1.1 CONFERENCE COMMITTEE REPORT ON H.F. NO. 2498
1.2 A bill for an act
1.3 relating to the financing and operation of government
1.4 in this state; providing a sales tax rebate; providing
1.5 property tax reform; making changes to income,
1.6 franchise, sales and use, property, motor vehicle
1.7 sales, motor vehicle registration, mortgage registry,
1.8 deed, motor fuels, cigarette and tobacco, liquor,
1.9 insurance premiums, lawful gambling, minerals, estate,
1.10 and special taxes; changing and allowing tax credits,
1.11 subtractions, and exemptions, including an income tax
1.12 subtraction for capital gains; providing a biomedical
1.13 innovation initiative; conforming with changes in
1.14 federal income tax provisions; providing for
1.15 allocation and apportionment of income; imposing a
1.16 state general tax levy on certain property; providing
1.17 a property tax homestead credit; imposing general levy
1.18 limits; providing for property tax levy reverse
1.19 referenda; changing property tax valuation,
1.20 assessment, levy, classification, homestead, credit,
1.21 aid, exemption, deferral, review, appeal, abatement,
1.22 and distribution provisions; abolishing certain
1.23 property tax levies for transit and establishing a
1.24 transit fund; providing and modifying certain aids to
1.25 local units of government; changing levy authority;
1.26 reducing certain utility taxes and requiring a
1.27 corresponding rate reduction; changing certain
1.28 provisions relating to biomass facilities; providing
1.29 for disposition of local lodging tax proceeds;
1.30 providing priorities for disposition of production tax
1.31 proceeds by the iron range resources and
1.32 rehabilitation board; providing for certain payments
1.33 in lieu of taxes; reducing rates on lawful gambling
1.34 taxes; reducing rates on solid waste management taxes;
1.35 providing for state takeover of certain costs of
1.36 district court administration and out-of-home
1.37 placement; providing for uniform sales and use tax
1.38 administration; providing for taxation and incentive
1.39 payments on forest lands; providing for electronic
1.40 filing and payment of taxes; changing procedures for
1.41 disposition of seized contraband; abolishing certain
1.42 health care provider taxes and health plan premium
1.43 taxes; providing for deposit of certain tobacco
1.44 settlement and cigarette tax proceeds to the health
1.45 care access fund; changing tax increment financing
2.1 provisions and authorizing certain grants, duration
2.2 extensions, and expenditures; requiring registration
2.3 of tax increment financing consultants; creating a
2.4 health care access fund reserve; reducing the tax on
2.5 life insurance premiums; increasing property tax
2.6 refunds and changing calculation of rent constituting
2.7 property taxes for purposes of property tax refunds;
2.8 reducing taconite production tax and occupation tax
2.9 rates; providing special authority to certain
2.10 political subdivisions; authorizing special taxing
2.11 districts; changing and clarifying tax administration,
2.12 collection, enforcement, interest, and penalty
2.13 provisions; changing revenue recapture provisions;
2.14 authorizing abatements and waivers of fees and certain
2.15 taxes in disaster areas; changing and imposing fees;
2.16 changing debt collection provisions for student loans;
2.17 providing certain duties and powers to the
2.18 commissioner of revenue; authorizing publication of
2.19 names of certain delinquent taxpayers; authorizing
2.20 border city allocations; changing provisions relating
2.21 to tax-forfeited lands and providing for tax-forfeited
2.22 lands transfers; defining terms; classifying data;
2.23 establishing a legislative commission; requiring
2.24 studies; imposing a criminal penalty; appropriating
2.25 money; amending Minnesota Statutes 2000, sections
2.26 16D.08, subdivision 2; 62J.041, subdivision 1;
2.27 62Q.095, subdivision 6; 69.021, subdivision 5; 84.922,
2.28 by adding a subdivision; 88.49, subdivisions 5, 9a;
2.29 88.491, subdivision 2; 97A.065, subdivision 2;
2.30 103D.905, subdivision 3; 115B.24, subdivision 2;
2.31 123B.55; 126C.01, subdivision 3; 126C.13, subdivision
2.32 4; 126C.17, by adding a subdivision; 144.3831,
2.33 subdivision 2; 168.013, subdivision 1a; 174.24,
2.34 subdivision 3b; 179A.101, subdivision 1; 179A.102,
2.35 subdivision 6; 179A.103, subdivision 1; 214.16,
2.36 subdivisions 2, 3; 216B.2424, subdivision 5; 239.101,
2.37 subdivision 3; 260.765, by adding a subdivision;
2.38 260.771, by adding a subdivision; 270.06; 270.07,
2.39 subdivision 3; 270.11, by adding a subdivision;
2.40 270.12, subdivision 2; 270.271, subdivisions 1, 3;
2.41 270.60, subdivision 4, by adding a subdivision;
2.42 270.70, subdivision 13; 270.73, subdivision 1;
2.43 270.771; 270.78; 270A.03, subdivisions 5, 7; 270A.11;
2.44 270B.01, subdivision 8; 270B.02, subdivisions 2, 3;
2.45 270B.03, subdivision 6; 270B.14, subdivision 1;
2.46 271.01, subdivision 5; 271.21, subdivision 2; 272.02,
2.47 subdivisions 9, 10, 22, by adding subdivisions;
2.48 273.061, subdivisions 1, 2, 8; 273.072, subdivision 1;
2.49 273.11, subdivisions 1a, 14, by adding subdivisions;
2.50 273.1104, subdivision 2; 273.111, subdivision 4;
2.51 273.121; 273.124, subdivisions 8, 13, 14; 273.13,
2.52 subdivisions 22, 23, 24, 25, 31; 273.1392; 273.1393;
2.53 273.1398, subdivisions 1a, 4a, by adding subdivisions;
2.54 274.01, subdivision 1; 274.13, subdivision 1; 275.02;
