorporated as a statutory city after December 1, 1993;
12.20    (ii) its city aid base does not exceed $5,600; and
12.21    (iii) the city had a population in 1996 of 5,000 or more.
12.22    (e) The city aid base for a city is increased by $450,000 in 1999 to 2008 and the
12.23maximum amount of total aid it may receive under section 477A.013, subdivision 9,
12.24paragraph (c), is also increased by $450,000 in calendar year 1999 only, provided that:
12.25    (i) the city had a population in 1996 of at least 50,000;
12.26    (ii) its population had increased by at least 40 percent in the ten-year period ending
12.27in 1996; and
12.28    (iii) its city's net tax capacity for aids payable in 1998 is less than $700 per capita.
12.29    (f) (e) The city aid base for a city is increased by $150,000 for aids payable in
12.302000 and thereafter, and the maximum amount of total aid it may receive under section
12.31477A.013, subdivision 9 , paragraph (c), is also increased by $150,000 in calendar year
12.322000 only, provided that:
12.33    (1) the city has a population that is greater than 1,000 and less than 2,500;
12.34    (2) its commercial and industrial percentage for aids payable in 1999 is greater
12.35than 45 percent; and
13.1    (3) the total market value of all commercial and industrial property in the city
13.2for assessment year 1999 is at least 15 percent less than the total market value of all
13.3commercial and industrial property in the city for assessment year 1998.
13.4    (g) (f) The city aid base for a city is increased by $200,000 in 2000 and thereafter,
13.5and the maximum amount of total aid it may receive under section 477A.013, subdivision
13.69 , paragraph (c), is also increased by $200,000 in calendar year 2000 only, provided that:
13.7    (1) the city had a population in 1997 of 2,500 or more;
13.8    (2) the net tax capacity of the city used in calculating its 1999 aid under section
13.9477A.013 is less than $650 per capita;
13.10    (3) the pre-1940 housing percentage of the city used in calculating 1999 aid under
13.11section 477A.013 is greater than 12 percent;
13.12    (4) the 1999 local government aid of the city under section 477A.013 is less than
13.1320 percent of the amount that the formula aid of the city would have been if the need
13.14increase percentage was 100 percent; and
13.15    (5) the city aid base of the city used in calculating aid under section 477A.013
13.16is less than $7 per capita.
13.17    (h) (g) The city aid base for a city is increased by $102,000 in 2000 and thereafter,
13.18and the maximum amount of total aid it may receive under section 477A.013, subdivision
13.199 , paragraph (c), is also increased by $102,000 in calendar year 2000 only, provided that:
13.20    (1) the city has a population in 1997 of 2,000 or more;
13.21    (2) the net tax capacity of the city used in calculating its 1999 aid under section
13.22477A.013 is less than $455 per capita;
13.23    (3) the net levy of the city used in calculating 1999 aid under section 477A.013 is
13.24greater than $195 per capita; and
13.25    (4) the 1999 local government aid of the city under section 477A.013 is less than
13.2638 percent of the amount that the formula aid of the city would have been if the need
13.27increase percentage was 100 percent.
13.28    (i) (h) The city aid base for a city is increased by $32,000 in 2001 and thereafter, and
13.29the maximum amount of total aid it may receive under section 477A.013, subdivision 9,
13.30paragraph (c), is also increased by $32,000 in calendar year 2001 only, provided that:
13.31    (1) the city has a population in 1998 that is greater than 200 but less than 500;
13.32    (2) the city's revenue need used in calculating aids payable in 2000 was greater
13.33than $200 per capita;
13.34    (3) the city net tax capacity for the city used in calculating aids available in 2000
13.35was equal to or less than $200 per capita;
14.1    (4) the city aid base of the city used in calculating aid under section 477A.013
14.2is less than $65 per capita; and
14.3    (5) the city's formula aid for aids payable in 2000 was greater than zero.
14.4    (j) (i) The city aid base for a city is increased by $7,200 in 2001 and thereafter, and
14.5the maximum amount of total aid it may receive under section 477A.013, subdivision 9,
14.6paragraph (c), is also increased by $7,200 in calendar year 2001 only, provided that:
14.7    (1) the city had a population in 1998 that is greater than 200 but less than 500;
14.8    (2) the city's commercial industrial percentage used in calculating aids payable in
14.92000 was less than ten percent;
14.10    (3) more than 25 percent of the city's population was 60 years old or older according
14.11to the 1990 census;
14.12    (4) the city aid base of the city used in calculating aid under section 477A.013
14.13is less than $15 per capita; and
14.14    (5) the city's formula aid for aids payable in 2000 was greater than zero.
14.15    (k) (j) The city aid base for a city is increased by $45,000 in 2001 and thereafter
14.16and by an additional $50,000 in calendar years 2002 to 2011, and the maximum amount
14.17of total aid it may receive under section 477A.013, subdivision 9, paragraph (c), is also
14.18increased by $45,000 in calendar year 2001 only, and by $50,000 in calendar year 2002
14.19only, provided that:
14.20    (1) the net tax capacity of the city used in calculating its 2000 aid under section
14.21477A.013 is less than $810 per capita;
14.22    (2) the population of the city declined more than two percent between 1988 and 1998;
14.23    (3) the net levy of the city used in calculating 2000 aid under section 477A.013 is
14.24greater than $240 per capita; and
14.25    (4) the city received less than $36 per capita in aid under section 477A.013,
14.26subdivision 9 , for aids payable in 2000.
14.27    (l) (k) The city aid base for a city with a population of 10,000 or more which is
14.28located outside of the seven-county metropolitan area is increased in 2002 and thereafter,
14.29and the maximum amount of total aid it may receive under section 477A.013, subdivision
14.309 , paragraph (b) or (c), is also increased in calendar year 2002 only, by an amount equal to
14.31the lesser of:
14.32    (1)(i) the total population of the city, as determined by the United States Bureau of
14.33the Census, in the 2000 census, (ii) minus 5,000, (iii) times 60; or
14.34    (2) $2,500,000.
15.1    (m) (l) The city aid base is increased by $50,000 in 2002 and thereafter, and the
15.2maximum amount of total aid it may receive under section 477A.013, subdivision 9,
15.3paragraph (c), is also increased by $50,000 in calendar year 2002 only, provided that:
15.4    (1) the city is located in the seven-county metropolitan area;
15.5    (2) its population in 2000 is between 10,000 and 20,000; and
15.6    (3) its commercial industrial percentage, as calculated for city aid payable in 2001,
15.7was greater than 25 percent.
15.8    (n) (m) The city aid base for a city is increased by $150,000 in calendar years 2002
15.9to 2011 and by an additional $75,000 in calendar years 2009 to 2014 and the maximum
15.10amount of total aid it may receive under section 477A.013, subdivision 9, paragraph (c), is
15.11also increased by $150,000 in calendar year 2002 only and by $75,000 in calendar year
15.122009 only, provided that:
15.13    (1) the city had a population of at least 3,000 but no more than 4,000 in 1999;
15.14    (2) its home county is located within the seven-county metropolitan area;
15.15    (3) its pre-1940 housing percentage is less than 15 percent; and
15.16    (4) its city net tax capacity per capita for taxes payable in 2000 is less than $900
15.17per capita.
15.18    (o) (n) The city aid base for a city is increased by $200,000 beginning in calendar
15.19year 2003 and the maximum amount of total aid it may receive under section 477A.013,
15.20subdivision 9 , paragraph (c), is also increased by $200,000 in calendar year 2003 only,
15.21provided that the city qualified for an increase in homestead and agricultural credit aid
15.22under Laws 1995, chapter 264, article 8, section 18.
15.23    (p) (o) The city aid base for a city is increased by $200,000 in 2004 only and the
15.24maximum amount of total aid it may receive under section 477A.013, subdivision 9, is
15.25also increased by $200,000 in calendar year 2004 only, if the city is the site of a nuclear
15.26dry cask storage facility.
15.27    (q) (p) The city aid base for a city is increased by $10,000 in 2004 and thereafter
15.28and the maximum total aid it may receive under section 477A.013, subdivision 9, is also
15.29increased by $10,000 in calendar year 2004 only, if the city was included in a federal
15.30major disaster designation issued on April 1, 1998, and its pre-1940 housing stock was
15.31decreased by more than 40 percent between 1990 and 2000.
15.32    (r) (q) The city aid base for a city is increased by $30,000 in 2009 and thereafter
15.33and the maximum total aid it may receive under section 477A.013, subdivision 9, is also
15.34increased by $25,000 in calendar year 2006 only if the city had a population in 2003
15.35of at least 1,000 and has a state park for which the city provides rescue services and
16.1which comprised at least 14 percent of the total geographic area included within the
16.2city boundaries in 2000.
16.3    (s) The city aid base for a city with a population less than 5,000 is increased in
16.42006 and thereafter and the minimum and maximum amount of total aid it may receive
16.5under this section is also increased in calendar year 2006 only by an amount equal to
16.6$6 multiplied by its population.
16.7    (t) (r) The city aid base for a city is increased by $80,000 in 2009 and thereafter and
16.8the minimum and maximum amount of total aid it may receive under section 477A.013,
16.9subdivision 9, is also increased by $80,000 in calendar year 2009 only, if:
16.10    (1) as of May 1, 2006, at least 25 percent of the tax capacity of the city is proposed
16.11to be placed in trust status as tax-exempt Indian land;
16.12    (2) the placement of the land is being challenged administratively or in court; and
16.13    (3) due to the challenge, the land proposed to be placed in trust is still on the tax
16.14rolls as of May 1, 2006.
16.15    (u) (s) The city aid base for a city is increased by $100,000 in 2007 and thereafter
16.16and the minimum and maximum total amount of aid it may receive under this section is
16.17also increased in calendar year 2007 only, provided that:
16.18    (1) the city has a 2004 estimated population greater than 200 but less than 2,000;
16.19    (2) its city net tax capacity for aids payable in 2006 was less than $300 per capita;
16.20    (3) the ratio of its pay 2005 tax levy compared to its city net tax capacity for aids
16.21payable in 2006 was greater than 110 percent; and
16.22    (4) it is located in a county where at least 15,000 acres of land are classified as
16.23tax-exempt Indian reservations according to the 2004 abstract of tax-exempt property.
16.24    (v) (t) The city aid base for a city is increased by $30,000 in 2009 only, and the
16.25maximum total aid it may receive under section 477A.013, subdivision 9, is also increased
16.26by $30,000 in calendar year 2009, only if the city had a population in 2005 of less than
16.273,000 and the city's boundaries as of 2007 were formed by the consolidation of two cities
16.28and one township in 2002.
16.29    (u) The city aid base for a city is increased by $100,000 in 2009 and thereafter, and
16.30the maximum total aid it may receive under section 477A.013, subdivision 9, is also
16.31increased by $100,000 in calendar year 2009 only, if the city had a city net tax capacity for
16.32aids payable in 2007 of less than $150 per capita and the city experienced flooding on
16.33March 14, 2007, that resulted in evacuation of at least 40 homes.
16.34    (v) The city aid base for a city is increased by $200,000 in 2009 to 2013, and the
16.35maximum total aid it may receive under section 477A.013, subdivision 9, is also increased
16.36by $200,000 in calendar year 2009 only, if the city:
17.1    (1) is located outside of the Minneapolis-St. Paul standard metropolitan statistical
17.2area;
17.3    (2) has a 2005 population greater than 7,000 but less than 8,000; and
17.4    (3) has a 2005 net tax capacity per capita of less than $500.
17.5    (w) The city aid base is increased by $80,000 in calendar years 2009 to 2018 and the
17.6maximum amount of total aid it may receive under section 477A.013, subdivision 9, is
17.7increased by $80,000 in calendar year 2009 only, provided that:
17.8    (1) the city is located in the seven-county metropolitan area;
17.9    (2) its population in 2006 is less than 200; and
17.10    (3) the percentage of its housing stock built before 1940, according to the 2000
17.11United States Census, is greater than 40 percent.
17.12    (x) The city aid base for a city is increased by $100,000 in 2009 and thereafter and
17.13the minimum and maximum total amount of aid it may receive under this section is also
17.14increased by $100,000 in calendar year 2009 only, provided that:
17.15    (1) the city is located in the metropolitan area and its 2006 population is less than
17.162,500;
17.17    (2) at least 25 percent of its housing was built before 1940 and at least 50 percent of
17.18its housing is rental housing, according to the 2000 United States Census;
17.19    (3) the median household income in the city is 80 percent or less than the median
17.20household income in the metropolitan area and 50 percent or less than the median
17.21household income for all cities contiguous to that city, according to the 2000 United
17.22States Census; and
17.23    (4) at least 60 percent of the land and water acres in the city are classified as
17.24tax-exempt property, according to its 2008 planning document.
17.25EFFECTIVE DATE.This section is effective for aids payable in calendar year
17.262009 and thereafter.

17.27    Sec. 3. Minnesota Statutes 2006, section 477A.011, is amended by adding a
17.28subdivision to read:
17.29    Subd. 41. Small city aid base. (a) "Small city aid base" for a city with a population
17.30less than 5,000 is equal to $8 multiplied by its population. The small city aid base for
17.31all other cities is equal to zero.
17.32    (b) For calendar year 2010 and subsequent years, the small city aid base for a city,
17.33as determined in paragraph (a), is multiplied by the ratio of the annual implicit price
17.34deflator for government consumption expenditures and gross investment for state and local
17.35governments as prepared by the United States Department of Commerce, for the most
18.1recently available year to the 2007 implicit price deflator for state and local government
18.2purchases.
18.3EFFECTIVE DATE.This section is effective for aids payable in calendar year
18.42009 and thereafter.

18.5    Sec. 4. Minnesota Statutes 2006, section 477A.011, is amended by adding a
18.6subdivision to read:
18.7    Subd. 42. City jobs base. (a) "City jobs base" for a city with a population of 5,000
18.8or more is equal to the product of (1) $18, (2) the number of jobs per capita in the city, and
18.9(3) its population. For cities with a population less than 5,000, the city jobs base is equal
18.10to zero. For a city receiving $2,500,000 in aid under section 477A.011, subdivision 36,
18.11paragraph (l), its city jobs base is reduced by 25 percent of the amount of aid received
18.12under that paragraph. No city's job base may exceed $5,000,000 under this paragraph.
18.13    (b) For calendar year 2010 and subsequent years, the city jobs base for a city, as
18.14determined in paragraph (a), is multiplied by the ratio of the annual implicit price deflator
18.15for government consumption expenditures and gross investment for state and local
18.16governments as prepared by the United States Department of Commerce, for the most
18.17recently available year to the 2007 implicit price deflator for state and local government
18.18purchases.
18.19    (c) For purposes of this subdivision, "jobs per capita in the city" means (1) the
18.20average annual number of employees in the city based on the data from the Quarterly
18.21Census of Employment and Wages, as reported by the Department of Employment and
18.22Economic Development, for the most recent calendar year available as of January 1 of
18.23the year in which the aid is calculated, divided by (2) the city's population for the same
18.24calendar year as the employment data.
18.25EFFECTIVE DATE.This section is effective for aids payable in calendar year
18.262009 and thereafter.

18.27    Sec. 5. Minnesota Statutes 2006, section 477A.0124, subdivision 5, is amended to read:
18.28    Subd. 5. County transition aid. (a) For 2005, a county is eligible for transition
18.29aid equal to the amount, if any, by which:
18.30    (1) the difference between:
18.31    (i) the aid the county received under subdivision 1 in 2004, divided by the total aid
18.32paid to all counties under subdivision 1, multiplied by $205,000,000; and
19.1    (ii) the amount of aid the county is certified to receive in 2005 under subdivisions
19.23 and 4;
19.3exceeds:
19.4    (2) three percent of the county's adjusted net tax capacity.
19.5A county's aid under this paragraph may not be less than zero.
19.6    (b) In 2006, a county is eligible to receive two-thirds of the transition aid it received
19.7in 2005.
19.8    (c) In 2007, For 2009 and each year thereafter, a county is eligible to receive
19.9one-third of the transition aid it received in 2005 2007.
19.10    (d) No county shall receive aid under this subdivision after 2007.
19.11    (b) In 2009 only, a county with (1) a 2006 population less than 30,000, and (2)
19.12an average Part I crimes per capita greater than 3.9 percent based on factors used in
19.13determining county program aid payable in 2008, shall receive $100,000.
19.14    (c) For aids payable in 2009, 2010, and 2011 only, $250,000 each year shall be
19.15distributed to any county in which (1) the 2006 estimated population exceeds 30,000, and
19.16(2) the 2006 percentage of households receiving food stamps exceeds 15 percent, based
19.17on data used in computing county program aids for aids payable in 2008 and the 2006
19.18estimated household count according to the state demographer. The aid must be used to
19.19meet the county's cost of out-of-home placement programs.
19.20EFFECTIVE DATE.This section is effective for aids payable in 2009 and
19.21thereafter.

19.22    Sec. 6. Minnesota Statutes 2006, section 477A.013, subdivision 1, is amended to read:
19.23    Subdivision 1. Towns. In 2002, no In calendar year 2009 and subsequent years,
19.24each organized town is eligible for a distribution under this subdivision equal to $100 plus
19.25the product of the town aid factor multiplied by its population. Each county with one or
19.26more unorganized townships shall receive $100 plus the product of the town aid factor
19.27multiplied by the total population in all unorganized townships in the county.
19.28    The "town aid factor" is the same for all towns and must be calculated by the
19.29Department of Revenue so that the total aid under this subdivision equals the total amount
19.30available for aid under section 477A.03.
19.31EFFECTIVE DATE.This section is effective for aids payable in calendar year
19.322009 and thereafter.

20.1    Sec. 7. Minnesota Statutes 2006, section 477A.013, subdivision 8, as amended by
20.2Laws 2008, chapter 154, article 1, section 2, is amended to read:
20.3    Subd. 8. City formula aid. In calendar year 2004 2009 and subsequent years, the
20.4formula aid for a city is equal to the sum of (1) its city jobs base, (2) its small city aid base,
20.5and (3) the need increase percentage multiplied by the difference between (1) (i) the
20.6city's revenue need multiplied by its population, and (2) (ii) the sum of the city's net tax
20.7capacity multiplied by the tax effort rate.
20.8No city may have a formula aid amount less than zero. The need increase percentage
20.9must be the same for all cities.
20.10    The applicable need increase percentage must be calculated by the Department of
20.11Revenue so that the total of the aid under subdivision 9 equals the total amount available
20.12for aid under section 477A.03 after the subtraction under section 477A.014, subdivisions 4
20.13and 5 . For aids payable in 2009 only, a city's revenue need, population, net tax capacity,
20.14and tax effort rate will be based on the data available for calculating these factors for
20.15aids payable in 2008.
20.16EFFECTIVE DATE.This section is effective for aids payable in calendar year
20.172009 and thereafter.

20.18    Sec. 8. Minnesota Statutes 2006, section 477A.013, subdivision 9, as amended by
20.19Laws 2008, chapter 154, article 1, section 3, is amended to read:
20.20    Subd. 9. City aid distribution. (a) In calendar year 2009 and thereafter, each
20.21city shall receive an aid distribution equal to the sum of (1) the city formula aid under
20.22subdivision 8, and (2) its city aid base, and (3) one-half of the difference between its total
20.23aid in the previous year under this subdivision and its city aid base in the previous year.
20.24    (b) For aids payable in 2010 and thereafter, each city shall receive an aid distribution
20.25equal to (1) the city aid formula under subdivision 8, (2) its city aid base, and (3) its
20.26formula aid under subdivision 8 in the previous year, prior to any adjustments under
20.27this subdivision 2009 only, the total aid for any city shall not exceed the sum of (1) 25
20.28percent of the city's net levy for the year prior to the aid distribution, plus (2) its total
20.29aid in the previous year.
20.30    (c) For aids payable in 2009 2010 and thereafter, the total aid for any city shall
20.31not exceed the sum of (1) ten percent of the city's net levy for the year prior to the aid
20.32distribution plus (2) its total aid in the previous year. For aids payable in 2009 and
20.33thereafter, the total aid for any city with a population of 2,500 or more may not be less
21.1than its total aid under this section in the previous year minus the lesser of $15 multiplied
21.2by its population, or ten percent of its net levy in the year prior to the aid distribution.
21.3    (d) For aids payable in 2009 2010 and thereafter, the total aid for a city with a
21.4population less than 2,500 must not be less than the amount it was certified to receive in
21.5the previous year minus the lesser of $15 multiplied by its population, or five percent of its
21.62003 certified aid amount. For aids payable in 2009 only the total aid for a city with a
21.7population less than 2,500 must not be less than what it received under this section in the
21.8previous year unless its total aid in calendar year 2008 was aid under section 477A.011,
21.9subdivision 36, paragraph (s), in which case its minimum aid is zero.
21.10    (e) If a city's net tax capacity used in calculating aid under this section has decreased
21.11in any year by more than 25 percent from its net tax capacity in the previous year due to
21.12property becoming tax-exempt Indian land, the city's maximum allowed aid increase
21.13under paragraph (c) shall be increased by an amount equal to (1) the city's tax rate in the
21.14year of the aid calculation, multiplied by (2) the amount of its net tax capacity decrease
21.15resulting from the property becoming tax exempt.
21.16EFFECTIVE DATE.This section is effective for aids payable in calendar year
21.172009 and thereafter.

21.18    Sec. 9. Minnesota Statutes 2006, section 477A.03, is amended to read:
21.19477A.03 APPROPRIATION.
21.20    Subd. 2. Annual appropriation. A sum sufficient to discharge the duties imposed
21.21by sections 477A.011 to 477A.014 is annually appropriated from the general fund to the
21.22commissioner of revenue.
21.23    Subd. 2a. Cities. For aids payable in 2004 2009 and thereafter, the total aids aid paid
21.24under section 477A.013, subdivision 9, are limited to $429,000,000 is $515,052,000. For
21.25aids payable in 2005, the total aids paid under section 477A.013, subdivision 9, are limited
21.26to $437,052,000. For aids payable in 2006 and thereafter, the total aids paid under section
21.27477A.013, subdivision 9, is limited to $485,052,000 2009 only, an additional $1,000,000
21.28shall be retained by the commissioner and used to make payments under section 10.
21.29    Subd. 2b. Counties. (a) For aids payable in calendar year 2005 and thereafter,
21.30the total aids paid to counties under section 477A.0124, subdivision 3, are limited to
21.31$100,500,000. For aids payable in 2009 and thereafter, the total aid payable under section
21.32477A.0124, subdivision 3, is $110,500,000 minus one-half of the total aid amount
21.33determined under section 477A.0124, subdivision 5, paragraph (a). Each calendar year,
21.34$500,000 shall be retained by the commissioner of revenue to make reimbursements
22.1to the commissioner of finance for payments made under section 611.27. For calendar
22.2year 2004, the amount shall be in addition to the payments authorized under section
22.3477A.0124, subdivision 1 . For calendar year 2005 and subsequent years, the amount shall
22.4be deducted from the appropriation under this paragraph. The reimbursements shall be to
22.5defray the additional costs associated with court-ordered counsel under section 611.27.
22.6Any retained amounts not used for reimbursement in a year shall be included in the next
22.7distribution of county need aid that is certified to the county auditors for the purpose of
22.8property tax reduction for the next taxes payable year.
22.9    (b) For aids payable in 2005 2009 and thereafter, the total aids aid under section
22.10477A.0124, subdivision 4 , are limited to $105,000,000 is $115,132,923 minus one-half of
22.11the total aid amount determined under section 477A.0124, subdivision 5, paragraph (a).
22.12For aids payable in 2006 and thereafter, the total aid under section 477A.0124, subdivision
22.134 , is limited to $105,132,923. The commissioner of finance shall bill the commissioner of
22.14revenue for the cost of preparation of local impact notes as required by section 3.987, not
22.15to exceed $207,000 in fiscal year 2004 and thereafter. The commissioner of education
22.16shall bill the commissioner of revenue for the cost of preparation of local impact notes
22.17for school districts as required by section 3.987, not to exceed $7,000 in fiscal year 2004
22.18and thereafter. The commissioner of revenue shall deduct the amounts billed under
22.19this paragraph from the appropriation under this paragraph. The amounts deducted are
22.20appropriated to the commissioner of finance and the commissioner of education for the
22.21preparation of local impact notes.
22.22    Subd. 2c. Towns. For aids payable in 2009 and thereafter, the total aid under section
22.23477A.013, subdivision 1, is $3,000,000.
22.24EFFECTIVE DATE.This section is effective for aids payable in calendar year
22.252009 and thereafter.

