HF 2447

as introduced - 82nd Legislature (2001 - 2002) Posted on 12/15/2009 12:00am

  1.1                          A bill for an act 
  1.2             relating to taxation; making minor and technical 
  1.3             changes in tax increment financing, abatement, and 
  1.4             related development statutes; amending Minnesota 
  1.5             Statutes 2000, sections 273.1399, subdivision 6; 
  1.6             276A.01, subdivision 3; 469.174, subdivisions 10, 10a, 
  1.7             12; 469.175, subdivision 1, by adding a subdivision; 
  1.8             469.176, subdivisions 1b, 1c, 1e, 3, 4, 4g, by adding 
  1.9             a subdivision; 469.177, subdivision 1; 469.178, by 
  1.10            adding a subdivision; 469.1812, subdivision 2; 
  1.11            469.1813, subdivisions 4, 6; 475.58, subdivision 1; 
  1.12            amending Laws 1997, chapter 231, article 10, section 
  1.13            25; Laws 2000, chapter 490, article 11, section 26. 
  1.14  BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.15     Section 1.  Minnesota Statutes 2000, section 273.1399, 
  1.16  subdivision 6, is amended to read: 
  1.17     Subd. 6.  [EXEMPT DISTRICTS.] (a) The provisions of this 
  1.18  section do not apply to exempt tax increment financing districts 
  1.19  as specified by this subdivision. 
  1.20     (b) A tax increment financing district for an ethanol 
  1.21  production facility that satisfies all of the following 
  1.22  requirements is exempt: 
  1.23     (1) The district is an economic development district, that 
  1.24  qualifies under section 469.176, subdivision 4c, paragraph (a), 
  1.25  clause (1). 
  1.26     (2) The facility is certified by the commissioner of 
  1.27  agriculture to qualify for state payments for ethanol 
  1.28  development under section 41A.09 to the extent funds are 
  1.29  available. 
  2.1      (3) Increments from the district are used only to finance 
  2.2   the qualifying ethanol development project located in the 
  2.3   district or to pay for administrative costs of the district. 
  2.4      (4) The district is located outside of the seven-county 
  2.5   metropolitan area, as defined in section 473.121. 
  2.6      (5) The tax increment financing plan was approved by a 
  2.7   resolution of the county board. 
  2.8      (6) The exemption provided by this paragraph applies until 
  2.9   the first year after the total amount of increment for the 
  2.10  district exceeds $1,500,000.  The county auditor shall notify 
  2.11  the commissioner of revenue of the expiration of the exemption 
  2.12  by June 1 of the year in which the auditor projects the revenues 
  2.13  from increments will exceed $1,500,000.  On or before the 
  2.14  expiration of the exemption, the municipality may elect to make 
  2.15  a qualifying local contribution under paragraph (d) in lieu of 
  2.16  the state aid reduction. 
  2.17     (c) A qualified housing district is exempt. 
  2.18     (d)(1) A district is exempt if the municipality elects at 
  2.19  the time of approving the tax increment financing plan for the 
  2.20  district to make a qualifying local contribution.  To qualify 
  2.21  for the exemption in each year, the authority or the 
  2.22  municipality must make a qualifying local contribution equal to 
  2.23  the listed percentages of increment from the district or 
  2.24  subdistrict: 
  2.25     (A) for an economic development district or a renewal and 
  2.26  renovation district, ten percent; 
  2.27     (B) for a redevelopment district, a housing district, a 
  2.28  mined underground space district, a hazardous substance 
  2.29  subdistrict, or a soils condition district, five percent. 
  2.30     (2) If the municipality elects to make a qualifying 
  2.31  contribution and fails to make the required contribution for a 
  2.32  year, the state aid reduction applies for the year.  The state 
  2.33  aid reduction equals the greater of (A) the required local 
  2.34  contribution or (B) the amount of the aid reduction that applies 
  2.35  under subdivision 3.  For a district exempt under paragraph (b), 
  2.36  no qualifying local contribution is required for years in which 
  3.1   the district is exempt. 
  3.2      (3)(A) If the sum of required local contributions for all 
  3.3   districts in the municipality exceeds two percent of city net 
  3.4   tax capacity as defined in section 477A.011, subdivision 20, for 
  3.5   a year, the municipality's total required local contribution for 
  3.6   that year is limited to two percent of net tax capacity to 
  3.7   qualify for the exemption under this subdivision.  The 
  3.8   municipality may allocate the contribution among the districts 
  3.9   on which it has made elections as it determines appropriate. 
  3.10     (B) If a municipality makes an election under this 
  3.11  subdivision for a district in a year in which item (A) applies, 
  3.12  a minimum annual qualifying contribution must be made for the 
  3.13  district equal to the lesser of 0.25 percent of city net tax 
  3.14  capacity or three percent of increment revenues.  This minimum 
  3.15  contribution applies for the life of the district for each year 
  3.16  that the restriction in item (A) applies and is in addition to 
  3.17  the contribution required by item (A). 
  3.18     (4) The amount of the local contribution must be made out 
  3.19  of unrestricted money of the authority or municipality, such as 
  3.20  the general fund, a property tax levy, or a federal or a state 
  3.21  grant-in-aid which may be spent for general government 
  3.22  purposes.  The local contribution may not be made, directly or 
  3.23  indirectly, with tax increments or developer payments as defined 
  3.24  under section 469.1766.  The local contribution must be used to 
  3.25  pay project costs and cannot be used for general government 
  3.26  purposes or for improvements or costs that the authority or 
  3.27  municipality planned to incur absent the project.  The authority 
  3.28  or municipality may request contributions from other local 
  3.29  government entities that will benefit from the district's 
  3.30  activities.  These contributions reduce the local contribution 
  3.31  required of the municipality or authority by this paragraph.  
  3.32  Cities, counties, towns, and schools may contribute to paying 
  3.33  these costs, notwithstanding any other law to the contrary. 
  3.34     (5) The municipality may make a local contribution in 
  3.35  excess of the required contribution for a year.  If it does so, 
  3.36  the municipality may credit the excess to a local contribution 
  4.1   account for the district.  The balance in the account may be 
  4.2   used to meet the requirements for qualifying local contributions 
  4.3   for later years.  No interest or investment earnings may be 
  4.4   credited or imputed to the account, except those (A) actually 
  4.5   paid by the municipality out of its unrestricted funds or by 
  4.6   another person or entity, other than a developer as used in 
  4.7   section 469.1766, and (B) used as required for a qualifying 
  4.8   local contribution. 
  4.9      (6) If the state contributes to the project costs through a 
  4.10  direct grant or similar incentive, the required local 
  4.11  contribution is reduced by one-half of the dollar amount of the 
  4.12  state grant or other similar incentive. 
  4.13     [EFFECTIVE DATE.] This section is effective the day 
  4.14  following final enactment. 