2.55 275.065, subdivisions 1, 3, 5a, 6, 8, by adding a
2.56 subdivision; 275.066; 275.07, subdivision 1; 275.16;
2.57 275.62, subdivision 1; 275.70, subdivision 5, by
2.58 adding subdivisions; 276.04, subdivision 2; 276.11,
2.59 subdivision 1; 276A.01, subdivision 3; 276A.06,
2.60 subdivision 3; 282.01, subdivisions 1a, 1b; 282.04,
2.61 subdivision 2; 287.035; 287.04; 287.08; 287.12;
2.62 287.13, by adding a subdivision; 287.20, subdivisions
2.63 2, 9; 287.21, subdivision 1; 287.28; 289A.02,
2.64 subdivision 7, by adding a subdivision; 289A.08,
2.65 subdivision 16; 289A.11, subdivision 1; 289A.12,
2.66 subdivision 3; 289A.18, subdivision 4; 289A.20,
2.67 subdivisions 1, 2, 4; 289A.26, subdivision 2a;
2.68 289A.31, subdivision 7; 289A.50, subdivisions 2, 2a;
2.69 289A.60, subdivisions 7, 21; 290.01, subdivisions 6b,
2.70 7, 19, 19b, 19c, 19d, 22, 29, 31, by adding a
2.71 subdivision; 290.014, subdivision 5; 290.05,
3.1 subdivision 1; 290.06, subdivisions 2c, 22; 290.067,
3.2 subdivisions 1, 2, 2b; 290.0671, subdivisions 1, 1a,
3.3 7; 290.0674, subdivisions 1, 2; 290.0675, subdivisions
3.4 1, 3; 290.068, subdivisions 1, 3, 4; 290.091,
3.5 subdivisions 2, 3; 290.0921, subdivisions 1, 2, 3, 6;
3.6 290.0922, subdivision 2; 290.093; 290.095, subdivision
3.7 2; 290.17, subdivisions 1, 4; 290.191, subdivisions 2,
3.8 3; 290.21, subdivision 4; 290.9725; 290A.03,
3.9 subdivisions 6, 11, 12, 13, 15; 290A.04, subdivisions
3.10 2, 2a, 4; 290A.15; 291.005, subdivision 1; 295.55,
3.11 subdivision 4; 296A.15, subdivisions 1, 7; 296A.16,
3.12 subdivision 2; 296A.21, subdivisions 1, 4; 296A.24,
3.13 subdivisions 1, 2; 297A.01, subdivision 3; 297A.07,
3.14 subdivision 3; 297A.25, subdivisions 3, 11, 28;
3.15 297A.61, subdivisions 2, 3, 4, 6, 7, 9, 10, 12, 14,
3.16 16, 17, 19, 22, 23, by adding subdivisions; 297A.62,
3.17 subdivision 3; 297A.64, subdivisions 3, 4; 297A.66,
3.18 subdivisions 1, 3; 297A.67, subdivisions 2, 8, 23, 24,
3.19 25, by adding subdivisions; 297A.68, subdivisions 2,
3.20 3, 5, 11, 13, 14, 18, 25, by adding subdivisions;
3.21 297A.69, subdivision 2; 297A.70, subdivisions 1, 2, 3,
3.22 4, 7, 8, 10, 13, 14; 297A.71, subdivisions 3, 6, by
3.23 adding subdivisions; 297A.72, subdivision 1; 297A.75;
3.24 297A.77, subdivision 1; 297A.80; 297A.82, subdivision
3.25 3, by adding a subdivision; 297A.89, subdivision 1;
3.26 297A.90, subdivision 1; 297A.91; 297A.92, subdivision
3.27 2; 297A.94; 297A.99, subdivisions 7, 9, 11; 297B.03;
3.28 297B.09, subdivision 1; 297E.02, subdivisions 1, 4, 6;
3.29 297E.16, subdivisions 1, 2; 297F.09, subdivision 7;
3.30 297F.10, subdivision 1; 297F.16, subdivision 4;
3.31 297F.20, subdivision 3; 297F.21, subdivisions 1, 2, 3;
3.32 297G.09, subdivision 6; 297G.15, subdivision 4;
3.33 297G.16, subdivisions 5, 7; 297G.20, subdivisions 3,
3.34 4; 297H.02, subdivision 2; 297H.03, subdivision 2;
3.35 297H.04, subdivision 2, by adding a subdivision;
3.36 297H.05; 297H.06, by adding a subdivision; 297H.13, by
3.37 adding a subdivision; 297I.05, by adding a
3.38 subdivision; 297I.15, by adding a subdivision;
3.39 297I.20; 297I.35, subdivision 2; 297I.40, subdivisions
3.40 1, 2, 7; 297I.85, subdivision 7; 298.01, subdivisions
3.41 3, 3a, 3b, 4, 4a, 4c; 298.22, subdivision 2, by adding
3.42 a subdivision; 298.225, subdivision 1; 298.24,
3.43 subdivision 1; 298.27; 298.28, subdivisions 6, 9a;
3.44 298.2961, subdivision 2; 298.75, subdivisions 1, 2, by
3.45 adding a subdivision; 299D.03, subdivision 5; 345.41;
3.46 345.42, by adding a subdivision; 349.19, subdivision
3.47 2a; 357.021, subdivision 1a; 461.12, by adding a
3.48 subdivision; 469.040, subdivision 5; 469.169, by
3.49 adding a subdivision; 469.1732, subdivision 1;
3.50 469.174, subdivisions 1, 3, 10, 10a, 12, 25; 469.175,
3.51 subdivisions 1, 3, 6, 6b, by adding a subdivision;
3.52 469.176, subdivisions 1b, 1c, 1e, 3, 4, 4g, by adding
3.53 a subdivision; 469.1763, subdivision 6; 469.177,
3.54 subdivisions 1, 11, by adding a subdivision; 469.1771,
3.55 subdivision 1; 469.178, by adding a subdivision;
3.56 469.1791, subdivisions 1, 3, 9; 469.1812, subdivision
3.57 2; 469.1813, subdivisions 4, 6; 469.190, subdivision
3.58 3; 469.202, subdivision 2; 473.388, subdivisions 4, 7;
3.59 473.446, subdivision 1, by adding a subdivision;
3.60 473.843, subdivision 3; 473F.08, subdivision 3;
3.61 473H.10, subdivision 3; 475.58, subdivision 1;
3.62 477A.011, subdivisions 35, 36; 477A.0121, by adding a
3.63 subdivision; 477A.0122, by adding a subdivision;
3.64 477A.013, subdivisions 1, 9; 477A.03, subdivision 2,
3.65 by adding a subdivision; 477A.12; 477A.14; 480.181,
3.66 subdivision 1; 487.33, subdivision 5; 574.34,
3.67 subdivision 1; Laws 1986, chapter 396, section 5; Laws
3.68 1997, chapter 231, article 10, section 25; Laws 1998,
3.69 chapter 389, article 16, section 35, subdivision 1;
3.70 Laws 1999, chapter 216, article 7, section 46,
3.71 subdivision 3; Laws 1999, chapter 243, article 4,
4.1 section 19; Laws 2000, chapter 490, article 8, section
4.2 17; Laws 2000, chapter 490, article 11, section 26;
4.3 proposing coding for new law in Minnesota Statutes,
4.4 chapters 3; 12; 16A; 62Q; 103B; 116J; 123B; 144F; 245;
4.5 256L; 270; 272; 273; 275; 290; 290A; 295; 296A; 297A;
4.6 469; 471; 473; 477A; 480; 484; proposing coding for
4.7 new law as Minnesota Statutes, chapters 126C; 216B;
4.8 290C; repealing Minnesota Statutes 2000, sections
4.9 13.4967, subdivision 3; 16A.1521; 16A.76; 62T.10;
4.10 126C.13, subdivisions 1, 2, 3; 144.1484, subdivision
