HF 2416

as introduced - 85th Legislature (2007 - 2008) Posted on 12/15/2009 12:00am

A bill for an act
relating to transportation; exempting certain unsubsidized providers of public
transit service from vehicle property taxes, registration taxes, motor fuel taxes,
and corporate income tax; permitting statewide use of freeway and expressway
shoulders by transit buses and metro mobility buses; requiring Metropolitan
Council to permit providers of transit service to use its bus stops; amending
Minnesota Statutes 2006, sections 168.012, subdivision 1; 169.306; 272.02, by
adding a subdivision; 290.01, subdivision 19d; 296A.07, subdivision 4; 296A.08,
subdivision 3; 473.411, by adding a subdivision.

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

Section 1.

Minnesota Statutes 2006, section 168.012, subdivision 1, is amended to read:

Subdivision 1.

Vehicles exempt from tax, fees, or plate display.

(a) The following
vehicles are exempt from the provisions of this chapter requiring payment of tax and
registration fees, except as provided in subdivision 1c:

(1) vehicles owned and used solely in the transaction of official business by the
federal government, the state, or any political subdivision;

(2) vehicles owned and used exclusively by educational institutions and used solely
in the transportation of pupils to and from those institutions;

(3) vehicles used solely in driver education programs at nonpublic high schools;

(4) vehicles owned by nonprofit charities and used exclusively to transport disabled
persons for charitable, religious, or educational purposes;

(5) ambulances owned by ambulance services licensed under section 144E.10, the
general appearance of which is unmistakable; deleted text begin and
deleted text end

(6) vehicles owned by a commercial driving school licensed under section 171.34,
or an employee of a commercial driving school licensed under section 171.34, and the
vehicle is used exclusively for driver education and training new text begin ; and
new text end

new text begin (7) until July 1, 2025, vehicles owned by a motor carrier of passengers registered
under section 221.0252 and operated:
new text end

new text begin (i) primarily to provide regular route public transit, as defined in section 174.22,
subdivision 8;
new text end

new text begin (ii) to provide service to an urban area having a population of at least 50,000; and
new text end

new text begin (iii) without financial operating assistance from the state or any political subdivision
of the state new text end .

(b) Vehicles owned by the federal government, municipal fire apparatuses including
fire-suppression support vehicles, police patrols, and ambulances, the general appearance
of which is unmistakable, are not required to register or display number plates.

(c) Unmarked vehicles used in general police work, liquor investigations, or arson
investigations, and passenger automobiles, pickup trucks, and buses owned or operated by
the Department of Corrections, must be registered and must display appropriate license
number plates, furnished by the registrar at cost. Original and renewal applications for
these license plates authorized for use in general police work and for use by the Department
of Corrections must be accompanied by a certification signed by the appropriate chief of
police if issued to a police vehicle, the appropriate sheriff if issued to a sheriff's vehicle,
the commissioner of corrections if issued to a Department of Corrections vehicle, or the
appropriate officer in charge if issued to a vehicle of any other law enforcement agency.
The certification must be on a form prescribed by the commissioner and state that the
vehicle will be used exclusively for a purpose authorized by this section.

(d) Unmarked vehicles used by the Departments of Revenue and Labor and Industry,
fraud unit, in conducting seizures or criminal investigations must be registered and must
display passenger vehicle classification license number plates, furnished at cost by the
registrar. Original and renewal applications for these passenger vehicle license plates
must be accompanied by a certification signed by the commissioner of revenue or the
commissioner of labor and industry. The certification must be on a form prescribed by
the commissioner and state that the vehicles will be used exclusively for the purposes
authorized by this section.

(e) Unmarked vehicles used by the Division of Disease Prevention and Control of the
Department of Health must be registered and must display passenger vehicle classification
license number plates. These plates must be furnished at cost by the registrar. Original
and renewal applications for these passenger vehicle license plates must be accompanied
by a certification signed by the commissioner of health. The certification must be on a
form prescribed by the commissioner and state that the vehicles will be used exclusively
for the official duties of the Division of Disease Prevention and Control.

(f) Unmarked vehicles used by staff of the Gambling Control Board in gambling
investigations and reviews must be registered and must display passenger vehicle
classification license number plates. These plates must be furnished at cost by the
registrar. Original and renewal applications for these passenger vehicle license plates must
be accompanied by a certification signed by the board chair. The certification must be on a
form prescribed by the commissioner and state that the vehicles will be used exclusively
for the official duties of the Gambling Control Board.

