HF 2232

as introduced - 81st Legislature (1999 - 2000) Posted on 12/15/2009 12:00am

  1.1                          A bill for an act 
  1.2             relating to state government; increasing the state 
  1.3             share of education funding; reducing income taxes; 
  1.4             reducing local property tax levies; reducing the sales 
  1.5             tax; eliminating the MinnesotaCare provider tax; 
  1.6             limiting increases in market value; amending Minnesota 
  1.7             Statutes 1998, sections 62J.041, subdivision 1; 
  1.8             62Q.095, subdivision 6; 123B.53, subdivisions 4 and 5; 
  1.9             123B.54; 123B.57, subdivision 4; 126C.13, subdivision 
  1.10            1; 126C.17, subdivision 5; 214.16, subdivisions 2 and 
  1.11            3; 270B.01, subdivision 8; 270B.14, subdivision 1; 
  1.12            273.11, subdivision 1a; 273.13, subdivisions 22 and 
  1.13            25; 273.1382, subdivision 1; 273.1398, subdivision 1a; 
  1.14            290.06, subdivision 2c; 290.091, subdivisions 1, 2, 
  1.15            and 6; and 297A.02, subdivision 1; repealing Minnesota 
  1.16            Statutes 1998, sections 13.99, subdivision 86b; 
  1.17            144.1484, subdivision 2; 273.1382, subdivision 1a; 
  1.18            295.50; 295.51; 295.52; 295.53; 295.54; 295.55; 
  1.19            295.56; 295.57; 295.58; 295.582; and 295.59. 
  1.20  BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.21     Section 1.  Minnesota Statutes 1998, section 62J.041, 
  1.22  subdivision 1, is amended to read: 
  1.23     Subdivision 1.  [DEFINITIONS.] (a) For purposes of this 
  1.24  section, the following definitions apply. 
  1.25     (b) "Health plan company" has the definition provided in 
  1.26  section 62Q.01. 
  1.27     (c) "Total expenditures" means incurred claims or 
  1.28  expenditures on health care services, administrative expenses, 
  1.29  charitable contributions, and all other payments made by health 
  1.30  plan companies out of premium revenues. 
  1.31     (d) "Net expenditures" means total expenditures minus 
  1.32  exempted taxes and assessments and payments or allocations made 
  2.1   to establish or maintain reserves.  
  2.2      (e) "Exempted taxes and assessments" means direct payments 
  2.3   for taxes to government agencies, contributions to the Minnesota 
  2.4   comprehensive health association, the medical assistance 
  2.5   provider's surcharge under section 256.9657, the MinnesotaCare 
  2.6   provider tax under Minnesota Statutes 1998, section 295.52, 
  2.7   assessments by the health coverage reinsurance association, 
  2.8   assessments by the Minnesota life and health insurance guaranty 
  2.9   association, assessments by the Minnesota risk adjustment 
  2.10  association, and any new assessments imposed by federal or state 
  2.11  law. 
  2.12     (f) "Consumer cost-sharing or subscriber liability" means 
  2.13  enrollee coinsurance, copayment, deductible payments, and 
  2.14  amounts in excess of benefit plan maximums. 
  2.15     Sec. 2.  Minnesota Statutes 1998, section 62Q.095, 
  2.16  subdivision 6, is amended to read: 
  2.17     Subd. 6.  [EXEMPTION.] A health plan company, to the extent 
  2.18  that it operates as a staff model health plan company as defined 
  2.19  in section 295.50, subdivision 12b, by employing allied 
  2.20  independent health care providers to deliver health care 
  2.21  services to enrollees, is exempt from this section.  For 
  2.22  purposes of this subdivision, "staff model health plan company" 
  2.23  means a health plan company as defined in section 62Q.01, 
  2.24  subdivision 4, that employs one or more types of health care 
  2.25  provider to deliver health care services to the health plan 
  2.26  company's enrollees. 
  2.27     Sec. 3.  Minnesota Statutes 1998, section 123B.53, 
  2.28  subdivision 4, is amended to read: 
  2.29     Subd. 4.  [DEBT SERVICE EQUALIZATION REVENUE.] (a) For 
  2.30  fiscal years 1995 2001 and later, the debt service equalization 
  2.31  revenue of a district equals the eligible debt service revenue 
  2.32  minus the amount raised by a levy of ten percent times the 
  2.33  adjusted net tax capacity of the district. 
  2.34     (b) For fiscal year 1993, debt service equalization revenue 
  2.35  equals one-third of the amount calculated in paragraph (a). 
  2.36     (c) For fiscal year 1994, debt service equalization revenue 
  3.1   equals two-thirds of the amount calculated in paragraph (a). 
  3.2      Sec. 4.  Minnesota Statutes 1998, section 123B.53, 
  3.3   subdivision 5, is amended to read: 
  3.4      Subd. 5.  [EQUALIZED DEBT SERVICE LEVY.] To obtain debt 
  3.5   service equalization revenue, a district must levy an amount not 
  3.6   to exceed the district's debt service equalization revenue times 
  3.7   the lesser of one or the ratio of: 
  3.8      (1) the quotient derived by dividing the adjusted net tax 
  3.9   capacity of the district for the year before the year the levy 
  3.10  is certified by the resident pupil units in the district for the 
  3.11  school year ending in the year prior to the year the levy is 
  3.12  certified; to 
  3.13     (2) $4,707.50 $10,000. 
  3.14     Sec. 5.  Minnesota Statutes 1998, section 123B.54, is 
  3.15  amended to read: 
  3.16     123B.54 [DEBT SERVICE APPROPRIATION.] 
  3.17     (a) $35,480,000 in fiscal year 1998, $38,159,000 in fiscal 
  3.18  year 1999, and $38,390,000 in fiscal year 2000 and $234,000,000 
  3.19  in fiscal year 2001 and each year thereafter is appropriated 
  3.20  from the general fund to the commissioner of children, families, 
  3.21  and learning for payment of debt service equalization aid under 
  3.22  section 123B.53.  The 2000 appropriation includes $3,842,000 for 
  3.23  1999 and $34,548,000 for 2000. 
  3.24     (b) The appropriations in paragraph (a) must be reduced by 
  3.25  the amount of any money specifically appropriated for the same 
  3.26  purpose in any year from any state fund. 