4.11 2; 256L.02, subdivision 3; 270.31; 270.32; 270.33;
4.12 270.34; 270.35; 270.36; 270.37; 270.38; 270.39;
4.13 273.13, subdivision 24a; 273.1382; 273.1399; 275.078;
4.14 275.08, subdivision 1e; 289A.60, subdivision 15;
4.15 290.06, subdivisions 25, 26; 290.0673; 290.095,
4.16 subdivisions 1a, 7; 290.191, subdivision 4; 290.21,
4.17 subdivision 3; 290.23; 290.25; 290.31, subdivisions 2,
4.18 2a, 3, 4, 5, 19; 290.35; 290.9726, subdivision 7;
4.19 290A.04, subdivision 2j; 290A.18, subdivision 2;
4.20 295.50; 295.51; 295.52; 295.53; 295.54; 295.55;
4.21 295.56; 295.57; 295.58; 295.582; 295.59; 296A.16,
4.22 subdivision 6; 296A.24, subdivision 3; 297A.61,
4.23 subdivision 16; 297A.62, subdivision 2; 297A.64,
4.24 subdivision 1; 297A.68, subdivision 21; 297A.71,
4.25 subdivisions 2, 15, 16, 21; 297B.032; 297E.16,
4.26 subdivision 3; 297F.21, subdivision 4; 297G.20,
4.27 subdivision 5; 297I.05, subdivisions 5, 8; 297I.30,
4.28 subdivision 3; 298.01, subdivisions 3c, 3d, 4d, 4e;
4.29 469.1732, subdivision 2; 469.1734, subdivision 4;
4.30 469.1782, subdivision 1; 473.446, subdivision 8; Laws
4.31 1988, chapter 426, section 1; Laws 1988, chapter 702,
4.32 section 16; Laws 1992, chapter 511, article 2, section
4.33 52, as amended; Laws 1996, chapter 471, article 8,
4.34 section 45; Laws 1999, chapter 243, article 6, section
4.35 14; Laws 1999, chapter 243, article 6, section 15;
4.36 Laws 2000, chapter 490, article 6, section 17;
4.37 Minnesota Rules, parts 8120.0200; 8120.0500;
4.38 8120.0700; 8120.0900; 8120.1300; 8120.1600; 8120.2000;
4.39 8120.2100; 8120.2200; 8120.2300; 8120.2500; 8120.2700;
4.40 8120.2800; 8120.3000; 8120.3200; 8120.4300; 8120.4400;
4.41 8120.4500; 8120.4600; 8120.4900; 8120.5000; 8120.5100;
4.42 8120.5300.
4.43 May 15, 2002
4.44 The Honorable Steve Sviggum
4.45 Speaker of the House of Representatives
4.47 The Honorable Don Samuelson
4.48 President of the Senate
4.50 We, the undersigned conferees for H.F. No. 2498, report
4.51 that we have agreed upon the items in dispute and recommend as
4.52 follows:
4.53
4.54 That the Senate recede from its amendments and that H.F.
4.55 No. 2498 be further amended as follows:
4.56 Delete everything after the enacting clause and insert:
4.57 "ARTICLE 1
4.58 INCOME AND FRANCHISE TAXES
4.59 Section 1. Minnesota Statutes 2001 Supplement, section
5.1 290.01, subdivision 19d, is amended to read:
5.2 Subd. 19d. [CORPORATIONS; MODIFICATIONS DECREASING FEDERAL
5.3 TAXABLE INCOME.] For corporations, there shall be subtracted
5.4 from federal taxable income after the increases provided in
5.5 subdivision 19c:
5.6 (1) the amount of foreign dividend gross-up added to gross
5.7 income for federal income tax purposes under section 78 of the
5.8 Internal Revenue Code;
5.9 (2) the amount of salary expense not allowed for federal
5.10 income tax purposes due to claiming the federal jobs credit
5.11 under section 51 of the Internal Revenue Code;
5.12 (3) any dividend (not including any distribution in
5.13 liquidation) paid within the taxable year by a national or state
5.14 bank to the United States, or to any instrumentality of the
5.15 United States exempt from federal income taxes, on the preferred
5.16 stock of the bank owned by the United States or the
5.17 instrumentality;
5.18 (4) amounts disallowed for intangible drilling costs due to
5.19 differences between this chapter and the Internal Revenue Code
5.20 in taxable years beginning before January 1, 1987, as follows:
5.21 (i) to the extent the disallowed costs are represented by
5.22 physical property, an amount equal to the allowance for
5.23 depreciation under Minnesota Statutes 1986, section 290.09,
5.24 subdivision 7, subject to the modifications contained in
5.25 subdivision 19e; and
5.26 (ii) to the extent the disallowed costs are not represented
5.27 by physical property, an amount equal to the allowance for cost
5.28 depletion under Minnesota Statutes 1986, section 290.09,
5.29 subdivision 8;
5.30 (5) the deduction for capital losses pursuant to sections
5.31 1211 and 1212 of the Internal Revenue Code, except that:
5.32 (i) for capital losses incurred in taxable years beginning
5.33 after December 31, 1986, capital loss carrybacks shall not be
5.34 allowed;
5.35 (ii) for capital losses incurred in taxable years beginning
5.36 after December 31, 1986, a capital loss carryover to each of the
6.1 15 taxable years succeeding the loss year shall be allowed;
6.2 (iii) for capital losses incurred in taxable years
6.3 beginning before January 1, 1987, a capital loss carryback to
6.4 each of the three taxable years preceding the loss year, subject
6.5 to the provisions of Minnesota Statutes 1986, section 290.16,
6.6 shall be allowed; and
6.7 (iv) for capital losses incurred in taxable years beginning
6.8 before January 1, 1987, a capital loss carryover to each of the
6.9 five taxable years succeeding the loss year to the extent such
6.10 loss was not used in a prior taxable year and subject to the
6.11 provisions of Minnesota Statutes 1986, section 290.16, shall be
6.12 allowed;
6.13 (6) an amount for interest and expenses relating to income
6.14 not taxable for federal income tax purposes, if (i) the income
6.15 is taxable under this chapter and (ii) the interest and expenses
6.16 were disallowed as deductions under the provisions of section
6.17 171(a)(2), 265 or 291 of the Internal Revenue Code in computing
6.18 federal taxable income;
6.19 (7) in the case of mines, oil and gas wells, other natural