  4.15     Sec. 2.  Minnesota Statutes 2000, section 276A.01, 
  4.16  subdivision 3, is amended to read: 
  4.17     Subd. 3.  [COMMERCIAL-INDUSTRIAL PROPERTY.] 
  4.18  "Commercial-industrial property" means the following categories 
  4.19  of property, as defined in section 273.13, excluding that 
  4.20  portion of the property (i) that may, by law, constitute the tax 
  4.21  base for a tax increment pledged pursuant to section 469.042 or 
  4.22  469.162 or sections 469.174 to 469.178, certification of which 
  4.23  was requested prior to May 1, 1996, to the extent and while the 
  4.24  tax increment is so pledged; or (ii) that is exempt from 
  4.25  taxation under section 272.02:  
  4.26     (1) that portion of class 5 property consisting of unmined 
  4.27  iron ore and low-grade iron-bearing formations as defined in 
  4.28  section 273.14, tools, implements, and machinery, except the 
  4.29  portion of high voltage transmission lines, the value of which 
  4.30  is deducted from net tax capacity under section 273.425; and 
  4.31     (2) that portion of class 3 and class 5 property which is 
  4.32  either used or zoned for use for any commercial or industrial 
  4.33  purpose, except for such property which is, or, in the case of 
  4.34  property under construction, will when completed be used 
  4.35  exclusively for residential occupancy and the provision of 
  4.36  services to residential occupants thereof.  Property must be 
  5.1   considered as used exclusively for residential occupancy only if 
  5.2   each of not less than 80 percent of its occupied residential 
  5.3   units is, or, in the case of property under construction, will 
  5.4   when completed be occupied under an oral or written agreement 
  5.5   for occupancy over a continuous period of not less than 30 days. 
  5.6      If the classification of property prescribed by section 
  5.7   273.13 is modified by legislative amendment, the references in 
  5.8   this subdivision are to the successor class or classes of 
  5.9   property, or portions thereof, that include the kinds of 
  5.10  property designated in this subdivision.  
  5.11     [EFFECTIVE DATE.] This section is effective retroactive to 
  5.12  July 1, 1997, for taxes levied in 1997, payable in 1998, and 
  5.13  subsequent years. 
  5.14     Sec. 3.  Minnesota Statutes 2000, section 469.174, 
  5.15  subdivision 10, is amended to read: 
  5.16     Subd. 10.  [REDEVELOPMENT DISTRICT.] (a) "Redevelopment 
  5.17  district" means a type of tax increment financing district 
  5.18  consisting of a project, or portions of a project, within which 
  5.19  the authority finds by resolution that one or more of the 
  5.20  following conditions, reasonably distributed throughout the 
  5.21  district, exists: 
  5.22     (1) parcels consisting of 70 percent of the area of the 
  5.23  district are occupied by buildings, streets, utilities, or other 
  5.24  improvements similar structures and more than 50 percent of the 
  5.25  buildings, not including outbuildings, are structurally 
  5.26  substandard to a degree requiring substantial renovation or 
  5.27  clearance; or 
  5.28     (2) the property consists of vacant, unused, underused, 
  5.29  inappropriately used, or infrequently used railyards, rail 
  5.30  storage facilities, or excessive or vacated railroad 
  5.31  rights-of-way; or 
  5.32     (3) tank facilities, or property whose immediately previous 
  5.33  use was for tank facilities, as defined in section 115C.02, 
  5.34  subdivision 15, if the tank facilities: 
  5.35     (i) have or had a capacity of more than 1,000,000 gallons; 
  5.36     (ii) are located adjacent to rail facilities; and 
  6.1      (iii) have been removed or are unused, underused, 
  6.2   inappropriately used, or infrequently used. 
  6.3      (b) For purposes of this subdivision, "structurally 
  6.4   substandard" shall mean containing defects in structural 
  6.5   elements or a combination of deficiencies in essential utilities 
  6.6   and facilities, light and ventilation, fire protection including 
  6.7   adequate egress, layout and condition of interior partitions, or 
  6.8   similar factors, which defects or deficiencies are of sufficient 
  6.9   total significance to justify substantial renovation or 
  6.10  clearance.  
  6.11     (c) A building is not structurally substandard if it is in 
  6.12  compliance with the building code applicable to new buildings or 
  6.13  could be modified to satisfy the building code at a cost of less 
  6.14  than 15 percent of the cost of constructing a new structure of 
  6.15  the same square footage and type on the site.  The municipality 
  6.16  may find that a building is not disqualified as structurally 
  6.17  substandard under the preceding sentence on the basis of 
  6.18  reasonably available evidence, such as the size, type, and age 
  6.19  of the building, the average cost of plumbing, electrical, or 
  6.20  structural repairs, or other similar reliable evidence.  The 
  6.21  municipality may not make such a determination without an 
  6.22  interior inspection of the property, but need not have an 
  6.23  independent, expert appraisal prepared of the cost of repair and 
  6.24  rehabilitation of the building.  An interior inspection of the 
  6.25  property is not required, if the municipality finds that (1) the 
  6.26  municipality or authority is unable to gain access to the 
  6.27  property after using its best efforts to obtain permission from 
  6.28  the party that owns or controls the property; and (2) the 
  6.29  evidence otherwise supports a reasonable conclusion that the 
  6.30  building is structurally substandard.  Items of evidence that 
  6.31  support such a conclusion include recent fire or police 
  6.32  inspections, on-site property tax appraisals or housing 
  6.33  inspections, exterior evidence of deterioration, or other 
  6.34  similar reliable evidence.  Written documentation of the 
  6.35  findings and reasons why an interior inspection was not 
  6.36  conducted must be made and retained under section 469.175, 
  7.1   subdivision 3, clause (1). 
  7.2      (d) A parcel is deemed to be occupied by a structurally 
  7.3   substandard building for purposes of the finding under paragraph 
  7.4   (a) if all of the following conditions are met: 
  7.5      (1) the parcel was occupied by a substandard building 
  7.6   within three years of the filing of the request for 
  7.7   certification of the parcel as part of the district with the 
  7.8   county auditor; 
  7.9      (2) the substandard building was demolished or removed by 
  7.10  the authority or the demolition or removal was financed by the 
  7.11  authority or was done by a developer under a development 
  7.12  agreement with the authority; 
  7.13     (3) the authority found by resolution before the demolition 
  7.14  or removal that the parcel was occupied by a structurally 
  7.15  substandard building and that after demolition and clearance the 
  7.16  authority intended to include the parcel within a district; and 
  7.17     (4) upon filing the request for certification of the tax 
  7.18  capacity of the parcel as part of a district, the authority 
  7.19  notifies the county auditor that the original tax capacity of 
  7.20  the parcel must be adjusted as provided by section 469.177, 
  7.21  subdivision 1, paragraph (h). 
  7.22     (e) For purposes of this subdivision, a parcel is not 
  7.23  occupied by buildings, streets, utilities, or other improvements 
  7.24  similar structures unless 15 percent of the area of the parcel 
  7.25  contains improvements buildings, streets, utilities, or other 
  7.26  similar structures. 
  7.27     (f) For districts consisting of two or more noncontiguous 
  7.28  areas, each area must qualify as a redevelopment district under 
  7.29  paragraph (a) to be included in the district, and the entire 
  7.30  area of the district must satisfy paragraph (a). 
  7.31     [EFFECTIVE DATE.] This section is effective for districts 
  7.32  for which the request for certification is made after June 30, 
  7.33  2001. 