  3.27     Sec. 6.  Minnesota Statutes 1998, section 123B.57, 
  3.28  subdivision 4, is amended to read: 
  3.29     Subd. 4.  [HEALTH AND SAFETY LEVY.] To receive health and 
  3.30  safety revenue, a district may levy an amount equal to the 
  3.31  district's health and safety revenue as defined in subdivision 3 
  3.32  multiplied by the lesser of one, or the ratio of the quotient 
  3.33  derived by dividing the adjusted net tax capacity of the 
  3.34  district for the year preceding the year the levy is certified 
  3.35  by the resident pupil units in the district for the school year 
  3.36  to which the levy is attributable, to $4,707.50 $10,000. 
  4.1      Sec. 7.  Minnesota Statutes 1998, section 126C.13, 
  4.2   subdivision 1, is amended to read: 
  4.3      Subdivision 1.  [GENERAL EDUCATION TAX RATE.] The 
  4.4   commissioner must establish the general education tax rate by 
  4.5   July 1 of each year for levies payable in the following year.  
  4.6   The general education tax capacity rate must be a rate, rounded 
  4.7   up to the nearest hundredth of a percent, that, when applied to 
  4.8   the adjusted net tax capacity for all districts, raises the 
  4.9   amount specified in this subdivision.  The general education tax 
  4.10  rate must be the rate that raises $1,385,500,000 for fiscal year 
  4.11  1999, $1,325,500,000 for fiscal year 2000, and 
  4.12  $1,387,100,000 $1,130,000,000 for fiscal year 2001, and later 
  4.13  fiscal years.  The general education tax rate may not be changed 
  4.14  due to changes or corrections made to a district's adjusted net 
  4.15  tax capacity after the tax rate has been established.  If the 
  4.16  levy target for fiscal year 1999 or fiscal year 2000 is changed 
  4.17  by another law enacted during the 1997 or 1998 session, the 
  4.18  commissioner shall reduce the general education levy target in 
  4.19  this section by the amount of the reduction in the enacted law. 
  4.20     Sec. 8.  Minnesota Statutes 1998, section 126C.17, 
  4.21  subdivision 5, is amended to read: 
  4.22     Subd. 5.  [REFERENDUM EQUALIZATION REVENUE.] A district's 
  4.23  referendum equalization revenue equals $350 $450 times the 
  4.24  district's resident pupil units for that year. 
  4.25     Referendum equalization revenue must not exceed a 
  4.26  district's total referendum revenue for that year. 
  4.27     Sec. 9.  Minnesota Statutes 1998, section 214.16, 
  4.28  subdivision 2, is amended to read: 
  4.29     Subd. 2.  [BOARD COOPERATION REQUIRED.] The board shall 
  4.30  assist the commissioner of health in data collection activities 
  4.31  required under Laws 1992, chapter 549, article 7, and shall 
  4.32  assist the commissioner of revenue in activities related to 
  4.33  collection of the health care provider tax required under Laws 
  4.34  1992, chapter 549, article 9.  Upon the request of the 
  4.35  commissioner or the commissioner of revenue, the board shall 
  4.36  make available names and addresses of current licensees and 
  5.1   provide other information or assistance as needed. 
  5.2      Sec. 10.  Minnesota Statutes 1998, section 214.16, 
  5.3   subdivision 3, is amended to read: 
  5.4      Subd. 3.  [GROUNDS FOR DISCIPLINARY ACTION.] The board 
  5.5   shall take disciplinary action, which may include license 
  5.6   revocation, against a regulated person for: 
  5.7      (1) intentional failure to provide the commissioner of 
  5.8   health with the data required under chapter 62J; 
  5.9      (2) intentional failure to provide the commissioner of 
  5.10  revenue with data on gross revenue and other information 
  5.11  required for the commissioner to implement sections 295.50 to 
  5.12  295.58; 
  5.13     (3) intentional failure to pay the health care provider tax 
  5.14  required under section 295.52; and 
  5.15     (4) (2) entering into a contract or arrangement that is 
  5.16  prohibited under sections 62J.70 to 62J.73. 
  5.17     Sec. 11.  Minnesota Statutes 1998, section 270B.01, 
  5.18  subdivision 8, is amended to read: 
  5.19     Subd. 8.  [MINNESOTA TAX LAWS.] For purposes of this 
  5.20  chapter only, unless expressly stated otherwise, "Minnesota tax 
  5.21  laws" means the taxes, refunds, and fees administered by or paid 
  5.22  to the commissioner under chapters 115B (except taxes imposed 
  5.23  under sections 115B.21 to 115B.24), 289A (except taxes imposed 
  5.24  under sections 298.01, 298.015, and 298.24), 290, 290A, 291, 
  5.25  297A, and 297H and sections 295.50 to 295.59, or any similar 
  5.26  Indian tribal tax administered by the commissioner pursuant to 
  5.27  any tax agreement between the state and the Indian tribal 
  5.28  government, and includes any laws for the assessment, 
  5.29  collection, and enforcement of those taxes, refunds, and fees. 
  5.30     Sec. 12.  Minnesota Statutes 1998, section 270B.14, 
  5.31  subdivision 1, is amended to read: 
  5.32     Subdivision 1.  [DISCLOSURE TO COMMISSIONER OF HUMAN 
  5.33  SERVICES.] (a) On the request of the commissioner of human 
  5.34  services, the commissioner shall disclose return information 
  5.35  regarding taxes imposed by chapter 290, and claims for refunds 
  5.36  under chapter 290A, to the extent provided in paragraph (b) and 
  6.1   for the purposes set forth in paragraph (c). 
  6.2      (b) Data that may be disclosed are limited to data relating 
  6.3   to the identity, whereabouts, employment, income, and property 
  6.4   of a person owing or alleged to be owing an obligation of child 
  6.5   support. 
  6.6      (c) The commissioner of human services may request data 
  6.7   only for the purposes of carrying out the child support 
  6.8   enforcement program and to assist in the location of parents who 
  6.9   have, or appear to have, deserted their children.  Data received 
  6.10  may be used only as set forth in section 256.978. 
  6.11     (d) The commissioner shall provide the records and 
  6.12  information necessary to administer the supplemental housing 
  6.13  allowance to the commissioner of human services.  
