HF 1925

as introduced - 86th Legislature (2009 - 2010) Posted on 02/09/2010 01:56am

A bill for an act
relating to taxation; property; repealing the 2008 changes to the Green Acres law;
providing appointments; amending Minnesota Statutes 2008, section 273.111,
subdivisions 3, 4, 8, 9, 11, 11a, by adding a subdivision; Laws 2008, chapter
366, article 6, section 52; repealing Minnesota Statutes 2008, section 273.111,
subdivision 3a.

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

Section 1.

Minnesota Statutes 2008, section 273.111, subdivision 3, is amended to read:

Subd. 3.

Requirements.

(a) Real estate consisting of ten acres or more or a nursery
or greenhouse, and qualifying for classification as class 2a new text begin or 2b new text end under section 273.13,
shall be entitled to valuation and tax deferment under this section if it is primarily devoted
to agricultural use, new text begin and meets the requirements in subdivision 6, new text end and either:

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

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

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

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

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

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

(2) a poultry entity other than a limited liability entity in which the majority of the
members, partners, or shareholders are related and at least one of the members, partners,
or shareholders either resides on the land or actively operates the land; and

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

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

(c) Land that previously qualified for tax deferment under this section and no longer
qualifies because it is not primarily used for agricultural purposes but would otherwise
qualify under deleted text begin Minnesota Statutes 2006, section 273.111, subdivision deleted text end new text begin subdivisions new text end 3 new text begin and 6 new text end ,
for a period of at least three years will not be required to make payment of the previously
deferred taxes, notwithstanding the provisions of subdivision 9. Sale of the land prior to
the expiration of the three-year period requires payment of deferred taxes as follows: sale
in the year the land no longer qualifies requires payment of the current year's deferred
taxes plus payment of deferred taxes for the two prior years; sale during the second year
the land no longer qualifies requires payment of the current year's deferred taxes plus
payment of the deferred taxes for the prior year; and sale during the third year the land
no longer qualifies requires payment of the current year's deferred taxes. Deferred taxes
shall be paid even if the land qualifies pursuant to subdivision 11a. When such property is
sold or no longer qualifies under this paragraph, or at the end of the three-year period,
whichever comes first, all deferred special assessments plus interest are payable in equal
installments spread over the time remaining until the last maturity date of the bonds issued
to finance the improvement for which the assessments were levied. If the bonds have
matured, the deferred special assessments plus interest are payable within 90 days. The
provisions of section 429.061, subdivision 2, apply to the collection of these installments.
Penalties are not imposed on any such special assessments if timely paid.

deleted text begin (d) Land that is enrolled in the reinvest in Minnesota program under sections
103F.501 to 103F.535, the federal Conservation Reserve Program as contained in Public
Law 99-198, or a similar state or federal conservation program does not qualify for
valuation and assessment deferral under this section. This paragraph applies to land that
has not qualified under this section for taxes payable in 2009 or previous years.
deleted text end

new text begin EFFECTIVE DATE. new text end

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

Sec. 2.

Minnesota Statutes 2008, section 273.111, is amended by adding a subdivision
to read:

new text begin Subd. 3b. new text end

new text begin Voluntary withdrawal of land. new text end

new text begin Notwithstanding the provisions of
subdivision 9, land enrolled under this section that is withdrawn between the effective date
of this section and May 1, 2010, is not subject to additional taxes under subdivision 9.
new text end

new text begin EFFECTIVE DATE. new text end

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

Sec. 3.

Minnesota Statutes 2008, section 273.111, subdivision 4, is amended to read:

Subd. 4.

Determination of value.

deleted text begin (a) deleted text end The value of any real estate described
in subdivision 3 shall upon timely application by the owner, in the manner provided
in subdivision 8, be determined solely with reference to its appropriate agricultural
classification and value notwithstanding sections 272.03, subdivision 8, and 273.11.
Furthermore, the assessor shall not consider any added values resulting from
nonagricultural factors. In order to account for the presence of nonagricultural influences
that may affect the value of agricultural land, the commissioner of revenue shall develop a
fair and uniform method of determining agricultural values for each county in the state
that are consistent with this subdivision. The commissioner shall annually assign the
resulting values to each county, and these values shall be used as the basis for determining
the agricultural value for all properties in the county qualifying for tax deferment under
this section.

deleted text begin (b) In the case of property qualifying for tax deferment only under subdivision 3a,
the value shall be based on the value in effect for assessment year 2008, multiplied by
the ratio of the total taxable market value of all property in the county for the current
assessment year divided by the total taxable market value of all property in the county
for assessment year 2008.
deleted text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for assessment year 2009 and
thereafter.
new text end

Sec. 4.