22.26    Sec. 10. CITY FORECLOSURE GRANTS.
22.27    For calendar 2009 only, a city with a concentration of foreclosures within the city
22.28or within a zip code area of a city in calendar year 2007, may receive a grant under this
22.29section. A "concentration of foreclosures" means that the percent of housing in foreclosure
22.30within the area is at least 50 percent higher than the average percent of housing in
22.31foreclosure in the metropolitan area, as defined in Minnesota Statutes, section 473.121,
22.32subdivision 2. The city must apply to the commissioner of revenue by December 30, 2008,
22.33on the form prescribed by the commissioner. The grant will be paid with other aids paid
22.34in calendar year 2009, as prescribed in section 477A.015.
23.1    The commissioner of revenue shall consult with the commissioner of the Housing
23.2Finance Agency, to develop a form for cities to use when applying for grants under this
23.3section and to determine whether applications qualify. The appropriation for the grants
23.4under Minnesota Statutes, section 477A.03, shall be divided between successful applicants
23.5based on the number of foreclosures in the area meeting the concentration criteria. No city
23.6may receive a grant of more than $250,000. All decisions by the commissioner regarding
23.7grant qualification and amount shall be final. The grant must be used to fund inspection
23.8and public safety costs associated with housing foreclosures.
23.9EFFECTIVE DATE.This section is effective for grants made in calendar year 2009.

23.10    Sec. 11. STUDY OF AIDS TO LOCAL GOVERNMENTS.
23.11    The chairs of the senate and house of representatives committees with jurisdiction
23.12over taxes shall each appoint five members to a study group of the tax committees to
23.13examine the current system of aids to local governments and make recommendations on
23.14improvements to the system. Of the five members appointed by each chair, two must be
23.15members of the tax committee, one of whom is a majority party member and one of
23.16whom is a minority party member. The remaining members must represent local units of
23.17government. The chairs of the divisions of the tax committees having jurisdiction over
23.18property taxes shall also be members and shall serve as cochairs of the study group.
23.19The study shall include, but not be limited to, consideration of existing disparities in
23.20the distribution of local government aid, the relationship of need for city aid to other
23.21sources of revenue such as local sales taxes, an analysis of current law need and capacity
23.22factors as well as alternative need factors, alternative analytical methods for determining
23.23correlations between factors and need, the formula used to calculate aid for small cities,
23.24and volatility in the local government aid distribution. The group must report on its
23.25specific recommendations to the legislature by December 15, 2010.
23.26EFFECTIVE DATE.This section is effective the day following final enactment.

23.27ARTICLE 3

23.28PROPERTY TAXES

23.29    Section 1. Minnesota Statutes 2006, section 216B.1646, is amended to read:
23.30216B.1646 RATE REDUCTION ADJUSTMENT; PROPERTY TAX
23.31REDUCTION CHANGE.
23.32    (a) The commission shall, by any method the commission finds appropriate, reduce
23.33adjust the rates each electric utility subject to rate regulation by the commission charges
24.1its customers to reflect, on an ongoing basis, the amount by which each utility's property
24.2tax, including the state general tax, if applicable, on the personal property of its electric
24.3system from taxes payable in 2001 to taxes payable in 2002 is reduced or pipeline system
24.4transporting or distributing natural gas is changed under this act. The commission must
24.5ensure that, to the extent feasible, each dollar of personal property tax reduction allocated
24.6to Minnesota consumers retroactive to January 1, 2002, change in taxes payable in 2009
24.7and subsequent years results in a dollar of savings adjustment to the utility's customers
24.8rates. A utility may voluntarily pass on any additional property tax savings allocated in
24.9the same manner as approved by the commission under this paragraph. The adjustment
24.10under this paragraph is outside of a general rate case proceeding under section 216B.16.
24.11    (b) By April 10, 2002, Each utility shall may submit a filing to the commission
24.12containing:
24.13    (1) certified information regarding the utility's property tax savings change allocated
24.14to Minnesota retail customers; and
24.15    (2) a proposed method of passing these savings on adjusting rates to Minnesota
24.16retail customers.
24.17The utility shall provide the information in clause (1) to the commissioner of revenue at
24.18the same time. The commissioner shall notify the commission within 30 days as to the
24.19accuracy of the property tax data submitted by the utility.
24.20    (c) For purposes of this section, "personal property" means tools, implements, and
24.21machinery of the generating plant. It does not apply to transformers, transmission lines,
24.22distribution lines, or any other tools, implements, and machinery that are part of an electric
24.23substation, wherever located an electric system or of a pipeline system transporting or
24.24distributing natural gas.

24.25    Sec. 2. Minnesota Statutes 2006, section 270C.85, subdivision 2, is amended to read:
24.26    Subd. 2. Powers and duties. The commissioner shall have and exercise the
24.27following powers and duties in administering the property tax laws.
24.28    (a) Confer with, advise, and give the necessary instructions and directions to local
24.29assessors and local boards of review throughout the state as to their duties under the
24.30laws of the state.
24.31    (b) Direct proceedings, actions, and prosecutions to be instituted to enforce the
24.32laws relating to the liability and punishment of public officers and officers and agents of
24.33corporations for failure or negligence to comply with the provisions of the property tax
24.34laws, and cause complaints to be made against local assessors, members of boards of
25.1equalization, members of boards of review, or any other assessing or taxing officer, to the
25.2proper authority, for their removal from office for misconduct or negligence of duty.
25.3    (c) Require county attorneys to assist in the commencement of prosecutions in
25.4actions or proceedings for removal, forfeiture, and punishment, for violation of the
25.5property tax laws in their respective districts or counties.
25.6    (d) Require town, city, county, and other public officers to report information as to
25.7the assessment of property, and such other information as may be needful in the work of
25.8the commissioner, in such form as the commissioner may prescribe.
25.9    (e) Transmit to the governor, on or before the third Monday in December of each
25.10even-numbered year, and to each member of the legislature, on or before November
25.1115 of each even-numbered year, the report of the department for the preceding years,
25.12showing all the taxable property subject to the property tax laws and the value of the
25.13same, in tabulated form.
25.14    (f) Inquire into the methods of assessment and taxation and ascertain whether the
25.15assessors faithfully discharge their duties.
25.16    (g) Assist local assessors in determining the estimated market value of industrial
25.17special-use property. For purposes of this paragraph, "industrial special-use property"
25.18means property that:
25.19    (1) is designed and equipped for a particular type of industry;
25.20    (2) is not easily adapted to some other use due to the unique nature of the facilities;
25.21    (3) has facilities totaling at least 75,000 square feet in size; and
25.22    (4) has a total estimated market value of $10,000,000 or greater based on the
25.23assessor's preliminary determination.
25.24EFFECTIVE DATE.This section is effective for assessment year 2009 and
25.25thereafter, for taxes payable in 2010 and thereafter.

25.26    Sec. 3. Minnesota Statutes 2006, section 272.02, is amended by adding a subdivision
25.27to read:
25.28    Subd. 85. Fergus Falls historical zone. (a) Property located in the area of the
25.29campus of the former state regional treatment center in the city of Fergus Falls, including
25.30the five buildings and associated land that were acquired by the city prior to January 1,
25.312007, is exempt from ad valorem taxes levied under chapter 275.
25.32    (b) The exemption applies for 15 calendar years from the date specified by resolution
25.33of the governing body of the city of Fergus Falls. For the final three assessment years of
25.34the duration limit, the exemption applies to the following percentages of estimated market
25.35value of the property:
26.1    (1) for the third to the last assessment year of the duration, 75 percent;
26.2    (2) for the second to the last assessment year of the duration, 50 percent; and
26.3    (3) for the last assessment year of the duration, 25 percent.
26.4EFFECTIVE DATE.This section is effective for property taxes payable in 2009
26.5and thereafter.

26.6    Sec. 4. Minnesota Statutes 2006, section 272.02, is amended by adding a subdivision
26.7to read:
26.8    Subd. 86. Electric generation facility; personal property. (a) Notwithstanding
26.9subdivision 9, paragraph (a), attached machinery and other personal property which is
26.10part of a simple-cycle combustion-turbine electric generation facility that exceeds 150
26.11megawatts of installed capacity and that meets the requirements of this subdivision is
26.12exempt. At the time of construction, the facility must:
26.13    (1) utilize natural gas as a primary fuel;
26.14    (2) be owned by an electric generation and transmission cooperative;
26.15    (3) be located within one mile of an existing 16-inch natural gas pipeline and
26.1669-kilovolt and 230-kilovolt high-voltage electric transmission lines;
26.17    (4) be designed to provide peaking, emergency backup, or contingency services;
26.18    (5) have received a certificate of need under section 216B.243 demonstrating
26.19demand for its capacity; and
26.20    (6) have received by resolution the approval from the governing bodies of the county
26.21and the city in which the proposed facility is to be located for the exemption of personal
26.22property under this subdivision.
26.23    (b) Construction of the facility must be commenced after January 1, 2008, and
26.24before January 1, 2012. Property eligible for this exemption does not include electric
26.25transmission lines and interconnections or gas pipelines and interconnections appurtenant
26.26to the property or the facility.
26.27EFFECTIVE DATE.This section is effective for the 2008 assessment payable in
26.282009 and thereafter.

26.29    Sec. 5. [273.0645] COMMISSIONER REVIEW OF LOCAL ASSESSMENT
26.30PRACTICES.
26.31    The commissioner of revenue must review the assessment practices in a taxing
26.32jurisdiction if requested in writing by a qualifying number of property owners in that
26.33taxing jurisdiction. The request must be signed by the greater of:
27.1    (1) one percent of the property owners; or
27.2    (2) five property owners.
27.3    The request must identify the city, town, or county and describe why a review is
27.4sought for that taxing jurisdiction. The commissioner must conduct the review in a
27.5reasonable amount of time and report the findings to the county board of the affected
27.6county, to the affected city council or town board, if the review is for a specific city or
27.7town, and to the property owner designated in the request as the person to receive the
27.8report on behalf of all the property owners who signed the request. The commissioner
27.9must also provide the report electronically to all property owners who signed the request
27.10and provided an e-mail address in order to receive the report electronically.
27.11EFFECTIVE DATE.This section is effective the day following final enactment.

27.12    Sec. 6. Minnesota Statutes 2006, section 273.11, subdivision 1, is amended to read:
27.13    Subdivision 1. Generally. Except as provided in this section or section 273.17,
27.14subdivision 1 , all property shall be valued at its market value. The market value as
27.15determined pursuant to this section shall be stated such that any amount under $100 is
27.16rounded up to $100 and any amount exceeding $100 shall be rounded to the nearest $100.
27.17In estimating and determining such value, the assessor shall not adopt a lower or different
27.18standard of value because the same is to serve as a basis of taxation, nor shall the assessor
27.19adopt as a criterion of value the price for which such property would sell at a forced
27.20sale, or in the aggregate with all the property in the town or district; but the assessor
27.21shall value each article or description of property by itself, and at such sum or price as
27.22the assessor believes the same to be fairly worth in money. The assessor shall take into
27.23account the effect on the market value of property of environmental factors in the vicinity
27.24of the property, and the market value effect of foreclosed property on all property in the
27.25vicinity due to the foreclosures. In assessing any tract or lot of real property, the value
27.26of the land, exclusive of structures and improvements, shall be determined, and also the
27.27value of all structures and improvements thereon, and the aggregate value of the property,
27.28including all structures and improvements, excluding the value of crops growing upon
27.29cultivated land. In valuing real property upon which there is a mine or quarry, it shall be
27.30valued at such price as such property, including the mine or quarry, would sell for at a fair,
27.31voluntary sale, for cash, if the material being mined or quarried is not subject to taxation
27.32under section 298.015 and the mine or quarry is not exempt from the general property
27.33tax under section 298.25. In valuing real property which is vacant, platted property shall
27.34be assessed as provided in subdivision 14. All property, or the use thereof, which is
27.35taxable under section 272.01, subdivision 2, or 273.19, shall be valued at the market
28.1value of such property and not at the value of a leasehold estate in such property, or at
28.2some lesser value than its market value.
28.3EFFECTIVE DATE.This section is effective for the 2009 assessment and
28.4thereafter.

28.5    Sec. 7. Minnesota Statutes 2006, section 273.11, subdivision 1a, is amended to read:
28.6    Subd. 1a. Limited market value. In the case of all property classified as
28.7agricultural homestead or nonhomestead, residential homestead or nonhomestead, timber,
28.8or noncommercial seasonal residential recreational, the assessor shall compare the value
28.9with the taxable portion of the value determined in the preceding assessment.
28.10    For assessment years 2004, 2005, and 2006, the amount of the increase shall not
28.11exceed the greater of (1) 15 percent of the value in the preceding assessment, or (2) 25
28.12percent of the difference between the current assessment and the preceding assessment.
28.13    For assessment year years 2007 through 2009, the amount of the increase shall not
28.14exceed the greater of (1) 15 percent of the value in the preceding assessment, or (2) 33
28.15percent of the difference between the current assessment and the preceding assessment.
28.16    For assessment year 2008 2010, the amount of the increase shall not exceed the
28.17greater of (1) 15 percent of the value in the preceding assessment, or (2) 50 percent of the
28.18difference between the current assessment and the preceding assessment.
28.19    This limitation shall not apply to increases in value due to improvements. For
28.20purposes of this subdivision, the term "assessment" means the value prior to any exclusion
28.21under subdivision 16.
28.22    The provisions of this subdivision shall be in effect through assessment year 2008
28.232010 as provided in this subdivision.
28.24    For purposes of the assessment/sales ratio study conducted under section 127A.48,
28.25and the computation of state aids paid under chapters 122A, 123A, 123B, 124D, 125A,
28.26126C, 127A, and 477A, market values and net tax capacities determined under this
28.27subdivision and subdivision 16, shall be used.
28.28EFFECTIVE DATE.This section is effective for assessment year 2008 and
28.29thereafter, for taxes payable in 2009 and thereafter.

28.30    Sec. 8. Minnesota Statutes 2006, section 273.11, is amended by adding a subdivision to
28.31read:
28.32    Subd. 24. Rural vacant land abutting public waters. (a) Any property that:
28.33    (1) is located in a township;
29.1    (2) is classified as either (i) agricultural property under section 273.13, subdivision
29.223, paragraph (b), or (ii) rural vacant land under section 273.13, subdivision 23, paragraph
29.3(c), contiguous to agricultural property under the same ownership with at least two-thirds
29.4of the acreage used for agricultural purposes;
29.5    (3) is not enrolled in the Minnesota agricultural property tax law under section
29.6273.111; and
29.7    (4) abuts public waters in whole or in part,
29.8shall be valued by the assessor on the same basis as rural vacant land of the same quality
29.9that does not abut public waters, until some action is taken to develop the land as specified
29.10in paragraph (c).
29.11    (b) In each assessment year, the assessor shall determine the estimated market value
29.12of the property as provided under subdivision 1, taking into consideration its highest
29.13and best use. For each year that the property is classified under this subdivision, the
29.14property tax statement shall include a notice that the property is being taxed under a
29.15reduced valuation that will terminate under certain conditions.
29.16    (c) An owner of property meeting the criteria of this subdivision must notify the
29.17county assessor within 30 days of applying for a development permit from the county
29.18or local zoning board. If development permits are not required, an owner of property
29.19meeting the criteria of this subdivision must notify the assessor prior to all or any portion
29.20of the property being platted or subdivided.
29.21    (d) When any of the conditions specified in paragraph (c) occurs, additional taxes
29.22shall be imposed in an amount equal to: (1) the average of the difference between the
29.23amount of taxes actually levied on the property in the current year and the two prior years,
29.24and the amount of taxes that would have been levied in the current year and the two prior
29.25years based on the estimated market value determined under paragraph (b); (2) multiplied
29.26by seven. The additional taxes shall be extended against the property on the tax list for the
29.27current year, provided that no interest or penalties shall be levied on the additional taxes if
29.28timely paid. For purposes of this subdivision, "public waters" means a meandered lake as
29.29defined under section 103G.005, subdivision 15, paragraph (a), clause (3).
29.30EFFECTIVE DATE.This section is effective for the 2009 assessment and
29.31thereafter.

29.32    Sec. 9. Minnesota Statutes 2006, section 273.11, is amended by adding a subdivision to
29.33read:
30.1    Subd. 25. Limit on taxable valuation; certain restored homes. A homestead
30.2property that either (i) has gone through foreclosure or (ii) is located within a disaster
30.3or emergency area and sustained physical damage of at least $5,000 in the disaster or
30.4emergency is eligible for valuation limitation under this subdivision. To qualify for the
30.5limitation, the property must:
30.6    (i) have been restored or rebuilt within 18 months of the foreclosure or the disaster
30.7or emergency;
30.8    (ii) have a gross living area that does not exceed 130 percent of the gross living area
30.9prior to the foreclosure or the disaster or emergency; and
30.10    (iii) have an estimated market value that exceeds its taxable market value for the
30.11assessment year of the foreclosure or the disaster or emergency by at least $20,000, due to
30.12the restoration or reconstruction.
30.13    In the first assessment year following the restoration or reconstruction, the taxable
30.14value shall be equal to three-quarters of its taxable value in the assessment year of the
30.15foreclosure or disaster or emergency, plus one-quarter of its current estimated market
30.16value. In the second assessment year following the restoration or reconstruction, the
30.17taxable value shall be equal to one-half of its taxable value in the assessment year of the
30.18foreclosure or disaster or emergency, and one-half of its current estimated market value.
30.19In the third assessment year following the restoration or reconstruction, the taxable value
30.20shall be equal to one-quarter of its taxable value in the assessment year of the foreclosure
30.21or disaster or emergency, and three-quarters of its current estimated market value. For
30.22the three assessment years immediately following the restoration or reconstruction, the
30.23property is not subject to the valuation limit under subdivision 1a.
30.24    For the purposes of this subdivision:
30.25    (i) "disaster or emergency area" means an area in which the president of the United
30.26States or the administrator of the Small Business Administration has determined that
30.27a disaster exists pursuant to federal law;
30.28    (ii) "gone through foreclosure" means that a foreclosure sale has been held and that
30.29the person who owned the home prior to the sale did not redeem it from the sale under
30.30section 580.23; and
30.31    (iii) "gross living area" means the square footage of the home that would customarily
30.32be used as living space.
30.33EFFECTIVE DATE.This section is effective for assessment year 2009 and
30.34thereafter.

31.1    Sec. 10. Minnesota Statutes 2006, section 273.111, subdivision 3, as amended by Laws
31.22008, chapter 154, article 13, section 26, is amended to read:
31.3    Subd. 3. Requirements. (a) Real estate consisting of ten three acres or more or
31.4a nursery or greenhouse, and qualifying for classification as class 1b, 2a, or 2b under
31.5section 273.13, shall be entitled to valuation and tax deferment under this section only
31.6if it is primarily devoted to agricultural use, and meets the qualifications in subdivision
31.76, and either:
31.8    (1) is the homestead of the owner, or of a surviving spouse, child, or sibling of the
31.9owner or is real estate which is farmed with the real estate which contains the homestead
31.10property; or
31.11    (2) has been in possession of the applicant, the applicant's spouse, parent, or sibling,
31.12or any combination thereof, for a period of at least seven years prior to application for
31.13benefits under the provisions of this section, or is real estate which is farmed with the
31.14real estate which qualifies under this clause and is within four townships or cities or
31.15combination thereof from the qualifying real estate; or
31.16    (3) is the homestead of a shareholder in a family farm corporation as defined in an
31.17individual who is part of an entity in compliance with section 500.24, notwithstanding
31.18the fact that legal title to the real estate may be held in the name of the family farm
31.19corporation; or
31.20    (4) is in the possession of a nursery or greenhouse or an entity owned by a proprietor,
31.21partnership, or corporation which also owns the nursery or greenhouse operations on the
31.22parcel or parcels, provided that only the acres used to produce nursery stock qualify
31.23for treatment under this section.
31.24    (b) Valuation of real estate under this section is limited to parcels the ownership of
31.25which is in noncorporate entities except for:
31.26    (1) family farm corporations organized pursuant to section 500.24; and
31.27    (2) corporations that derive 80 percent or more of their gross receipts from the
31.28wholesale or retail sale of horticultural or nursery stock.
31.29    (c) Land that previously qualified for tax deferment under this section and no longer
31.30qualifies because it is not primarily used for agricultural purposes but would otherwise
31.31qualify under subdivisions Minnesota Statutes 2006, section 273.111, subdivision 3, and 6
31.32for a period of at least three years will not be required to make payment of the previously
31.33deferred taxes, notwithstanding the provisions of subdivision 9. Sale of the land prior to
31.34the expiration of the three-year period requires payment of deferred taxes as follows: sale
31.35in the year the land no longer qualifies requires payment of the current year's deferred
31.36taxes plus payment of deferred taxes for the two prior years; sale during the second year
32.1the land no longer qualifies requires payment of the current year's deferred taxes plus
32.2payment of the deferred taxes for the prior year; and sale during the third year the land
32.3no longer qualifies requires payment of the current year's deferred taxes. Deferred taxes
32.4shall be paid even if the land qualifies pursuant to subdivision 11a. When such property is
32.5sold or no longer qualifies under this paragraph, or at the end of the three-year period,
32.6whichever comes first, all deferred special assessments plus interest are payable in equal
32.7installments spread over the time remaining until the last maturity date of the bonds issued
32.8to finance the improvement for which the assessments were levied. If the bonds have
32.9matured, the deferred special assessments plus interest are payable within 90 days. The
32.10provisions of section 429.061, subdivision 2, apply to the collection of these installments.
32.11Penalties are not imposed on any such special assessments if timely paid.
32.12EFFECTIVE DATE.This section is effective for assessment year 2009, taxes
32.13payable in 2010 and thereafter.