  6.14     (e) At the request of the commissioner of human services, 
  6.15  the commissioner of revenue shall electronically match the 
  6.16  social security numbers and names of participants in the 
  6.17  telephone assistance plan operated under sections 237.69 to 
  6.18  237.711, with those of property tax refund filers, and determine 
  6.19  whether each participant's household income is within the 
  6.20  eligibility standards for the telephone assistance plan. 
  6.21     (f) The commissioner may provide records and information 
  6.22  collected under Minnesota Statutes 1998, sections 295.50 to 
  6.23  295.59, to the commissioner of human services for purposes of 
  6.24  the Medicaid Voluntary Contribution and Provider-Specific Tax 
  6.25  Amendments of 1991, Public Law Number 102-234.  Upon the written 
  6.26  agreement by the United States Department of Health and Human 
  6.27  Services to maintain the confidentiality of the data, the 
  6.28  commissioner may provide records and information collected under 
  6.29  Minnesota Statutes 1998, sections 295.50 to 295.59, to the 
  6.30  Health Care Financing Administration section of the United 
  6.31  States Department of Health and Human Services for purposes of 
  6.32  meeting federal reporting requirements.  
  6.33     (g) The commissioner may provide records and information to 
  6.34  the commissioner of human services as necessary to administer 
  6.35  the early refund of refundable tax credits. 
  6.36     (h) The commissioner may disclose information to the 
  7.1   commissioner of human services necessary to verify income for 
  7.2   eligibility and premium payment under the MinnesotaCare program, 
  7.3   under section 256L.05, subdivision 2. 
  7.4      Sec. 13.  Minnesota Statutes 1998, section 273.11, 
  7.5   subdivision 1a, is amended to read: 
  7.6      Subd. 1a.  [LIMITED MARKET VALUE.] In the case of all 
  7.7   property classified as agricultural homestead or nonhomestead, 
  7.8   residential homestead or nonhomestead, or noncommercial seasonal 
  7.9   recreational residential, the assessor shall compare the value 
  7.10  with that determined in the preceding assessment.  The amount of 
  7.11  the increase entered in the current assessment shall not exceed 
  7.12  the greater of (1) ten percent of the value in the preceding 
  7.13  assessment, or (2) one-fourth of the difference between the 
  7.14  current assessment and the preceding assessment. (a) Property 
  7.15  classified under section 273.13 may not have a market value for 
  7.16  property tax purposes greater than the sum of: 
  7.17     (1) its estimated market value for the previous assessment 
  7.18  year or, if applicable, its limited market value for the 
  7.19  previous assessment year, plus 
  7.20     (2) an amount obtained by multiplying the market value in 
  7.21  clause (1) by the lesser of (i) five percent or (ii) the 
  7.22  percentage rate of increase in the Consumer Price Index for the 
  7.23  12-month period ending October of the preceding assessment year. 
  7.24     This limitation shall not apply to increases in value due 
  7.25  to improvements.  For purposes of this subdivision, the term 
  7.26  "assessment" "market value" means the value prior to any 
  7.27  exclusion under subdivision 16. 
  7.28     The provisions of this subdivision shall be in effect only 
  7.29  for assessment years 1993 through 2001. 
  7.30     (b) For the first assessment year after the sale or 
  7.31  conveyance of property, the value of the property for property 
  7.32  tax purposes shall be the assessor's estimated market value. 
  7.33     (c) For purposes of this subdivision, "Consumer Price 
  7.34  Index" means the Consumer Price Index of all urban consumers as 
  7.35  determined by the United States Department of Labor, Bureau of 
  7.36  Labor Statistics. 
  8.1      (d) For purposes of the assessment/sales ratio study 
  8.2   conducted under section 127A.48, and the computation of state 
  8.3   aids paid under chapters 122A, 123A, 123B, 124D, 125A, 126C, 
  8.4   127A, and 477A, market values and net tax capacities determined 
  8.5   under this subdivision and subdivision 16, shall be used. 
  8.6      Sec. 14.  Minnesota Statutes 1998, section 273.13, 
  8.7   subdivision 22, is amended to read: 
  8.8      Subd. 22.  [CLASS 1.] (a) Except as provided in subdivision 
  8.9   23, real estate which is residential and used for homestead 
  8.10  purposes is class 1.  The market value of class 1a property must 
  8.11  be determined based upon the value of the house, garage, and 
  8.12  land.  
  8.13     The first $75,000 of market value of class 1a property has 
  8.14  a net class rate of one 0.5 percent of its market value; and the 
  8.15  market value of class 1a property that exceeds $75,000 has a 
  8.16  class rate of 1.7 0.85 percent of its market value.  
  8.17     (b) Class 1b property includes homestead real estate or 
  8.18  homestead manufactured homes used for the purposes of a 
  8.19  homestead by 
  8.20     (1) any blind person, or the blind person and the blind 
  8.21  person's spouse; or 
  8.22     (2) any person, hereinafter referred to as "veteran," who: 
  8.23     (i) served in the active military or naval service of the 
  8.24  United States; and 
  8.25     (ii) is entitled to compensation under the laws and 
  8.26  regulations of the United States for permanent and total 
  8.27  service-connected disability due to the loss, or loss of use, by 
  8.28  reason of amputation, ankylosis, progressive muscular 
  8.29  dystrophies, or paralysis, of both lower extremities, such as to 
  8.30  preclude motion without the aid of braces, crutches, canes, or a 
  8.31  wheelchair; and 
  8.32     (iii) has acquired a special housing unit with special 
  8.33  fixtures or movable facilities made necessary by the nature of 
  8.34  the veteran's disability, or the surviving spouse of the 
  8.35  deceased veteran for as long as the surviving spouse retains the 
  8.36  special housing unit as a homestead; or 
  9.1      (3) any person who: 
  9.2      (i) is permanently and totally disabled and 
  9.3      (ii) receives 90 percent or more of total income from 
  9.4      (A) aid from any state as a result of that disability; or 
  9.5      (B) supplemental security income for the disabled; or 
  9.6      (C) workers' compensation based on a finding of total and 
  9.7   permanent disability; or 
  9.8      (D) social security disability, including the amount of a 
  9.9   disability insurance benefit which is converted to an old age 
  9.10  insurance benefit and any subsequent cost of living increases; 
  9.11  or 
  9.12     (E) aid under the federal Railroad Retirement Act of 1937, 
  9.13  United States Code Annotated, title 45, section 228b(a)5; or 
  9.14     (F) a pension from any local government retirement fund 
  9.15  located in the state of Minnesota as a result of that 
  9.16  disability; or 
  9.17     (G) pension, annuity, or other income paid as a result of 
  9.18  that disability from a private pension or disability plan, 
  9.19  including employer, employee, union, and insurance plans and 
  9.20     (iii) has household income as defined in section 290A.03, 
  9.21  subdivision 5, of $50,000 or less; or 
  9.22     (4) any person who is permanently and totally disabled and 
  9.23  whose household income as defined in section 290A.03, 
  9.24  subdivision 5, is 275 percent or less of the federal poverty 
  9.25  level. 