  7.34     Sec. 4.  Minnesota Statutes 2000, section 469.174, 
  7.35  subdivision 10a, is amended to read: 
  7.36     Subd. 10a.  [RENEWAL AND RENOVATION DISTRICT.] (a) "Renewal 
  8.1   and renovation district" means a type of tax increment financing 
  8.2   district consisting of a project, or portions of a project, 
  8.3   within which the authority finds by resolution that: 
  8.4      (1)(i) parcels consisting of 70 percent of the area of the 
  8.5   district are occupied by buildings, streets, utilities, or other 
  8.6   improvements similar structures; (ii) 20 percent of the 
  8.7   buildings are structurally substandard; and (iii) 30 percent of 
  8.8   the other buildings require substantial renovation or clearance 
  8.9   to remove existing conditions such as:  inadequate street 
  8.10  layout, incompatible uses or land use relationships, 
  8.11  overcrowding of buildings on the land, excessive dwelling unit 
  8.12  density, obsolete buildings not suitable for improvement or 
  8.13  conversion, or other identified hazards to the health, safety, 
  8.14  and general well-being of the community; and 
  8.15     (2) the conditions described in clause (1) are reasonably 
  8.16  distributed throughout the geographic area of the district. 
  8.17     (b) For purposes of determining whether a building is 
  8.18  structurally substandard, whether parcels are occupied by 
  8.19  buildings or other improvements similar structures, or whether 
  8.20  noncontiguous areas qualify, the provisions of subdivision 10, 
  8.21  paragraphs (b), (c), (e), and (d) (f) apply.  
  8.22     [EFFECTIVE DATE.] This section is effective for districts 
  8.23  for which the requests for certification are made after June 30, 
  8.24  1997, except the provision requiring parcels to be occupied by 
  8.25  structures is effective for districts for which the request for 
  8.26  certification is made after June 30, 2001. 
  8.27     Sec. 5.  Minnesota Statutes 2000, section 469.174, 
  8.28  subdivision 12, is amended to read: 
  8.29     Subd. 12.  [ECONOMIC DEVELOPMENT DISTRICT.] "Economic 
  8.30  development district" means a type of tax increment financing 
  8.31  district which consists of any project, or portions of a 
  8.32  project, not meeting the requirements found in the definition of 
  8.33  redevelopment district, renewal and renovation district, soils 
  8.34  condition district, or housing district, but which the authority 
  8.35  finds to be in the public interest because: 
  8.36     (1) it will discourage commerce, industry, or manufacturing 
  9.1   from moving their operations to another state or municipality; 
  9.2   or 
  9.3      (2) it will result in increased employment in the state; or 
  9.4      (3) it will result in preservation and enhancement of the 
  9.5   tax base of the state. 
  9.6      [EFFECTIVE DATE.] This section is effective for districts 
  9.7   for which the request for certification is made after June 30, 
  9.8   2001. 
  9.9      Sec. 6.  Minnesota Statutes 2000, section 469.175, 
  9.10  subdivision 1, is amended to read: 
  9.11     Subdivision 1.  [TAX INCREMENT FINANCING PLAN.] (a) A tax 
  9.12  increment financing plan shall contain:  
  9.13     (1) a statement of objectives of an authority for the 
  9.14  improvement of a project; 
  9.15     (2) a statement as to the development program for the 
  9.16  project, including the property within the project, if any, that 
  9.17  the authority intends to acquire; 
  9.18     (3) a list of any development activities that the plan 
  9.19  proposes to take place within the project, for which contracts 
  9.20  have been entered into at the time of the preparation of the 
  9.21  plan, including the names of the parties to the contract, the 
  9.22  activity governed by the contract, the cost stated in the 
  9.23  contract, and the expected date of completion of that activity; 
  9.24     (4) identification or description of the type of any other 
  9.25  specific development reasonably expected to take place within 
  9.26  the project, and the date when the development is likely to 
  9.27  occur; 
  9.28     (5) estimates of the following:  
  9.29     (i) cost of the project, including administration expenses; 
  9.30     (ii) amount of bonded indebtedness to be incurred; 
  9.31     (iii) sources of revenue to finance or otherwise pay public 
  9.32  costs; 
  9.33     (iv) (ii) the most recent net tax capacity of taxable real 
  9.34  property within the tax increment financing district and within 
  9.35  any subdistrict; 
  9.36     (v) (iii) the estimated captured net tax capacity of the 
 10.1   tax increment financing district at completion; and 
 10.2      (vi) (iv) the duration of the tax increment financing 
 10.3   district's and any subdistrict's existence; 
 10.4      (6) a budget specifying the following items for the project 
 10.5   to be paid with tax increments from the district: 
 10.6      (i) the total cost of the district, broken down by at least 
 10.7   the following items (to the extent the plan permits spending for 
 10.8   items within these categories): 
 10.9      (A) administrative expenses; 
 10.10     (B) property acquisition and site preparation, including 
 10.11  clearance and soils preparation; 
 10.12     (C) public improvements (other than public improvements 
 10.13  that are part of site preparation); and 
 10.14     (D) amounts for assistance to construct, acquire, or 
 10.15  improve other improvements or other forms of assistance paid to 
 10.16  private entities or individuals; 
 10.17     (ii) the amount of bonded indebtedness to be incurred; 
 10.18     (6) (7) statements of the authority's alternate estimates 
 10.19  of the impact of tax increment financing on the net tax 
 10.20  capacities of all taxing jurisdictions in which the tax 
 10.21  increment financing district is located in whole or in part.  
 10.22  For purposes of one statement, the authority shall assume that 
 10.23  the estimated captured net tax capacity would be available to 
 10.24  the taxing jurisdictions without creation of the district, and 
 10.25  for purposes of the second statement, the authority shall assume 
 10.26  that none of the estimated captured net tax capacity would be 
 10.27  available to the taxing jurisdictions without creation of the 
 10.28  district or subdistrict; 
 10.29     (7) (8) identification and description of studies and 
 10.30  analyses used to make the determination set forth in subdivision 
 10.31  3, clause (2); and 
 10.32     (8) (9) identification of all parcels to be included in the 
 10.33  district or any subdistrict. 
 10.34     (b) For a housing district, redevelopment district, or a 
 10.35  hazardous substance subdistrict, the authority may elect in the 
 10.36  tax increment financing plan to provide for the identification 
 11.1   of a minimum market value in the plan, development agreement, or 
 11.2   assessment agreement, and provide that increment is first 
 11.3   received by the authority when (1) the market value of the 
 11.4   improvements as determined by the assessor reaches or exceeds 
 11.5   the minimum market value, or (2) four years has elapsed from the 
 11.6   date of certification of the original net tax capacity of the 
 11.7   taxable real property in the district or subdistrict by the 
 11.8   county auditor, whichever is earlier. 
 11.9      [EFFECTIVE DATE.] The amendments to paragraph (a) are 
 11.10  effective for tax increment financing plans approved after June 
 11.11  30, 2001, and for amendments to tax increment financing plans 
 11.12  modifying the estimated project costs adopted after June 30, 
 11.13  2001.  The amendments to paragraph (b) are effective for 
 11.14  requests for certification of tax increment financing districts 
 11.15  received after June 30, 2001. 