Minnesota Statutes 2008, section 273.111, subdivision 8, is amended to read:

Subd. 8.

Application.

Application for deferment of taxes and assessment under this
section shall be filed by May 1 of the year prior to the year in which the taxes are payable.
Any application filed hereunder and granted shall continue in effect for subsequent years
until the property no longer qualifies. The application must be filed with the assessor of
the taxing district in which the real property is located on the form prescribed by the
commissioner of revenue. The assessor may require proof by affidavit or otherwise
that the property qualifies under deleted text begin subdivision deleted text end new text begin subdivisions new text end 3 new text begin and 6 new text end and may require the
applicant to provide a copy of the appropriate schedule or form showing farm income that
is attested to by the applicant as having been included in the most recently filed federal
income tax return of the applicant.

new text begin EFFECTIVE DATE. new text end

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

Sec. 5.

Minnesota Statutes 2008, section 273.111, subdivision 9, is amended to read:

Subd. 9.

Additional taxes.

When real property which is being, or has been valued
and assessed under this section no longer qualifies under deleted text begin subdivision deleted text end new text begin subdivisions new text end 3 new text begin and 6 new text end ,
the portion no longer qualifying shall be subject to additional taxes, in the amount equal to
the difference between the taxes determined in accordance with subdivision 4, and the
amount determined under subdivision 5. Provided, however, that the amount determined
under subdivision 5 shall not be greater than it would have been had the actual bona fide
sale price of the real property at an arm's-length transaction been used in lieu of the market
value determined under subdivision 5. Such additional taxes shall be extended against
the property on the tax list for the current year, provided, however, that no interest or
penalties shall be levied on such additional taxes if timely paid, and provided further, that
such additional taxes shall only be levied with respect to the last three years that the said
property has been valued and assessed under this section.

new text begin EFFECTIVE DATE. new text end

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

Sec. 6.

Minnesota Statutes 2008, section 273.111, subdivision 11, is amended to read:

Subd. 11.

Special local assessments.

The payment of special local assessments
levied after June 1, 1967, for improvements made to any real property described in
subdivision 3 together with the interest thereon shall, on timely application as provided
in subdivision 8, be deferred as long as such property meets the conditions contained in
deleted text begin subdivision deleted text end new text begin subdivisions new text end 3 deleted text begin or 3a deleted text end new text begin and 6 new text end or is transferred to an agricultural preserve under
sections 473H.02 to 473H.17. If special assessments against the property have been
deferred pursuant to this subdivision, the governmental unit shall file with the county
recorder in the county in which the property is located a certificate containing the legal
description of the affected property and of the amount deferred. When such property
no longer qualifies under deleted text begin subdivision deleted text end new text begin subdivisions new text end 3 deleted text begin or 3a deleted text end new text begin and 6 new text end , all deferred special
assessments plus interest shall be payable in equal installments spread over the time
remaining until the last maturity date of the bonds issued to finance the improvement
for which the assessments were levied. If the bonds have matured, the deferred special
assessments plus interest shall be payable within 90 days. The provisions of section
429.061, subdivision 2, apply to the collection of these installments. Penalty shall not be
levied on any such special assessments if timely paid.

new text begin EFFECTIVE DATE. new text end

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

Sec. 7.

Minnesota Statutes 2008, section 273.111, subdivision 11a, is amended to read:

Subd. 11a.

Continuation of tax treatment upon sale.

new text begin (a) new text end When real property
qualifying under deleted text begin subdivision deleted text end new text begin subdivisions new text end 3 new text begin and 6 new text end is sold, no additional taxes or deferred
special assessments plus interest shall be extended against the property provided the
property continues to qualify pursuant to deleted text begin subdivision deleted text end new text begin subdivisions new text end 3 new text begin and 6 new text end , and provided
the new owner files an application for continued deferment within 30 days after the sale.

new text begin (b) For purposes of meeting the income requirements of subdivision 6, the property
purchased shall be considered in conjunction with other qualifying property owned by
the purchaser.
new text end

new text begin EFFECTIVE DATE. new text end

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

Sec. 8.