(g) All other motor vehicles must be registered and display tax-exempt number
plates, furnished by the registrar at cost, except as provided in subdivision 1c. All
vehicles required to display tax-exempt number plates must have the name of the state
department or political subdivision, nonpublic high school operating a driver education
program, or licensed commercial driving school, plainly displayed on both sides of the
vehicle; except that each state hospital and institution for persons who are mentally ill
and developmentally disabled may have one vehicle without the required identification
on the sides of the vehicle, and county social service agencies may have vehicles used
for child and vulnerable adult protective services without the required identification on
the sides of the vehicle. This identification must be in a color giving contrast with that
of the part of the vehicle on which it is placed and must endure throughout the term of
the registration. The identification must not be on a removable plate or placard and must
be kept clean and visible at all times; except that a removable plate or placard may be
utilized on vehicles leased or loaned to a political subdivision or to a nonpublic high
school driver education program.

Sec. 2.

Minnesota Statutes 2006, section 169.306, is amended to read:

169.306 USE OF new text begin FREEWAY new text end SHOULDERS BY BUSES.

(a) The commissioner of transportation may permit the use by transit buses and
metro mobility buses of a shoulder of a freeway or expressway, as defined in section
160.02 deleted text begin , in the seven-county metropolitan area deleted text end .

(b) If the commissioner permits the use of a freeway or expressway shoulder by
transit buses, the commissioner shall also permit the use on that shoulder of a bus with a
seating capacity of 40 passengers or more operated by a motor carrier of passengers, as
defined in section 221.011, subdivision 48, while operating in intrastate commerce.

(c) Buses authorized to use the shoulder under this section may be operated on the
shoulder only when main line traffic speeds are less than 35 miles per hour. Drivers of
buses being operated on the shoulder may not exceed the speed of main line traffic by
more than 15 miles per hour and may never exceed 35 miles per hour. Drivers of buses
being operated on the shoulder must yield to merging, entering, and exiting traffic and
must yield to other vehicles on the shoulder. Buses operated on the shoulder must be
registered with the Department of Transportation.

(d) For the purposes of this section, the term "metro mobility bus" means a motor
vehicle of not less than 20 feet in length engaged in providing special transportation
services under section 473.386 that is:

(1) operated by the Metropolitan Council, or operated by a public or private entity
receiving financial assistance from the Metropolitan Council; and

(2) authorized by the council to use freeway or expressway shoulders.

Sec. 3.

Minnesota Statutes 2006, section 272.02, is amended by adding a subdivision
to read:

new text begin Subd. 85. new text end

new text begin Passenger motor carrier maintenance facility. new text end

new text begin If approved by the
governing body of the municipality in which the property is located, a passenger motor
carrier maintenance facility constructed on or after January 1, 2007, is exempt from
property tax. The property must be owned and operated by a motor carrier of passengers
that is registered under section 221.0252. Vehicles serviced in the facility must be
operated:
new text end

new text begin (1) primarily to provide regular route public transit, as defined in section 174.22,
subdivision 8;
new text end

new text begin (2) to provide service to an urban area having a population of at least 50,000; and
new text end

new text begin (3) without financial operating assistance from the state or any political subdivision
of the state.
new text end

Sec. 4.

Minnesota Statutes 2006, section 290.01, subdivision 19d, is amended to read:

Subd. 19d.

Corporations; modifications decreasing federal taxable income.

For
corporations, there shall be subtracted from federal taxable income after the increases
provided in subdivision 19c:

(1) the amount of foreign dividend gross-up added to gross income for federal
income tax purposes under section 78 of the Internal Revenue Code;

(2) the amount of salary expense not allowed for federal income tax purposes due to
claiming the federal jobs credit under section 51 of the Internal Revenue Code;

(3) any dividend (not including any distribution in liquidation) paid within the
taxable year by a national or state bank to the United States, or to any instrumentality of
the United States exempt from federal income taxes, on the preferred stock of the bank
owned by the United States or the instrumentality;

(4) amounts disallowed for intangible drilling costs due to differences between
this chapter and the Internal Revenue Code in taxable years beginning before January
1, 1987, as follows:

(i) to the extent the disallowed costs are represented by physical property, an amount
equal to the allowance for depreciation under Minnesota Statutes 1986, section 290.09,
subdivision 7, subject to the modifications contained in subdivision 19e; and

(ii) to the extent the disallowed costs are not represented by physical property, an
amount equal to the allowance for cost depletion under Minnesota Statutes 1986, section
290.09, subdivision 8;

(5) the deduction for capital losses pursuant to sections 1211 and 1212 of the
Internal Revenue Code, except that:

(i) for capital losses incurred in taxable years beginning after December 31, 1986,
capital loss carrybacks shall not be allowed;

(ii) for capital losses incurred in taxable years beginning after December 31, 1986,
a capital loss carryover to each of the 15 taxable years succeeding the loss year shall be
allowed;

(iii) for capital losses incurred in taxable years beginning before January 1, 1987, a
capital loss carryback to each of the three taxable years preceding the loss year, subject to
the provisions of Minnesota Statutes 1986, section 290.16, shall be allowed; and

(iv) for capital losses incurred in taxable years beginning before January 1, 1987,
a capital loss carryover to each of the five taxable years succeeding the loss year to the
extent such loss was not used in a prior taxable year and subject to the provisions of
Minnesota Statutes 1986, section 290.16, shall be allowed;

(6) an amount for interest and expenses relating to income not taxable for federal
income tax purposes, if (i) the income is taxable under this chapter and (ii) the interest and
expenses were disallowed as deductions under the provisions of section 171(a)(2), 265 or
291 of the Internal Revenue Code in computing federal taxable income;

(7) in the case of mines, oil and gas wells, other natural deposits, and timber for
which percentage depletion was disallowed pursuant to subdivision 19c, clause (11), a
reasonable allowance for depletion based on actual cost. In the case of leases the deduction
must be apportioned between the lessor and lessee in accordance with rules prescribed
by the commissioner. In the case of property held in trust, the allowable deduction must
be apportioned between the income beneficiaries and the trustee in accordance with the
pertinent provisions of the trust, or if there is no provision in the instrument, on the basis
of the trust's income allocable to each;

(8) for certified pollution control facilities placed in service in a taxable year
beginning before December 31, 1986, and for which amortization deductions were elected
under section 169 of the Internal Revenue Code of 1954, as amended through December
31, 1985, an amount equal to the allowance for depreciation under Minnesota Statutes
1986, section 290.09, subdivision 7;

(9) amounts included in federal taxable income that are due to refunds of income,
excise, or franchise taxes based on net income or related minimum taxes paid by the
corporation to Minnesota, another state, a political subdivision of another state, the
District of Columbia, or a foreign country or possession of the United States to the extent
that the taxes were added to federal taxable income under section 290.01, subdivision 19c,
clause (1), in a prior taxable year;

(10) 80 percent of royalties, fees, or other like income accrued or received from a
foreign operating corporation or a foreign corporation which is part of the same unitary
business as the receiving corporation;

(11) income or gains from the business of mining as defined in section 290.05,
subdivision 1, clause (a), that are not subject to Minnesota franchise tax;

(12) the amount of disability access expenditures in the taxable year which are not
allowed to be deducted or capitalized under section 44(d)(7) of the Internal Revenue Code;

(13) the amount of qualified research expenses not allowed for federal income tax
purposes under section 280C(c) of the Internal Revenue Code, but only to the extent that
the amount exceeds the amount of the credit allowed under section 290.068;

(14) the amount of salary expenses not allowed for federal income tax purposes due
to claiming the Indian employment credit under section 45A(a) of the Internal Revenue
Code;

(15) the amount of any refund of environmental taxes paid under section 59A of the
Internal Revenue Code;

(16) for taxable years beginning before January 1, 2008, the amount of the federal
small ethanol producer credit allowed under section 40(a)(3) of the Internal Revenue Code
which is included in gross income under section 87 of the Internal Revenue Code;

(17) for a corporation whose foreign sales corporation, as defined in section 922
of the Internal Revenue Code, constituted a foreign operating corporation during any
taxable year ending before January 1, 1995, and a return was filed by August 15, 1996,
claiming the deduction under section 290.21, subdivision 4, for income received from
the foreign operating corporation, an amount equal to 1.23 multiplied by the amount of
income excluded under section 114 of the Internal Revenue Code, provided the income is
not income of a foreign operating company;