  9.26     Property is classified and assessed under clause (4) only 
  9.27  if the government agency or income-providing source certifies, 
  9.28  upon the request of the homestead occupant, that the homestead 
  9.29  occupant satisfies the disability requirements of this paragraph.
  9.30     Property is classified and assessed pursuant to clause (1) 
  9.31  only if the commissioner of economic security certifies to the 
  9.32  assessor that the homestead occupant satisfies the requirements 
  9.33  of this paragraph.  
  9.34     Permanently and totally disabled for the purpose of this 
  9.35  subdivision means a condition which is permanent in nature and 
  9.36  totally incapacitates the person from working at an occupation 
 10.1   which brings the person an income.  The first $32,000 market 
 10.2   value of class 1b property has a net class rate of .45 .225 
 10.3   percent of its market value.  The remaining market value of 
 10.4   class 1b property has a net class rate using the rates for class 
 10.5   1 or class 2a property, whichever is appropriate, of similar 
 10.6   market value.  
 10.7      (c) Class 1c property is commercial use real property that 
 10.8   abuts a lakeshore line and is devoted to temporary and seasonal 
 10.9   residential occupancy for recreational purposes but not devoted 
 10.10  to commercial purposes for more than 250 days in the year 
 10.11  preceding the year of assessment, and that includes a portion 
 10.12  used as a homestead by the owner, which includes a dwelling 
 10.13  occupied as a homestead by a shareholder of a corporation that 
 10.14  owns the resort or a partner in a partnership that owns the 
 10.15  resort, even if the title to the homestead is held by the 
 10.16  corporation or partnership.  For purposes of this clause, 
 10.17  property is devoted to a commercial purpose on a specific day if 
 10.18  any portion of the property, excluding the portion used 
 10.19  exclusively as a homestead, is used for residential occupancy 
 10.20  and a fee is charged for residential occupancy.  Class 1c 
 10.21  property has a class rate of one 0.5 percent of total market 
 10.22  value with the following limitation:  the area of the property 
 10.23  must not exceed 100 feet of lakeshore footage for each cabin or 
 10.24  campsite located on the property up to a total of 800 feet and 
 10.25  500 feet in depth, measured away from the lakeshore.  If any 
 10.26  portion of the class 1c resort property is classified as class 
 10.27  4c under subdivision 25, the entire property must meet the 
 10.28  requirements of subdivision 25, paragraph (d), clause (1), to 
 10.29  qualify for class 1c treatment under this paragraph. 
 10.30     (d) Class 1d property includes structures that meet all of 
 10.31  the following criteria: 
 10.32     (1) the structure is located on property that is classified 
 10.33  as agricultural property under section 273.13, subdivision 23; 
 10.34     (2) the structure is occupied exclusively by seasonal farm 
 10.35  workers during the time when they work on that farm, and the 
 10.36  occupants are not charged rent for the privilege of occupying 
 11.1   the property, provided that use of the structure for storage of 
 11.2   farm equipment and produce does not disqualify the property from 
 11.3   classification under this paragraph; 
 11.4      (3) the structure meets all applicable health and safety 
 11.5   requirements for the appropriate season; and 
 11.6      (4) the structure is not salable as residential property 
 11.7   because it does not comply with local ordinances relating to 
 11.8   location in relation to streets or roads. 
 11.9      The market value of class 1d property has the same class 
 11.10  rates as class 1a property under paragraph (a). 
 11.11     Sec. 15.  Minnesota Statutes 1998, section 273.13, 
 11.12  subdivision 25, is amended to read: 
 11.13     Subd. 25.  [CLASS 4.] (a) Class 4a is residential real 
 11.14  estate containing four or more units and used or held for use by 
 11.15  the owner or by the tenants or lessees of the owner as a 
 11.16  residence for rental periods of 30 days or more.  Class 4a also 
 11.17  includes hospitals licensed under sections 144.50 to 144.56, 
 11.18  other than hospitals exempt under section 272.02, and contiguous 
 11.19  property used for hospital purposes, without regard to whether 
 11.20  the property has been platted or subdivided.  Class 4a property 
 11.21  in a city with a population of 5,000 or less, that is (1) 
 11.22  located outside of the metropolitan area, as defined in section 
 11.23  473.121, subdivision 2, or outside any county contiguous to the 
 11.24  metropolitan area, and (2) whose city boundary is at least 15 
 11.25  miles from the boundary of any city with a population greater 
 11.26  than 5,000 has a class rate of 2.15 percent of market value. All 
 11.27  other class 4a property has a class rate of 2.5 percent of 
 11.28  market value.  For purposes of this paragraph, population has 
 11.29  the same meaning given in section 477A.011, subdivision 3. 
 11.30     (b) Class 4b includes: 
 11.31     (1) residential real estate containing less than four units 
 11.32  that does not qualify as class 4bb, other than seasonal 
 11.33  residential, and recreational; 
 11.34     (2) manufactured homes not classified under any other 
 11.35  provision; 
 11.36     (3) a dwelling, garage, and surrounding one acre of 
 12.1   property on a nonhomestead farm classified under subdivision 23, 
 12.2   paragraph (b) containing two or three units; 
 12.3      (4) unimproved property that is classified residential as 
 12.4   determined under subdivision 33.  
 12.5      Class 4b property has a class rate of 1.7 percent of market 
 12.6   value.  
 12.7      (c) Class 4bb includes: 
 12.8      (1) nonhomestead residential real estate containing one 
 12.9   unit, other than seasonal residential, and recreational; and 
 12.10     (2) a single family dwelling, garage, and surrounding one 
 12.11  acre of property on a nonhomestead farm classified under 
 12.12  subdivision 23, paragraph (b). 
 12.13     Class 4bb has a class rate of 1.25 percent on the first 
 12.14  $75,000 of market value and a class rate of 1.7 percent of its 
 12.15  market value that exceeds $75,000. 