6.20 deposits, and timber for which percentage depletion was
6.21 disallowed pursuant to subdivision 19c, clause (11), a
6.22 reasonable allowance for depletion based on actual cost. In the
6.23 case of leases the deduction must be apportioned between the
6.24 lessor and lessee in accordance with rules prescribed by the
6.25 commissioner. In the case of property held in trust, the
6.26 allowable deduction must be apportioned between the income
6.27 beneficiaries and the trustee in accordance with the pertinent
6.28 provisions of the trust, or if there is no provision in the
6.29 instrument, on the basis of the trust's income allocable to
6.30 each;
6.31 (8) for certified pollution control facilities placed in
6.32 service in a taxable year beginning before December 31, 1986,
6.33 and for which amortization deductions were elected under section
6.34 169 of the Internal Revenue Code of 1954, as amended through
6.35 December 31, 1985, an amount equal to the allowance for
6.36 depreciation under Minnesota Statutes 1986, section 290.09,
7.1 subdivision 7;
7.2 (9) amounts included in federal taxable income that are due
7.3 to refunds of income, excise, or franchise taxes based on net
7.4 income or related minimum taxes paid by the corporation to
7.5 Minnesota, another state, a political subdivision of another
7.6 state, the District of Columbia, or a foreign country or
7.7 possession of the United States to the extent that the taxes
7.8 were added to federal taxable income under section 290.01,
7.9 subdivision 19c, clause (1), in a prior taxable year;
7.10 (10) 80 percent of royalties, fees, or other like income
7.11 accrued or received from a foreign operating corporation or a
7.12 foreign corporation which is part of the same unitary business
7.13 as the receiving corporation;
7.14 (11) income or gains from the business of mining as defined
7.15 in section 290.05, subdivision 1, clause (a), that are not
7.16 subject to Minnesota franchise tax;
7.17 (12) the amount of handicap access expenditures in the
7.18 taxable year which are not allowed to be deducted or capitalized
7.19 under section 44(d)(7) of the Internal Revenue Code;
7.20 (13) the amount of qualified research expenses not allowed
7.21 for federal income tax purposes under section 280C(c) of the
7.22 Internal Revenue Code, but only to the extent that the amount
7.23 exceeds the amount of the credit allowed under section 290.068;
7.24 (14) the amount of salary expenses not allowed for federal
7.25 income tax purposes due to claiming the Indian employment credit
7.26 under section 45A(a) of the Internal Revenue Code;
7.27 (15) the amount of any refund of environmental taxes paid
7.28 under section 59A of the Internal Revenue Code;
7.29 (16) for taxable years beginning before January 1, 2008,
7.30 the amount of the federal small ethanol producer credit allowed
7.31 under section 40(a)(3) of the Internal Revenue Code which is
7.32 included in gross income under section 87 of the Internal
7.33 Revenue Code; and
7.34 (17) for a corporation whose foreign sales corporation, as
7.35 defined in section 922 of the Internal Revenue Code, constituted
7.36 a foreign operating corporation during the any taxable years
8.1 year ending during calendar year 1992 before January 1, 1995,
8.2 and a return was filed by August 15, 1996, claiming the
8.3 deduction under this subdivision for income received from the
8.4 foreign operating corporation, an amount equal to 1.23
8.5 multiplied by the amount of income excluded under section 114 of
8.6 the Internal Revenue Code, provided the income is not income of
8.7 a foreign operating company.
8.8 [EFFECTIVE DATE.] This section is effective for taxable
8.9 years beginning after December 31, 2000.
8.10 Sec. 2. Minnesota Statutes 2000, section 290.081, is
8.11 amended to read:
8.12 290.081 [INCOME OF NONRESIDENTS, RECIPROCITY.]
8.13 (a) The compensation received for the performance of
8.14 personal or professional services within this state by an
8.15 individual whose residence, place of abode, and place
8.16 customarily returned to at least once a month is in another
8.17 state, shall be excluded from gross income to the extent such
8.18 compensation is subject to an income tax imposed by the state of
8.19 residence; provided that such state allows a similar exclusion
8.20 of compensation received by residents of Minnesota for services
8.21 performed therein.
8.22 (b) When it is deemed to be in the best interests of the
8.23 people of this state, the commissioner may determine that the
8.24 provisions of clause paragraph (a) shall not apply. As long as
8.25 the provisions of clause paragraph (a) apply between Minnesota
8.26 and Wisconsin, the provisions of clause paragraph (a) shall
8.27 apply to any individual who is domiciled in Wisconsin.
8.28 (c) For the purposes of clause paragraph (a), whenever the
8.29 Wisconsin tax on Minnesota residents which would have been paid
8.30 Wisconsin without clause paragraph (a) exceeds the Minnesota tax
8.31 on Wisconsin residents which would have been paid Minnesota
8.32 without clause paragraph (a), or vice versa, then the state with
8.33 the net revenue loss resulting from clause paragraph (a) shall
8.34 receive from the other state the amount of such loss. This
8.35 provision shall be effective for all years beginning after
8.36 December 31, 1972. The data used for computing the loss to
9.1 either state shall be determined on or before September 30 of
9.2 the year following the close of the previous calendar year.