32.14    Sec. 11. Minnesota Statutes 2006, section 273.111, is amended by adding a subdivision
32.15to read:
32.16    Subd. 3a. Property no longer eligible for deferment. Real estate that qualifies for
32.17tax deferment under this section for assessment year 2008, but which does not qualify
32.18for the current assessment year due to changes in qualification requirements under this
32.19act, shall continue to qualify until the land is sold or transferred, provided that the
32.20property continues to meet the requirements of Minnesota Statutes 2006, section 273.111,
32.21subdivision 3.
32.22EFFECTIVE DATE.This section is effective for taxes payable in 2010 and
32.23thereafter.

32.24    Sec. 12. Minnesota Statutes 2006, section 273.111, subdivision 4, is amended to read:
32.25    Subd. 4. Determination of value. (a) The value of any real estate described
32.26in subdivision 3 shall upon timely application by the owner, in the manner provided
32.27in subdivision 8, be determined solely with reference to its appropriate agricultural
32.28classification and value notwithstanding sections 272.03, subdivision 8, and 273.11. In
32.29determining the value for ad valorem tax purposes, the assessor shall use sales data for
32.30agricultural lands located outside the seven metropolitan counties having similar soil
32.31types, number of degree days, and other similar agricultural characteristics. Furthermore,
32.32the assessor shall not consider any added values resulting from nonagricultural factors.
32.33In order to account for the presence of nonagricultural influences that may affect the value
33.1of agricultural land, the commissioner of revenue shall develop a fair and uniform method
33.2of determining agricultural values for each county in the state that are consistent with this
33.3subdivision. The commissioner shall annually assign the resulting values to each county,
33.4and these values shall be used as the basis for determining the agricultural value for all
33.5properties in the county qualifying for tax deferment under this section.
33.6    (b) In the case of property qualifying for tax deferment only under subdivision 3a,
33.7the value shall be based on the value in effect for assessment year 2008, multiplied by
33.8the ratio of the total taxable market value of all property in the county for the current
33.9assessment year divided by the total taxable market value of all property in the county
33.10for assessment year 2008.
33.11EFFECTIVE DATE.This section is effective for assessment year 2009 and
33.12thereafter.

33.13    Sec. 13. Minnesota Statutes 2006, section 273.111, subdivision 8, is amended to read:
33.14    Subd. 8. Application. Application for deferment of taxes and assessment under this
33.15section shall be filed by May 1 of the year prior to the year in which the taxes are payable.
33.16Any application filed hereunder and granted shall continue in effect for subsequent years
33.17until the property no longer qualifies. Such application shall be filed with the assessor of
33.18the taxing district in which the real property is located on such form as may be prescribed
33.19by the commissioner of revenue. The assessor may require proof by affidavit or otherwise
33.20that the property qualifies under subdivisions subdivision 3 and 6.
33.21EFFECTIVE DATE.This section is effective for taxes payable in 2010 and
33.22thereafter.

33.23    Sec. 14. Minnesota Statutes 2006, section 273.111, subdivision 9, is amended to read:
33.24    Subd. 9. Additional taxes. When real property which is being, or has been valued
33.25and assessed under this section no longer qualifies under subdivisions subdivision 3
33.26and 6 or 3a, the portion no longer qualifying shall be subject to additional taxes, in the
33.27amount equal to the average difference between the taxes determined in accordance with
33.28subdivision 4, and the amount determined under subdivision 5, for the current year and the
33.29two preceding years, multiplied by seven. Provided, however, that the amount determined
33.30under subdivision 5 shall not be greater than it would have been had the actual bona fide
33.31sale price of the real property at an arm's-length transaction been used in lieu of the market
33.32value determined under subdivision 5. Such additional taxes shall be extended against
33.33the property on the tax list for the current year, provided, however, that no interest or
34.1penalties shall be levied on such additional taxes if timely paid, and provided further, that
34.2such additional taxes shall only be levied with respect to the last three years that the said
34.3property has been valued and assessed under this section.
34.4EFFECTIVE DATE.This section is effective for taxes payable in 2010 and
34.5thereafter.

34.6    Sec. 15. Minnesota Statutes 2006, section 273.111, subdivision 11, is amended to read:
34.7    Subd. 11. Special local assessments. The payment of special local assessments
34.8levied after June 1, 1967, for improvements made to any real property described in
34.9subdivision 3 together with the interest thereon shall, on timely application as provided
34.10in subdivision 8, be deferred as long as such property meets the conditions contained in
34.11subdivisions subdivision 3 and 6 or 3a or is transferred to an agricultural preserve under
34.12sections 473H.02 to 473H.17. If special assessments against the property have been
34.13deferred pursuant to this subdivision, the governmental unit shall file with the county
34.14recorder in the county in which the property is located a certificate containing the legal
34.15description of the affected property and of the amount deferred. When such property
34.16no longer qualifies under subdivisions subdivision 3 and 6 or 3a, all deferred special
34.17assessments plus interest shall be payable in equal installments spread over the time
34.18remaining until the last maturity date of the bonds issued to finance the improvement
34.19for which the assessments were levied. If the bonds have matured, the deferred special
34.20assessments plus interest shall be payable within 90 days. The provisions of section
34.21429.061, subdivision 2 , apply to the collection of these installments. Penalty shall not be
34.22levied on any such special assessments if timely paid.
34.23EFFECTIVE DATE.This section is effective for taxes payable in 2010 and
34.24thereafter.

34.25    Sec. 16. Minnesota Statutes 2006, section 273.111, subdivision 11a, is amended to read:
34.26    Subd. 11a. Continuation of tax treatment upon sale. When real property
34.27qualifying under subdivisions subdivision 3 and 6 is sold, no additional taxes or deferred
34.28special assessments plus interest shall be extended against the property provided the
34.29property continues to qualify pursuant to subdivisions subdivision 3 and 6, and provided
34.30the new owner files an application for continued deferment within 30 days after the sale.
34.31    For purposes of meeting the income requirements of subdivision 6, the property
34.32purchased shall be considered in conjunction with other qualifying property owned by
34.33the purchaser.
35.1EFFECTIVE DATE.This section is effective for taxes payable in 2010 and
35.2thereafter.

35.3    Sec. 17. [273.113] TAX CREDIT FOR PROPERTY IN BOVINE
35.4TUBERCULOSIS MANAGEMENT ZONES.
35.5    Subdivision 1. Definition. For the purposes of this section, "bovine tuberculosis
35.6management zone" means the area within the ten-mile radius around the five presumptive
35.7tuberculosis-positive deer sampled during the fall 2006 hunter-harvested surveillance
35.8effort.
35.9    Subd. 2. Eligibility; credit on agricultural land; cattle herds. Land classified
35.10as class 2a or 2b under section 273.13, subdivision 23, located in a bovine tuberculosis
35.11management zone is eligible for a property tax credit if the property owner has eradicated
35.12a cattle herd that had been kept on that land for at least part of the year in order to prevent
35.13the onset or spread of bovine tuberculosis. The net credit is equal to that portion of the tax
35.14relating to the market value of the land on the parcels where the herd had been located
35.15after all other applicable credits have been deducted. To initially qualify for the tax credit,
35.16the property owner shall file an application with the county by January 2 of the year
35.17following the calendar year when the herd was eradicated. The credit must be given for
35.18each taxes payable year following the calendar year when the herd was eradicated and
35.19must terminate for all taxes payable years beginning after the calendar year when a new
35.20herd of cattle was placed on the land. The auditor shall indicate the amount of the property
35.21tax reduction on the property tax statement of each taxpayer receiving a credit under
35.22this section. Notwithstanding section 276.04, subdivision 3, property tax statements of
35.23properties eligible for a credit under this section must be mailed no later than April 15.
35.24    Subd. 3. Eligibility; credit on hunting land; deer and elk herds. Land located
35.25in a bovine tuberculosis management zone that is primarily used for hunting purposes is
35.26eligible for a property tax credit if (1) the property owner or the Department of Natural
35.27Resources has eradicated the deer and elk herd on that land in order to prevent the onset or
35.28spread of bovine tuberculosis, (2) the property owner adheres strictly to the deer and elk
35.29feeding ban, and (3) the property owner makes every effort to keep their land free of deer
35.30and elk. The net credit is equal to the property tax on the parcel where the herd had been
35.31located after all other applicable credits have been deducted. The credit is only on that
35.32portion of the tax relating to the market value of the land. To initially qualify for the tax
35.33credit, the property owner shall file an application with the county by January 2 of the
35.34year following the calendar year when the deer or elk herd was eradicated. To receive
35.35the tax credit in subsequent years, the property owner shall file by January 2 of each
36.1subsequent year until the state is upgraded to a bovine tuberculosis status of modified
36.2accredited advanced. The county board must approve the application before the credit
36.3is allowed. The credit is for each taxes payable year following the calendar year when
36.4the deer or elk herd was eradicated and must terminate as provided in subdivision 5.
36.5The auditor shall indicate the amount of the property tax reduction on the property tax
36.6statement of each taxpayer receiving a credit under this section. Notwithstanding section
36.7276.04, subdivision 3, property tax statements of properties eligible for a credit under this
36.8section must be mailed no later than April 15.
36.9    Subd. 4. Reimbursement for lost revenue; appropriations. The county auditor
36.10shall certify to the commissioner of revenue, as part of the abstracts of tax lists required to
36.11be filed with the commissioner under section 275.29, the amount of tax lost to the county
36.12from the property tax credit under this section after all other applicable credits have been
36.13deducted. Any prior year adjustments must also be certified in the abstracts of tax lists.
36.14The commissioner of revenue shall review the certifications to determine their accuracy.
36.15The commissioner may make the changes in the certification that are considered necessary
36.16or return a certification to the county auditor for corrections. The commissioner shall
36.17reimburse each taxing district for the taxes lost. The payments must be made at the time
36.18provided in section 273.1398, subdivision 6, for payment to taxing jurisdictions in the
36.19same proportion that the ad valorem tax is distributed. The amount necessary to make the
36.20reimbursements under this section is annually appropriated from the general fund to the
36.21commissioner of revenue. The credits paid under this section shall be deducted from the
36.22tax due on the property as provided in section 273.1393.
36.23    Subd. 5. Termination of credit. The credit provided under this section ceases to
36.24be available beginning with any assessment year following the date when the United
36.25States Department of Agriculture publishes notice in the Federal Register that the state is
36.26upgraded to a bovine tuberculosis status of modified accredited advanced.
36.27EFFECTIVE DATE.This section is effective beginning with taxes payable in 2009.

36.28    Sec. 18. Minnesota Statutes 2006, section 273.121, as amended by Laws 2008, chapter
36.29154, article 13, section 28, is amended to read:
36.30273.121 VALUATION OF REAL PROPERTY, NOTICE.
36.31    Subdivision 1. Notice. Any county assessor or city assessor having the powers of a
36.32county assessor, valuing or classifying taxable real property shall in each year notify those
36.33persons whose property is to be included on the assessment roll that year if the person's
36.34address is known to the assessor, otherwise the occupant of the property. The notice shall
37.1be in writing and shall be sent by ordinary mail at least ten days before the meeting of
37.2the local board of appeal and equalization under section 274.01 or the review process
37.3established under section 274.13, subdivision 1c. Upon written request by the owner of the
37.4property, the assessor may send the notice in electronic form or by electronic mail instead
37.5of on paper or by ordinary mail. It shall contain: (1) the market value for the current and
37.6prior assessment, (2) the limited market value under section 273.11, subdivision 1a, for
37.7the current and prior assessment, (3) the qualifying amount of any improvements under
37.8section 273.11, subdivision 16, for the current assessment, (4) the market value subject
37.9to taxation after subtracting the amount of any qualifying improvements for the current
37.10assessment, (5) the classification of the property for the current and prior assessment,
37.11(6) a note that if the property is homestead and at least 45 years old, improvements
37.12made to the property may be eligible for a valuation exclusion under section 273.11,
37.13subdivision 16 , (7) the assessor's office address, and (8) the dates, places, and times set for
37.14the meetings of the local board of appeal and equalization, the review process established
37.15under section 274.13, subdivision 1c, and the county board of appeal and equalization.
37.16The commissioner of revenue shall specify the form of the notice. The assessor shall
37.17attach to the assessment roll a statement that the notices required by this section have been
37.18mailed. Any assessor who is not provided sufficient funds from the assessor's governing
37.19body to provide such notices, may make application to the commissioner of revenue
37.20to finance such notices. The commissioner of revenue shall conduct an investigation
37.21and, if satisfied that the assessor does not have the necessary funds, issue a certification
37.22to the commissioner of finance of the amount necessary to provide such notices. The
37.23commissioner of finance shall issue a warrant for such amount and shall deduct such
37.24amount from any state payment to such county or municipality. The necessary funds to
37.25make such payments are hereby appropriated. Failure to receive the notice shall in no way
37.26affect the validity of the assessment, the resulting tax, the procedures of any board of
37.27review or equalization, or the enforcement of delinquent taxes by statutory means.
37.28    Subd. 2. Availability of data. The notice must state where the information on
37.29the property is available, the times when the information may be viewed by the public,
37.30and the county's Web site address.
37.31EFFECTIVE DATE.This section is effective for notices prepared in 2009 and
37.32thereafter.

37.33    Sec. 19. Minnesota Statutes 2006, section 273.124, subdivision 1, is amended to read:
38.1    Subdivision 1. General rule. (a) Residential real estate that is occupied and used
38.2for the purposes of a homestead by its owner, who must be a Minnesota resident, is
38.3a residential homestead.
38.4    Agricultural land, as defined in section 273.13, subdivision 23, that is occupied and
38.5used as a homestead by its owner, who must be a Minnesota resident, is an agricultural
38.6homestead.
38.7    Dates for establishment of a homestead and homestead treatment provided to
38.8particular types of property are as provided in this section.
38.9    Property held by a trustee under a trust is eligible for homestead classification if the
38.10requirements under this chapter are satisfied.
38.11    The assessor shall require proof, as provided in subdivision 13, of the facts upon
38.12which classification as a homestead may be determined. Notwithstanding any other law,
38.13the assessor may at any time require a homestead application to be filed in order to verify
38.14that any property classified as a homestead continues to be eligible for homestead status.
38.15Notwithstanding any other law to the contrary, the Department of Revenue may, upon
38.16request from an assessor, verify whether an individual who is requesting or receiving
38.17homestead classification has filed a Minnesota income tax return as a resident for the most
38.18recent taxable year for which the information is available.
38.19    When there is a name change or a transfer of homestead property, the assessor may
38.20reclassify the property in the next assessment unless a homestead application is filed to
38.21verify that the property continues to qualify for homestead classification.
38.22    (b) For purposes of this section, homestead property shall include property which
38.23is used for purposes of the homestead but is separated from the homestead by a road,
38.24street, lot, waterway, or other similar intervening property. The term "used for purposes
38.25of the homestead" shall include but not be limited to uses for gardens, garages, or other
38.26outbuildings commonly associated with a homestead, but shall not include vacant land
38.27held primarily for future development. In order to receive homestead treatment for
38.28the noncontiguous property, the owner must use the property for the purposes of the
38.29homestead, and must apply to the assessor, both by the deadlines given in subdivision
38.309. After initial qualification for the homestead treatment, additional applications for
38.31subsequent years are not required.
38.32    (c) Residential real estate that is occupied and used for purposes of a homestead by a
38.33relative of the owner is a homestead but only to the extent of the homestead treatment
38.34that would be provided if the related owner occupied the property. For purposes of this
38.35paragraph and paragraph (g), "relative" means a parent, stepparent, child, stepchild,
38.36grandparent, grandchild, brother, sister, uncle, aunt, nephew, or niece. This relationship
39.1may be by blood or marriage. Property that has been classified as seasonal residential
39.2recreational property at any time during which it has been owned by the current owner or
39.3spouse of the current owner will not be reclassified as a homestead unless it is occupied as
39.4a homestead by the owner; this prohibition also applies to property that, in the absence of
39.5this paragraph, would have been classified as seasonal residential recreational property at
39.6the time when the residence was constructed. Neither the related occupant nor the owner
39.7of the property may claim a property tax refund under chapter 290A for a homestead
39.8occupied by a relative. In the case of a residence located on agricultural land, only the
39.9house, garage, and immediately surrounding one acre of land shall be classified as a
39.10homestead under this paragraph, except as provided in paragraph (d).
39.11    (d) Agricultural property that is occupied and used for purposes of a homestead by
39.12a relative of the owner, is a homestead, only to the extent of the homestead treatment
39.13that would be provided if the related owner occupied the property, and only if all of the
39.14following criteria are met:
39.15    (1) the relative who is occupying the agricultural property is a son, daughter, brother,
39.16sister, grandson, granddaughter, father, or mother of the owner of the agricultural property
39.17or a son, daughter, brother, sister, grandson, or granddaughter of the spouse of the owner
39.18of the agricultural property;
39.19    (2) the owner of the agricultural property must be a Minnesota resident;
39.20    (3) the owner of the agricultural property must not receive homestead treatment on
39.21any other agricultural property in Minnesota; and
39.22    (4) the owner of the agricultural property is limited to only one agricultural
39.23homestead per family under this paragraph.
39.24    Neither the related occupant nor the owner of the property may claim a property
39.25tax refund under chapter 290A for a homestead occupied by a relative qualifying under
39.26this paragraph. For purposes of this paragraph, "agricultural property" means the house,
39.27garage, other farm buildings and structures, and agricultural land.
39.28    Application must be made to the assessor by the owner of the agricultural property to
39.29receive homestead benefits under this paragraph. The assessor may require the necessary
39.30proof that the requirements under this paragraph have been met.
39.31    (e) In the case of property owned by a property owner who is married, the assessor
39.32must not deny homestead treatment in whole or in part if only one of the spouses occupies
39.33the property and the other spouse is absent due to: (1) marriage dissolution proceedings,
39.34(2) legal separation, (3) employment or self-employment in another location, or (4) other
39.35personal circumstances causing the spouses to live separately, not including an intent to
39.36obtain two homestead classifications for property tax purposes. To qualify under clause
40.1(3), the spouse's place of employment or self-employment must be at least 50 miles distant
40.2from the other spouse's place of employment, and the homesteads must be at least 50 miles
40.3distant from each other. Homestead treatment, in whole or in part, shall not be denied to
40.4the owner's spouse who previously occupied the residence with the owner if the absence
40.5of the owner is due to one of the exceptions provided in this paragraph.
40.6    (f) The assessor must not deny homestead treatment in whole or in part if:
40.7    (1) in the case of a property owner who is not married, the owner is absent due to
40.8residence in a nursing home, boarding care facility, or an elderly assisted living facility
40.9property as defined in section 273.13, subdivision 25a, and the property is not otherwise
40.10occupied; or
40.11    (2) in the case of a property owner who is married, the owner or the owner's spouse
40.12or both are absent due to residence in a nursing home, boarding care facility, or an elderly
40.13assisted living facility property as defined in section 273.13, subdivision 25a, and the
40.14property is not occupied or is occupied only by the owner's spouse.
40.15    (g) If an individual is purchasing property with the intent of claiming it as a
40.16homestead and is required by the terms of the financing agreement to have a relative
40.17shown on the deed as a co-owner, the assessor shall allow a full homestead classification.
40.18This provision only applies to first-time purchasers, whether married or single, or to a
40.19person who had previously been married and is purchasing as a single individual for the
40.20first time. The application for homestead benefits must be on a form prescribed by the
40.21commissioner and must contain the data necessary for the assessor to determine if full
40.22homestead benefits are warranted.
40.23    (h) If residential or agricultural real estate is occupied and used for purposes of a
40.24homestead by a child of a deceased owner and the property is subject to jurisdiction of
40.25probate court, the child shall receive relative homestead classification under paragraph (c)
40.26or (d) to the same extent they would be entitled to it if the owner was still living, until
40.27the probate is completed. For purposes of this paragraph, "child" includes a relationship
40.28by blood or by marriage.
40.29    (i) If a single-family home, duplex, or triplex classified as either residential
40.30homestead or agricultural homestead is also used to provide licensed child care, the
40.31portion of the property used for licensed child care must be classified as a part of the
40.32homestead property.
40.33EFFECTIVE DATE.This section is effective for taxes payable in 2009 and
40.34thereafter.