 12.16     Property that has been classified as seasonal recreational 
 12.17  residential property at any time during which it has been owned 
 12.18  by the current owner or spouse of the current owner does not 
 12.19  qualify for class 4bb. 
 12.20     (d) Class 4c property includes: 
 12.21     (1) except as provided in subdivision 22, paragraph (c), 
 12.22  real property devoted to temporary and seasonal residential 
 12.23  occupancy for recreation purposes, including real property 
 12.24  devoted to temporary and seasonal residential occupancy for 
 12.25  recreation purposes and not devoted to commercial purposes for 
 12.26  more than 250 days in the year preceding the year of 
 12.27  assessment.  For purposes of this clause, property is devoted to 
 12.28  a commercial purpose on a specific day if any portion of the 
 12.29  property is used for residential occupancy, and a fee is charged 
 12.30  for residential occupancy.  In order for a property to be 
 12.31  classified as class 4c, seasonal recreational residential for 
 12.32  commercial purposes, at least 40 percent of the annual gross 
 12.33  lodging receipts related to the property must be from business 
 12.34  conducted during 90 consecutive days and either (i) at least 60 
 12.35  percent of all paid bookings by lodging guests during the year 
 12.36  must be for periods of at least two consecutive nights; or (ii) 
 13.1   at least 20 percent of the annual gross receipts must be from 
 13.2   charges for rental of fish houses, boats and motors, 
 13.3   snowmobiles, downhill or cross-country ski equipment, or charges 
 13.4   for marina services, launch services, and guide services, or the 
 13.5   sale of bait and fishing tackle.  For purposes of this 
 13.6   determination, a paid booking of five or more nights shall be 
 13.7   counted as two bookings.  Class 4c also includes commercial use 
 13.8   real property used exclusively for recreational purposes in 
 13.9   conjunction with class 4c property devoted to temporary and 
 13.10  seasonal residential occupancy for recreational purposes, up to 
 13.11  a total of two acres, provided the property is not devoted to 
 13.12  commercial recreational use for more than 250 days in the year 
 13.13  preceding the year of assessment and is located within two miles 
 13.14  of the class 4c property with which it is used.  Class 4c 
 13.15  property classified in this clause also includes the remainder 
 13.16  of class 1c resorts provided that the entire property including 
 13.17  that portion of the property classified as class 1c also meets 
 13.18  the requirements for class 4c under this clause; otherwise the 
 13.19  entire property is classified as class 3.  Owners of real 
 13.20  property devoted to temporary and seasonal residential occupancy 
 13.21  for recreation purposes and all or a portion of which was 
 13.22  devoted to commercial purposes for not more than 250 days in the 
 13.23  year preceding the year of assessment desiring classification as 
 13.24  class 1c or 4c, must submit a declaration to the assessor 
 13.25  designating the cabins or units occupied for 250 days or less in 
 13.26  the year preceding the year of assessment by January 15 of the 
 13.27  assessment year.  Those cabins or units and a proportionate 
 13.28  share of the land on which they are located will be designated 
 13.29  class 1c or 4c as otherwise provided.  The remainder of the 
 13.30  cabins or units and a proportionate share of the land on which 
 13.31  they are located will be designated as class 3a.  The owner of 
 13.32  property desiring designation as class 1c or 4c property must 
 13.33  provide guest registers or other records demonstrating that the 
 13.34  units for which class 1c or 4c designation is sought were not 
 13.35  occupied for more than 250 days in the year preceding the 
 13.36  assessment if so requested.  The portion of a property operated 
 14.1   as a (1) restaurant, (2) bar, (3) gift shop, and (4) other 
 14.2   nonresidential facility operated on a commercial basis not 
 14.3   directly related to temporary and seasonal residential occupancy 
 14.4   for recreation purposes shall not qualify for class 1c or 4c; 
 14.5      (2) qualified property used as a golf course if: 
 14.6      (i) it is open to the public on a daily fee basis.  It may 
 14.7   charge membership fees or dues, but a membership fee may not be 
 14.8   required in order to use the property for golfing, and its green 
 14.9   fees for golfing must be comparable to green fees typically 
 14.10  charged by municipal courses; and 
 14.11     (ii) it meets the requirements of section 273.112, 
 14.12  subdivision 3, paragraph (d). 
 14.13     A structure used as a clubhouse, restaurant, or place of 
 14.14  refreshment in conjunction with the golf course is classified as 
 14.15  class 3a property. 
 14.16     (3) real property up to a maximum of one acre of land owned 
 14.17  by a nonprofit community service oriented organization; provided 
 14.18  that the property is not used for a revenue-producing activity 
 14.19  for more than six days in the calendar year preceding the year 
 14.20  of assessment and the property is not used for residential 
 14.21  purposes on either a temporary or permanent basis.  For purposes 
 14.22  of this clause, a "nonprofit community service oriented 
 14.23  organization" means any corporation, society, association, 
 14.24  foundation, or institution organized and operated exclusively 
 14.25  for charitable, religious, fraternal, civic, or educational 
 14.26  purposes, and which is exempt from federal income taxation 
 14.27  pursuant to section 501(c)(3), (10), or (19) of the Internal 
 14.28  Revenue Code of 1986, as amended through December 31, 1990.  For 
 14.29  purposes of this clause, "revenue-producing activities" shall 
 14.30  include but not be limited to property or that portion of the 
 14.31  property that is used as an on-sale intoxicating liquor or 3.2 
 14.32  percent malt liquor establishment licensed under chapter 340A, a 
 14.33  restaurant open to the public, bowling alley, a retail store, 
 14.34  gambling conducted by organizations licensed under chapter 349, 
 14.35  an insurance business, or office or other space leased or rented 
 14.36  to a lessee who conducts a for-profit enterprise on the 
 15.1   premises.  Any portion of the property which is used for 
 15.2   revenue-producing activities for more than six days in the 
 15.3   calendar year preceding the year of assessment shall be assessed 
 15.4   as class 3a.  The use of the property for social events open 
 15.5   exclusively to members and their guests for periods of less than 
 15.6   24 hours, when an admission is not charged nor any revenues are 
 15.7   received by the organization shall not be considered a 
 15.8   revenue-producing activity; 
 15.9      (4) post-secondary student housing of not more than one 
 15.10  acre of land that is owned by a nonprofit corporation organized 
 15.11  under chapter 317A and is used exclusively by a student 
 15.12  cooperative, sorority, or fraternity for on-campus housing or 
 15.13  housing located within two miles of the border of a college 
 15.14  campus; 
 15.15     (5) manufactured home parks as defined in section 327.14, 
 15.16  subdivision 3; and 
 15.17     (6) real property that is actively and exclusively devoted 
 15.18  to indoor fitness, health, social, recreational, and related 
 15.19  uses, is owned and operated by a not-for-profit corporation, and 
 15.20  is located within the metropolitan area as defined in section 
 15.21  473.121, subdivision 2. 