9.3 (d) Interest shall be is payable on all delinquent balances
9.4 amounts calculated under paragraph (c) relating to taxable years
9.5 beginning after December 31, 1977 December 31, 2000. Interest
9.6 accrues from July 1 of the taxable year. The commissioner of
9.7 revenue is authorized to enter into agreements with the state of
9.8 Wisconsin specifying the reciprocity payment due date,
9.9 conditions constituting delinquency, interest rates, and a
9.10 method for computing interest due on any delinquent amounts.
9.11 (e) If an agreement cannot be reached as to the amount of
9.12 the loss, the commissioner of revenue and the taxing official of
9.13 the state of Wisconsin shall each appoint a member of a board of
9.14 arbitration and these members shall appoint the third member of
9.15 the board. The board shall select one of its members as chair.
9.16 Such board may administer oaths, take testimony, subpoena
9.17 witnesses, and require their attendance, require the production
9.18 of books, papers and documents, and hold hearings at such places
9.19 as are deemed necessary. The board shall then make a
9.20 determination as to the amount to be paid the other state which
9.21 determination shall be final and conclusive.
9.22 (f) The commissioner may furnish copies of returns,
9.23 reports, or other information to the taxing official of the
9.24 state of Wisconsin, a member of the board of arbitration, or a
9.25 consultant under joint contract with the states of Minnesota and
9.26 Wisconsin for the purpose of making a determination as to the
9.27 amount to be paid the other state under the provisions of this
9.28 section. Prior to the release of any information under the
9.29 provisions of this section, the person to whom the information
9.30 is to be released shall sign an agreement which provides that
9.31 the person will protect the confidentiality of the returns and
9.32 information revealed thereby to the extent that it is protected
9.33 under the laws of the state of Minnesota.
9.34 [EFFECTIVE DATE.] This section is effective the day
9.35 following final enactment. Income tax reciprocity under
9.36 Minnesota Statutes, section 290.081, with the state of Wisconsin
10.1 is terminated effective for taxable years beginning after
10.2 December 31, 2002, unless the state of Wisconsin agrees, in
10.3 writing, by October 1, 2002, that interest will be included in
10.4 payments as required by this section, calculated from the date
10.5 specified under this section at a rate at least equal to the
10.6 rate under Minnesota Statutes, section 270.75, and beginning
10.7 with the payment due in December 2002. If income tax
10.8 reciprocity is terminated, the requirement under Minnesota
10.9 Statutes, section 136A.08, subdivision 3, that an income tax
10.10 reciprocity agreement be in effect as a condition for a higher
10.11 education reciprocity is suspended through the 2003-2004 school
10.12 year.
10.13 Sec. 3. Minnesota Statutes 2001 Supplement, section
10.14 290.0921, subdivision 2, is amended to read:
10.15 Subd. 2. [DEFINITIONS.] (a) For purposes of this section,
10.16 the following terms have the meanings given them.
10.17 (b) "Alternative minimum taxable net income" is alternative
10.18 minimum taxable income,
10.19 (1) less the exemption amount, and
10.20 (2) apportioned or allocated to Minnesota under section
10.21 290.17, 290.191, or 290.20.
10.22 (c) The "exemption amount" is $40,000, reduced, but not
10.23 below zero, by 25 percent of the excess of alternative minimum
10.24 taxable income over $150,000.
10.25 (d) "Minnesota alternative minimum taxable income" is
10.26 alternative minimum taxable net income, less the deductions for
10.27 alternative tax net operating loss under subdivision 4;
10.28 charitable contributions under subdivision 5; and dividends
10.29 received under subdivision 6. The sum of the deductions under
10.30 this paragraph may not exceed 90 percent of alternative minimum
10.31 taxable net income. This limitation does not apply to:
10.32 (1) a deduction for dividends paid to or received from a
10.33 corporation which is subject to tax under section 290.36 and
10.34 which is a member of an affiliated group of corporations as
10.35 defined by the Internal Revenue Code; or
10.36 (2) a deduction for dividends received from a property and
11.1 casualty insurer as defined under section 60A.60, subdivision 8,
11.2 which is a member of an affiliated group of corporations as
11.3 defined by the Internal Revenue Code and either: (i) the
11.4 dividend is eliminated in consolidation under Treasury
11.5 Regulation 1.1502-14(a), as amended through December 31, 1989;
11.6 or (ii) the dividend is deducted under an election under section
11.7 243(b) of the Internal Revenue Code.
11.8 [EFFECTIVE DATE.] This section is effective for tax years
11.9 beginning after December 31, 2002.
11.10 Sec. 4. Minnesota Statutes 2001 Supplement, section
11.11 290.0921, subdivision 6, is amended to read:
11.12 Subd. 6. [DIVIDENDS RECEIVED.] (a) A deduction is allowed
11.13 from alternative minimum taxable net income equal to the
11.14 deduction for dividends received under section 290.21,
11.15 subdivision 4, for purposes of calculating taxable income under
11.16 section 290.01, subdivision 29.
11.17 (b) The amount of the deduction must not exceed 90 percent
11.18 of alternative minimum taxable net income.
11.19 This limitation does not apply to:
11.20 (1) dividends paid to or received from a corporation which
11.21 is subject to tax under section 290.36 and which is a member of
11.22 an affiliated group of corporations as defined by the Internal
11.23 Revenue Code; or
11.24 (2) dividends received from a property and casualty insurer
11.25 as defined under section 60A.60, subdivision 8, which is a
11.26 member of an affiliated group of corporations as defined by the
11.27 Internal Revenue Code and either: (i) the dividend is
11.28 eliminated in consolidation under Treasury Regulation
11.29 1.1502-14(a), as amended through December 31, 1989; or (ii) the
11.30 dividend is deducted under an election under section 243(b) of
11.31 the Internal Revenue Code.
11.32 [EFFECTIVE DATE.] This section is effective for tax years
11.33 beginning after December 31, 2002.