 11.16     Sec. 7.  Minnesota Statutes 2000, section 469.175, is 
 11.17  amended by adding a subdivision to read: 
 11.18     Subd. 4a.  [FILING PLAN WITH STATE.] (a) The authority must 
 11.19  file a copy of the tax increment financing plan and amendments 
 11.20  to the plan with the commissioner of revenue.  The authority 
 11.21  must also file a copy of the development plan or the project 
 11.22  plan for the project area with the commissioner of revenue.  The 
 11.23  commissioner of revenue shall provide a copy of the plan to the 
 11.24  state auditor upon request. 
 11.25     (b) Filing under this subdivision must be made within 60 
 11.26  days after the latest of: 
 11.27     (1) the filing of the request for certification of the 
 11.28  district; 
 11.29     (2) approval of the plan by the municipality; or 
 11.30     (3) adoption of the plan by the authority. 
 11.31     [EFFECTIVE DATE.] This section is effective for plans and 
 11.32  amendments approved after July 1, 2000. 
 11.33     Sec. 8.  Minnesota Statutes 2000, section 469.176, 
 11.34  subdivision 1b, is amended to read: 
 11.35     Subd. 1b.  [DURATION LIMITS; TERMS.] (a) No tax increment 
 11.36  shall in any event be paid to the authority 
 12.1      (1) after 15 years after receipt by the authority of the 
 12.2   first increment for a renewal and renovation district, 
 12.3      (2) after 20 years after receipt by the authority of the 
 12.4   first increment for a soils condition district, 
 12.5      (3) after eight years after receipt by the authority of the 
 12.6   first increment for an economic development district, 
 12.7      (4) for a housing district or a redevelopment district, 
 12.8   after 20 years from the date of receipt by the authority of the 
 12.9   first tax increment by the authority pursuant to section 
 12.10  469.175, subdivision 1, paragraph (b); or, if no provision is 
 12.11  made under section 469.175, subdivision 1, paragraph (b), after 
 12.12  25 years from the date of receipt by the authority of the first 
 12.13  increment. 
 12.14     (b) For purposes of determining a duration limit under this 
 12.15  subdivision or subdivision 1e that is based on the receipt of an 
 12.16  increment, any increments from taxes payable in the year in 
 12.17  which the district terminates shall be paid to the authority.  
 12.18  This paragraph does not affect a duration limit calculated from 
 12.19  the date of approval of the tax increment financing plan or 
 12.20  based on the recovery of costs or to a duration limit under 
 12.21  subdivision 1c.  This paragraph does not supersede the 
 12.22  restrictions on payment of delinquent taxes in subdivision 1f. 
 12.23     (c) Except as authorized by section 469.175, subdivision 1, 
 12.24  paragraph (b), An action by the authority to waive or decline to 
 12.25  accept an increment has no effect for purposes of computing a 
 12.26  duration limit based on the receipt of increment under this 
 12.27  subdivision or any other provision of law.  The authority is 
 12.28  deemed to have received an increment for any year in which it 
 12.29  waived or declined to accept an increment, regardless of whether 
 12.30  the increment was paid to the authority. 
 12.31     (d) Receipt by a hazardous substance subdistrict of an 
 12.32  increment as a result of a reduction in original net tax 
 12.33  capacity under section 469.174, subdivision 7, paragraph (b), 
 12.34  does not constitute receipt of increment by the overlying 
 12.35  district for purpose of calculating the duration limit under 
 12.36  this section. 
 13.1      [EFFECTIVE DATE.] This section is effective for districts 
 13.2   for which the request for certification is made after June 30, 
 13.3   2001. 
 13.4      Sec. 9.  Minnesota Statutes 2000, section 469.176, 
 13.5   subdivision 1c, is amended to read: 
 13.6      Subd. 1c.  [DURATION LIMITS; PRE-1979 DISTRICTS.] For tax 
 13.7   increment financing districts created prior to August 1, 1979, 
 13.8   no tax increment shall be paid to the authority after April 1, 
 13.9   2001, or the term of a nondefeased bond or obligation 
 13.10  outstanding on April 1, 1990, secured by increments from the 
 13.11  district or project area, whichever time is greater, provided 
 13.12  that in no case will a tax increment be paid to an authority 
 13.13  after August 1, 2009, from such a district.  If a district's 
 13.14  termination date is extended beyond April 1, 2001, because bonds 
 13.15  were outstanding on April 1, 1990, with maturities extending 
 13.16  beyond April 1, 2001, the following restrictions apply.  No 
 13.17  Increment collected from the district may at any time, and 
 13.18  interest earned on increment from the district and received 
 13.19  after December 31, 2001, must be expended after April 1, 
 13.20  2001, except only to pay or defease (i) bonds issued before 
 13.21  April 1, 1990, or (ii) bonds issued to refund the principal of 
 13.22  the outstanding bonds and pay associated issuance costs, 
 13.23  provided the average maturity of the refunding bonds does not 
 13.24  exceed the bonds refunded.  When sufficient money has been 
 13.25  received to defease or pay the bonds, the tax increment project 
 13.26  or district must be decertified. 
 13.27     [EFFECTIVE DATE.] This section is effective for tax 
 13.28  increment financing districts and projects for which the request 
 13.29  for certification was made before August 2, 1979. 
 13.30     Sec. 10.  Minnesota Statutes 2000, section 469.176, 
 13.31  subdivision 1e, is amended to read: 
 13.32     Subd. 1e.  [DURATION LIMITS; HAZARDOUS SUBSTANCE 
 13.33  SUBDISTRICTS.] If a parcel of a district is part of a designated 
 13.34  hazardous substance site or a hazardous substance subdistrict, 
 13.35  tax increment may be paid to the authority from the parcel for 
 13.36  longer than the period otherwise provided by subdivisions 1 to 
 14.1   1f for the overlying district.  The extended period for 
 14.2   collection of tax increment begins on the date of receipt of the 
 14.3   first tax increment from the parcel that is more than any tax 
 14.4   increment received from the parcel before the date of the 
 14.5   certification under section 469.174, subdivision 7, paragraph 
 14.6   (b), and received after the date of certification to the county 
 14.7   auditor described in section 469.174, subdivision 7, paragraph 
 14.8   (b).  The extended period for collection of tax increment is the 
 14.9   lesser of:  (1) 25 years from the date of commencement of the 
 14.10  extended period or 20 years if the authority elects under 
 14.11  section 469.175, subdivision 1, paragraph (b), to defer receipt 
 14.12  of the first increment; or (2) the period necessary to recover 
 14.13  the costs of removal actions or remedial actions specified in a 
 14.14  development response action plan. 
 14.15     [EFFECTIVE DATE.] This section is effective for requests 
 14.16  for certification of subdistricts made after June 30, 2001. 
 14.17     Sec. 11.  Minnesota Statutes 2000, section 469.176, 
 14.18  subdivision 3, is amended to read: 
 14.19     Subd. 3.  [LIMITATION ON ADMINISTRATIVE EXPENSES.] (a) For 
 14.20  districts for which certification was requested before August 1, 
 14.21  1979, or after June 30, 1982, no tax increment shall be used to 
 14.22  pay any administrative expenses for a project which exceed ten 
 14.23  percent of the total tax increment expenditures authorized by 
 14.24  the tax increment financing plan or the total tax increment 
 14.25  expenditures for the project, whichever is less.  