41.1    Sec. 20. Minnesota Statutes 2007 Supplement, section 273.124, subdivision 14,
41.2is amended to read:
41.3    Subd. 14. Agricultural homesteads; special provisions. (a) Real estate of less than
41.4ten acres that is the homestead of its owner must be classified as class 2a under section
41.5273.13, subdivision 23 , paragraph (a), if:
41.6    (1) the parcel on which the house is located is contiguous on at least two sides to (i)
41.7agricultural land, (ii) land owned or administered by the United States Fish and Wildlife
41.8Service, or (iii) land administered by the Department of Natural Resources on which in
41.9lieu taxes are paid under sections 477A.11 to 477A.14;
41.10    (2) its owner also owns a noncontiguous parcel of agricultural land that is at least
41.1120 acres;
41.12    (3) the noncontiguous land is located not farther than four townships or cities, or a
41.13combination of townships or cities from the homestead; and
41.14    (4) the agricultural use value of the noncontiguous land and farm buildings is equal
41.15to at least 50 percent of the market value of the house, garage, and one acre of land.
41.16    Homesteads initially classified as class 2a under the provisions of this paragraph shall
41.17remain classified as class 2a, irrespective of subsequent changes in the use of adjoining
41.18properties, as long as the homestead remains under the same ownership, the owner owns a
41.19noncontiguous parcel of agricultural land that is at least 20 acres, and the agricultural use
41.20value qualifies under clause (4). Homestead classification under this paragraph is limited
41.21to property that qualified under this paragraph for the 1998 assessment.
41.22    (b)(i) Agricultural property consisting of at least 40 acres shall be classified as the
41.23owner's homestead, to the same extent as other agricultural homestead property, if all
41.24of the following criteria are met:
41.25    (1) the owner, the owner's spouse, the son or daughter of the owner or owner's
41.26spouse, the brother or sister of the owner or owner's spouse, or the grandson or
41.27granddaughter of the owner or the owner's spouse, is actively farming the agricultural
41.28property, either on the person's own behalf as an individual or on behalf of a partnership
41.29operating a family farm, family farm corporation, joint family farm venture, or limited
41.30liability company of which the person is a partner, shareholder, or member;
41.31    (2) both the owner of the agricultural property and the person who is actively
41.32farming the agricultural property under clause (1), are Minnesota residents;
41.33    (3) neither the owner nor the spouse of the owner claims another agricultural
41.34homestead in Minnesota; and
41.35    (4) neither the owner nor and the person actively farming the property lives farther
41.36than four townships or cities, or a combination of four townships or cities, from the
42.1agricultural property, must live either in the county where the agricultural property is
42.2located or in a county contiguous to the county where the agricultural property is located,
42.3except that if the owner or the owner's spouse is required to live in employer-provided
42.4housing, the owner or owner's spouse, whichever is actively farming the agricultural
42.5property, may live more than four townships or cities, or combination of four townships
42.6or cities further from the agricultural property than in the county or county contiguous
42.7to the property.
42.8    The relationship under this paragraph may be either by blood or marriage.
42.9    (ii) Real property held by a trustee under a trust is eligible for agricultural homestead
42.10classification under this paragraph if the qualifications in clause (i) are met, except that
42.11"owner" means the grantor of the trust.
42.12    (iii) Property containing the residence of an owner who owns qualified property
42.13under clause (i) shall be classified as part of the owner's agricultural homestead, if that
42.14property is also used for noncommercial storage or drying of agricultural crops.
42.15    (c) Noncontiguous land shall be included as part of a homestead under section
42.16273.13, subdivision 23 , paragraph (a), only if the homestead is classified as class 2a
42.17and the detached land is located in the same township or city, or not farther than four
42.18townships or cities or combination thereof from county or in a county contiguous to the
42.19homestead. Any taxpayer of these noncontiguous lands must notify the county assessor
42.20that the noncontiguous land is part of the taxpayer's homestead, and, if the homestead is
42.21located in another county, the taxpayer must also notify the assessor of the other county.
42.22    (d) Agricultural land used for purposes of a homestead and actively farmed by a
42.23person holding a vested remainder interest in it must be classified as a homestead under
42.24section 273.13, subdivision 23, paragraph (a). If agricultural land is classified class 2a,
42.25any other dwellings on the land used for purposes of a homestead by persons holding
42.26vested remainder interests who are actively engaged in farming the property, and up to
42.27one acre of the land surrounding each homestead and reasonably necessary for the use of
42.28the dwelling as a home, must also be assessed class 2a.
42.29    (e) Agricultural land and buildings that were class 2a homestead property under
42.30section 273.13, subdivision 23, paragraph (a), for the 1997 assessment shall remain
42.31classified as agricultural homesteads for subsequent assessments if:
42.32    (1) the property owner abandoned the homestead dwelling located on the agricultural
42.33homestead as a result of the April 1997 floods;
42.34    (2) the property is located in the county of Polk, Clay, Kittson, Marshall, Norman,
42.35or Wilkin;
43.1    (3) the agricultural land and buildings remain under the same ownership for the
43.2current assessment year as existed for the 1997 assessment year and continue to be used
43.3for agricultural purposes;
43.4    (4) the dwelling occupied by the owner is located in Minnesota and is within 30
43.5miles of one of the parcels of agricultural land that is owned by the taxpayer; and
43.6    (5) the owner notifies the county assessor that the relocation was due to the 1997
43.7floods, and the owner furnishes the assessor any information deemed necessary by the
43.8assessor in verifying the change in dwelling. Further notifications to the assessor are not
43.9required if the property continues to meet all the requirements in this paragraph and any
43.10dwellings on the agricultural land remain uninhabited.
43.11    (f) Agricultural land and buildings that were class 2a homestead property under
43.12section 273.13, subdivision 23, paragraph (a), for the 1998 assessment shall remain
43.13classified agricultural homesteads for subsequent assessments if:
43.14    (1) the property owner abandoned the homestead dwelling located on the agricultural
43.15homestead as a result of damage caused by a March 29, 1998, tornado;
43.16    (2) the property is located in the county of Blue Earth, Brown, Cottonwood,
43.17LeSueur, Nicollet, Nobles, or Rice;
43.18    (3) the agricultural land and buildings remain under the same ownership for the
43.19current assessment year as existed for the 1998 assessment year;
43.20    (4) the dwelling occupied by the owner is located in this state and is within 50 miles
43.21of one of the parcels of agricultural land that is owned by the taxpayer; and
43.22    (5) the owner notifies the county assessor that the relocation was due to a March 29,
43.231998, tornado, and the owner furnishes the assessor any information deemed necessary by
43.24the assessor in verifying the change in homestead dwelling. For taxes payable in 1999, the
43.25owner must notify the assessor by December 1, 1998. Further notifications to the assessor
43.26are not required if the property continues to meet all the requirements in this paragraph
43.27and any dwellings on the agricultural land remain uninhabited.
43.28    (g) Agricultural property consisting of at least 40 acres of a family farm corporation,
43.29joint family farm venture, family farm limited liability company, or partnership operating
43.30a family farm as described under subdivision 8 shall be classified homestead, to the same
43.31extent as other agricultural homestead property, if all of the following criteria are met:
43.32    (1) a shareholder, member, or partner of that entity is actively farming the
43.33agricultural property;
43.34    (2) that shareholder, member, or partner who is actively farming the agricultural
43.35property is a Minnesota resident;
44.1    (3) neither that shareholder, member, or partner, nor the spouse of that shareholder,
44.2member, or partner claims another agricultural homestead in Minnesota; and
44.3    (4) that shareholder, member, or partner does not live farther than four townships
44.4or cities, or a combination of four townships or cities, from the agricultural property
44.5lives in the county where the agricultural property is located or in a county contiguous to
44.6the county where the property is located.
44.7    Homestead treatment applies under this paragraph for property leased to a family
44.8farm corporation, joint farm venture, limited liability company, or partnership operating a
44.9family farm if legal title to the property is in the name of an individual who is a member,
44.10shareholder, or partner in the entity.
44.11    (h) To be eligible for the special agricultural homestead under this subdivision, an
44.12initial full application must be submitted to the county assessor where the property is
44.13located. Owners and the persons who are actively farming the property shall be required
44.14to complete only a one-page abbreviated version of the application in each subsequent
44.15year provided that none of the following items have changed since the initial application:
44.16    (1) the day-to-day operation, administration, and financial risks remain the same;
44.17    (2) the owners and the persons actively farming the property continue to live within
44.18the four townships or city criteria the county or a contiguous county and are Minnesota
44.19residents;
44.20    (3) the same operator of the agricultural property is listed with the Farm Service
44.21Agency;
44.22    (4) a Schedule F or equivalent income tax form was filed for the most recent year;
44.23    (5) the property's acreage is unchanged; and
44.24    (6) none of the property's acres have been enrolled in a federal or state farm program
44.25since the initial application.
44.26    The owners and any persons who are actively farming the property must include
44.27the appropriate Social Security numbers, and sign and date the application. If any of the
44.28specified information has changed since the full application was filed, the owner must
44.29notify the assessor, and must complete a new application to determine if the property
44.30continues to qualify for the special agricultural homestead. The commissioner of revenue
44.31shall prepare a standard reapplication form for use by the assessors.
44.32    (i) Agricultural land and buildings that were class 2a homestead property under
44.33section 273.13, subdivision 23, paragraph (a), for the 2007 assessment shall remain
44.34classified agricultural homesteads for subsequent assessments if:
44.35    (1) the property owner abandoned the homestead dwelling located on the agricultural
44.36homestead as a result of damage caused by the August 2007 floods;
45.1    (2) the property is located in the county of Dodge, Fillmore, Houston, Olmsted,
45.2Steele, Wabasha, or Winona;
45.3    (3) the agricultural land and buildings remain under the same ownership for the
45.4current assessment year as existed for the 2007 assessment year;
45.5    (4) the dwelling occupied by the owner is located in this state and is within 50 miles
45.6of one of the parcels of agricultural land that is owned by the taxpayer; and
45.7    (5) the owner notifies the county assessor that the relocation was due to the August
45.82007 floods, and the owner furnishes the assessor any information deemed necessary by
45.9the assessor in verifying the change in homestead dwelling. For taxes payable in 2009, the
45.10owner must notify the assessor by December 1, 2008. Further notifications to the assessor
45.11are not required if the property continues to meet all the requirements in this paragraph
45.12and any dwellings on the agricultural land remain uninhabited.
45.13EFFECTIVE DATE.This section is effective for taxes payable in 2010 and
45.14thereafter, except that the provision extending the homestead to brothers and sisters is
45.15effective for taxes payable in 2009 and thereafter.

45.16    Sec. 21. Minnesota Statutes 2006, section 273.13, subdivision 23, as amended by Laws
45.172008, chapter 154, article 2, section 12, is amended to read:
45.18    Subd. 23. Class 2. (a) Class 2a property is agricultural land including any
45.19improvements An agricultural homestead consists of class 2a agricultural land that is
45.20homesteaded, along with any class 2b rural vacant land that is contiguous to the class 2a
45.21land. The market value of the house and garage and immediately surrounding one acre
45.22of land has the same class rates as class 1a or 1b property under subdivision 22. The
45.23value of the remaining land including improvements up to the first tier valuation limit of
45.24agricultural homestead property has a net class rate of 0.55 0.5 percent of market value.
45.25The remaining property over the first tier has a class rate of one percent of market value.
45.26For purposes of this subdivision, the "first tier valuation limit of agricultural homestead
45.27property" and "first tier" means the limit certified under section 273.11, subdivision 23.
45.28    (b) Class 2a agricultural land consists of parcels of property, or portions thereof,
45.29that are agricultural land and buildings. Class 2a property has a net class rate of one
45.30percent of market value, unless it is part of an agricultural homestead under paragraph
45.31(a). Class 2a property may contain an incidental amount of property that would otherwise
45.32be classified as 2b, including but not limited to sloughs, wooded wind shelters, acreage
45.33abutting ditches, and other similar land impractical for the assessor to value separately
45.34from the rest of the property.
46.1    (c) Class 2b property is (1) rural vacant land consists of parcels of property,
46.2or portions thereof, that are unplatted real estate, rural in character and not used for
46.3agricultural purposes, including land used exclusively for growing trees for timber,
46.4lumber, and wood and wood products; (2) real estate that is not improved with a structure
46.5and is used exclusively for growing trees for timber, lumber, and wood and wood products,
46.6if the owner has participated or is participating in a cost-sharing program for afforestation,
46.7reforestation, or timber stand improvement on that particular property, administered or
46.8coordinated by the commissioner of natural resources; (3) real estate that is nonhomestead
46.9agricultural land; or (4) a landing area or public access area of a privately owned public use
46.10airport, provided that the presence of a minor, ancillary nonresidential structure as defined
46.11by the commissioner of revenue does not disqualify the property from classification
46.12under this paragraph and provided that any parcel improved with a structure that is not a
46.13minor, ancillary nonresidential structure may be split-classified, provided that the acreage
46.14assigned to the split parcel with the structure is at least 20 acres. Class 2b property has
46.15a net class rate of one percent of market value, except that unplatted property described
46.16in clause (1) or (2) has a net class rate of .65 percent if it consists unless it is part of an
46.17agricultural homestead under paragraph (a), or qualifies as class 2c under paragraph (d).
46.18    (d) Class 2c managed forest land consists of no less than ten 20 and no more than
46.191,920 acres statewide per taxpayer and that is being managed under a forest management
46.20plan that meets the requirements of chapter 290C, but is not enrolled in the sustainable
46.21forest resource management incentive program. It has a class rate of .65 percent, provided
46.22that the owner of the property must apply to the assessor annually to receive the reduced
46.23class rate and provide the information required by the assessor to verify that the property
46.24qualifies for the reduced rate. The commissioner of natural resources must concur that the
46.25land is qualified. The commissioner of natural resources shall annually provide county
46.26assessors verification information on a timely basis.
46.27    (c) (e) Agricultural land as used in this section means contiguous acreage of
46.28ten acres or more, property used during the preceding year for agricultural purposes.
46.29"Agricultural purposes" as used in this section means the raising or, cultivation, drying,
46.30or storage of agricultural products for sale, or the storage of machinery or equipment
46.31used in support of agricultural production. For a property to be classified as agricultural
46.32based only on the drying or storage of agricultural products, the products being dried or
46.33stored must have been produced by the same farm entity as the entity operating the drying
46.34or storage facility. "Agricultural purposes" also includes enrollment in the Reinvest in
46.35Minnesota program under sections 103F.501 to 103F.535 or the federal Conservation
46.36Reserve Program as contained in Public Law 99-198 if the property was classified as
47.1agricultural (i) under this subdivision for the assessment year 2002 or (ii) in the year prior
47.2to its enrollment. Contiguous acreage on the same parcel, or contiguous acreage on an
47.3immediately adjacent parcel under the same ownership, may also qualify as agricultural
47.4land, but only if it is pasture, timber, waste, unusable wild land, or land included in state
47.5or federal farm programs. Agricultural classification for property shall be determined
47.6excluding the house, garage, and immediately surrounding one acre of land, and shall not
47.7be based upon the market value of any residential structures on the parcel or contiguous
47.8parcels under the same ownership.
47.9    (d) (f) Real estate of less than five acres, excluding the house, garage, and
47.10immediately surrounding one acre of land, of less than ten acres which is exclusively and
47.11intensively used for raising or cultivating agricultural products, shall be considered as
47.12agricultural land qualifies as class 2a if:
47.13    (i) the entire parcel is tilled or pastured to produce an agricultural product for sale in
47.14three of the last five years;
47.15    (ii) the acres are used primarily for drying or storage of grain or storage of machinery
47.16or equipment used to support agricultural activities on other parcels of property operated
47.17by the same farming entity;
47.18    (iii) the land mass contains a nursery, provided only those acres used to produce
47.19nursery stock are considered agricultural land;
47.20    (iv) the parcel is used exclusively as a livestock or poultry confinement process; or
47.21    (v) the parcel is used primarily for market farming; for purposes of this paragraph,
47.22"market farming" means the cultivation of one or more fruits or vegetables or production
47.23of animal or other agricultural products for sale to local markets by the farmer or an
47.24organization with which the farmer is affiliated.
47.25    (g) Land shall be classified as agricultural even if all or a portion of the agricultural
47.26use of that property is the leasing to, or use by another person for agricultural purposes.
47.27    Classification under this subdivision is not determinative for qualifying under
47.28section 273.111.
47.29    (h) The property classification under this section supersedes, for property tax
47.30purposes only, any locally administered agricultural policies or land use restrictions that
47.31define minimum or maximum farm acreage.
47.32    (e) (i) The term "agricultural products" as used in this subdivision includes
47.33production for sale of:
47.34    (1) livestock, dairy animals, dairy products, poultry and poultry products, fur-bearing
47.35animals, horticultural and nursery stock, fruit of all kinds, vegetables, forage, grains,
47.36bees, and apiary products by the owner;
48.1    (2) fish bred for sale and consumption if the fish breeding occurs on land zoned
48.2for agricultural use;
48.3    (3) the commercial boarding of horses if the boarding is done in conjunction with
48.4raising or cultivating agricultural products as defined in clause (1);
48.5    (4) property which is owned and operated by nonprofit organizations used for
48.6equestrian activities, excluding racing;
48.7    (5) game birds and waterfowl bred and raised for use on a shooting preserve licensed
48.8under section 97A.115;
48.9    (6) insects primarily bred to be used as food for animals;
48.10    (7) trees, grown for sale as a crop, including short rotation woody crops, and not
48.11sold for timber, lumber, wood, or wood products; and
48.12    (8) maple syrup taken from trees grown by a person licensed by the Minnesota
48.13Department of Agriculture under chapter 28A as a food processor.
48.14    (f) (j) If a parcel used for agricultural purposes is also used for commercial or
48.15industrial purposes, including but not limited to:
48.16    (1) wholesale and retail sales;
48.17    (2) processing of raw agricultural products or other goods;
48.18    (3) warehousing or storage of processed goods; and
48.19    (4) office facilities for the support of the activities enumerated in clauses (1), (2),
48.20and (3),
48.21the assessor shall classify the part of the parcel used for agricultural purposes as class
48.221b, 2a, or 2b, whichever is appropriate, and the remainder in the class appropriate to its
48.23use. The grading, sorting, and packaging of raw agricultural products for first sale is
48.24considered an agricultural purpose. A greenhouse or other building where horticultural
48.25or nursery products are grown that is also used for the conduct of retail sales must be
48.26classified as agricultural if it is primarily used for the growing of horticultural or nursery
48.27products from seed, cuttings, or roots and occasionally as a showroom for the retail sale of
48.28those products. Use of a greenhouse or building only for the display of already grown
48.29horticultural or nursery products does not qualify as an agricultural purpose.
48.30    The assessor shall determine and list separately on the records the market value of
48.31the homestead dwelling and the one acre of land on which that dwelling is located. If any
48.32farm buildings or structures are located on this homesteaded acre of land, their market
48.33value shall not be included in this separate determination.
48.34    (g) (k) Class 2d airport landing area consists of a landing area or public access
48.35area of a privately owned public use airport. To qualify for classification under this
48.36paragraph (b), clause (4), a privately owned public use airport must be licensed as a public
49.1airport under section 360.018. For purposes of this paragraph (b), clause (4), "landing
49.2area" means that part of a privately owned public use airport properly cleared, regularly
49.3maintained, and made available to the public for use by aircraft and includes runways,
49.4taxiways, aprons, and sites upon which are situated landing or navigational aids. A
49.5landing area also includes land underlying both the primary surface and the approach
49.6surfaces that comply with all of the following:
49.7    (i) the land is properly cleared and regularly maintained for the primary purposes of
49.8the landing, taking off, and taxiing of aircraft; but that portion of the land that contains
49.9facilities for servicing, repair, or maintenance of aircraft is not included as a landing area;
49.10    (ii) the land is part of the airport property; and
49.11    (iii) the land is not used for commercial or residential purposes.
49.12The land contained in a landing area under this paragraph (b), clause (4), must be described
49.13and certified by the commissioner of transportation. The certification is effective until it
49.14is modified, or until the airport or landing area no longer meets the requirements of this
49.15paragraph (b), clause (4). For purposes of this paragraph (b), clause (4), "public access
49.16area" means property used as an aircraft parking ramp, apron, or storage hangar, or an
49.17arrival and departure building in connection with the airport.
49.18EFFECTIVE DATE.The portion of this section reducing the agricultural class rate,
49.19and expanding the definition of "agricultural purposes" in paragraph (e) and "agricultural
49.20products" in paragraph (h), is effective for taxes payable in 2009 and thereafter. The
49.21remainder of the section is effective for taxes payable in 2010 and thereafter.

49.22    Sec. 22. Minnesota Statutes 2006, section 273.13, subdivision 24, is amended to read:
49.23    Subd. 24. Class 3. (a) Commercial and industrial property and utility real and
49.24personal property is class 3a.
49.25    (1) Except as otherwise provided, each parcel of commercial, industrial, or utility
49.26real property has a class rate of 1.5 percent of the first tier of market value, and 2.0 percent
49.27of the remaining market value. In the case of contiguous parcels of property owned by the
49.28same person or entity, only the value equal to the first-tier value of the contiguous parcels
49.29qualifies for the reduced class rate, except that contiguous parcels owned by the same
49.30person or entity shall be eligible for the first-tier value class rate on each separate business
49.31operated by the owner of the property, provided the business is housed in a separate
49.32structure. For the purposes of this subdivision, the first tier means the first $150,000 of
49.33market value. Real property owned in fee by a utility for transmission line right-of-way
49.34shall be classified at the class rate for the higher tier.
50.1    For purposes of this subdivision, parcels are considered to be contiguous even if
50.2they are separated from each other by a road, street, waterway, or other similar intervening
50.3type of property. Connections between parcels that consist of power lines or pipelines do
50.4not cause the parcels to be contiguous. Property owners who have contiguous parcels of
50.5property that constitute separate businesses that may qualify for the first-tier class rate shall
50.6notify the assessor by July 1, for treatment beginning in the following taxes payable year.
50.7    (2) All Personal property that is: (i) part of an electric generation, transmission, or
50.8distribution system; or (ii), including tools, implements, and machinery, has a class rate
50.9of 2.4 percent for taxes payable in 2009, and 2.8 percent for taxes payable in 2010, and
50.10thereafter.
50.11    (3) Personal property that is either: (i) part of a pipeline system transporting
50.12or distributing water, gas, crude oil, or petroleum products; and (iii) not described in
50.13clause (3), and all, including tools, implements, and machinery, or (ii) part of an electric
50.14transmission or distribution system, including tools, implements, and machinery, has a
50.15class rate of 2.0 percent for taxes payable in 2009 and thereafter.
50.16    (4) Railroad operating property has a class rate as provided under clause (1) for
50.17the first tier of market value and the remaining market value. In the case of multiple
50.18parcels in one county that are owned by one person or entity, only one first tier amount
50.19is eligible for the reduced rate.
50.20    (3) The entire market value of personal property that is: (i) tools, implements, and
50.21machinery of an electric generation, transmission, or distribution system; (ii) tools,
50.22implements, and machinery of a pipeline system transporting or distributing water, gas,
50.23crude oil, or petroleum products; or (iii) the (5) Personal property consisting of mains
50.24and pipes used in the distribution of steam or hot or chilled water for heating or cooling
50.25buildings, has a class rate as provided under clause (1) for the remaining market value
50.26in excess of the first tier.
50.27    (b) Employment property defined in section 469.166, during the period provided
50.28in section 469.170, shall constitute class 3b. The class rates for class 3b property are
50.29determined under paragraph (a).
50.30EFFECTIVE DATE.This section is effective for taxes payable in 2009 and
50.31thereafter.