11.34 Sec. 5. Minnesota Statutes 2000, section 290.191,
11.35 subdivision 4, is amended to read:
11.36 Subd. 4. [APPORTIONMENT FORMULA FOR CERTAIN MAIL ORDER
12.1 BUSINESSES.] If the business of a corporation, partnership, or
12.2 proprietorship consists exclusively of the selling of tangible
12.3 personal property and services at retail, as defined in section
12.4 297A.61, subdivision 4, paragraph (a), in response to orders
12.5 received by United States mail, telephone, facsimile, or other
12.6 electronic media, and 99 percent of the taxpayer's property and
12.7 payroll is within Minnesota, then the taxpayer may apportion net
12.8 income to Minnesota based solely upon the percentage that the
12.9 sales made within this state in connection with its trade or
12.10 business during the tax period are of the total sales wherever
12.11 made in connection with the trade or business during the tax
12.12 period. Property and payroll factors are disregarded. In
12.13 determining eligibility for this subdivision:
12.14 (1) the sale not in the ordinary course of business of
12.15 tangible or intangible assets used in conducting business
12.16 activities must be disregarded; and
12.17 (2) property and payroll at a distribution center outside
12.18 of Minnesota are disregarded if the sole activity at the
12.19 distribution center is the filling of orders, and no
12.20 solicitation of orders occurs at the distribution center.
12.21 [EFFECTIVE DATE.] This section is effective for tax years
12.22 beginning after December 31, 2001.
12.23 Sec. 6. Minnesota Statutes 2001 Supplement, section
12.24 290.21, subdivision 4, is amended to read:
12.25 Subd. 4. (a)(1) Eighty percent of dividends received by a
12.26 corporation during the taxable year from another corporation, in
12.27 which the recipient owns 20 percent or more of the stock, by
12.28 vote and value, not including stock described in section
12.29 1504(a)(4) of the Internal Revenue Code when the corporate stock
12.30 with respect to which dividends are paid does not constitute the
12.31 stock in trade of the taxpayer or would not be included in the
12.32 inventory of the taxpayer, or does not constitute property held
12.33 by the taxpayer primarily for sale to customers in the ordinary
12.34 course of the taxpayer's trade or business, or when the trade or
12.35 business of the taxpayer does not consist principally of the
12.36 holding of the stocks and the collection of the income and gains
13.1 therefrom; and
13.2 (2)(i) the remaining 20 percent of dividends if the
13.3 dividends received are the stock in an affiliated company
13.4 transferred in an overall plan of reorganization and the
13.5 dividend is eliminated in consolidation under Treasury
13.6 Department Regulation 1.1502-14(a), as amended through December
13.7 31, 1989; or
13.8 (ii) the remaining 20 percent of dividends if the dividends
13.9 are received from a corporation which is subject to tax under
13.10 section 290.36 and which is a member of an affiliated group of
13.11 corporations as defined by the Internal Revenue Code and the
13.12 dividend is eliminated in consolidation under Treasury
13.13 Department Regulation 1.1502-14(a), as amended through December
13.14 31, 1989, or is deducted under an election under section 243(b)
13.15 of the Internal Revenue Code; or
13.16 (iii) the remaining 20 percent of the dividends if the
13.17 dividends are received from a property and casualty insurer as
13.18 defined under section 60A.60, subdivision 8, which is a member
13.19 of an affiliated group of corporations as defined by the
13.20 Internal Revenue Code and either: (A) the dividend is
13.21 eliminated in consolidation under Treasury Regulation
13.22 1.1502-14(a), as amended through December 31, 1989; or (B) the
13.23 dividend is deducted under an election under section 243(b) of
13.24 the Internal Revenue Code.
13.25 (b) Seventy percent of dividends received by a corporation
13.26 during the taxable year from another corporation in which the
13.27 recipient owns less than 20 percent of the stock, by vote or
13.28 value, not including stock described in section 1504(a)(4) of
13.29 the Internal Revenue Code when the corporate stock with respect
13.30 to which dividends are paid does not constitute the stock in
13.31 trade of the taxpayer, or does not constitute property held by
13.32 the taxpayer primarily for sale to customers in the ordinary
13.33 course of the taxpayer's trade or business, or when the trade or
13.34 business of the taxpayer does not consist principally of the
13.35 holding of the stocks and the collection of income and gain
13.36 therefrom.
14.1 (c) The dividend deduction provided in this subdivision
14.2 shall be allowed only with respect to dividends that are
14.3 included in a corporation's Minnesota taxable net income for the
14.4 taxable year.
14.5 The dividend deduction provided in this subdivision does
14.6 not apply to a dividend from a corporation which, for the
14.7 taxable year of the corporation in which the distribution is
14.8 made or for the next preceding taxable year of the corporation,
14.9 is a corporation exempt from tax under section 501 of the
14.10 Internal Revenue Code.
14.11 The dividend deduction provided in this subdivision applies
14.12 to the amount of regulated investment company dividends only to
14.13 the extent determined under section 854(b) of the Internal
14.14 Revenue Code.
14.15 The dividend deduction provided in this subdivision shall
14.16 not be allowed with respect to any dividend for which a
14.17 deduction is not allowed under the provisions of section 246(c)
14.18 of the Internal Revenue Code.
14.19 (d) If dividends received by a corporation that does not
14.20 have nexus with Minnesota under the provisions of Public Law
14.21 Number 86-272 are included as income on the return of an
14.22 affiliated corporation permitted or required to file a combined
14.23 report under section 290.34, subdivision 2, then for purposes of
14.24 this subdivision the determination as to whether the trade or
14.25 business of the corporation consists principally of the holding
14.26 of stocks and the collection of income and gains therefrom shall
14.27 be made with reference to the trade or business of the
14.28 affiliated corporation having a nexus with Minnesota.
14.29 (e) The deduction provided by this subdivision does not
14.30 apply if the dividends are paid by a FSC as defined in section
14.31 922 of the Internal Revenue Code.
14.32 (f) If one or more of the members of the unitary group
14.33 whose income is included on the combined report received a
14.34 dividend, the deduction under this subdivision for each member
14.35 of the unitary business required to file a return under this
14.36 chapter is the product of: (1) 100 percent of the dividends
15.1 received by members of the group; (2) the percentage allowed
15.2 pursuant to paragraph (a) or (b); and (3) the percentage of the
15.3 taxpayer's business income apportionable to this state for the
15.4 taxable year under section 290.191 or 290.20.
15.5 [EFFECTIVE DATE.] This section is effective for tax years
15.6 beginning after December 31, 2002.
15.7 ARTICLE 2
15.8 FEDERAL UPDATE
15.9 Section 1. Minnesota Statutes 2001 Supplement, section
15.10 289A.02, subdivision 7, is amended to read:
15.11 Subd. 7. [INTERNAL REVENUE CODE.] Unless specifically
15.12 defined otherwise, "Internal Revenue Code" means the Internal
15.13 Revenue Code of 1986, as amended through June 15, 2001 March 15,
15.14 2002.