 14.26     (b) For districts for which certification was requested 
 14.27  after July 31, 1979, and before July 1, 1982, no tax increment 
 14.28  shall be used to pay administrative expenses, as defined in 
 14.29  Minnesota Statutes 1980, section 273.73, for a project district 
 14.30  which exceeds five percent of the total tax increment 
 14.31  expenditures authorized by the tax increment financing plan or 
 14.32  the total tax increment expenditures for the project district, 
 14.33  whichever is less. 
 14.34     (c) For districts for which certification was requested 
 14.35  after June 30, 2001, no tax increment may be used to pay any 
 14.36  administrative expenses for a project which exceed ten percent 
 15.1   of total tax increment expenditures authorized by the tax 
 15.2   increment financing plan or the total tax increments from the 
 15.3   district, whichever is less. 
 15.4      [EFFECTIVE DATE.] This section is effective for districts 
 15.5   for which the request for certification is received after June 
 15.6   30, 2001. 
 15.7      Sec. 12.  Minnesota Statutes 2000, section 469.176, 
 15.8   subdivision 4, is amended to read: 
 15.9      Subd. 4.  [LIMITATION ON USE OF TAX INCREMENT; GENERAL 
 15.10  RULE.] (a) All revenues derived from Tax increment shall 
 15.11  increments must be used in accordance with the tax increment 
 15.12  financing plan, including the separate line items amounts 
 15.13  required by section 469.175, subdivision 1, clause (6).  If a 
 15.14  tax increment financing plan does not include an amount for a 
 15.15  separate line item required by section 469.175, subdivision 1, 
 15.16  clause (6), the amount for the line item is zero. 
 15.17     (b) The revenues shall tax increments may be used solely 
 15.18  for the following purposes: 
 15.19     (1) to pay the principal of and interest on bonds issued to 
 15.20  finance a project; 
 15.21     (2) as permitted by an enabling development authority law, 
 15.22  whether made by the authority or the municipality or another 
 15.23  entity authorized to exercise the powers of the respective 
 15.24  authority, as specified in paragraph (c). 
 15.25     (c) The following purposes are permitted: 
 15.26     (1) by a rural development financing authority for the 
 15.27  purposes stated in section 469.142,; 
 15.28     (2) by a port authority or municipality exercising the 
 15.29  powers of a port authority to finance or otherwise pay the cost 
 15.30  of redevelopment pursuant to under sections 469.048 to 469.068,; 
 15.31     (3) by an economic development authority to finance or 
 15.32  otherwise pay the cost of redevelopment pursuant to under 
 15.33  sections 469.090 to 469.108,; 
 15.34     (4) by a housing and redevelopment authority or economic 
 15.35  development authority to finance or otherwise pay public 
 15.36  redevelopment costs pursuant to under sections 469.001 to 
 16.1   469.047,; 
 16.2      (5) by a municipality or economic development authority to 
 16.3   finance or otherwise pay the capital and administration costs of 
 16.4   a development district pursuant to under sections 469.124 to 
 16.5   469.134,; 
 16.6      (6) by a municipality or authority to finance or otherwise 
 16.7   pay the costs of developing and implementing a development 
 16.8   action response plan,; 
 16.9      (7) by a municipality or redevelopment agency to finance or 
 16.10  otherwise pay premiums for insurance or other security 
 16.11  guaranteeing the payment when due of principal of and interest 
 16.12  on the bonds pursuant to under chapter 462C, sections 469.152 to 
 16.13  469.165, or both, or to accumulate and maintain a reserve 
 16.14  securing the payment when due of the principal of and interest 
 16.15  on the bonds pursuant to under chapter 462C, sections 469.152 to 
 16.16  469.165, or both, which revenues in the reserve shall may not 
 16.17  exceed, subsequent to after the fifth anniversary of the date of 
 16.18  issue of the first bond issue secured by the reserve, an amount 
 16.19  equal to 20 percent of the aggregate principal amount of the 
 16.20  outstanding and nondefeased bonds secured by the reserve. 
 16.21     [EFFECTIVE DATE.] This section is effective for tax 
 16.22  increment financing plans approved after June 30, 2001, and for 
 16.23  amendments to tax increment financing plans modifying the 
 16.24  estimated project costs approved after June 30, 2001.  Amounts 
 16.25  spent in excess of the estimates or budget items in the tax 
 16.26  increment financing plan are deemed to be spent in accordance 
 16.27  within the plan, notwithstanding that they exceeded the 
 16.28  estimates or budget items, for purposes of this section if the 
 16.29  plan and amendments to it were approved before July 1, 2001, and 
 16.30  if the total amounts spent are within the total estimated cost 
 16.31  under the plan for the district. 
 16.32     Sec. 13.  Minnesota Statutes 2000, section 469.176, 
 16.33  subdivision 4g, is amended to read: 
 16.34     Subd. 4g.  [GENERAL GOVERNMENT USE PROHIBITED.] (a) These 
 16.35  revenues shall Tax increments may not be used to circumvent 
 16.36  existing levy limit law.  
 17.1      (b) No revenues derived from tax increment from any 
 17.2   district, whether certified before or after August 1, 1979, 
 17.3   shall may be used for the acquisition, construction, renovation, 
 17.4   operation, or maintenance of a building to be used primarily and 
 17.5   regularly for conducting the business of a municipality, county, 
 17.6   school district, or any other local unit of government or the 
 17.7   state or federal government or for a commons area used as a 
 17.8   public park, or a facility used for social, recreational, or 
 17.9   conference purposes.  This provision shall does not prohibit the 
 17.10  use of revenues derived from tax increments for the construction 
 17.11  or renovation of a parking structure or of a privately owned 
 17.12  facility for conference purposes.  
 17.13     (b) If any publicly owned facility used for social, 
 17.14  recreational, or conference purposes and financed in whole or in 
 17.15  part from revenues derived from a district is operated or 
 17.16  managed by an entity other than the authority, the operating and 
 17.17  management policies of the facility must be approved by the 
 17.18  governing body of the authority. 
 17.19     (c)(1) Tax increments may not be used to pay for the cost 
 17.20  of public improvements, equipment, or other items, if: 
 17.21     (i) the improvements, equipment, or other items are located 
 17.22  outside of the area of the tax increment financing district from 
 17.23  which the increments were collected; and 
 17.24     (ii) the improvements, equipment, or items that (A) 
 17.25  primarily serve a decorative or aesthetic purpose, or (B) serve 
 17.26  a functional purpose, but their cost is increased by more than 
 17.27  100 percent as a result of the selection of materials, design, 
 17.28  or type as compared with more commonly used materials, designs, 
 17.29  or types for similar improvements, equipment, or items. 
 17.30     (2) The provisions of this paragraph do not apply to 
 17.31  expenditures related to the rehabilitation of historic 
 17.32  structures that are: 
 17.33     (i) individually listed on the National Register of 
 17.34  Historic Places; or 
 17.35     (ii) a contributing element to a historic district listed 
 17.36  on the National Register of Historic Places. 