 15.22     Class 4c property has a class rate of 1.8 percent of market 
 15.23  value, except that (i) for each parcel of seasonal residential 
 15.24  recreational property not used for commercial purposes the first 
 15.25  $75,000 of market value has a class rate of 1.25 0.625 percent, 
 15.26  and the market value that exceeds $75,000 has a class rate 
 15.27  of 2.2 1.1 percent, (ii) manufactured home parks assessed under 
 15.28  clause (5) have a class rate of two percent, and (iii) property 
 15.29  described in paragraph (d), clause (4), has the same class rate 
 15.30  as the rate applicable to the first tier of class 4bb 
 15.31  nonhomestead residential real estate under paragraph (c).  
 15.32     (e) Class 4d property is qualifying low-income rental 
 15.33  housing certified to the assessor by the housing finance agency 
 15.34  under sections 273.126 and 462A.071.  Class 4d includes land in 
 15.35  proportion to the total market value of the building that is 
 15.36  qualifying low-income rental housing.  For all properties 
 16.1   qualifying as class 4d, the market value determined by the 
 16.2   assessor must be based on the normal approach to value using 
 16.3   normal unrestricted rents. 
 16.4      Class 4d property has a class rate of one percent of market 
 16.5   value.  
 16.6      (f) Class 4e property consists of the residential portion 
 16.7   of any structure located within a city that was converted from 
 16.8   nonresidential use to residential use, provided that: 
 16.9      (1) the structure had formerly been used as a warehouse; 
 16.10     (2) the structure was originally constructed prior to 1940; 
 16.11     (3) the conversion was done after December 31, 1995, but 
 16.12  before January 1, 2003; and 
 16.13     (4) the conversion involved an investment of at least 
 16.14  $25,000 per residential unit. 
 16.15     Class 4e property has a class rate of 2.3 percent, provided 
 16.16  that a structure is eligible for class 4e classification only in 
 16.17  the 12 assessment years immediately following the conversion. 
 16.18     Sec. 16.  Minnesota Statutes 1998, section 273.1382, 
 16.19  subdivision 1, is amended to read: 
 16.20     Subdivision 1.  [EDUCATION HOMESTEAD CREDIT.] Each year, 
 16.21  the respective county auditors shall determine the initial tax 
 16.22  rate for each school district for the general education levy 
 16.23  certified under section 126C.13, subdivision 2 or 3.  That rate 
 16.24  plus the school district's education homestead credit tax rate 
 16.25  adjustment under section 275.08, subdivision 1e, shall be the 
 16.26  general education homestead credit local tax rate for the 
 16.27  district.  The auditor shall then determine a general education 
 16.28  homestead credit for each homestead within the county equal to 
 16.29  68 percent for taxes payable in 1999 and 69 100 percent for 
 16.30  taxes payable in 2000 and thereafter of the general education 
 16.31  homestead credit local tax rate times the net tax capacity of 
 16.32  the homestead for the taxes payable year.  The amount of general 
 16.33  education homestead credit for a homestead may not exceed $320 
 16.34  for taxes payable in 1999 and $335 $263 for taxes payable in 
 16.35  2000 and thereafter.  In the case of an agricultural homestead, 
 16.36  only the net tax capacity of the house, garage, and surrounding 
 17.1   one acre of land shall be used in determining the property's 
 17.2   education homestead credit. 
 17.3      Sec. 17.  Minnesota Statutes 1998, section 273.1398, 
 17.4   subdivision 1a, is amended to read: 
 17.5      Subd. 1a.  [TAX BASE DIFFERENTIAL.] For aids payable in 
 17.6   2000, the tax base differential is equal to the sum of the 
 17.7   following percentages of the assessment year 1998 taxable market 
 17.8   values of the indicated classes:  (1) 0.5 percent of class 1a or 
 17.9   2a homestead property up to $75,000 in value, plus (2) 0.85 
 17.10  percent of class 1a or 2a homestead property over $75,000 in 
 17.11  value, plus (3) 0.225 percent of class 1b homestead property up 
 17.12  to $32,000 in value, plus (4) 0.625 percent of class 4c 
 17.13  noncommercial seasonal residential recreational property up to 
 17.14  $75,000 in value, plus (5) 1.1 percent of class 4c noncommercial 
 17.15  seasonal residential recreational property over $75,000 in 
 17.16  value, plus (6) 0.5 percent of class 1c commercial seasonal 
 17.17  residential recreational property, plus (7) for purposes of 
 17.18  computing the fiscal disparity adjustment only, the tax base 
 17.19  differential is 0.2 percent of the assessment year 1998 taxable 
 17.20  market value of class 3 commercial-industrial property over 
 17.21  $150,000.  In the case of class 2a agricultural homestead 
 17.22  property, only the value of the house, garage, and surrounding 
 17.23  one acre of land is included in the amount described in clauses 
 17.24  (1) and (2). 
 17.25     Sec. 18.  Minnesota Statutes 1998, section 290.06, 
 17.26  subdivision 2c, is amended to read: 
 17.27     Subd. 2c.  [SCHEDULES OF RATES FOR INDIVIDUALS, ESTATES, 
 17.28  AND TRUSTS.] (a) The income taxes imposed by this chapter upon 
 17.29  married individuals filing joint returns and surviving spouses 
 17.30  as defined in section 2(a) of the Internal Revenue Code must be 
 17.31  computed by applying to their taxable net income the following 
 17.32  schedule of rates: 
 17.33     (1) On the first $19,910 $25,680, 6 5 percent; 
 17.34     (2) On all over $19,910 $25,680, but not 
 17.35  over $79,120 $102,050, 8 7 percent; 
 17.36     (3) On all over $79,120 $102,050, 8.5 7.5 percent. 