15.15 [EFFECTIVE DATE.] This section is effective the day
15.16 following final enactment.
15.17 Sec. 2. Minnesota Statutes 2001 Supplement, section
15.18 289A.20, subdivision 2, is amended to read:
15.19 Subd. 2. [WITHHOLDING FROM WAGES, ENTERTAINER WITHHOLDING,
15.20 WITHHOLDING FROM PAYMENTS TO OUT-OF-STATE CONTRACTORS, AND
15.21 WITHHOLDING BY PARTNERSHIPS AND SMALL BUSINESS CORPORATIONS.]
15.22 (a) A tax required to be deducted and withheld during the
15.23 quarterly period must be paid on or before the last day of the
15.24 month following the close of the quarterly period, unless an
15.25 earlier time for payment is provided. A tax required to be
15.26 deducted and withheld from compensation of an entertainer and
15.27 from a payment to an out-of-state contractor must be paid on or
15.28 before the date the return for such tax must be filed under
15.29 section 289A.18, subdivision 2. Taxes required to be deducted
15.30 and withheld by partnerships and S corporations must be paid on
15.31 or before the date the return must be filed under section
15.32 289A.18, subdivision 2.
15.33 (b) An employer who, during the previous quarter, withheld
15.34 more than $1,500 of tax under section 290.92, subdivision 2a or
15.35 3, or 290.923, subdivision 2, must deposit tax withheld under
15.36 those sections with the commissioner within the time allowed to
16.1 deposit the employer's federal withheld employment taxes under
16.2 Treasury Regulation Code of Federal Regulations, title 26,
16.3 section 31.6302-1, as amended through December 31, 2001, without
16.4 regard to the safe harbor or de minimis rules in subparagraph
16.5 (f) or the one-day rule in subsection (c), clause (3).
16.6 Taxpayers must submit a copy of their federal notice of deposit
16.7 status to the commissioner upon request by the commissioner.
16.8 (c) The commissioner may prescribe by rule other return
16.9 periods or deposit requirements. In prescribing the reporting
16.10 period, the commissioner may classify payors according to the
16.11 amount of their tax liability and may adopt an appropriate
16.12 reporting period for the class that the commissioner judges to
16.13 be consistent with efficient tax collection. In no event will
16.14 the duration of the reporting period be more than one year.
16.15 (d) If less than the correct amount of tax is paid to the
16.16 commissioner, proper adjustments with respect to both the tax
16.17 and the amount to be deducted must be made, without interest, in
16.18 the manner and at the times the commissioner prescribes. If the
16.19 underpayment cannot be adjusted, the amount of the underpayment
16.20 will be assessed and collected in the manner and at the times
16.21 the commissioner prescribes.
16.22 (e) If the aggregate amount of the tax withheld during a
16.23 fiscal year ending June 30 under section 290.92, subdivision 2a
16.24 or 3, is equal to or exceeds the amounts established for
16.25 remitting federal withheld taxes pursuant to the regulations
16.26 promulgated under section 6302(h) of the Internal Revenue Code,
16.27 the employer must remit each required deposit for wages paid in
16.28 the subsequent calendar year by electronic means.
16.29 (f) A third-party bulk filer as defined in section 290.92,
16.30 subdivision 30, paragraph (a), clause (2), who remits
16.31 withholding deposits must remit all deposits by electronic means
16.32 as provided in paragraph (e), regardless of the aggregate amount
16.33 of tax withheld during a fiscal year for all of the employers.
16.34 [EFFECTIVE DATE.] This section is effective the day
16.35 following final enactment.
16.36 Sec. 3. Minnesota Statutes 2001 Supplement, section
17.1 290.01, subdivision 19, is amended to read:
17.2 Subd. 19. [NET INCOME.] The term "net income" means the
17.3 federal taxable income, as defined in section 63 of the Internal
17.4 Revenue Code of 1986, as amended through the date named in this
17.5 subdivision, incorporating any elections made by the taxpayer in
17.6 accordance with the Internal Revenue Code in determining federal
17.7 taxable income for federal income tax purposes, and with the
17.8 modifications provided in subdivisions 19a to 19f.
17.9 In the case of a regulated investment company or a fund
17.10 thereof, as defined in section 851(a) or 851(g) of the Internal
17.11 Revenue Code, federal taxable income means investment company
17.12 taxable income as defined in section 852(b)(2) of the Internal
17.13 Revenue Code, except that:
17.14 (1) the exclusion of net capital gain provided in section
17.15 852(b)(2)(A) of the Internal Revenue Code does not apply;
17.16 (2) the deduction for dividends paid under section
17.17 852(b)(2)(D) of the Internal Revenue Code must be applied by
17.18 allowing a deduction for capital gain dividends and
17.19 exempt-interest dividends as defined in sections 852(b)(3)(C)
17.20 and 852(b)(5) of the Internal Revenue Code; and
17.21 (3) the deduction for dividends paid must also be applied
17.22 in the amount of any undistributed capital gains which the
17.23 regulated investment company elects to have treated as provided
17.24 in section 852(b)(3)(D) of the Internal Revenue Code.
17.25 The net income of a real estate investment trust as defined
17.26 and limited by section 856(a), (b), and (c) of the Internal
17.27 Revenue Code means the real estate investment trust taxable
17.28 income as defined in section 857(b)(2) of the Internal Revenue
17.29 Code.
17.30 The net income of a designated settlement fund as defined
17.31 in section 468B(d) of the Internal Revenue Code means the gross
17.32 income as defined in section 468B(b) of the Internal Revenue
17.33 Code.
17.34 The provisions of sections 1113(a), 1117, 1206(a), 1313(a),
17.35 1402(a), 1403(a), 1443, 1450, 1501(a), 1605, 1611(a), 1612,
17.36 1616, 1617, 1704(l), and 1704(m) of the Small Business Job
18.1 Protection Act, Public Law Number 104-188, the provisions of
18.2 Public Law Number 104-117, the provisions of sections 313(a) and
18.3 (b)(1), 602(a), 913(b), 941, 961, 971, 1001(a) and (b), 1002,
18.4 1003, 1012, 1013, 1014, 1061, 1062, 1081, 1084(b), 1086, 1087,
18.5 1111(a), 1131(b) and (c), 1211(b), 1213, 1530(c)(2), 1601(f)(5)
18.6 and (h), and 1604(d)(1) of the Taxpayer Relief Act of 1997,
18.7 Public Law Number 105-34, the provisions of section 6010 of the
18.8 Internal Revenue Service Restructuring and Reform Act of 1998,
18.9 Public Law Number 105-206, the provisions of section 4003 of the
18.10 Omnibus Consolidated and Emergency Supplemental Appropriations
18.11 Act, 1999, Public Law Number 105-277, and the provisions of
18.12 section 318 of the Consolidated Appropriation Act of 2001,
18.13 Public Law Number 106-554, shall become effective at the time
18.14 they become effective for federal purposes.