 18.1      [EFFECTIVE DATE.] This section is effective for 
 18.2   expenditures of increment made after June 30, 2001. 
 18.3      Sec. 14.  Minnesota Statutes 2000, section 469.176, is 
 18.4   amended by adding a subdivision to read: 
 18.5      Subd. 41.  [PROHIBITED FACILITIES.] (a) No tax increment 
 18.6   from any district may be used for: 
 18.7      (1) a commons area used as a public park; or 
 18.8      (2) a facility used for social, recreational, or conference 
 18.9   purposes. 
 18.10     (b) This subdivision does not apply to a privately owned 
 18.11  facility for conference purposes or a parking structure. 
 18.12     [EFFECTIVE DATE.] This section is effective for 
 18.13  expenditures of increment made after June 30, 2001, but does not 
 18.14  apply to (1) expenditures made before January 1, 2000; (2) 
 18.15  expenditures made under a binding contract entered before 
 18.16  January 1, 2000; or (3) expenditures made under a binding 
 18.17  contract entered pursuant to a letter of intent with the 
 18.18  developer or contractor if the letter of intent was entered 
 18.19  before January 1, 2000. 
 18.20     Sec. 15.  Minnesota Statutes 2000, section 469.177, 
 18.21  subdivision 1, is amended to read: 
 18.22     Subdivision 1.  [ORIGINAL NET TAX CAPACITY.] (a) Upon or 
 18.23  after adoption of a tax increment financing plan, the auditor of 
 18.24  any county in which the district is situated shall, upon request 
 18.25  of the authority, certify the original net tax capacity of the 
 18.26  tax increment financing district and that portion of the 
 18.27  district overlying any subdistrict as described in the tax 
 18.28  increment financing plan and shall certify in each year 
 18.29  thereafter the amount by which the original net tax capacity has 
 18.30  increased or decreased as a result of a change in tax exempt 
 18.31  status of property within the district and any subdistrict, 
 18.32  reduction or enlargement of the district or changes pursuant to 
 18.33  subdivision 4.  
 18.34     (b) For districts approved under section 469.175, 
 18.35  subdivision 3, or parcels added to existing districts after May 
 18.36  1, 1988, if the classification under section 273.13 of property 
 19.1   located in a district changes to a classification that has a 
 19.2   different assessment ratio, the original net tax capacity of 
 19.3   that property must be redetermined at the time when its use is 
 19.4   changed as if the property had originally been classified in the 
 19.5   same class in which it is classified after its use is changed. 
 19.6      (c) The amount to be added to the original net tax capacity 
 19.7   of the district as a result of previously tax exempt real 
 19.8   property within the district becoming taxable equals the net tax 
 19.9   capacity of the real property as most recently assessed pursuant 
 19.10  to section 273.18 or, if that assessment was made more than one 
 19.11  year prior to the date of title transfer rendering the property 
 19.12  taxable, the net tax capacity assessed by the assessor at the 
 19.13  time of the transfer.  If improvements are made to tax exempt 
 19.14  property after certification of the district and before the 
 19.15  parcel becomes taxable, the assessor shall, at the request of 
 19.16  the authority, separately assess the estimated market value of 
 19.17  the improvements.  If the property becomes taxable, the county 
 19.18  auditor shall add to original net tax capacity, the net tax 
 19.19  capacity of the parcel, excluding the separately assessed 
 19.20  improvements.  If substantial taxable improvements were made to 
 19.21  a parcel after certification of the district and if the property 
 19.22  later becomes tax exempt, in whole or part, as a result of the 
 19.23  authority acquiring the property through foreclosure or exercise 
 19.24  of remedies under a lease or other revenue agreement or as a 
 19.25  result of tax forfeiture, the amount to be added to the original 
 19.26  net tax capacity of the district as a result of the property 
 19.27  again becoming taxable is the amount of the parcel's value that 
 19.28  was included in original net tax capacity when the parcel was 
 19.29  first certified.  The amount to be added to the original net tax 
 19.30  capacity of the district as a result of enlargements equals the 
 19.31  net tax capacity of the added real property as most recently 
 19.32  certified by the commissioner of revenue as of the date of 
 19.33  modification of the tax increment financing plan pursuant to 
 19.34  section 469.175, subdivision 4. 
 19.35     (d) For districts approved under section 469.175, 
 19.36  subdivision 3, or parcels added to existing districts after May 
 20.1   1, 1988, if the net tax capacity of a property increases because 
 20.2   the property no longer qualifies under the Minnesota 
 20.3   Agricultural Property Tax Law, section 273.111; the Minnesota 
 20.4   Open Space Property Tax Law, section 273.112; or the 
 20.5   Metropolitan Agricultural Preserves Act, chapter 473H, or 
 20.6   because platted, unimproved property is improved or three years 
 20.7   pass after approval of the plat under section 273.11, 
 20.8   subdivision 1, the increase in net tax capacity must be added to 
 20.9   the original net tax capacity.  
 20.10     (e) The amount to be subtracted from the original net tax 
 20.11  capacity of the district as a result of previously taxable real 
 20.12  property within the district becoming tax exempt, or a reduction 
 20.13  in the geographic area of the district, shall be the amount of 
 20.14  original net tax capacity initially attributed to the property 
 20.15  becoming tax exempt or being removed from the district.  If the 
 20.16  net tax capacity of property located within the tax increment 
 20.17  financing district is reduced by reason of a court-ordered 
 20.18  abatement, stipulation agreement, voluntary abatement made by 
 20.19  the assessor or auditor or by order of the commissioner of 
 20.20  revenue, the reduction shall be applied to the original net tax 
 20.21  capacity of the district when the property upon which the 
 20.22  abatement is made has not been improved since the date of 
 20.23  certification of the district and to the captured net tax 
 20.24  capacity of the district in each year thereafter when the 
 20.25  abatement relates to improvements made after the date of 
 20.26  certification.  The county auditor may specify reasonable form 
 20.27  and content of the request for certification of the authority 
 20.28  and any modification thereof pursuant to section 469.175, 
 20.29  subdivision 4.  
 20.30     (f) If a parcel of property contained a substandard 
 20.31  building that was demolished or removed and if the authority 
 20.32  elects to treat the parcel as occupied by a substandard building 
 20.33  under section 469.174, subdivision 10, paragraph (b), the 
 20.34  auditor shall certify the original net tax capacity of the 
 20.35  parcel using the greater of (1) the current net tax capacity of 
 20.36  the parcel, or (2) the estimated market value of the parcel for 
 21.1   the year in which the building was demolished or removed, but 
 21.2   applying the class rates for the current year. 
 21.3      [EFFECTIVE DATE.] This section is effective for parcels 
 21.4   that become taxable after June 30, 2001, and applies to tax 
 21.5   increment financing districts, regardless of when the request 
 21.6   for certification was made. 
 21.7      Sec. 16.  Minnesota Statutes 2000, section 469.1771, 
 21.8   subdivision 1, is amended to read: 
 21.9      Subdivision 1.  [ENFORCEMENT.] (a) The owner of taxable 
 21.10  property located in the city, town, school district, or county 
 21.11  in which the tax increment financing district is located may 
 21.12  bring suit for equitable relief or for damages, as provided in 
 21.13  subdivisions 2, 3, and 4, arising out of a failure of a 
 21.14  municipality or authority to comply with the provisions of 
 21.15  sections 469.174 to 469.179 469.1799, or related provisions of 
 21.16  this chapter.  The prevailing party in a suit filed under the 
 21.17  preceding sentence is entitled to costs, including reasonable 
 21.18  attorney fees. 