Laws 2008, chapter 366, article 6, section 52, is amended to read:

Sec. 52. REPEALER.

(a) Minnesota Statutes 2006, section 272.027, subdivision 3, is repealed.

(b) Minnesota Statutes 2006, section 273.11, subdivision 14, is repealed.

deleted text begin (c) deleted text end deleted text begin Minnesota Statutes 2006, section 273.111, subdivision 6, deleted text end deleted text begin is repealed.
deleted text end

new text begin EFFECTIVE DATE. new text end

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

Sec. 9. new text begin REVIVAL.
new text end

new text begin Pursuant to Minnesota Statutes, section 645.36, Minnesota Statutes, section 273.111,
subdivision 6, is revived, effective the day following final enactment.
new text end

new text begin EFFECTIVE DATE. new text end

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

Sec. 10. new text begin LAND REMOVED FROM PROGRAM.
new text end

new text begin Any land that had been enrolled in the Minnesota Agricultural Property Tax Law
under Minnesota Statutes 2008, section 273.111, and that was removed from the program
between May 21, 2008, and the effective date of this section, must be reinstated to the
program at the request of the owner provided that the eligibility requirements under
Minnesota Statutes 2008, section 273.111, subdivisions 3 and 6, are met.
new text end

new text begin EFFECTIVE DATE. new text end

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

Sec. 11. new text begin MINNESOTA AGRICULTURAL PROPERTY TAX LAW WORKING
GROUP.
new text end

new text begin Subdivision 1. new text end

new text begin Creation. new text end

new text begin The Minnesota Agricultural Property Tax Law working
group consists of the following members:
new text end

new text begin (1) two members of the house of representatives, including one member from the
majority party, appointed by the speaker of the house, and one member from the minority
party, appointed by the minority leader;
new text end

new text begin (2) two senators, including one member from the majority party and one member
from the minority party, appointed by the Subcommittee on Committees of the Committee
on Rules and Administration of the senate;
new text end

new text begin (3) the commissioners of the Department of Agriculture and the Department of
Revenue, or their designees; and
new text end

new text begin (4) four members appointed by the Minnesota Association of Assessment Officers,
two of whom must be from the metropolitan area and two of whom must be from greater
Minnesota;
new text end

new text begin (5) one member appointed by the Minnesota Farm Bureau;
new text end

new text begin (6) one member appointed by the Minnesota Farmers Union; and
new text end

new text begin (7) five public members who have an interest in agriculture, land use, or property
taxation, appointed by the governor. At least three of the public members must be farmers.
The public membership must include balanced representation from greater Minnesota
and from the metropolitan area.
new text end

new text begin Subd. 2. new text end

new text begin Duties. new text end

new text begin The working group must study and make recommendations for
legislative and administrative changes in the Minnesota Agricultural Property Tax Law
and the metropolitan agricultural preserves program, and in the classification and taxation
of agricultural land and other rural land. The results of the study and the recommendations
must be made to the legislative committees with jurisdiction over property taxes and to the
governor by January 15, 2011.
new text end

new text begin Subd. 3. new text end

new text begin Administrative provisions. new text end

new text begin (a) The commissioner of revenue or the
commissioner's designee must convene the initial meeting of the working group. Upon
request of the working group, the commissioner must provide meeting space and
administrative and research services for the group. The members of the working group
must elect a chair or cochairs from the members of the working group at the initial meeting.
new text end

new text begin (b) Public members of the working group serve without compensation or payment of
expenses.
new text end

new text begin (c) The working group expires January 15, 2011, or upon submission of the report
required under subdivision 2, whichever is earlier.
new text end

new text begin Subd. 4. new text end

new text begin Deadline for appointments and designations. new text end

new text begin The appointments and
designations authorized by this section must be completed by July 1, 2009.
new text end

new text begin EFFECTIVE DATE. new text end

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

Sec. 12. new text begin REPEALER.
new text end

new text begin Minnesota Statutes 2008, section 273.111, subdivision 3a, new text end new text begin is repealed.
new text end

new text begin EFFECTIVE DATE. new text end

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