50.32    Sec. 23. Minnesota Statutes 2006, section 273.13, subdivision 25, as amended by Laws
50.332008, chapter 154, article 2, section 13, is amended to read:
50.34    Subd. 25. Class 4. (a) Class 4a is residential real estate containing four or more
50.35units and used or held for use by the owner or by the tenants or lessees of the owner
51.1as a residence for rental periods of 30 days or more, excluding property qualifying for
51.2class 4d. Class 4a also includes hospitals licensed under sections 144.50 to 144.56, other
51.3than hospitals exempt under section 272.02, and contiguous property used for hospital
51.4purposes, without regard to whether the property has been platted or subdivided. The
51.5market value of class 4a property has a class rate of 1.25 percent.
51.6    (b) Class 4b includes:
51.7    (1) residential real estate containing less than four units that does not qualify as class
51.84bb, other than seasonal residential recreational property;
51.9    (2) manufactured homes not classified under any other provision;
51.10    (3) a dwelling, garage, and surrounding one acre of property on a nonhomestead
51.11farm classified under subdivision 23, paragraph (b) containing two or three units; and
51.12    (4) is unimproved property that is classified residential as determined under
51.13subdivision 33.
51.14    The market value of class 4b property has a class rate of 1.25 percent.
51.15    (c) Class 4bb includes:
51.16    (1) nonhomestead residential real estate containing one unit up to three units, other
51.17than seasonal residential recreational property; and
51.18    (2) a single family dwelling, garage, and surrounding one acre of property on a
51.19nonhomestead farm classified under subdivision 23, paragraph (b), containing up to three
51.20units; and
51.21    (3) manufactured homes not classified under any other provision.
51.22    Class 4bb property has the same class rates as class 1a property under subdivision 22.
51.23    Property that has been classified as seasonal residential recreational property at
51.24any time during which it has been owned by the current owner or spouse of the current
51.25owner does not qualify for class 4bb.
51.26    (d) Class 4c property includes:
51.27    (1) except as provided in subdivision 22, paragraph (c), or subdivision 23, paragraph
51.28(b), clause (1), real and personal property devoted to temporary and seasonal residential
51.29occupancy for recreation purposes, including real and personal property devoted to
51.30temporary and seasonal residential occupancy for recreation purposes and not devoted to
51.31commercial purposes for more than 250 days in the year preceding the year of assessment.
51.32For purposes of this clause, property is devoted to a commercial purpose on a specific
51.33day if any portion of the property is used for residential occupancy, and a fee is charged
51.34for residential occupancy. Class 4c property must contain three or more rental units. A
51.35"rental unit" is defined as a cabin, condominium, townhouse, sleeping room, or individual
51.36camping site equipped with water and electrical hookups for recreational vehicles. Class
52.14c property must provide recreational activities such as renting ice fishing houses, boats
52.2and motors, snowmobiles, downhill or cross-country ski equipment; provide marina
52.3services, launch services, or guide services; or sell bait and fishing tackle. A camping
52.4pad offered for rent by a property that otherwise qualifies for class 4c is also class 4c
52.5regardless of the term of the rental agreement, as long as the use of the camping pad
52.6does not exceed 250 days. In order for a property to be classified as class 4c, seasonal
52.7residential recreational for commercial purposes, at least 40 percent of the annual gross
52.8lodging receipts related to the property must be from business conducted during 90
52.9consecutive days and either (i) at least 60 percent of all paid bookings by lodging guests
52.10during the year must be for periods of at least two consecutive nights; or (ii) at least 20
52.11percent of the annual gross receipts must be from charges for rental of fish houses, boats
52.12and motors, snowmobiles, downhill or cross-country ski equipment, or charges for marina
52.13services, launch services, and guide services, or the sale of bait and fishing tackle. For
52.14purposes of this determination, a paid booking of five or more nights shall be counted as
52.15two bookings. Class 4c also includes commercial use real property used exclusively
52.16for recreational purposes in conjunction with class 4c property devoted to temporary
52.17and seasonal residential occupancy for recreational purposes, up to a total of two acres,
52.18provided the property is not devoted to commercial recreational use for more than 250
52.19days in the year preceding the year of assessment and is located within two miles of the
52.20class 4c property with which it is used. Owners of real and personal property devoted
52.21to temporary and seasonal residential occupancy for recreation purposes and all or a
52.22portion of which was devoted to commercial purposes for not more than 250 days in the
52.23year preceding the year of assessment desiring classification as class 4c, must submit a
52.24declaration to the assessor designating the cabins or units occupied for 250 days or less in
52.25the year preceding the year of assessment by January 15 of the assessment year. Those
52.26cabins or units and a proportionate share of the land on which they are located must be
52.27designated class 4c as otherwise provided. The remainder of the cabins or units and
52.28a proportionate share of the land on which they are located will be designated as class
52.293a. The owner of property desiring designation as class 4c property must provide guest
52.30registers or other records demonstrating that the units for which class 4c designation is
52.31sought were not occupied for more than 250 days in the year preceding the assessment if
52.32so requested. The portion of a property operated as a (1) restaurant, (2) bar, (3) gift shop,
52.33(4) conference center or meeting room, and (5) other nonresidential facility operated on a
52.34commercial basis not directly related to temporary and seasonal residential occupancy for
52.35recreation purposes does not qualify for class 4c;
52.36    (2) qualified property used as a golf course if:
53.1    (i) it is open to the public on a daily fee basis. It may charge membership fees or
53.2dues, but a membership fee may not be required in order to use the property for golfing,
53.3and its green fees for golfing must be comparable to green fees typically charged by
53.4municipal courses; and
53.5    (ii) it meets the requirements of section 273.112, subdivision 3, paragraph (d).
53.6    A structure used as a clubhouse, restaurant, or place of refreshment in conjunction
53.7with the golf course is classified as class 3a property;
53.8    (3) real property up to a maximum of three acres of land owned and used by a
53.9nonprofit community service oriented organization and that is not used for residential
53.10purposes on either a temporary or permanent basis, qualifies for class 4c provided that
53.11it meets either of the following:
53.12    (i) the property is not used for a revenue-producing activity for more than six days
53.13in the calendar year preceding the year of assessment; or
53.14    (ii) the organization makes annual charitable contributions and donations at least
53.15equal to the property's previous year's property taxes and the property is allowed to be
53.16used for public and community meetings or events for no charge, as appropriate to the
53.17size of the facility.
53.18    For purposes of this clause,
53.19    (A) "charitable contributions and donations" has the same meaning as lawful
53.20gambling purposes under section 349.12, subdivision 25, excluding those purposes
53.21relating to the payment of taxes, assessments, fees, auditing costs, and utility payments;
53.22    (B) "property taxes" excludes the state general tax;
53.23    (C) a "nonprofit community service oriented organization" means any corporation,
53.24society, association, foundation, or institution organized and operated exclusively for
53.25charitable, religious, fraternal, civic, or educational purposes, and which is exempt from
53.26federal income taxation pursuant to section 501(c)(3), (10), or (19) of the Internal Revenue
53.27Code of 1986, as amended through December 31, 1990; and
53.28    (D) "revenue-producing activities" shall include but not be limited to property or that
53.29portion of the property that is used as an on-sale intoxicating liquor or 3.2 percent malt
53.30liquor establishment licensed under chapter 340A, a restaurant open to the public, bowling
53.31alley, a retail store, gambling conducted by organizations licensed under chapter 349, an
53.32insurance business, or office or other space leased or rented to a lessee who conducts a
53.33for-profit enterprise on the premises.
53.34Any portion of the property qualifying under item (i) which is used for revenue-producing
53.35activities for more than six days in the calendar year preceding the year of assessment
53.36shall be assessed as class 3a. The use of the property for social events open exclusively
54.1to members and their guests for periods of less than 24 hours, when an admission is
54.2not charged nor any revenues are received by the organization shall not be considered a
54.3revenue-producing activity.
54.4    The organization shall maintain records of its charitable contributions and donations
54.5and of public meetings and events held on the property and make them available upon
54.6request any time to the assessor to ensure eligibility. An organization meeting the
54.7requirement under item (ii) must file an application by May 1 with the assessor for
54.8eligibility for the current year's assessment. The commissioner shall prescribe a uniform
54.9application form and instructions;
54.10    (4) postsecondary student housing of not more than one acre of land that is owned by
54.11a nonprofit corporation organized under chapter 317A and is used exclusively by a student
54.12cooperative, sorority, or fraternity for on-campus housing or housing located within two
54.13miles of the border of a college campus;
54.14    (5) manufactured home parks as defined in section 327.14, subdivision 3;
54.15    (6) real property that is actively and exclusively devoted to indoor fitness, health,
54.16social, recreational, and related uses, is owned and operated by a not-for-profit corporation,
54.17and is located within the metropolitan area as defined in section 473.121, subdivision 2;
54.18    (7) a leased or privately owned noncommercial aircraft storage hangar not exempt
54.19under section 272.01, subdivision 2, and the land on which it is located, provided that:
54.20    (i) the land is on an airport owned or operated by a city, town, county, Metropolitan
54.21Airports Commission, or group thereof; and
54.22    (ii) the land lease, or any ordinance or signed agreement restricting the use of the
54.23leased premise, prohibits commercial activity performed at the hangar.
54.24    If a hangar classified under this clause is sold after June 30, 2000, a bill of sale must
54.25be filed by the new owner with the assessor of the county where the property is located
54.26within 60 days of the sale;
54.27    (8) a privately owned noncommercial aircraft storage hangar not exempt under
54.28section 272.01, subdivision 2, and the land on which it is located, provided that:
54.29    (i) the land abuts a public airport; and
54.30    (ii) the owner of the aircraft storage hangar provides the assessor with a signed
54.31agreement restricting the use of the premises, prohibiting commercial use or activity
54.32performed at the hangar; and
54.33    (9) residential real estate, a portion of which is used by the owner for homestead
54.34purposes, and that is also a place of lodging, if all of the following criteria are met:
54.35    (i) rooms are provided for rent to transient guests that generally stay for periods
54.36of 14 or fewer days;
55.1    (ii) meals are provided to persons who rent rooms, the cost of which is incorporated
55.2in the basic room rate;
55.3    (iii) meals are not provided to the general public except for special events on fewer
55.4than seven days in the calendar year preceding the year of the assessment; and
55.5    (iv) the owner is the operator of the property.
55.6The market value subject to the 4c classification under this clause is limited to five rental
55.7units. Any rental units on the property in excess of five, must be valued and assessed as
55.8class 3a. The portion of the property used for purposes of a homestead by the owner must
55.9be classified as class 1a property under subdivision 22.
55.10    Class 4c property has a class rate of 1.5 percent of market value, except that (i) each
55.11parcel of seasonal residential recreational property not used for commercial purposes has
55.12the same class rates as class 4bb property, (ii) manufactured home parks assessed under
55.13clause (5) have the same class rate as class 4b property, (iii) commercial-use seasonal
55.14residential recreational property has a class rate of one percent for the first $500,000 of
55.15market value, and 1.25 percent for the remaining market value, (iv) the market value of
55.16property described in clause (4) has a class rate of one percent, (v) the market value of
55.17property described in clauses (2) and (6) has a class rate of 1.25 percent, and (vi) that
55.18portion of the market value of property in clause (9) qualifying for class 4c property
55.19has a class rate of 1.25 percent.
55.20    (e) Class 4d property is qualifying low-income rental housing certified to the assessor
55.21by the Housing Finance Agency under section 273.128, subdivision 3. If only a portion
55.22of the units in the building qualify as low-income rental housing units as certified under
55.23section 273.128, subdivision 3, only the proportion of qualifying units to the total number
55.24of units in the building qualify for class 4d. The remaining portion of the building shall be
55.25classified by the assessor based upon its use. Class 4d also includes the same proportion of
55.26land as the qualifying low-income rental housing units are to the total units in the building.
55.27For all properties qualifying as class 4d, the market value determined by the assessor must
55.28be based on the normal approach to value using normal unrestricted rents.
55.29    Class 4d property has a class rate of 0.75 percent.
55.30EFFECTIVE DATE.This section is effective for assessment year 2008 and
55.31thereafter, and for taxes payable in 2009 and thereafter.

55.32    Sec. 24. Minnesota Statutes 2007 Supplement, section 273.1393, is amended to read:
55.33273.1393 COMPUTATION OF NET PROPERTY TAXES.
56.1    Notwithstanding any other provisions to the contrary, "net" property taxes are
56.2determined by subtracting the credits in the order listed from the gross tax:
56.3    (1) disaster credit as provided in sections 273.1231 to 273.1235;
56.4    (2) powerline credit as provided in section 273.42;
56.5    (3) agricultural preserves credit as provided in section 473H.10;
56.6    (4) enterprise zone credit as provided in section 469.171;
56.7    (5) disparity reduction credit;
56.8    (6) conservation tax credit as provided in section 273.119;
56.9    (7) homestead and agricultural credits as provided in section 273.1384;
56.10    (8) taconite homestead credit as provided in section 273.135; and
56.11    (9) supplemental homestead credit as provided in section 273.1391; and
56.12    (10) bovine tuberculosis management credit as provided in section 273.113.
56.13    The combination of all property tax credits must not exceed the gross tax amount.
56.14EFFECTIVE DATE.This section is effective for taxes payable in 2009 and
56.15thereafter.

56.16    Sec. 25. Minnesota Statutes 2006, section 274.14, is amended to read:
56.17274.14 LENGTH OF SESSION; RECORD.
56.18    The board may meet on any ten consecutive meeting days in June, after the second
56.19Friday in June. The actual meeting dates must be contained on the valuation notices
56.20mailed to each property owner in the county as provided in section 273.121. For this
56.21purpose, "meeting days" is defined as any day of the week excluding Saturday and Sunday.
56.22At the board's discretion, "meeting days" may include Saturday. No action taken by the
56.23county board of review after June 30 is valid, except for corrections permitted in sections
56.24273.01 and 274.01. The county auditor shall keep an accurate record of the proceedings
56.25and orders of the board. The record must be published like other proceedings of county
56.26commissioners. A copy of the published record must be sent to the commissioner of
56.27revenue, with the abstract of assessment required by section 274.16.
56.28    For counties that conduct either regular board of review meetings or open book
56.29meetings, at least one of the meeting days must include a meeting that does not end
56.30before 7:00 p.m. For counties that require taxpayer appointments for the board of review,
56.31appointments must include some available times that extend until at least 7:00 p.m. The
56.32county may have a Saturday meeting in lieu of, or in addition to, the extended meeting
56.33times under this paragraph.

57.1    Sec. 26. Minnesota Statutes 2007 Supplement, section 275.065, subdivision 1, is
57.2amended to read:
57.3    Subdivision 1. Proposed levy. (a) Notwithstanding any law or charter to the
57.4contrary, on or before September 15 1, each taxing authority, other than a school district,
57.5shall adopt a proposed budget and shall certify to the county auditor the proposed or, in
57.6the case of a town, the final property tax levy for taxes payable in the following year.
57.7    (b) On or before September 30 15, each school district that has not mutually agreed
57.8with its home county to extend this date shall certify to the county auditor the proposed
57.9property tax levy for taxes payable in the following year. Each school district that has
57.10agreed with its home county to delay the certification of its proposed property tax levy
57.11must certify its proposed property tax levy for the following year no later than October
57.127. The school district shall certify the proposed levy as:
57.13    (1) a specific dollar amount by school district fund, broken down between
57.14voter-approved and non-voter-approved levies and between referendum market value
57.15and tax capacity levies; or
57.16    (2) the maximum levy limitation certified by the commissioner of education
57.17according to section 126C.48, subdivision 1.
57.18    (c) If the board of estimate and taxation or any similar board that establishes
57.19maximum tax levies for taxing jurisdictions within a first class city certifies the maximum
57.20property tax levies for funds under its jurisdiction by charter to the county auditor by
57.21September 15 1, the city shall be deemed to have certified its levies for those taxing
57.22jurisdictions.
57.23    (d) For purposes of this section, "taxing authority" includes all home rule and
57.24statutory cities, towns, counties, school districts, and special taxing districts as defined
57.25in section 275.066. Intermediate school districts that levy a tax under chapter 124 or
57.26136D, joint powers boards established under sections 123A.44 to 123A.446, and Common
57.27School Districts No. 323, Franconia, and No. 815, Prinsburg, are also special taxing
57.28districts for purposes of this section.
57.29EFFECTIVE DATE.This section is effective for proposed notices and hearings
57.30held in 2009 and thereafter, for property taxes payable in 2010 and thereafter.

57.31    Sec. 27. Minnesota Statutes 2007 Supplement, section 275.065, subdivision 1a,
57.32is amended to read:
57.33    Subd. 1a. Overlapping jurisdictions. In the case of a taxing authority lying in two
57.34or more counties, the home county auditor shall certify the proposed levy and the proposed
57.35local tax rate to the other county auditor by October September 5, unless the home county
58.1has agreed to delay the certification of its proposed property tax levy, in which case the
58.2home county auditor shall certify the proposed levy and the proposed local tax rate to the
58.3other county auditor by October 10. The home county auditor must estimate the levy or
58.4rate in preparing the notices required in subdivision 3, if the other county has not certified
58.5the appropriate information. If requested by the home county auditor, the other county
58.6auditor must furnish an estimate to the home county auditor.
58.7EFFECTIVE DATE.This section is effective for proposed notices and hearings
58.8held in 2009 and thereafter, for property taxes payable in 2010 and thereafter.

58.9    Sec. 28. Minnesota Statutes 2006, section 275.065, subdivision 1c, is amended to read:
58.10    Subd. 1c. Levy; shared, merged, consolidated services. If two or more taxing
58.11authorities are in the process of negotiating an agreement for sharing, merging, or
58.12consolidating services between those taxing authorities at the time the proposed levy is to
58.13be certified under subdivision 1, each taxing authority involved in the negotiation shall
58.14certify its total proposed levy as provided in that subdivision, including a notification to the
58.15county auditor of the specific service involved in the agreement which is not yet finalized.
58.16The affected taxing authorities may amend their proposed levies under subdivision 1 until
58.17October September 10 for levy amounts relating only to the specific service involved.
58.18EFFECTIVE DATE.This section is effective for proposed notices and hearings
58.19held in 2009 and thereafter, for property taxes payable in 2010 and thereafter.

58.20    Sec. 29. Minnesota Statutes 2006, section 275.065, is amended by adding a subdivision
58.21to read:
58.22    Subd. 1d. Failure to certify proposed levy. If a taxing authority fails to certify
58.23its proposed levy by the due dates specified under subdivisions 1, 1a, and 1c, the county
58.24auditor shall use the authority's previous year's final levy under section 275.07, subdivision
58.251, for purposes of determining its proposed property tax notices and public advertisements
58.26under this section.
58.27EFFECTIVE DATE.This section is effective for notices prepared in 2008, for
58.28property taxes payable in 2009 and thereafter.

58.29    Sec. 30. Minnesota Statutes 2007 Supplement, section 275.065, subdivision 3, is
58.30amended to read:
58.31    Subd. 3. Notice of proposed property taxes. (a) The county auditor shall prepare
58.32and the county treasurer shall deliver after November 10 October 15 and on or before
59.1November October 24 each year, by first class mail to each taxpayer at the address listed
59.2on the county's current year's assessment roll, a notice of proposed property taxes.
59.3    (b) The commissioner of revenue shall prescribe the form of the notice.
59.4    (c) The notice must inform taxpayers that it contains the amount of property taxes
59.5each taxing authority proposes to collect for taxes payable the following year. In the case
59.6of a town, or in the case of the state general tax, the final tax amount will be its proposed
59.7tax. In the case of taxing authorities required to hold a public meeting under subdivision 6,
59.8the notice must clearly state that each taxing authority, including regional library districts
59.9established under section 134.201, and including the metropolitan taxing districts as
59.10defined in paragraph (i), but excluding all other special taxing districts and towns, will
59.11hold a public meeting to receive public testimony on the proposed budget and proposed or
59.12final property tax levy, or, in case of a school district, on the current budget and proposed
59.13property tax levy. It must clearly state the time and place of each taxing authority's
59.14meeting, a telephone number for the taxing authority that taxpayers may call if they have
59.15questions related to the notice, and an address where comments will be received by mail.
59.16    (d) The notice must state for each parcel:
59.17    (1) the market value of the property as determined under section 273.11, and used
59.18for computing property taxes payable in the following year and for taxes payable in the
59.19current year as each appears in the records of the county assessor on November October
59.201 of the current year; and, in the case of residential property, whether the property is
59.21classified as homestead or nonhomestead. The notice must clearly inform taxpayers of the
59.22years to which the market values apply and that the values are final values;
59.23    (2) the items listed below, shown separately by county, city or town, and state general
59.24tax, net of the residential and agricultural homestead credit under section 273.1384, voter
59.25approved school levy, other local school levy, and the sum of the special taxing districts,
59.26and as a total of all taxing authorities:
59.27    (i) the actual tax for taxes payable in the current year; and
59.28    (ii) the proposed tax amount.
59.29    If the county levy under clause (2) includes an amount for a lake improvement
59.30district as defined under sections 103B.501 to 103B.581, the amount attributable for that
59.31purpose must be separately stated from the remaining county levy amount.
59.32    In the case of a town or the state general tax, the final tax shall also be its proposed
59.33tax unless the town changes its levy at a special town meeting under section 365.52. If a
59.34school district has certified under section 126C.17, subdivision 9, that a referendum will
59.35be held in the school district at the November general election, the county auditor must
59.36note next to the school district's proposed amount that a referendum is pending and that, if
60.1approved by the voters, the tax amount may be higher than shown on the notice. In the
60.2case of the city of Minneapolis, the levy for Minneapolis Park and Recreation shall be
60.3listed separately from the remaining amount of the city's levy. In the case of the city of
60.4St. Paul, the levy for the St. Paul Library Agency must be listed separately from the
60.5remaining amount of the city's levy. In the case of Ramsey County, any amount levied
60.6under section 134.07 may be listed separately from the remaining amount of the county's
60.7levy. In the case of a parcel where tax increment or the fiscal disparities areawide tax
60.8under chapter 276A or 473F applies, the proposed tax levy on the captured value or the
60.9proposed tax levy on the tax capacity subject to the areawide tax must each be stated
60.10separately and not included in the sum of the special taxing districts; and
60.11    (3) the increase or decrease between the total taxes payable in the current year and
60.12the total proposed taxes, expressed as a percentage.
60.13    For purposes of this section, the amount of the tax on homesteads qualifying under
60.14the senior citizens' property tax deferral program under chapter 290B is the total amount
60.15of property tax before subtraction of the deferred property tax amount.
60.16    (e) The notice must clearly state that the proposed or final taxes do not include
60.17the following:
60.18    (1) special assessments;
60.19    (2) levies approved by the voters after the date the proposed taxes are certified,
60.20including bond referenda and school district levy referenda;
60.21    (3) a levy limit increase approved by the voters by the first Tuesday after the first
60.22Monday in November of the levy year as provided under section 275.73;
60.23    (4) amounts necessary to pay cleanup or other costs due to a natural disaster
60.24occurring after the date the proposed taxes are certified;
60.25    (5) amounts necessary to pay tort judgments against the taxing authority that become
60.26final after the date the proposed taxes are certified; and
60.27    (6) the contamination tax imposed on properties which received market value
60.28reductions for contamination.
60.29    (f) Except as provided in subdivision 7, failure of the county auditor to prepare or
60.30the county treasurer to deliver the notice as required in this section does not invalidate the
60.31proposed or final tax levy or the taxes payable pursuant to the tax levy.
60.32    (g) If the notice the taxpayer receives under this section lists the property as
60.33nonhomestead, and satisfactory documentation is provided to the county assessor by the
60.34applicable deadline, and the property qualifies for the homestead classification in that
60.35assessment year, the assessor shall reclassify the property to homestead for taxes payable
60.36in the following year.
61.1    (h) In the case of class 4 residential property used as a residence for lease or rental
61.2periods of 30 days or more, the taxpayer must either:
61.3    (1) mail or deliver a copy of the notice of proposed property taxes to each tenant,
61.4renter, or lessee; or
61.5    (2) post a copy of the notice in a conspicuous place on the premises of the property.
61.6    The notice must be mailed or posted by the taxpayer by November October 27 or
61.7within three days of receipt of the notice, whichever is later. A taxpayer may notify the
61.8county treasurer of the address of the taxpayer, agent, caretaker, or manager of the premises
61.9to which the notice must be mailed in order to fulfill the requirements of this paragraph.
61.10    (i) For purposes of this subdivision, subdivisions 5a and 6, "metropolitan special
61.11taxing districts" means the following taxing districts in the seven-county metropolitan area
61.12that levy a property tax for any of the specified purposes listed below:
61.13    (1) Metropolitan Council under section 473.132, 473.167, 473.249, 473.325,
61.14473.446 , 473.521, 473.547, or 473.834;
61.15    (2) Metropolitan Airports Commission under section 473.667, 473.671, or 473.672;
61.16and
61.17    (3) Metropolitan Mosquito Control Commission under section 473.711.
61.18    For purposes of this section, any levies made by the regional rail authorities in the
61.19county of Anoka, Carver, Dakota, Hennepin, Ramsey, Scott, or Washington under chapter
61.20398A shall be included with the appropriate county's levy and shall be discussed at that
61.21county's public hearing.
61.22    (j) The governing body of a county, city, or school district may, with the consent
61.23of the county board, include supplemental information with the statement of proposed
61.24property taxes about the impact of state aid increases or decreases on property tax
61.25increases or decreases and on the level of services provided in the affected jurisdiction.
61.26This supplemental information may include information for the following year, the current
61.27year, and for as many consecutive preceding years as deemed appropriate by the governing
61.28body of the county, city, or school district. It may include only information regarding:
61.29    (1) the impact of inflation as measured by the implicit price deflator for state and
61.30local government purchases;
61.31    (2) population growth and decline;
61.32    (3) state or federal government action; and
61.33    (4) other financial factors that affect the level of property taxation and local services
61.34that the governing body of the county, city, or school district may deem appropriate to
61.35include.
62.1    The information may be presented using tables, written narrative, and graphic
62.2representations and may contain instruction toward further sources of information or
62.3opportunity for comment.
62.4EFFECTIVE DATE.This section is effective for proposed notices and hearings
62.5held in 2009 and thereafter, for property taxes payable in 2010 and thereafter.