 21.19     (b) The state auditor may examine and audit political 
 21.20  subdivisions' use of tax increment financing.  Without previous 
 21.21  notice, the state auditor may examine or audit accounts and 
 21.22  records on a random basis as the auditor deems to be in the 
 21.23  public interest.  If the state auditor finds evidence that an 
 21.24  authority or municipality has violated a provision of the law 
 21.25  for which a remedy is provided under this section, the state 
 21.26  auditor shall forward the relevant information to the county 
 21.27  attorney.  The county attorney may bring an action to enforce 
 21.28  the provisions of sections 469.174 to 469.179 469.1799 or 
 21.29  related provisions of this chapter, for matters referred by the 
 21.30  state auditor or on behalf of the county.  If the county 
 21.31  attorney determines not to bring an action or if the county 
 21.32  attorney has not brought an action within 12 months after 
 21.33  receipt of the initial notification by the state auditor of the 
 21.34  violation, the county attorney shall notify the state auditor in 
 21.35  writing. 
 21.36     (c) If the state auditor finds an authority is not in 
 22.1   compliance with sections 469.174 to 469.179 469.1799 or related 
 22.2   provisions of law, the auditor shall notify the governing body 
 22.3   of the municipality that approved the tax increment financing 
 22.4   district of its findings.  The governing body of the 
 22.5   municipality must respond in writing to the state auditor within 
 22.6   60 days after receiving the notification.  Its written response 
 22.7   must state whether the municipality accepts, in whole or part, 
 22.8   the auditor's findings.  If the municipality does not accept the 
 22.9   findings, the statement must indicate the basis for its 
 22.10  disagreement.  The state auditor shall annually summarize the 
 22.11  responses it receives under this section and send the summary 
 22.12  and copies of the responses to the chairs of the committees of 
 22.13  the legislature with jurisdiction over tax increment financing. 
 22.14     (d) The state auditor shall notify the attorney general in 
 22.15  writing and provide supporting materials for a violation found 
 22.16  by the auditor, if the: 
 22.17     (1) auditor receives notification from the county attorney 
 22.18  under paragraph (b) or receives no notification for a 12-month 
 22.19  period after initially notifying the county attorney and the 
 22.20  state auditor confirms with the county attorney or the 
 22.21  municipality that no action has been brought regarding the 
 22.22  matter; and 
 22.23     (2) municipality or development authority have not 
 22.24  eliminated or resolved the violation to the satisfaction of the 
 22.25  state auditor. 
 22.26  The auditor shall provide the municipality and development 
 22.27  authority a copy of the notification sent to the attorney 
 22.28  general. 
 22.29     [EFFECTIVE DATE.] This section applies to violations 
 22.30  occurring after July 1, 2001. 
 22.31     Sec. 17.  Minnesota Statutes 2000, section 469.178, is 
 22.32  amended by adding a subdivision to read: 
 22.33     Subd. 7.  [INTERFUND LOANS.] The authority or municipality 
 22.34  may advance or loan money to finance expenditures under section 
 22.35  469.176, subdivision 4, from its general fund or any other fund 
 22.36  under which it has legal authority to do so.  The loan or 
 23.1   advance must be approved, by resolution of the governing body, 
 23.2   before money is transferred, advanced, or spent.  The terms and 
 23.3   conditions for repayment of the loan must be provided in writing 
 23.4   and include, at a minimum, the principal amount, the interest 
 23.5   rate, maturity, and repayment schedule.  The maximum rate of 
 23.6   interest permitted to be charged is limited to the greater of 
 23.7   the rates specified under section 270.75 or 549.09. 
 23.8      [EFFECTIVE DATE.] This section is effective for loans and 
 23.9   advances made after June 30, 2001.  Interfund loans and advances 
 23.10  made before July 1, 2001, are ratified and approved, subject to 
 23.11  the requirement that interest accrued or paid after July 1, 
 23.12  2001, may not exceed the limit in this section. 
 23.13     Sec. 18.  Minnesota Statutes 2000, section 469.1812, 
 23.14  subdivision 2, is amended to read: 
 23.15     Subd. 2.  [GOVERNING BODY.] "Governing body" means, for a 
 23.16  city, the city council; for a school district, the school board; 
 23.17  for a county, the county board; and for a town, the annual 
 23.18  meeting of the town board of supervisors. 
 23.19     [EFFECTIVE DATE.] This section is effective retroactive to 
 23.20  May 26, 1999. 
 23.21     Sec. 19.  Minnesota Statutes 2000, section 469.1813, 
 23.22  subdivision 4, is amended to read: 
 23.23     Subd. 4.  [PROPERTY LOCATED IN TAX INCREMENT FINANCING 
 23.24  DISTRICTS.] The governing body of a political subdivision may 
 23.25  not enter into a property tax abatement agreement under sections 
 23.26  469.1812 to 469.1815 that provides for abatement of taxes on a 
 23.27  parcel, if the abatement will occur either: 
 23.28     (1) while the parcel is located in a tax increment 
 23.29  financing district; or 
 23.30     (2) within two years after the parcel was eliminated from a 
 23.31  tax increment financing district, other than by decertification 
 23.32  of the entire district. 
 23.33     [EFFECTIVE DATE.] This section is effective for abatement 
 23.34  resolutions approved after June 30, 2001. 
 23.35     Sec. 20.  Minnesota Statutes 2000, section 469.1813, 
 23.36  subdivision 6, is amended to read: 
 24.1      Subd. 6.  [DURATION LIMIT.] (a) A political subdivision may 
 24.2   grant an abatement for a period no longer than ten years, except 
 24.3   as provided under paragraph (b).  The subdivision may specify in 
 24.4   the abatement resolution a shorter duration.  If the resolution 
 24.5   does not specify a period of time, the abatement is for eight 
 24.6   years.  If an abatement has been granted to a parcel of property 
 24.7   and the period of the abatement has expired, the political 
 24.8   subdivision that granted the abatement may not grant another 
 24.9   abatement for eight years after the expiration of the first 
 24.10  abatement.  This prohibition does not apply to improvements 
 24.11  added after and not subject to the first abatement. 
 24.12     (b) A political subdivision proposing to abate taxes for a 
 24.13  parcel may request, in writing, that the other political 
 24.14  subdivisions in which the parcel is located grant an abatement 
 24.15  for the property.  If one of the other political subdivisions 
 24.16  declines, in writing, to grant an abatement or if 90 days pass 
 24.17  after receipt of the request to grant an abatement without a 
 24.18  written response from one of the political subdivisions, the 
 24.19  duration limit for an abatement for the parcel by the requesting 
 24.20  political subdivision and any other participating political 
 24.21  subdivision is increased to 15 years.  If the political 
 24.22  subdivision which declined to grant an abatement later grants an 
 24.23  abatement for the parcel, the 15-year duration limit is reduced 
 24.24  by one year for each year that the declining political 
 24.25  subdivision grants an abatement for the parcel during the period 
 24.26  of the abatement granted by the requesting political 
 24.27  subdivision.  The duration limit may not be reduced below the 
 24.28  limit under paragraph (a).  