(18) any decrease in subpart F income, as defined in section 952(a) of the Internal
Revenue Code, for the taxable year when subpart F income is calculated without regard
to the provisions of section 614 of Public Law 107-147;

(19) in each of the five tax years immediately following the tax year in which an
addition is required under subdivision 19c, clause (15), an amount equal to one-fifth of
the delayed depreciation. For purposes of this clause, "delayed depreciation" means the
amount of the addition made by the taxpayer under subdivision 19c, clause (15). The
resulting delayed depreciation cannot be less than zero; deleted text begin and
deleted text end

(20) in each of the five tax years immediately following the tax year in which an
addition is required under subdivision 19c, clause (16), an amount equal to one-fifth of
the amount of the addition new text begin ; and
new text end

new text begin (21) for taxable years ending before January 1, 2026, income earned by a registered
motor carrier of passengers from providing regular route public transit, as defined in
section 174.22, subdivision 8, when provided:
new text end

new text begin (i) to serve an urban area having a population of at least 50,000;
new text end

new text begin (ii) without financial operating assistance from the state or any political subdivision
of the state; and
new text end

new text begin (iii) in vehicles exempt from taxation under section 168.012, subdivision 1,
paragraph (a), clause (7) new text end .

Sec. 5.

Minnesota Statutes 2006, section 296A.07, subdivision 4, is amended to read:

Subd. 4.

Exemptions.

The provisions of subdivision 1 do not apply to gasoline
purchased by:

(1) a transit system or transit provider receiving financial assistance or
reimbursement under section 174.24, 256B.0625, subdivision 17, or 473.384; deleted text begin or deleted text end

(2) an ambulance service licensed under chapter 144E new text begin ; or
new text end

new text begin (3) until July 1, 2025, a registered motor carrier of passengers for use exclusively in
vehicles that:
new text end

new text begin (i) are exempt from taxation under section 168.012, subdivision 1, paragraph (a),
clause (7);
new text end

new text begin (ii) primarily provide regular route public transit, as defined in section 174.22,
subdivision 8; and
new text end

new text begin (iii) are operated without financial operating assistance from the state or any political
subdivision of the state new text end .

Sec. 6.

Minnesota Statutes 2006, section 296A.08, subdivision 3, is amended to read:

Subd. 3.

Exemptions.

The provisions of subdivisions 1 and 2 do not apply to
special fuel or alternative fuels purchased by:

(1) a transit system or transit provider receiving financial assistance or
reimbursement under section 174.24, 256B.0625, subdivision 17, or 473.384; deleted text begin or deleted text end

(2) an ambulance service licensed under chapter 144E new text begin ; or
new text end

new text begin (3) until July 1, 2025, a registered motor carrier of passengers for use exclusively in
vehicles that:
new text end

new text begin (i) are exempt from taxation under section 168.012, subdivision 1, paragraph (a),
clause (7);
new text end

new text begin (ii) primarily provide regular route public transit, as defined in section 174.22,
subdivision 8;
new text end

new text begin (iii) are operated to serve any urban area having a population of at least 50,000; and
new text end

new text begin (iv) are operated without financial operating assistance from the state or any political
subdivision of the state new text end .

Sec. 7.

Minnesota Statutes 2006, section 473.411, is amended by adding a subdivision
to read:

new text begin Subd. 6. new text end

new text begin Use of bus stops. new text end

new text begin The council shall take all necessary steps to permit
providers of regular route transit in vehicles exempt from taxation under section 168.012,
subdivision 1, paragraph (a), clause (7), to use bus stops and bus shelters that the council
uses in providing regular route transit service, unless use by those vehicles unreasonably
interferes with the safety and reliability of the council's transit operations. This subdivision
applies only to vehicles that:
new text end

new text begin (1) provide transit service originating outside the metropolitan area as defined in
section new text begin 473.121, subdivision 2 new text end ;
new text end

new text begin (2) while inbound to the metropolitan area, do not pick up passengers within the
metropolitan area; and
new text end

new text begin (3) while outbound from the metropolitan area, do not drop off passengers within the
metropolitan area.
new text end