62.6    Sec. 31. Minnesota Statutes 2006, section 275.065, is amended by adding a subdivision
62.7to read:
62.8    Subd. 3b. Supplemental notice of proposed levy increases. (a) If a city that has a
62.9population of more than 2,500 or a county proposes a levy that would cause a levy plus
62.10aid increase greater than the threshold increase calculated under paragraph (b), it shall
62.11prepare and deliver by first class mail a supplemental proposed property tax notice to each
62.12property taxpayer in the taxing jurisdiction, as described in this subdivision.
62.13    (b) The threshold increase in the proposed property tax levy plus aid is equal to
62.14the levy plus aid amount in the previous year, multiplied by the sum of (i) one percent,
62.15(ii) the percentage growth, if any, in the population in the taxing jurisdiction for the
62.16most recent available year, (iii) the percentage increase in the total market value in the
62.17taxing jurisdiction due to new construction of commercial and industrial property, and
62.18(iv) the percentage increase in the implicit price deflator for government consumption
62.19expenditures and gross investment for state and local governments as prepared by the
62.20United States Department of Commerce for the most recent 12-month period ending
62.21March of the levy year.
62.22    (c) The supplemental proposed notice must show the taxing jurisdiction's (1) levy
62.23plus aid amount for the previous year, (2) its threshold levy plus aid increase indicating that
62.24this increase is calculated to reflect reasonable growth adjusting for population increases,
62.25increased demand from new business, and inflation, (3) the aid amount corresponding to
62.26the proposed levy year, (4) the proposed property tax increase, and (5) the amount the
62.27proposed increase in levy plus aid exceeds the threshold increase. The notice must contain
62.28a description of why the jurisdiction needs to raise property taxes above the threshold
62.29amount and how the taxing jurisdiction plans to spend the additional revenue.
62.30    (d) For purposes of this subdivision, "aid" means county program aid under section
62.31477A.0124 or local government aid under section 477A.013.
62.32EFFECTIVE DATE.This section is effective for taxes payable in 2009 and
62.33thereafter.

63.1    Sec. 32. Minnesota Statutes 2006, section 275.065, subdivision 6, is amended to read:
63.2    Subd. 6. Public hearing; adoption of budget and levy. (a) For purposes of this
63.3section, the following terms shall have the meanings given:
63.4    (1) "Initial hearing" means the first and primary hearing held to discuss the taxing
63.5authority's proposed budget and proposed property tax levy for taxes payable in the
63.6following year, or, for school districts, the current budget and the proposed property tax
63.7levy for taxes payable in the following year.
63.8    (2) "Continuation hearing" means a hearing held to complete the initial hearing, if
63.9the initial hearing is not completed on its scheduled date.
63.10    (3) "Subsequent hearing" means the hearing held to adopt the taxing authority's final
63.11property tax levy, and, in the case of taxing authorities other than school districts, the final
63.12budget, for taxes payable in the following year.
63.13    (b) Between November 29 9 and December 20 1, the governing bodies of a city that
63.14has a population over 500, county, metropolitan special taxing districts as defined in
63.15subdivision 3, paragraph (i), and regional library districts shall each hold an initial public
63.16hearing to discuss and seek public comment on its final budget and property tax levy for
63.17taxes payable in the following year, and the governing body of the school district shall
63.18hold an initial public hearing to review its current budget and proposed property tax
63.19levy for taxes payable in the following year. The metropolitan special taxing districts
63.20shall be required to hold only a single joint initial public hearing, the location of which
63.21will be determined by the affected metropolitan agencies. A city, county, metropolitan
63.22special taxing district as defined in subdivision 3, paragraph (i), regional library district
63.23established under section 134.201, or school district is not required to hold a public
63.24hearing under this subdivision unless its proposed property tax levy for taxes payable
63.25in the following year, as certified under subdivision 1, has increased over its final
63.26property tax levy for taxes payable in the current year by a percentage that is greater
63.27than the percentage increase in the implicit price deflator for government consumption
63.28expenditures and gross investment for state and local governments prepared by the Bureau
63.29of Economic Analysts of the United States Department of Commerce for the 12-month
63.30period ending March 31 of the current year.
63.31    (c) The initial hearing must be held after 5:00 p.m. if scheduled on a day other than
63.32Saturday. No initial hearing may be held on a Sunday.
63.33    (d) At the initial hearing under this subdivision, the percentage increase in property
63.34taxes proposed by the taxing authority, if any, and the specific purposes for which property
63.35tax revenues are being increased must be discussed. During the discussion, the governing
63.36body shall hear comments regarding a proposed increase and explain the reasons for the
64.1proposed increase. The public shall be allowed to speak and to ask questions. At the public
64.2hearing, the school district must also provide and discuss information on the distribution
64.3of its revenues by revenue source, and the distribution of its spending by program area.
64.4    (e) If the initial hearing is not completed on its scheduled date, the taxing authority
64.5must announce, prior to adjournment of the hearing, the date, time, and place for the
64.6continuation of the hearing. The continuation hearing must be held at least five business
64.7days but no more than 14 business days after the initial hearing. A continuation hearing
64.8may not be held later than December 20 except as provided in paragraphs (f) and (g).
64.9A continuation hearing must be held after 5:00 p.m. if scheduled on a day other than
64.10Saturday. No continuation hearing may be held on a Sunday.
64.11    (f) The governing body of a county shall hold its initial hearing on the first second
64.12Thursday in December November each year, and may hold additional initial hearings on
64.13other dates before December 20 1 if necessary for the convenience of county residents. If
64.14the county needs a continuation of its hearing, the continuation hearing shall be held on
64.15the third Tuesday in December. If the third Tuesday in December falls on December 21,
64.16the county's continuation hearing shall be held on Monday, December 20 November.
64.17    (g) The metropolitan special taxing districts shall hold a joint initial public hearing
64.18on the first Wednesday of December. A continuation hearing, if necessary, shall be held on
64.19the second Wednesday of December even if that second Wednesday is after December 10.
64.20    (h) The county auditor shall provide for the coordination of initial and continuation
64.21hearing dates for all school districts and cities within the county to prevent conflicts under
64.22clauses (i) and (j).
64.23    (i) By August 10, each school board and the board of the regional library district
64.24shall certify to the county auditors of the counties in which the school district or regional
64.25library district is located the dates on which it elects to hold its initial hearing and any
64.26continuation hearing. If a school board or regional library district does not certify these
64.27dates by August 10, the auditor will assign the initial and continuation hearing dates. The
64.28dates elected or assigned must not conflict with the initial and continuation hearing dates
64.29of the county or the metropolitan special taxing districts.
64.30    (j) By August 20, the county auditor shall notify the clerks of the cities within the
64.31county of the dates on which school districts and regional library districts have elected
64.32to hold their initial and continuation hearings. At the time a city certifies its proposed
64.33levy under subdivision 1 it shall certify the dates on which it elects to hold its initial
64.34hearing and any continuation hearing. Until September 15, the first and second Mondays
64.35Monday of December are is reserved for the use of the cities. If a city does not certify its
64.36hearing dates by September 15, the auditor shall assign the initial and continuation hearing
65.1dates. The dates elected or assigned for the initial hearing must not conflict with the
65.2initial hearing dates of the county, metropolitan special taxing districts, regional library
65.3districts, or school districts within which the city is located. To the extent possible, the
65.4dates of the city's continuation hearing should not conflict with the continuation hearing
65.5dates of the county, metropolitan special taxing districts, regional library districts, or
65.6school districts within which the city is located. This paragraph does not apply to cities
65.7of 500 population or less.
65.8    (k) The county initial hearing date and the city, metropolitan special taxing district,
65.9regional library district, and school district initial hearing dates must be designated on
65.10the notices required under subdivision 3. The continuation hearing dates need not be
65.11stated on the notices.
65.12    (l) At a subsequent hearing, each county, school district, city over 500 population,
65.13and metropolitan special taxing district may amend its proposed property tax levy
65.14and must adopt a final property tax levy. Each county, city over 500 population, and
65.15metropolitan special taxing district may also amend its proposed budget and must adopt a
65.16final budget at the subsequent hearing. The final property tax levy must be adopted prior
65.17to adopting the final budget. A school district is not required to adopt its final budget at the
65.18subsequent hearing. The subsequent hearing of a taxing authority must be held on a date
65.19subsequent to the date of the taxing authority's initial public hearing. If a continuation
65.20hearing is held, the subsequent hearing must be held either immediately following the
65.21continuation hearing or on a date subsequent to the continuation hearing. The subsequent
65.22hearing may be held at a regularly scheduled board or council meeting or at a special
65.23meeting scheduled for the purposes of the subsequent hearing. The subsequent hearing
65.24of a taxing authority does not have to be coordinated by the county auditor to prevent a
65.25conflict with an initial hearing, a continuation hearing, or a subsequent hearing of any
65.26other taxing authority. All subsequent hearings must be held prior to five working days
65.27after December 20 of the levy year. The date, time, and place of the subsequent hearing
65.28must be announced at the initial public hearing or at the continuation hearing.
65.29    (m) The property tax levy certified under section 275.07 by a city of any population,
65.30county, metropolitan special taxing district, regional library district, or school district
65.31must not exceed the proposed levy determined under subdivision 1, except by an amount
65.32up to the sum of the following amounts:
65.33    (1) the amount of a school district levy whose voters approved a referendum to
65.34increase taxes under section 123B.63, subdivision 3, or 126C.17, subdivision 9, after
65.35the proposed levy was certified;
66.1    (2) the amount of a city or county levy approved by the voters after the proposed
66.2levy was certified;
66.3    (3) the amount of a levy to pay principal and interest on bonds approved by the
66.4voters under section 475.58 after the proposed levy was certified;
66.5    (4) the amount of a levy to pay costs due to a natural disaster occurring after the
66.6proposed levy was certified, if that amount is approved by the commissioner of revenue
66.7under subdivision 6a;
66.8    (5) the amount of a levy to pay tort judgments against a taxing authority that become
66.9final after the proposed levy was certified, if the amount is approved by the commissioner
66.10of revenue under subdivision 6a;
66.11    (6) the amount of an increase in levy limits certified to the taxing authority by the
66.12commissioner of education or the commissioner of revenue after the proposed levy was
66.13certified; and
66.14    (7) the amount required under section 126C.55.
66.15    (n) This subdivision does not apply to towns and special taxing districts other than
66.16regional library districts and metropolitan special taxing districts.
66.17    (o) Notwithstanding the requirements of this section, the employer is required to
66.18meet and negotiate over employee compensation as provided for in chapter 179A.
66.19EFFECTIVE DATE.This section is effective for proposed notices and hearings
66.20held in 2009 and thereafter, for property taxes payable in 2010 and thereafter.

66.21    Sec. 33. Minnesota Statutes 2006, section 275.065, subdivision 8, is amended to read:
66.22    Subd. 8. Hearing. Notwithstanding any other provision of law, Ramsey County,
66.23the city of St. Paul, and Independent School District No. 625 are authorized to and shall
66.24hold their initial public hearing jointly. The hearing must be held on during the week of
66.25the second Tuesday of December November each year. The advertisement required in
66.26subdivision 5a may be a joint advertisement. The hearing is otherwise subject to the
66.27requirements of this section.
66.28    Ramsey County is authorized to hold an additional initial hearing or hearings as
66.29provided under this section, provided that any additional hearings must not conflict
66.30with the initial or continuation hearing dates of the other taxing districts. However, if
66.31Ramsey County elects not to hold such additional initial hearing or hearings, the joint
66.32initial hearing required by this subdivision must be held in a St. Paul location convenient
66.33to residents of Ramsey County.
67.1EFFECTIVE DATE.This section is effective for proposed notices and hearings
67.2held in 2009 and thereafter, for property taxes payable in 2010 and thereafter, except that
67.3proposed notices and hearings held in 2008 may be held during the week of the second
67.4Tuesday of December.

67.5    Sec. 34. Minnesota Statutes 2006, section 275.065, subdivision 9, is amended to read:
67.6    Subd. 9. Aitkin County and school district hearing. Notwithstanding any other
67.7law, Aitkin County and Independent School District No. 1, and the city of Aitkin, or any
67.8two of them, may hold their initial public hearing jointly. The hearing must be held on
67.9the second Tuesday of December November each year. The advertisement required in
67.10subdivision 5a may be a joint advertisement. The hearing is otherwise subject to the
67.11requirements of this section.
67.12EFFECTIVE DATE.This section is effective for proposed notices and hearings
67.13held in 2009 and thereafter, for property taxes payable in 2010 and thereafter.

67.14    Sec. 35. Minnesota Statutes 2006, section 275.065, subdivision 10, is amended to read:
67.15    Subd. 10. Nobles County; joint initial public hearing. Notwithstanding any
67.16other law, Nobles County, the city of Worthington, and Independent School District No.
67.17518, Worthington, or any two of them, may hold their initial public hearing jointly. The
67.18hearing must be held on the second Tuesday of December November each year. The
67.19advertisement required in subdivision 5a may be a joint advertisement. The hearing is
67.20otherwise subject to the requirements of this section.
67.21EFFECTIVE DATE.This section is effective for proposed notices and hearings
67.22held in 2009 and thereafter, for property taxes payable in 2010 and thereafter.

67.23    Sec. 36. Minnesota Statutes 2006, section 282.08, is amended to read:
67.24282.08 APPORTIONMENT OF PROCEEDS TO TAXING DISTRICTS.
67.25    The net proceeds from the sale or rental of any parcel of forfeited land, or from the
67.26sale of products from the forfeited land, must be apportioned by the county auditor to the
67.27taxing districts interested in the land, as follows:
67.28    (1) the portion required to pay any amounts included in the appraised value
67.29under section 282.01, subdivision 3, as representing increased value due to any public
67.30improvement made after forfeiture of the parcel to the state, but not exceeding the amount
67.31certified by the clerk of the municipality appropriate governmental authority must be
67.32apportioned to the municipal governmental subdivision entitled to it;
68.1    (2) the portion required to pay any amount included in the appraised value under
68.2section 282.019, subdivision 5, representing increased value due to response actions
68.3taken after forfeiture of the parcel to the state, but not exceeding the amount of expenses
68.4certified by the Pollution Control Agency or the commissioner of agriculture, must be
68.5apportioned to the agency or the commissioner of agriculture and deposited in the fund
68.6from which the expenses were paid;
68.7    (3) the portion of the remainder required to discharge any special assessment
68.8chargeable against the parcel for drainage or other purpose whether due or deferred at
68.9the time of forfeiture, must be apportioned to the municipal governmental subdivision
68.10entitled to it; and
68.11    (4) any balance must be apportioned as follows:
68.12    (i) The county board may annually by resolution set aside no more than 30 percent
68.13of the receipts remaining to be used for forest development on tax-forfeited land and
68.14dedicated memorial forests, to be expended under the supervision of the county board. It
68.15must be expended only on projects improving the health and management of the forest
68.16resource.
68.17    (ii) The county board may annually by resolution set aside no more than 20 percent
68.18of the receipts remaining to be used for the acquisition and maintenance of county parks
68.19or recreational areas as defined in sections 398.31 to 398.36, to be expended under the
68.20supervision of the county board.
68.21    (iii) Any balance remaining must be apportioned as follows: county, 40 percent;
68.22town or city, 20 percent; and school district, 40 percent, provided, however, that in
68.23unorganized territory that portion which would have accrued to the township must be
68.24administered by the county board of commissioners.
68.25EFFECTIVE DATE.This section is effective the day following final enactment.

68.26    Sec. 37. Minnesota Statutes 2006, section 290B.03, subdivision 1, is amended to read:
68.27    Subdivision 1. Program qualifications. The qualifications for the senior citizens'
68.28property tax deferral program are as follows:
68.29    (1) the property must be owned and occupied as a homestead by a person 65 years of
68.30age or older. In the case of a married couple, both only one of the spouses must be at least
68.3165 years old at the time the first property tax deferral is granted, regardless of whether the
68.32property is titled in the name of one spouse or both spouses, or titled in another way that
68.33permits the property to have homestead status;
68.34    (2) the total household income of the qualifying homeowners homeowner, or in the
68.35case of a married couple, the qualifying homeowner and spouse, as defined in section
69.1290A.03, subdivision 5 , for the calendar year preceding the year of the initial application
69.2may not exceed $60,000 $80,000;
69.3    (3) the homestead must have been owned and occupied as the homestead of at
69.4least one of the qualifying homeowners for at least 15 years prior to the year the initial
69.5application is filed;
69.6    (4) there are no state or federal tax liens or judgment liens on the homesteaded
69.7property;
69.8    (5) there are no mortgages or other liens on the property that secure future advances,
69.9except for those subject to credit limits that result in compliance with clause (6); and
69.10    (6) the total unpaid balances of debts secured by mortgages and other liens on the
69.11property, including unpaid and delinquent special assessments and interest and any
69.12delinquent property taxes, penalties, and interest, but not including property taxes payable
69.13during the year, does not exceed 75 percent of the assessor's estimated market value for
69.14the year.
69.15EFFECTIVE DATE.This section is effective for applications filed on or after
69.16July 1, 2008.

69.17    Sec. 38. Minnesota Statutes 2006, section 290B.04, subdivision 3, is amended to read:
69.18    Subd. 3. Excess-income certification by taxpayer. A taxpayer whose initial
69.19application has been approved under subdivision 2 shall notify the commissioner of
69.20revenue in writing by July 1 if the taxpayer's household income for the preceding calendar
69.21year exceeded $60,000 $80,000. The certification must state the homeowner's total
69.22household income for the previous calendar year. No property taxes may be deferred
69.23under this chapter in any year following the year in which a program participant filed or
69.24should have filed an excess-income certification under this subdivision showing income in
69.25excess of the maximum allowed, unless the participant has filed a resumption of eligibility
69.26certification as described in subdivision 4.
69.27EFFECTIVE DATE.This section is effective for applications filed on or after
69.28July 1, 2008.

69.29    Sec. 39. Minnesota Statutes 2006, section 290B.04, subdivision 4, is amended to read:
69.30    Subd. 4. Resumption of eligibility certification by taxpayer. A taxpayer who has
69.31previously filed an excess-income certification under subdivision 3 may resume program
69.32participation if the taxpayer's household income for a subsequent year is $60,000 $80,000
69.33or less. If the taxpayer chooses to resume program participation, the taxpayer must notify
70.1the commissioner of revenue in writing by July 1 of the year following a calendar year in
70.2which the taxpayer's household income is $60,000 $80,000 or less. The certification must
70.3state the taxpayer's total household income for the previous calendar year. Once a taxpayer
70.4resumes participation in the program under this subdivision, participation will continue
70.5until the taxpayer files a subsequent excess-income certification under subdivision 3 or
70.6until participation is terminated under section 290B.08, subdivision 1.
70.7EFFECTIVE DATE.This section is effective for applications filed on or after
70.8July 1, 2008.

70.9    Sec. 40. Minnesota Statutes 2006, section 290B.05, subdivision 1, is amended to read:
70.10    Subdivision 1. Determination by commissioner. The commissioner shall
70.11determine each qualifying homeowner's "annual maximum property tax amount"
70.12following approval of the homeowner's initial application and following the receipt of a
70.13resumption of eligibility certification. The "annual maximum property tax amount" equals
70.14three percent of the homeowner's total household income for the year preceding either the
70.15initial application or the resumption of eligibility certification, whichever is applicable.
70.16Following approval of the initial application, the commissioner shall determine the
70.17qualifying homeowner's "maximum allowable deferral." No tax may be deferred relative
70.18to the appropriate assessment year for any homeowner whose total household income
70.19for the previous year exceeds $60,000 $80,000. No tax shall be deferred in any year in
70.20which the homeowner does not meet the program qualifications in section 290B.03. The
70.21maximum allowable total deferral is equal to 75 percent of the assessor's estimated market
70.22value for the year, less the balance of any mortgage loans and other amounts secured by
70.23liens against the property at the time of application, including any unpaid and delinquent
70.24special assessments and interest and any delinquent property taxes, penalties, and interest,
70.25but not including property taxes payable during the year.
70.26EFFECTIVE DATE.This section is effective for applications received on or after
70.27July 1, 2008.

70.28    Sec. 41. Minnesota Statutes 2006, section 290B.07, is amended to read:
70.29290B.07 LIEN; DEFERRED PORTION.
70.30    (a) Payment by the state to the county treasurer of property taxes, penalties, interest,
70.31or special assessments and interest deferred under this chapter is deemed a loan from the
70.32state to the program participant. The commissioner must compute the interest as provided
70.33in section 270C.40, subdivision 5, but not to exceed five percent, and maintain records of
71.1the total deferred amount and interest for each participant. Interest shall accrue beginning
71.2September 1 of the payable year for which the taxes are deferred, provided that no interest
71.3shall be charged on (1) deferred property tax amounts on applications filed on or after
71.4July 1, 2008, or (2) deferred property taxes beginning with taxes payable in 2009 on
71.5applications filed prior to July 1, 2008. Any deferral made under this chapter shall not
71.6be construed as delinquent property taxes.
71.7    The lien created under section 272.31 continues to secure payment by the taxpayer,
71.8or by the taxpayer's successors or assigns, of the amount deferred, including interest, with
71.9respect to all years for which amounts are deferred. The lien for deferred taxes and interest
71.10has the same priority as any other lien under section 272.31, except that liens, including
71.11mortgages, recorded or filed prior to the recording or filing of the notice under section
71.12290B.04, subdivision 2 , have priority over the lien for deferred taxes and interest. A
71.13seller's interest in a contract for deed, in which a qualifying homeowner is the purchaser
71.14or an assignee of the purchaser, has priority over deferred taxes and interest on deferred
71.15taxes, regardless of whether the contract for deed is recorded or filed. The lien for deferred
71.16taxes and interest for future years has the same priority as the lien for deferred taxes and
71.17interest for the first year, which is always higher in priority than any mortgages or other
71.18liens filed, recorded, or created after the notice recorded or filed under section 290B.04,
71.19subdivision 2 . The county treasurer or auditor shall maintain records of the deferred
71.20portion and shall list the amount of deferred taxes for the year and the cumulative deferral
71.21and interest for all previous years as a lien against the property. In any certification of
71.22unpaid taxes for a tax parcel, the county auditor shall clearly distinguish between taxes
71.23payable in the current year, deferred taxes and interest, and delinquent taxes. Payment
71.24of the deferred portion becomes due and owing at the time specified in section 290B.08.
71.25Upon receipt of the payment, the commissioner shall issue a receipt for it to the person
71.26making the payment upon request and shall notify the auditor of the county in which the
71.27parcel is located, within ten days, identifying the parcel to which the payment applies.
71.28Upon receipt by the commissioner of revenue of collected funds in the amount of the
71.29deferral, the state's loan to the program participant is deemed paid in full.
71.30    (b) If property for which taxes have been deferred under this chapter forfeits
71.31under chapter 281 for nonpayment of a nondeferred property tax amount, or because
71.32of nonpayment of amounts previously deferred following a termination under section
71.33290B.08 , the lien for the taxes deferred under this chapter, plus interest and costs, shall be
71.34canceled by the county auditor as provided in section 282.07. However, notwithstanding
71.35any other law to the contrary, any proceeds from a subsequent sale of the property under
71.36chapter 282 or another law, must be used to first reimburse the county's forfeited tax sale
72.1fund for any direct costs of selling the property or any costs directly related to preparing
72.2the property for sale, and then to reimburse the state for the amount of the canceled lien.
72.3Within 90 days of the receipt of any sale proceed to which the state is entitled under these
72.4provisions, the county auditor must pay those funds to the commissioner of revenue by
72.5warrant for deposit in the general fund. No other deposit, use, distribution, or release of
72.6gross sale proceeds or receipts may be made by the county until payments sufficient
72.7to fully reimburse the state for the canceled lien amount have been transmitted to the
72.8commissioner.
72.9EFFECTIVE DATE.This section is effective July 1, 2008.