 24.29     [EFFECTIVE DATE.] This section is effective for abatements 
 24.30  approved after the day following final enactment. 
 24.31     Sec. 21.  Minnesota Statutes 2000, section 475.58, 
 24.32  subdivision 1, is amended to read: 
 24.33     Subdivision 1.  [APPROVAL BY ELECTORS; EXCEPTIONS.] 
 24.34  Obligations authorized by law or charter may be issued by any 
 24.35  municipality upon obtaining the approval of a majority of the 
 24.36  electors voting on the question of issuing the obligations, but 
 25.1   an election shall not be required to authorize obligations 
 25.2   issued: 
 25.3      (1) to pay any unpaid judgment against the municipality; 
 25.4      (2) for refunding obligations; 
 25.5      (3) for an improvement or improvement program, which 
 25.6   obligation is payable wholly or partly from the proceeds of 
 25.7   special assessments levied upon property specially benefited by 
 25.8   the improvement or by an improvement within the improvement 
 25.9   program, or of taxes levied upon the increased value of property 
 25.10  within a district for the development of which the improvement 
 25.11  is undertaken, including obligations which are the general 
 25.12  obligations of the municipality, if the municipality is entitled 
 25.13  to reimbursement in whole or in part from the proceeds of such 
 25.14  special assessments or taxes and not less than 20 percent of the 
 25.15  cost of the improvement or the improvement program is to be 
 25.16  assessed against benefited property or is to be paid from the 
 25.17  proceeds of federal grant funds or a combination thereof, or is 
 25.18  estimated to be received from such taxes within the district; 
 25.19     (4) payable wholly from the income of revenue producing 
 25.20  conveniences; 
 25.21     (5) under the provisions of a home rule charter which 
 25.22  permits the issuance of obligations of the municipality without 
 25.23  election; 
 25.24     (6) under the provisions of a law which permits the 
 25.25  issuance of obligations of a municipality without an election; 
 25.26     (7) to fund pension or retirement fund liabilities pursuant 
 25.27  to section 475.52, subdivision 6; 
 25.28     (8) under a capital improvement plan under section 373.40; 
 25.29     (9) to fund facilities as provided in subdivision 3; and 
 25.30     (10) under sections 469.1813 to 469.1815 (property tax 
 25.31  abatement authority bonds), if the proceeds of the bonds are not 
 25.32  used for a purpose prohibited under section 469.176, subdivision 
 25.33  4g, paragraph (b). 
 25.34     [EFFECTIVE DATE.] This section is effective for bonds 
 25.35  issued or sold after the day following final enactment. 
 25.36     Sec. 22.  Laws 1997, chapter 231, article 10, section 25, 
 26.1   is amended to read: 
 26.2      Sec. 25.  [EFFECTIVE DATE.] 
 26.3      Sections 1, 3 to 6, 7, and 10, are effective for districts 
 26.4   for which the requests for certification are made after June 30, 
 26.5   1997. 
 26.6      Section 2, clauses clause (1) and (4), are is effective for 
 26.7   all districts for which regardless of when the requests for 
 26.8   certification were made after July 31, 1979, and for payments 
 26.9   and investment earnings received after July 1, 1997 and 
 26.10  regardless of when the increments were received.  Section 2, 
 26.11  clauses (2) and (3), are effective for districts for which the 
 26.12  request for certification was made after June 30, 1982, and 
 26.13  proceeds from sales and leases of properties purchased by the 
 26.14  authority after June 30, 1997, and repayments of advances and 
 26.15  loans that were made after June 30, 1997.  Section 2, clause 
 26.16  (4), is effective for districts for which the requests for 
 26.17  certification were made (i) after July 31, 1979, and for 
 26.18  investment earnings received after July 1, 1997, and (ii) before 
 26.19  August 1, 1979, and for investment earnings received after 
 26.20  December 31, 2001. 
 26.21     Sections 8 and 9 apply to all tax increment districts, 
 26.22  whenever certified, insofar as the underlying law applies to 
 26.23  them, and any uses of tax increment expended prior to the date 
 26.24  of enactment of this act which are in compliance with the 
 26.25  provisions of those sections are deemed valid. 
 26.26     Sections 12 and 13 are effective on the day the chief 
 26.27  clerical officer of the city of Columbia Heights complies with 
 26.28  Minnesota Statutes, sections 645.021, subdivision 3. 
 26.29     Sections 17 to 20 are effective the day following final 
 26.30  enactment and upon compliance by the governing body with 
 26.31  Minnesota Statutes, section 645.021, subdivision 3. 
 26.32     Section 24 is effective the day following final enactment. 
 26.33     [EFFECTIVE DATE.] This section is effective the day 
 26.34  following final enactment. 
 26.35     Sec. 23.  Laws 2000, chapter 490, article 11, section 26, 
 26.36  the effective date, is amended to read: 
 27.1      EFFECTIVE DATE:  This section is effective for increments 
 27.2   spent after July 1, 2000, from districts for which certification 
 27.3   was requested after May 1, 1990 June 30, 1982. 
 27.4      [EFFECTIVE DATE.] This section is effective the day 
 27.5   following final enactment. 
 27.6      Sec. 24.  [HOLMAN DECREE HOUSING.] 
 27.7      To implement a federal court order or decree relating to 
 27.8   the provision of low-rent public housing finance, in whole or in 
 27.9   part, with federal financial assistance under section 5 of the 
 27.10  United States Housing Act, or any successor legislation, the 
 27.11  Minneapolis public housing authority or the metropolitan 
 27.12  council, acting under the powers of Minnesota Statutes, sections 
 27.13  469.001 to 469.047, may enter a cooperation agreement with the 
 27.14  governing body of any municipality or county within the 
 27.15  metropolitan area, as defined in Minnesota Statutes, section 
 27.16  473.121, subdivision 2, to provide exemption from all real and 
 27.17  personal taxes levied or imposed by the state, city, county, or 
 27.18  other political subdivision, for which the Minneapolis public 
 27.19  housing authority or the metropolitan council shall make, or 
 27.20  cause to be made, payments in lieu of taxes as provided under 
 27.21  Minnesota Statutes, section 469.040.  This exemption and 
 27.22  obligation to make payments in lieu of taxes continues until the 
 27.23  housing is no longer subject to the provisions of section 5 of 
 27.24  the United States Housing Act, or any successor legislation. 
 27.25     [EFFECTIVE DATE.] This section is effective with respect to 
 27.26  any cooperation agreement entered into on or after November 1, 
 27.27  1997.  Any owner of low-rent public housing acquired and 
 27.28  renovated or constructed under a cooperation agreement under 
 27.29  this section may apply for abatement of the real or personal 
 27.30  property taxes under Minnesota Statutes, section 375.192, 
 27.31  notwithstanding the time limitation for filing application under 
 27.32  section 375.192.  This section applies in counties of Anoka, 
 27.33  Carver, Dakota, Hennepin, Ramsey, Scott, and Washington.