 18.1      Married individuals filing separate returns, estates, and 
 18.2   trusts must compute their income tax by applying the above rates 
 18.3   to their taxable income, except that the income brackets will be 
 18.4   one-half of the above amounts.  
 18.5      (b) The income taxes imposed by this chapter upon unmarried 
 18.6   individuals must be computed by applying to taxable net income 
 18.7   the following schedule of rates: 
 18.8      (1) On the first $13,620 $17,570, 6 5 percent; 
 18.9      (2) On all over $13,620 $17,570, but not 
 18.10  over $44,750 $57,720, 8 7 percent; 
 18.11     (3) On all over $44,750 $57,720, 8.5 7.5 percent. 
 18.12     (c) The income taxes imposed by this chapter upon unmarried 
 18.13  individuals qualifying as a head of household as defined in 
 18.14  section 2(b) of the Internal Revenue Code must be computed by 
 18.15  applying to taxable net income the following schedule of rates: 
 18.16     (1) On the first $16,770 $21,630, 6 5 percent; 
 18.17     (2) On all over $16,770 $21,630, but not 
 18.18  over $67,390 $86,920, 8 7 percent; 
 18.19     (3) On all over $67,390 $86,920, 8.5 7.5 percent. 
 18.20     (d) In lieu of a tax computed according to the rates set 
 18.21  forth in this subdivision, the tax of any individual taxpayer 
 18.22  whose taxable net income for the taxable year is less than an 
 18.23  amount determined by the commissioner must be computed in 
 18.24  accordance with tables prepared and issued by the commissioner 
 18.25  of revenue based on income brackets of not more than $100.  The 
 18.26  amount of tax for each bracket shall be computed at the rates 
 18.27  set forth in this subdivision, provided that the commissioner 
 18.28  may disregard a fractional part of a dollar unless it amounts to 
 18.29  50 cents or more, in which case it may be increased to $1. 
 18.30     (e) An individual who is not a Minnesota resident for the 
 18.31  entire year must compute the individual's Minnesota income tax 
 18.32  as provided in this subdivision.  After the application of the 
 18.33  nonrefundable credits provided in this chapter, the tax 
 18.34  liability must then be multiplied by a fraction in which:  
 18.35     (1) the numerator is the individual's Minnesota source 
 18.36  federal adjusted gross income as defined in section 62 of the 
 19.1   Internal Revenue Code disregarding income or loss flowing from a 
 19.2   corporation having a valid election for the taxable year under 
 19.3   section 1362 of the Internal Revenue Code but which is not an 
 19.4   "S" corporation under section 290.9725 and increased by the 
 19.5   additions required under section 290.01, subdivision 19a, 
 19.6   clauses (1) and (9), after applying the allocation and 
 19.7   assignability provisions of section 290.081, clause (a), or 
 19.8   290.17; and 
 19.9      (2) the denominator is the individual's federal adjusted 
 19.10  gross income as defined in section 62 of the Internal Revenue 
 19.11  Code of 1986, increased by the amounts specified in section 
 19.12  290.01, subdivision 19a, clauses (1), (5), (6), (7), and (9), 
 19.13  and reduced by the amounts specified in section 290.01, 
 19.14  subdivision 19b, clauses (1), (11), and (12). 
 19.15     Sec. 19.  Minnesota Statutes 1998, section 290.091, 
 19.16  subdivision 1, is amended to read: 
 19.17     Subdivision 1.  [IMPOSITION OF TAX.] In addition to all 
 19.18  other taxes imposed by this chapter a tax is imposed on 
 19.19  individuals, estates, and trusts equal to the excess (if any) of 
 19.20     (a) an amount equal to seven 6.5 percent of alternative 
 19.21  minimum taxable income after subtracting the exemption amount, 
 19.22  over 
 19.23     (b) the regular tax for the taxable year. 
 19.24     Sec. 20.  Minnesota Statutes 1998, section 290.091, 
 19.25  subdivision 2, is amended to read: 
 19.26     Subd. 2.  [DEFINITIONS.] For purposes of the tax imposed by 
 19.27  this section, the following terms have the meanings given: 
 19.28     (a) "Alternative minimum taxable income" means the sum of 
 19.29  the following for the taxable year: 
 19.30     (1) the taxpayer's federal alternative minimum taxable 
 19.31  income as defined in section 55(b)(2) of the Internal Revenue 
 19.32  Code; 
 19.33     (2) the taxpayer's itemized deductions allowed in computing 
 19.34  federal alternative minimum taxable income, but excluding: 
 19.35     (i) the Minnesota charitable contribution deduction; 
 19.36     (ii) the medical expense deduction; 
 20.1      (iii) the casualty, theft, and disaster loss deduction; and 
 20.2      (iv) the impairment-related work expenses of a disabled 
 20.3   person; 
 20.4      (3) for depletion allowances computed under section 613A(c) 
 20.5   of the Internal Revenue Code, with respect to each property (as 
 20.6   defined in section 614 of the Internal Revenue Code), to the 
 20.7   extent not included in federal alternative minimum taxable 
 20.8   income, the excess of the deduction for depletion allowable 
 20.9   under section 611 of the Internal Revenue Code for the taxable 
 20.10  year over the adjusted basis of the property at the end of the 
 20.11  taxable year (determined without regard to the depletion 
 20.12  deduction for the taxable year); 
 20.13     (4) to the extent not included in federal alternative 
 20.14  minimum taxable income, the amount of the tax preference for 
 20.15  intangible drilling cost under section 57(a)(2) of the Internal 
 20.16  Revenue Code determined without regard to subparagraph (E); 
 20.17     (5) to the extent not included in federal alternative 
 20.18  minimum taxable income, the amount of interest income as 
 20.19  provided by section 290.01, subdivision 19a, clause (1); 
 20.20     (6) amounts added to federal taxable income as provided by 
 20.21  section 290.01, subdivision 19a, clauses (5), (6), and (7); 
 20.22     less the sum of the amounts determined under the following 
 20.23  clauses (1) to (4): 
 20.24     (1) interest income as defined in section 290.01, 
 20.25  subdivision 19b, clause (1); 
 20.26     (2) an overpayment of state income tax as provided by 
 20.27  section 290.01, subdivision 19b, clause (2), to the extent 
 20.28  included in federal alternative minimum taxable income; 
 20.29     (3) the amount of investment interest paid or accrued 
 20.30  within the taxable year on indebtedness to the extent that the 
 20.31  amount does not exceed net investment income, as defined in 
 20.32  section 163(d)(4) of the Internal Revenue Code.  Interest does 
 20.33  not include amounts deducted in computing federal adjusted gross 
 20.34  income; and 
 20.35     (4) amounts subtracted from federal taxable income as 
 20.36  provided by section 290.01, subdivision 19b, clauses (11) and 
 21.1   (12). 