72.10    Sec. 42. [290D.01] CITATION.
72.11    This program shall be named the "seasonal recreational property tax deferral
72.12program."
72.13EFFECTIVE DATE.This section is effective July 1, 2009.

72.14    Sec. 43. [290D.02] TERMS.
72.15    Subdivision 1. Terms. For purposes of sections 290D.01 to 290D.08, the terms
72.16defined in this section have the meanings given them.
72.17    Subd. 2. Primary property owner. "Primary property owner" means a person who
72.18(1) has been the owner, or one of the owners, of the eligible property for at least 15 years
72.19prior to the year the application is filed under section 290D.04; and (2) applies for the
72.20deferral of property taxes under section 290D.04.
72.21    Subd. 3. Secondary property owner. "Secondary property owner" means any
72.22person, other than the primary property owner, who has been an owner of the eligible
72.23property for at least 15 years prior to the year the initial application is filed for deferral
72.24of property taxes under section 290D.04.
72.25    Subd. 4. Eligible property. "Eligible property" means a parcel of property or
72.26contiguous parcels of property under the same ownership classified as noncommercial
72.27seasonal residential recreational 4c(1) property under section 273.13, subdivision 25.
72.28    Subd. 5. Base property tax amount. "Base property tax amount" means the total
72.29property taxes levied by all taxing jurisdictions, including special assessments, on the
72.30eligible property in the year prior to the year that the initial application is approved under
72.31section 290D.04 and payable in the year of the application.
73.1    Subd. 6. Special assessments. "Special assessments" means any assessment, fee, or
73.2other charge that may be made by law, and that appears on the property tax statement for
73.3the property for collection under the laws applicable to the enforcement of real estate taxes.
73.4    Subd. 7. Commissioner. "Commissioner" means the commissioner of revenue.
73.5EFFECTIVE DATE.This section is effective for applications filed July 1, 2009,
73.6and thereafter.

73.7    Sec. 44. [290D.03] QUALIFICATIONS FOR DEFERRAL.
73.8    In order for an eligible property to qualify for treatment under this program:
73.9    (1) the eligible property must have been owned solely by the primary property owner,
73.10or jointly with others, for at least 15 years prior to the year the initial application is filed;
73.11    (2) there must be no state or federal tax liens or judgment liens on the eligible
73.12property;
73.13    (3) there must be no mortgages or other liens on the eligible property that secure
73.14future advances, except for those subject to credit limits that result in compliance with
73.15clause (4); and
73.16    (4) the total unpaid balances of debts secured by mortgages and other liens on the
73.17eligible property, including unpaid and delinquent special assessments and interest and
73.18any delinquent property taxes, penalties, and interest, but not including property taxes
73.19payable during the year, must not exceed 60 percent of the assessor's estimated market
73.20value for the current assessment year.
73.21EFFECTIVE DATE.This section is effective for applications filed July 1, 2009,
73.22and thereafter.

73.23    Sec. 45. [290D.04] APPLICATION FOR DEFERRAL.
73.24    Subdivision 1. Initial application. (a) A primary owner of a property meeting
73.25the qualifications under section 290D.03 may apply to the commissioner for deferral
73.26of taxes on the eligible property. Applications are due on or before July 1 for deferral
73.27of any taxes payable in the following year. The application, which must be prescribed
73.28by the commissioner, shall include the following items and any other information the
73.29commissioner deems necessary:
73.30    (1) the name, address, and Social Security number of the primary property owner
73.31and secondary property owners, if any;
73.32    (2) a copy of the property tax statement for the current taxes payable year for the
73.33eligible property;
74.1    (3) the initial year of ownership of the primary property owner and any second
74.2property owners of the eligible property;
74.3    (4) information on any mortgage loans or other amounts secured by mortgages or
74.4other liens against the eligible property, for which purpose the commissioner may require
74.5the applicant to provide a copy of the mortgage note, the mortgage, or a statement of the
74.6balance owing on the mortgage loan provided by the mortgage holder. The commissioner
74.7may require the appropriate documents in connection with obtaining and confirming
74.8information on unpaid amounts secured by other liens; and
74.9    (5) the signatures of the primary property owner and all other owners, if any, stating
74.10that each owner agrees to enroll the eligible property in the program to defer property
74.11taxes under this chapter.
74.12    The application must state that program participation is voluntary. The application
74.13must also state that program participation includes authorization for the annual deferred
74.14amount. The deferred property tax calculated by the county and the cumulative deferred
74.15property tax amount is public data.
74.16    (b) As part of the initial application process, if the property is abstract property, the
74.17commissioner may require the applicant to obtain at the applicant's cost a report prepared
74.18by a licensed abstracter showing the last deed and any unsatisfied mortgages, liens,
74.19judgments, and state and federal tax lien notices which were recorded on or after the date
74.20of that last deed with respect to the eligible property or to the applicant.
74.21    The certificate or report need not include references to any documents filed or
74.22recorded more than 40 years prior to the date of the certification or report. The certification
74.23or report must be as of a date not more than 30 days prior to submission of the application
74.24under this section.
74.25    The commissioner may also require the county recorder or county registrar of the
74.26county where the eligible property is located to provide copies of recorded documents
74.27related to the applicant of the eligible property, for which the recorder or registrar shall
74.28not charge a fee. The commissioner may use any information available to determine or
74.29verify eligibility under this section.
74.30    Subd. 2. Approval; recording. The commissioner shall approve all initial
74.31applications that qualify under this chapter and shall notify the primary property owner on
74.32or before December 1. The commissioner may investigate the facts or require confirmation
74.33in regard to an application. The commissioner shall record or file a notice of qualification
74.34for deferral, including the names of the primary and any secondary property owners and a
74.35legal description of the eligible property, in the office of the county recorder, or registrar of
74.36titles, whichever is applicable, in the county where the eligible property is located. The
75.1notice must state that it serves as a notice of lien and that it includes deferrals under this
75.2section for future years. The primary property owner shall pay the recording or filing fees
75.3for the notice, which, notwithstanding section 357.18, shall be paid by that owner at the
75.4time of satisfaction of the lien.
75.5    Subd. 3. Penalty for failure; investigations. (a) The commissioner shall assess
75.6a penalty equal to 20 percent of the property taxes improperly deferred in the case of a
75.7false application. The commissioner shall assess a penalty equal to 50 percent of the
75.8property taxes improperly deferred if the taxpayer knowingly filed a false application. The
75.9commissioner shall assess penalties under this section through the issuance of an order
75.10under the provisions of chapter 270C. Persons affected by a commissioner's order issued
75.11under this section may appeal as provided in chapter 270C.
75.12    (b) The commissioner may conduct investigations related to initial applications
75.13required under this chapter within the period ending 3-1/2 years from the due date of
75.14the application.
75.15    Subd. 4. Annual certification to commissioner. Annually on or before July 1,
75.16the primary property owner must certify to the commissioner that the person continues
75.17to qualify as a primary property owner. If the primary owner has died or has transferred
75.18the property in the preceding year, a certification may be filed by the primary owner's
75.19spouse, or by one of the secondary owners, provided that the person is currently an
75.20owner of the property. In this case, the primary owner's spouse or the secondary owner
75.21shall be considered the primary owner from that point forward. If neither the primary
75.22owner, the primary owner's spouse, or a secondary owner is eligible to file the required
75.23annual certification for the property, the property's participation in the program shall be
75.24terminated, and the procedures in section 290D.07 apply.
75.25    Subd. 5. Annual notice to primary property owner. Annually, on or before
75.26September 1, the commissioner shall notify each primary property owner, in writing, of
75.27the total cumulative deferred taxes and accrued interest on the qualifying property as of
75.28that date.
75.29EFFECTIVE DATE.This section is effective for applications filed July 1, 2009,
75.30and thereafter.

75.31    Sec. 46. [290D.05] DEFERRED PROPERTY TAX AMOUNT.
75.32    Subdivision 1. Calculation of deferred property tax amount. Each year after
75.33the county auditor has determined the final property tax rates under section 275.08, the
75.34"deferred property tax amount" must be calculated on each eligible property. The deferred
75.35property tax amount is equal to 50 percent of the amount of the difference between (1) the
76.1total amount of property taxes and special assessments levied upon the eligible property
76.2for the current year by all taxing jurisdictions and (2) the eligible property's base property
76.3tax amount. Any tax attributable to new improvements made to the eligible property after
76.4the initial application has been approved under section 290D.04, subdivision 2, must be
76.5excluded in determining the deferred property tax amount. The eligible property's total
76.6current year's tax less the deferred property tax amount for the current year must be listed
76.7on the property tax statement and is the amount due to the county under chapter 276.
76.8Reference that the property is enrolled in the seasonal recreational property tax deferral
76.9program under this chapter and a state lien has been recorded must be clearly printed on
76.10the statement.
76.11    Subd. 2. Certification to commissioner. The county auditor shall annually, on or
76.12before April 15, certify to the commissioner the property tax deferral amounts determined
76.13under this section for each eligible property in the county. The commissioner shall
76.14prescribe the information that is necessary to identify the eligible properties.
76.15    Subd. 3. Limitation on total amount of deferred taxes. The total amount of
76.16deferred taxes and interest on a property, when added to (1) the balance owed on any
76.17mortgages on the property at the time of initial application; (2) other amounts secured by
76.18liens on the property at the time of the initial application; and (3) any unpaid and delinquent
76.19special assessments and interest and any delinquent property taxes, penalties, and interest,
76.20but not including property taxes payable during the year, must not exceed 60 percent of
76.21the assessor's estimated market value of the property for the current assessment year.
76.22EFFECTIVE DATE.This section is effective for applications filed July 1, 2009,
76.23and thereafter.

76.24    Sec. 47. [290D.06] LIEN; DEFERRED PORTION.
76.25    (a) Payment by the state to the county treasurer of property taxes, penalties, interest,
76.26or special assessments and interest, deferred under this chapter is deemed a loan from the
76.27state to the program participant. The commissioner shall compute the interest as provided
76.28in section 270C.40, subdivision 5, but not to exceed two percent over the maximum
76.29interest rate provided in section 290B.07, paragraph (a), and maintain records of the total
76.30deferred amount and interest for each participant. Interest accrues beginning September 1
76.31of the payable year for which the taxes are deferred. Any deferral made under this chapter
76.32must not be construed as delinquent property taxes.
76.33    The lien created under section 272.31 continues to secure payment by the taxpayer,
76.34or by the taxpayer's successors or assigns, of the amount deferred, including interest, with
76.35respect to all years for which amounts are deferred. The lien for deferred taxes and interest
77.1has the same priority as any other lien under section 272.31, except that liens, including
77.2mortgages, recorded or filed prior to the recording or filing of the notice under section
77.3290D.04, subdivision 2, have priority over the lien for deferred taxes and interest. A
77.4seller's interest in a contract for deed, in which a qualifying owner is the purchaser or an
77.5assignee of the purchaser, has priority over deferred taxes and interest on deferred taxes,
77.6regardless of whether the contract for deed is recorded or filed. The lien for deferred taxes
77.7and interest for future years has the same priority as the lien for deferred taxes and interest
77.8for the first year, which is always higher in priority than any mortgages or other liens filed,
77.9recorded, or created after the notice recorded or filed under section 290D.04, subdivision
77.102 . The county treasurer or auditor shall maintain records of the deferred portion and shall
77.11list the amount of deferred taxes for the year and the cumulative deferral and interest for
77.12all previous years as a lien against the eligible property. In any certification of unpaid
77.13taxes for a tax parcel, the county auditor shall clearly distinguish between taxes payable in
77.14the current year, deferred taxes and interest, and delinquent taxes. Payment of the deferred
77.15portion becomes due and owing at the time specified in section 290D.07. Upon receipt of
77.16the payment, the commissioner shall issue a receipt to the person making the payment
77.17upon request and shall notify the auditor of the county in which the parcel is located,
77.18within ten days, identifying the parcel to which the payment applies. Upon receipt by the
77.19commissioner of collected funds in the amount of the deferral, the state's loan to the
77.20program participant is deemed paid in full.
77.21    (b) If eligible property for which taxes have been deferred under this chapter forfeits
77.22under chapter 281 for nonpayment of a nondeferred property tax amount, or because
77.23of nonpayment of amounts previously deferred following a termination under section
77.24290D.07, the lien for the taxes deferred under this chapter, plus interest and costs, shall be
77.25canceled by the county auditor as provided in section 282.07. However, notwithstanding
77.26any other law to the contrary, any proceeds from a subsequent sale of the eligible property
77.27under chapter 282 or another law must be used to first reimburse the county's forfeited
77.28tax sale fund for any direct costs of selling the eligible property or any costs directly
77.29related to preparing the eligible property for sale, and then to reimburse the state for
77.30the amount of the canceled lien. Within 90 days of the receipt of any sale proceeds to
77.31which the state is entitled under these provisions, the county auditor must pay those funds
77.32to the commissioner by warrant for deposit in the general fund. No other deposit, use,
77.33distribution, or release of gross sale proceeds or receipts may be made by the county until
77.34payments sufficient to fully reimburse the state for the canceled lien amount have been
77.35transmitted to the commissioner.
78.1EFFECTIVE DATE.This section is effective for applications filed July 1, 2009,
78.2and thereafter.

78.3    Sec. 48. [290D.07] TERMINATION OF DEFERRAL; PAYMENT OF
78.4DEFERRED TAXES.
78.5    Subdivision 1. Termination. (a) The deferral of taxes granted under this chapter
78.6terminates when one of the following occurs:
78.7    (1) the eligible property is sold or transferred to someone other than the primary
78.8owner's spouse or a secondary owner;
78.9    (2) the death of the primary owner, or in the case of a married couple, after the
78.10death of both spouses, provided that there is not a secondary owner eligible to become
78.11the primary owner;
78.12    (3) the primary property owner notifies the commissioner, in writing, that all owners,
78.13including any secondary property owners, desire to discontinue the deferral; or
78.14    (4) the eligible property no longer qualifies under section 290D.03.
78.15    (b) An eligible property is not terminated from the program because no deferred
78.16property tax amount is determined for any given year after the eligible property's initial
78.17enrollment into the program.
78.18    (c) An eligible property is not terminated from the program if the eligible property
78.19subsequently becomes the homestead of one or more of the property owners and the
78.20property and the owners qualify for, and are immediately enrolled in, the senior deferral
78.21program under chapter 290B.
78.22    Subd. 2. Payment upon termination. Upon the termination of the deferral under
78.23subdivision 1, the amount of deferred taxes, penalties, interest, and special assessments
78.24and interest, plus the recording or filing fees under this subdivision and section 290D.04,
78.25subdivision 2 , becomes due and payable to the commissioner within 90 days of termination
78.26of the deferral for terminations under subdivision 1, paragraph (a), clauses (1) and (2),
78.27and within one year of termination of the deferral for terminations under subdivision 1,
78.28paragraph (a), clauses (3) and (4). No additional interest is due on the deferral if timely
78.29paid. On receipt of payment, the commissioner shall, within ten days, notify the auditor
78.30of the county in which the parcel is located, identifying the parcel to which the payment
78.31applies and shall remit the recording or filing fees under this subdivision and section
78.32290D.04, subdivision 2, to the auditor. A notice of termination of deferral, containing the
78.33legal description and the recording or filing data for the notice of qualification for deferral
78.34under section 290D.04, subdivision 2, shall be prepared and recorded or filed by the
78.35county auditor in the same office in which the notice of qualification for deferral under
79.1section 290D.04, subdivision 2, was recorded or filed, and the county auditor shall mail a
79.2copy of the notice of termination to the property owner. The property owner shall pay the
79.3recording or filing fees. Upon recording or filing of the notice of termination of deferral,
79.4the notice of qualification for deferral under section 290D.04, subdivision 2, and the lien
79.5created by it are discharged. If the deferral is not timely paid, the penalty, interest, lien,
79.6forfeiture, and other rules for the collection of ad valorem property taxes apply.
79.7EFFECTIVE DATE.This section is effective for applications filed July 1, 2009,
79.8and thereafter.

79.9    Sec. 49. [290D.08] STATE REIMBURSEMENT.
79.10    Subdivision 1. Determination; payment. The county auditor shall determine the
79.11total current year's deferred amount of property tax under this chapter in the county, and
79.12submit those amounts as part of the abstracts of tax lists submitted by the county auditors
79.13under section 275.29. The commissioner may make changes in the abstracts of tax lists as
79.14deemed necessary. The commissioner, after such review, shall pay the deferred amount of
79.15property tax to each county treasurer on or before August 31.
79.16    The county treasurer shall distribute, as part of the October settlement, the funds
79.17received as if they had been collected as part of the property tax.
79.18    Subd. 2. Appropriation. An amount sufficient to pay the total amount of property
79.19tax determined under subdivision 1, plus any amounts paid under section 290D.04,
79.20subdivision 4 , is annually appropriated from the general fund to the commissioner.
79.21EFFECTIVE DATE.This section is effective for applications filed July 1, 2009,
79.22and thereafter.

79.23    Sec. 50. Minnesota Statutes 2006, section 469.1813, subdivision 8, is amended to read:
79.24    Subd. 8. Limitation on abatements. In any year, the total amount of property
79.25taxes abated by a political subdivision under this section may not exceed (1) ten percent
79.26of the current levy net tax capacity of the political subdivision for the taxes payable year
79.27to which the abatement applies, or (2) $200,000, whichever is greater. The limit under
79.28this subdivision does not apply to:
79.29    (i) an uncollected abatement from a prior year that is added to the abatement levy; or
79.30    (ii) a taxpayer whose real and personal property is subject to valuation under
79.31Minnesota Rules, chapter 8100.
79.32EFFECTIVE DATE.This section is effective for abatement resolutions approved
79.33after the day following final enactment.

80.1    Sec. 51. Minnesota Statutes 2006, section 473.446, subdivision 2, is amended to read:
80.2    Subd. 2. Transit taxing district. The metropolitan transit taxing district is hereby
80.3designated as that portion of the metropolitan transit area lying within the following
80.4named cities, towns, or unorganized territory within the counties indicated:
80.5    (a) Anoka County. Anoka, Blaine, Centerville, Columbia Heights, Coon Rapids,
80.6Fridley, Circle Pines, Hilltop, Lexington, Lino Lakes, Spring Lake Park;
80.7    (b) Carver County. Chanhassen, the city of Chaska;
80.8    (c) Dakota County. Apple Valley, Burnsville, Eagan, Inver Grove Heights, Lilydale,
80.9Mendota, Mendota Heights, Rosemount, South St. Paul, Sunfish Lake, West St. Paul;
80.10    (d) Ramsey County. All of the territory within Ramsey County;
80.11    (e) Hennepin County. Bloomington, Brooklyn Center, Brooklyn Park, Champlin,
80.12Chanhassen, Crystal, Deephaven, Eden Prairie, Edina, Excelsior, Golden Valley,
80.13Greenwood, Hopkins, Long Lake, Maple Grove, Medicine Lake, Minneapolis,
80.14Minnetonka, Minnetonka Beach, Mound, New Hope, Orono, Osseo, Plymouth, Richfield,
80.15Robbinsdale, St. Anthony, St. Louis Park, Shorewood, Spring Park, Tonka Bay, Wayzata,
80.16Woodland, the unorganized territory of Hennepin County;
80.17    (f) Scott County. Prior Lake, Savage, Shakopee;
80.18    (g) Washington County. Baytown, the city of Stillwater, White Bear Lake, Bayport,
80.19Birchwood, Cottage Grove, Dellwood, Lake Elmo, Landfall, Mahtomedi, Newport,
80.20Oakdale, Oak Park Heights, Pine Springs, St. Paul Park, Willernie, Woodbury means the
80.21metropolitan area.
80.22    The Metropolitan Council in its sole discretion may provide transit service by
80.23contract beyond the boundaries of the metropolitan transit taxing district or to cities and
80.24towns within the taxing district which are receiving financial assistance under section
80.25473.388 , upon petition therefor by an interested city, township or political subdivision
80.26within the metropolitan transit area. The Metropolitan Council may establish such
80.27terms and conditions as it deems necessary and advisable for providing the transit
80.28service, including such combination of fares and direct payments by the petitioner as
80.29will compensate the council for the full capital and operating cost of the service and the
80.30related administrative activities of the council. The amount of the levy made by any
80.31municipality to pay for the service shall be disregarded when calculation of levies subject
80.32to limitations is made, provided that cities and towns receiving financial assistance under
80.33section 473.388 shall not make a special levy under this subdivision without having first
80.34exhausted the available local transit funds as defined in section 473.388. The council shall
80.35not be obligated to extend service beyond the boundaries of the taxing district, or to cities
81.1and towns within the taxing district which are receiving financial assistance under section
81.2473.388 , under any law or contract unless or until payment therefor is received.
81.3EFFECTIVE DATE.This section is effective for taxes payable in 2009 and
81.4thereafter.

81.5    Sec. 52. Minnesota Statutes 2006, section 473.446, subdivision 8, is amended to read:
81.6    Subd. 8. State review. The commissioner of revenue shall certify the council's levy
81.7limitation under this section to the council by August 1 of the levy year. The council
81.8must certify its proposed property tax levy under this section to the commissioner of
81.9revenue by September 1 of the levy year. The commissioner of revenue shall annually
81.10determine whether the property tax for transit purposes certified by the council for levy
81.11following the adoption of its proposed budget is within the levy limitation imposed by
81.12subdivisions subdivision 1 and 1b. The commissioner shall also annually determine
81.13whether the transit tax imposed on all taxable property within the metropolitan transit area
81.14but outside of the metropolitan transit taxing district is within the levy limitation imposed
81.15by subdivision 1a. The determination must be completed prior to September 10 of each
81.16year. If current information regarding market valuation in any county is not transmitted to
81.17the commissioner in a timely manner, the commissioner may estimate the current market
81.18valuation within that county for purposes of making the calculations.
81.19EFFECTIVE DATE.This section is effective for taxes payable in 2009 and
81.20thereafter.

81.21    Sec. 53. Laws 2008, chapter 154, article 2, section 11, the effective date, is amended to
81.22read:
81.23EFFECTIVE DATE.The amendments of this section to paragraph (b) and to the
81.24market value increase on the first tier of class 1c homestead resorts are effective for taxes
81.25payable in 2009 and thereafter. The rest of this section is effective for taxes payable in
81.262010 and thereafter.
81.27EFFECTIVE DATE.This section is effective the day following final enactment.

81.28    Sec. 54. FISCAL DISPARITIES STUDY.
81.29    The commissioner of revenue shall conduct a study of the metropolitan revenue
81.30distribution program contained in Minnesota Statutes, chapter 473F, commonly known
81.31as the fiscal disparities program. On or before February 1, 2010, the commissioner shall
82.1make a report to the chairs of the house of representatives and senate tax committees
82.2consisting of the findings of the study and any recommendations resulting from the study.
82.3    The study must consider to what extent the program is meeting the following goals,
82.4and what changes could be made to the program in the furtherance of meeting those goals:
82.5    (1) reducing the extent to which the property tax encourages development patterns
82.6that do not make cost-effective use of public infrastructure or impose other high public
82.7costs;
82.8    (2) ensuring that the benefits of economic growth of the region are shared throughout
82.9the region, especially for growth that results from state and/or regional decisions;
82.10    (3) improving the ability of each jurisdiction within the region to deliver services at
82.11a level commensurate with its tax effort;
82.12    (4) compensating jurisdictions containing properties that provide regional benefits
82.13for the costs those properties impose on their host jurisdictions in excess of their tax
82.14payments;
82.15    (5) promoting a fair distribution of property tax burdens across jurisdictions of
82.16the region; and
82.17    (6) reducing the economic losses that result from competition among communities
82.18for commercial-industrial tax base.
82.19EFFECTIVE DATE.This section is effective July 1, 2008.

82.20    Sec. 55. WHITE COMMUNITY HOSPITAL DISTRICT.
82.21    Subdivision 1. Authorized. Notwithstanding the contiguity requirement in
82.22Minnesota Statutes, section 447.31, subdivision 2, any two or more of the following
82.23cities and towns in St. Louis County may establish by resolution of their respective
82.24governing bodies the White Community Hospital District: the cities of Aurora, Biwabik,
82.25and Hoyt Lakes, and the towns of Biwabik, White, and Colvin. The proposed resolution to
82.26establish the hospital district must be published and is subject to referendum as provided
82.27in Minnesota Statutes, section 447.31, subdivision 2.
82.28    Subd. 2. Powers; may make grants. (a) Except as otherwise provided in this
82.29section, the White Community Hospital District shall be organized and have the powers
82.30and duties provided in Minnesota Statutes, sections 447.31, except subdivisions 2, 5, and
82.316; 447.32, subdivisions 5, 7, and 9; 447.345; 447.37; and 447.38.
82.32    (b) The hospital district may levy taxes as provided in this section to provide funding
82.33to make grants to the White Community Hospital and any affiliated health care facility or
82.34provider for any purpose authorized for hospital districts in Minnesota Statutes, sections
82.35447.31 to 447.38, except 447.331. A grant must not be made under this section until the
83.1governing body of the White Community Hospital, and any of its affiliated health care
83.2facilities or providers receiving a grant, have entered into a written agreement with the
83.3hospital district board stating that the governing body will comply with and is subject to
83.4all provisions of the Minnesota open meeting law in Minnesota Statutes, chapter 13D.
83.5    Subd. 3. Annexation; detachment. Once the hospital district is established, any
83.6other city, town, or unorganized area in St. Louis County may join the hospital district
83.7in the same manner provided in subdivision 1 for establishment of the hospital district.
83.8A city, town, or unorganized area that is a member of the hospital district may detach
83.9from the district in the same manner as it may join. An annexation to or detachment
83.10from the hospital district is effective for taxes payable in the following calendar year if
83.11the resolution is adopted, or in the case of an unorganized area the petition submitted
83.12to the county auditor, before July 1 of the levy year. A resolution adopted or petition
83.13submitted after July 1 of any year is effective for the taxes payable the year following
83.14the next levy year.
83.15    Subd. 4. Unorganized areas. An unorganized area in St. Louis County shall
83.16become a member of the hospital district if at least 51 percent of the residents of the
83.17unorganized area signed a petition submitted to the hospital district board and the county
83.18auditor requesting to participate in the hospital district.
83.19    Subd. 5. Hospital district board. The hospital district shall be governed by a
83.20hospital board composed of one member of each participating city and town's governing
83.21body, appointed by the governing body. If the hospital district only has two members,
83.22each member city or town shall appoint two board members. The hospital district board
83.23must appoint from among its members a chair, clerk, treasurer, and any other officers the
83.24board deems necessary or useful. The St. Louis County Board of Commissioners shall
83.25appoint a resident of any unorganized area that is participating in the hospital district. All
83.26board members serve at the pleasure of the respective appointing authorities.
83.27    Subd. 6. No compensation; expenses. Board members shall serve without
83.28compensation but shall be eligible for per diem and expenses provided by, and at the
83.29discretion of, their respective appointing authorities.
83.30    Subd. 7. Operating tax levy. The hospital district board may levy a tax as
83.31provided in Minnesota Statutes, section 447.34, except as provided in this subdivision.
83.32If the hospital district board levies it must be a uniform tax rate levied against the net
83.33tax capacity of all taxable properties located within each participating city, town, or
83.34unorganized area. The maximum amount that may be levied in the hospital district must
83.35not exceed 0.066088 percent of the fully taxable market value of all taxable properties
83.36located within each participating city, town, or unorganized area.
84.1    Any tax levied by the hospital district is in addition to all other taxes levied on the
84.2property, including taxes levied for any other hospital purpose by a participating city
84.3or town. The levy must be disregarded in the calculation of all other rate or per capita
84.4levy limitations imposed by law.
84.5EFFECTIVE DATE; NO LOCAL APPROVAL.This section is effective the
84.6day following final enactment without local approval under Minnesota Statutes, section
84.7645.023, subdivision 1, paragraph (a), for taxes levied in 2008, payable in 2009, and
84.8thereafter.

84.9    Sec. 56. VADNAIS LAKE AREA WATER MANAGEMENT ORGANIZATION;
84.10STORM SEWER UTILITY FEES.
84.11    Notwithstanding any other law to the contrary and pursuant to joint powers
84.12agreements authorized under Minnesota Statutes, sections 103B.211 and 471.59, the
84.13Vadnais Lake Area Water Management Organization may certify to the county auditor any
84.14fees or charges imposed by the organization under Minnesota Statutes, section 103B.211
84.15or 444.075, and the parcels on which the charges are imposed. The county auditor shall
84.16extend the charges on the property tax statements. The amounts must be certified by
84.17November 30 to appear on statements for taxes payable in the following year. The charges,
84.18if not paid, become delinquent and are subject to the same penalties, the same rate of
84.19interest, and become a lien upon the property in the same manner as real property taxes.
84.20The charges shall be paid to the Vadnais Lake Area Water Management Organization by
84.21the county auditor in the same manner and at the same time as property taxes. The county
84.22auditor may charge the Vadnais Lake Area Water Management Organization a fee in the
84.23amount necessary to recover the costs of administering the charges.
84.24EFFECTIVE DATE.This section is effective the day following final enactment.

84.25    Sec. 57. CITY OF BROOKLYN CENTER; PARTICIPATION IN CRIME-FREE
84.26MULTIHOUSING PROGRAM.
84.27    (a) In addition to the requirements of Minnesota Statutes, section 273.128, if
84.28property located in the city of Brooklyn Center qualifies under paragraph (b), the owners
84.29or managers must complete the three phases of the city's crime-free multihousing program
84.30and the qualifying property must be annually certified by the police as participating
84.31in the program. If a qualifying property is not certified within one year after it is first
84.32determined to be a qualifying property under paragraph (b), or does not annually maintain
84.33its certification in the program, the city shall notify the property owner that the qualifying
85.1property must comply with the requirements of this section to maintain its classification
85.2as class 4d property. If a qualifying property is not in compliance within one year after
85.3receiving the notice from the city, the city shall issue a second notice and require the
85.4owners to enter into a plan to achieve compliance within one year. If, upon expiration
85.5of the one-year time period, the qualifying property has not been certified by the police
85.6as completing the program, the city shall notify the commissioner of the Housing
85.7Finance Agency and the commissioner shall remove the property from the list of class 4d
85.8properties certified to the assessor under Minnesota Statutes, section 273.128, subdivision
85.93. Once removed from the list, the property is not eligible for class 4d classification until
85.10it complies with this section and its compliance has been certified to the Housing Finance
85.11Agency by the city. Certification to the Housing Finance Agency must be made by May
85.1215 to be effective for taxes payable in the following year.
85.13    (b) A property is a qualifying property for purposes of this section's requirements if
85.14it satisfies each of the following requirements:
85.15    (1) the city offers a crime-free multihousing program through its city police;
85.16    (2) over the preceding three-year period, the number of police calls to the property
85.17exceeded the city's average number of calls for multiunit rental properties for the period
85.18by at least 25 percent, adjusted for the number of rental units;
85.19    (3) the police department has requested, in writing, the owners or managers of the
85.20property to enroll in the crime-free multihousing program and the owners or managers
85.21refused or failed to enroll within 60 days after the request, or failed to complete phases
85.22one and three within 90 days and all three phases of the program within a one-year time
85.23period; and
85.24    (4) the governing body of the city, by resolution, determines the property is a
85.25qualifying property under clauses (1) to (3).
85.26    (c) Calls for police or emergency assistance in response to domestic abuse or
85.27medical assistance shall not be counted toward the number of calls in paragraph (b), clause
85.28(2). For purposes of this section, "domestic abuse" has the meaning given in Minnesota
85.29Statutes, section 518B.01, subdivision 2.
85.30    (d) Low-income qualifying rental housing property classified as class 4d property
85.31for taxes payable in 2008 must meet the requirements of this section by May 15, 2011.
85.32EFFECTIVE DATE; LOCAL APPROVAL.This section is effective the day after
85.33compliance by the governing body of the city of Brooklyn Center and its chief clerical
85.34officer with Minnesota Statutes, section 645.021, subdivisions 2 and 3.

85.35    Sec. 58. ASSESSMENT OF PROPERTIES OF PURELY PUBLIC CHARITIES.
86.1    Subdivision 1. Application. (a) To facilitate a review by the 2009 legislature of
86.2the property tax exemption for property of nonprofit organizations as purely public
86.3charities and the development of standards and criteria for the tax status of these facilities,
86.4this section:
86.5    (1) requires the commissioner of revenue to conduct an analysis of standards applied
86.6to determine the tax status of these organizations; and
86.7    (2) prohibits changes in assessment practices and policies regarding the property of
86.8these organizations.
86.9    (b) The purpose of this study is to allow the legislature to evaluate whether the
86.10judicially established rules and the assessment practices and policies in applying those
86.11rules to determine the tax status of these properties ensure that public benefits are, at
86.12least, commensurate with the costs of the exemption. The legislature does not intend, in
86.13requiring this study, to indicate an intention to expand or to narrow the existing rules for
86.14exempting institutions of purely public charity.
86.15    Subd. 2. Report by commissioner of revenue. (a) The commissioner of revenue
86.16shall survey all county assessors on:
86.17    (1) the tax status of property of institutions of purely public charity located in the
86.18state, including details on the type of organization and the use of the property; and
86.19    (2) their practices and policies in determining the tax status of property of institutions
86.20of purely public charity, including the extent to which the assessment practices and
86.21policies require the institutions to provide goods or services at free or below market prices
86.22and on the treatment of government payments.
86.23    (b) The commissioner shall report the findings to the chairs of the house of
86.24representatives and senate committees with jurisdiction over taxation by February 1, 2009.
86.25    Subd. 3. Moratorium on changes in assessment practices. (a) An assessor
86.26may not change the current practices or policies used generally in assessing property
86.27of institutions of purely public charities.
86.28    (b) An assessor may not change the assessment of the taxable status of an existing
86.29property of an organization of purely public charity, unless the change is made as a result of
86.30a change in ownership, occupancy or use of the facility, or to correct an error. For currently
86.31taxable properties, the assessor may change the estimated market value of the property.
86.32    (c) This subdivision expires on the earlier of:
86.33    (1) the enactment of legislation establishing criteria for the property taxation of
86.34purely public charities; or
86.35    (2) adjournment of the 2009 regular legislative session to a date in calendar year
86.362010.
87.1EFFECTIVE DATE.This section is effective for the 2008 assessment, taxes
87.2payable in 2009.

87.3    Sec. 59. REPEALER.
87.4(a) Minnesota Statutes 2006, section 273.111, subdivision 6, is repealed.
87.5(b) Minnesota Statutes 2006, section 473.4461, is repealed.
87.6EFFECTIVE DATE.Paragraph (a) is effective for taxes payable in 2010 and
87.7thereafter. Paragraph (b) is effective for taxes payable in 2009 and thereafter.

87.8ARTICLE 4

87.9LOCAL SALES TAXES

87.10    Section 1. Minnesota Statutes 2006, section 297A.99, subdivision 1, as amended by
87.11Laws 2008, chapter 152, article 4, section 1, is amended to read:
87.12    Subdivision 1. Authorization; scope. (a) A political subdivision of this state may
87.13impose a general sales tax (1) under section 297A.992, (2) under section 297A.993,
87.14(3) if permitted by special law enacted prior to May 20, 2008, or (4) if the political
87.15subdivision enacted and imposed the tax before the effective date of section 477A.016 and
87.16its predecessor provision.
87.17    (b) This section governs the imposition of a general sales tax by the political
87.18subdivision. The provisions of this section preempt the provisions of any special law:
87.19    (1) enacted before June 2, 1997, or
87.20    (2) enacted on or after June 2, 1997, that does not explicitly exempt the special law
87.21provision from this section's rules by reference.
87.22    (c) This section does not apply to or preempt a sales tax on motor vehicles or a
87.23special excise tax on motor vehicles.
87.24    (d) Until after December 31, 2011, a political subdivision may not advertise,
87.25promote, expend funds, or hold a referendum to support imposing a local option sales tax
87.26unless the tax was authorized by a special law enacted prior to May 20, 2008.
87.27EFFECTIVE DATE.This section is effective the day following final enactment.

87.28    Sec. 2. CITY OF CLEARWATER; TAXES AUTHORIZED.
87.29    Subdivision 1. Sales and use tax. Notwithstanding Minnesota Statutes, section
87.30477A.016, or any other provision of law, ordinance, or city charter, pursuant to the
87.31approval of the voters on November 7, 2006, the city of Clearwater may impose by
87.32ordinance a sales and use tax of up to one-half of one percent for the purposes specified in
88.1subdivision 2. Except as otherwise provided in this section, the provisions of Minnesota
88.2Statutes, section 297A.99, govern the imposition, administration, collection, and
88.3enforcement of the tax authorized under this subdivision.
88.4    Subd. 2. Excise tax authorized. Notwithstanding Minnesota Statutes, section
88.5477A.016, or any other provision of law, ordinance, or city charter, the city of Clearwater
88.6may impose by ordinance, for the purposes specified in subdivision 3, an excise tax of up
88.7to $20 per motor vehicle, as defined by ordinance, purchased or acquired from any person
88.8engaged within the city in the business of selling motor vehicles at retail.
88.9    Subd. 3. Use of revenues. The proceeds of the tax imposed under this section shall
88.10be used to pay for the costs of acquisition, construction, improvement, and development
88.11of a pedestrian bridge, and land and buildings for a community and recreation center. The
88.12total amount of revenues from the taxes in subdivisions 1 and 2 that may be used to fund
88.13these projects is $12,000,000 plus any associated bond costs.
88.14    Subd. 4. Bonding authority. The city of Clearwater may issue bonds in an amount
88.15not to exceed $12,000,000 under Minnesota Statutes, chapter 475, to finance the capital
88.16expenditures and improvements authorized by the referendum under subdivision 3. An
88.17election to approve the bonds under Minnesota Statutes, section 475.59, is not required.
88.18The issuance of bonds under this subdivision is not subject to Minnesota Statutes, section
88.19275.60 or 275.61. The debt represented by the bonds must not be included in computing
88.20any debt limitations applicable to the city, and the levy of taxes required by Minnesota
88.21Statutes, section 475.61, to pay the principal or any interest on the bonds must not be
88.22subject to any levy limitation.
88.23    Subd. 5. Termination of tax. The tax authorized under subdivision 1 terminates at
88.24the earlier of (1) 20 years after the date of initial imposition of the tax, or (2) when the
88.25city council determines that sufficient funds have been raised from the tax to finance the
88.26capital and administrative costs of the improvements described in subdivision 3, plus the
88.27additional amount needed to pay the costs related to issuance of bonds under subdivision
88.284, including interest on the bonds. Any funds remaining after completion of the projects
88.29specified in subdivision 3 and retirement or redemption of the bonds in subdivision 4 may
88.30be placed in the general fund of the city. The tax imposed under subdivision 1 may expire
88.31at an earlier time if the city so determines by ordinance.
88.32EFFECTIVE DATE.This section is effective the day after compliance by the
88.33governing body of the city of Clearwater with Minnesota Statutes, section 645.021,
88.34subdivisions 2 and 3.

88.35    Sec. 3. CITY OF NORTH MANKATO; TAXES AUTHORIZED.
89.1    Subdivision 1. Sales and use tax authorized. Notwithstanding Minnesota Statutes,
89.2section 477A.016, or any other provision of law, ordinance, or city charter, pursuant to
89.3the approval of the voters on November 7, 2006, the city of North Mankato may impose
89.4by ordinance a sales and use tax of one-half of one percent for the purposes specified
89.5in subdivision 2. The provisions of Minnesota Statutes, section 297A.99, govern the
89.6imposition, administration, collection, and enforcement of the taxes authorized under
89.7this subdivision.
89.8    Subd. 2. Use of revenues. Revenues received from the tax authorized by
89.9subdivision 1 must be used to pay all or part of the capital costs of the following projects:
89.10    (1) the local share of the Trunk Highway 14/County State-Aid Highway 41
89.11interchange project;
89.12    (2) development of regional parks and hiking and biking trails;
89.13    (3) expansion of the North Mankato Taylor Library;
89.14    (4) riverfront redevelopment; and
89.15    (5) lake improvement projects.
89.16    The total amount of revenues from the tax in subdivision 1 that may be used to fund
89.17these projects is $6,000,000 plus any associated bond costs.
89.18    Subd. 3. Bonds. (a) The city of North Mankato, pursuant to the approval of the
89.19voters at the November 7, 2006, referendum authorizing the imposition of the taxes in
89.20this section, may issue bonds under Minnesota Statutes, chapter 475, to pay capital and
89.21administrative expenses for the projects described in subdivision 2 in an amount that
89.22does not exceed $6,000,000. A separate election to approve the bonds under Minnesota
89.23Statutes, section 475.58, is not required.
89.24    (b) The debt represented by the bonds is not included in computing any debt
89.25limitation applicable to the city, and any levy of taxes under Minnesota Statutes, section
89.26475.61, to pay principal and interest on the bonds is not subject to any levy limitation.
89.27    Subd. 4. Termination of taxes. The tax imposed under subdivision 1 expires
89.28when the city council determines that the amount of revenues received from the taxes
89.29to pay for the projects under subdivision 2, first equals or exceeds $6,000,000 plus the
89.30additional amount needed to pay the costs related to issuance of bonds under subdivision
89.313, including interest on the bonds. Any funds remaining after completion of the projects
89.32and retirement or redemption of the bonds shall be placed in a capital facilities and
89.33equipment replacement fund of the city. The tax imposed under subdivision 1 may expire
89.34at an earlier time if the city so determines by ordinance.
90.1EFFECTIVE DATE.This section is effective the day after compliance by the
90.2governing body of the city of North Mankato with Minnesota Statutes, section 645.021,
90.3subdivision 3.

90.4    Sec. 4. CITY OF WINONA; TAXES AUTHORIZED.
90.5    Subdivision 1. Sales and use tax. Notwithstanding Minnesota Statutes, section
90.6477A.016, or any other provision of law, ordinance, or city charter, if approved by the
90.7voters at a general or special election held before December 31, 2009, the city of Winona
90.8may impose by ordinance a sales and use tax of up to one-half of one percent for the
90.9purpose specified in subdivision 2. Except as otherwise provided in this section, the
90.10provisions of Minnesota Statutes, section 297A.99, govern the imposition, administration,
90.11collection, and enforcement of the tax authorized under this subdivision.
90.12    Subd. 2. Use of revenues. The proceeds of the tax imposed under this section shall
90.13be used to pay the city-borne costs for the construction of a street connection from the
90.14city of Winona to Minnesota State Highways 61 and 43. The construction will provide
90.15access to the city's newly built industrial park and additional access to a hospital. The total
90.16amount of revenues from the tax in subdivision 1 that may be used to fund this project is
90.17$8,000,000 plus any associated bond costs.
90.18    Subd. 3. Bonding authority. The city of Winona may issue bonds in an amount
90.19not to exceed $8,000,000 under Minnesota Statutes, chapter 475, to finance the capital
90.20expenditures under subdivision 2. An election to approve the bonds under Minnesota
90.21Statutes, section 475.58, is not required. The issuance of bonds under this subdivision is
90.22not subject to Minnesota Statutes, section 275.60 or 275.61. The debt represented by the
90.23bonds must not be included in computing any debt limitations applicable to the city, and
90.24the levy of taxes required by Minnesota Statutes, section 475.61, to pay the principal or
90.25any interest on the bonds must not be subject to any levy limitation.
90.26    Subd. 4. Termination of tax. The tax authorized under subdivision 1 terminates
90.27at the earlier of: (1) five years after the date of initial imposition of the tax; or (2) when
90.28the city council determines that sufficient funds have been raised from the tax to finance
90.29the capital and administrative costs of the project described in subdivision 2, plus the
90.30additional amount needed to pay the costs related to issuance of bonds under subdivision
90.313, including interest on the bonds. Any funds remaining after completion of the project
90.32specified in subdivision 2 and retirement or redemption of the bonds in subdivision 3 may
90.33be placed in the general fund of the city. The tax imposed under subdivision 1 may expire
90.34at an earlier time if the city so determines by ordinance.
91.1EFFECTIVE DATE.This section is effective the day after compliance by
91.2the governing body of the city of Winona with Minnesota Statutes, section 645.021,
91.3subdivisions 2 and 3.