 21.2      In the case of an estate or trust, alternative minimum 
 21.3   taxable income must be computed as provided in section 59(c) of 
 21.4   the Internal Revenue Code. 
 21.5      (b) "Investment interest" means investment interest as 
 21.6   defined in section 163(d)(3) of the Internal Revenue Code. 
 21.7      (c) "Tentative minimum tax" equals seven 6.5 percent of 
 21.8   alternative minimum taxable income after subtracting the 
 21.9   exemption amount determined under subdivision 3. 
 21.10     (d) "Regular tax" means the tax that would be imposed under 
 21.11  this chapter (without regard to this section and section 
 21.12  290.032), reduced by the sum of the nonrefundable credits 
 21.13  allowed under this chapter.  
 21.14     (e) "Net minimum tax" means the minimum tax imposed by this 
 21.15  section. 
 21.16     (f) "Minnesota charitable contribution deduction" means a 
 21.17  charitable contribution deduction under section 170 of the 
 21.18  Internal Revenue Code to or for the use of an entity described 
 21.19  in section 290.21, subdivision 3, clauses (a) to (e).  When the 
 21.20  federal deduction for charitable contributions is limited under 
 21.21  section 170(b) of the Internal Revenue Code, the allowable 
 21.22  contributions in the year of contribution are deemed to be first 
 21.23  contributions to entities described in section 290.21, 
 21.24  subdivision 3, clauses (a) to (e). 
 21.25     Sec. 21.  Minnesota Statutes 1998, section 290.091, 
 21.26  subdivision 6, is amended to read: 
 21.27     Subd. 6.  [CREDIT FOR PRIOR YEARS' LIABILITY.] (a) A credit 
 21.28  is allowed against the tax imposed by this chapter on 
 21.29  individuals, trusts, and estates equal to the minimum tax credit 
 21.30  for the taxable year.  The minimum tax credit equals the 
 21.31  adjusted net minimum tax for taxable years beginning after 
 21.32  December 31, 1988, reduced by the minimum tax credits allowed in 
 21.33  a prior taxable year.  The credit may not exceed the excess (if 
 21.34  any) for the taxable year of 
 21.35     (1) the regular tax, over 
 21.36     (2) the greater of (i) the tentative alternative minimum 
 22.1   tax, or (ii) zero. 
 22.2      (b) The adjusted net minimum tax for a taxable year equals 
 22.3   the lesser of the net minimum tax or the excess (if any) of 
 22.4      (1) the tentative minimum tax, over 
 22.5      (2) seven 6.5 percent of the sum of 
 22.6      (i) adjusted gross income as defined in section 62 of the 
 22.7   Internal Revenue Code, 
 22.8      (ii) interest income as defined in section 290.01, 
 22.9   subdivision 19a, clause (1), 
 22.10     (iii) the amount added to federal taxable income as 
 22.11  provided by section 290.01, subdivision 19a, clauses (5), (6), 
 22.12  and (7), 
 22.13     (iv) interest on specified private activity bonds, as 
 22.14  defined in section 57(a)(5) of the Internal Revenue Code, to the 
 22.15  extent not included under clause (ii), 
 22.16     (v) depletion as defined in section 57(a)(1), determined 
 22.17  without regard to the last sentence of paragraph (1), of the 
 22.18  Internal Revenue Code, less 
 22.19     (vi) the deductions allowed in computing alternative 
 22.20  minimum taxable income provided in subdivision 2, paragraph (a), 
 22.21  clause (2) of the first series of clauses and clauses (1), (2), 
 22.22  (3), and (4) of the second series of clauses, and 
 22.23     (vii) the exemption amount determined under subdivision 3. 
 22.24     In the case of an individual who is not a Minnesota 
 22.25  resident for the entire year, adjusted net minimum tax must be 
 22.26  multiplied by the fraction defined in section 290.06, 
 22.27  subdivision 2c, paragraph (e).  In the case of a trust or 
 22.28  estate, adjusted net minimum tax must be multiplied by the 
 22.29  fraction defined under subdivision 4, paragraph (b). 
 22.30     Sec. 22.  Minnesota Statutes 1998, section 297A.02, 
 22.31  subdivision 1, is amended to read: 
 22.32     Subdivision 1.  [GENERALLY.] Except as otherwise provided 
 22.33  in this chapter, there is imposed an excise tax of 6.5 5.5 
 22.34  percent of the gross receipts from sales at retail made by any 
 22.35  person in this state. 
 22.36     Sec. 23.  [REPEALER.] 
 23.1      Subdivision 1.  [MINNESOTACARE.] Minnesota Statutes 1998, 
 23.2   sections 13.99, subdivision 86b; 144.1484, subdivision 2; 
 23.3   295.50; 295.51; 295.52; 295.53; 295.54; 295.55; 295.56; 295.57; 
 23.4   295.58; 295.582; and 295.59, are repealed January 1, 2000, for 
 23.5   gross revenue received on or after that date. 
 23.6      Subd. 2.  [PROPERTY TAX.] Minnesota Statutes 1998, section 
 23.7   273.1382, subdivision 1a, is repealed. 
 23.8      Sec. 24.  [EFFECTIVE DATE.] 
 23.9      Subdivision 1.  [TAXES PAYABLE IN 2000.] Sections 3, 4, 5, 
 23.10  6, 7, 8, 13, 14, 15, 16, and 17 are effective for taxes payable 
 23.11  in 2000 and later.  
 23.12     Subd. 2.  [INCOME TAX.] Sections 18, 19, 20, and 21 are 
 23.13  effective for tax years beginning after December 31, 1999. 
 23.14     Subd. 3.  [SALES TAX.] Section 22 is effective for sales 
 23.15  occurring after June 30, 1999. 
 23.16     Subd. 4.  [MINNESOTACARE.] Sections 1, 2, 9, 10, 11, and 12 
 23.17  are effective for gross revenue received on or after January 1, 
 23.18  2000.