18.15 The Internal Revenue Code of 1986, as amended through
18.16 December 31, 1996, shall be in effect for taxable years
18.17 beginning after December 31, 1996.
18.18 The provisions of sections 202(a) and (b), 221(a), 225,
18.19 312, 313, 913(a), 934, 962, 1004, 1005, 1052, 1063, 1084(a) and
18.20 (c), 1089, 1112, 1171, 1204, 1271(a) and (b), 1305(a), 1306,
18.21 1307, 1308, 1309, 1501(b), 1502(b), 1504(a), 1505, 1527, 1528,
18.22 1530, 1601(d), (e), (f), and (i) and 1602(a), (b), (c), and (e)
18.23 of the Taxpayer Relief Act of 1997, Public Law Number 105-34,
18.24 the provisions of sections 6004, 6005, 6012, 6013, 6015, 6016,
18.25 7002, and 7003 of the Internal Revenue Service Restructuring and
18.26 Reform Act of 1998, Public Law Number 105-206, the provisions of
18.27 section 3001 of the Omnibus Consolidated and Emergency
18.28 Supplemental Appropriations Act, 1999, Public Law Number
18.29 105-277, the provisions of section 3001 of the Miscellaneous
18.30 Trade and Technical Corrections Act of 1999, Public Law Number
18.31 106-36, and the provisions of section 316 of the Consolidated
18.32 Appropriation Act of 2001, Public Law Number 106-554, shall
18.33 become effective at the time they become effective for federal
18.34 purposes.
18.35 The Internal Revenue Code of 1986, as amended through
18.36 December 31, 1997, shall be in effect for taxable years
19.1 beginning after December 31, 1997.
19.2 The provisions of sections 5002, 6009, 6011, and 7001 of
19.3 the Internal Revenue Service Restructuring and Reform Act of
19.4 1998, Public Law Number 105-206, the provisions of section 9010
19.5 of the Transportation Equity Act for the 21st Century, Public
19.6 Law Number 105-178, the provisions of sections 1004, 4002, and
19.7 5301 of the Omnibus Consolidation and Emergency Supplemental
19.8 Appropriations Act, 1999, Public Law Number 105-277, the
19.9 provision of section 303 of the Ricky Ray Hemophilia Relief Fund
19.10 Act of 1998, Public Law Number 105-369, the provisions of
19.11 sections 532, 534, 536, 537, and 538 of the Ticket to Work and
19.12 Work Incentives Improvement Act of 1999, Public Law Number
19.13 106-170, the provisions of the Installment Tax Correction Act of
19.14 2000, Public Law Number 106-573, and the provisions of section
19.15 309 of the Consolidated Appropriation Act of 2001, Public Law
19.16 Number 106-554, shall become effective at the time they become
19.17 effective for federal purposes.
19.18 The Internal Revenue Code of 1986, as amended through
19.19 December 31, 1998, shall be in effect for taxable years
19.20 beginning after December 31, 1998.
19.21 The provisions of the FSC Repeal and Extraterritorial
19.22 Income Exclusion Act of 2000, Public Law Number 106-519, and the
19.23 provision of section 412 of the Job Creation and Worker
19.24 Assistance Act of 2002, Public Law Number 107-147, shall become
19.25 effective at the time it became effective for federal purposes.
19.26 The Internal Revenue Code of 1986, as amended through
19.27 December 31, 1999, shall be in effect for taxable years
19.28 beginning after December 31, 1999. The provisions of sections
19.29 306 and 401 of the Consolidated Appropriation Act of 2001,
19.30 Public Law Number 106-554, and the provision of section
19.31 632(b)(2)(A) of the Economic Growth and Tax Relief
19.32 Reconciliation Act of 2001, Public Law Number 107-16, and
19.33 provisions of sections 101 and 402 of the Job Creation and
19.34 Worker Assistance Act of 2002, Public Law Number 107-147, shall
19.35 become effective at the same time it became effective for
19.36 federal purposes.
20.1 The Internal Revenue Code of 1986, as amended through
20.2 December 31, 2000, shall be in effect for taxable years
20.3 beginning after December 31, 2000. The provisions of sections
20.4 659a and 671 of the Economic Growth and Tax Relief
20.5 Reconciliation Act of 2001, Public Law Number 107-16, the
20.6 provisions of sections 104, 105, and 111 of the Victims of
20.7 Terrorism Tax Relief Act of 2001, Public Law Number 107-134, and
20.8 the provisions of sections 201, 403, 413, and 606 of the Job
20.9 Creation and Worker Assistance Act of 2002, Public Law Number
20.10 107-147, shall become effective at the same time it became
20.11 effective for federal purposes.
20.12 The Internal Revenue Code of 1986, as amended through June
20.13 15, 2001 March 15, 2002, shall be in effect for taxable years
20.14 beginning after December 31, 2001.
20.15 The provisions of sections 101 and 102 of the Victims of
20.16 Terrorism Tax Relief Act of 2001, Public Law Number 107-134,
20.17 shall become effective at the same time it becomes effective for
20.18 federal purposes.
20.19 Except as otherwise provided, references to the Internal
20.20 Revenue Code in subdivisions 19a to 19g mean the code in effect
20.21 for purposes of determining net income for the applicable year.
20.22 [EFFECTIVE DATE.] This section is effective the day
20.23 following final enactment.
20.24 Sec. 4. Minnesota Statutes 2000, section 290.01,
20.25 subdivision 19a, is amended to read:
20.26 Subd. 19a. [ADDITIONS TO FEDERAL TAXABLE INCOME.] For
20.27 individuals, estates, and trusts, there shall be added to
20.28 federal taxable income:
20.29 (1)(i) interest income on obligations of any state other
20.30 than Minnesota or a political or governmental subdivision,
20.31 municipality, or governmental agency or instrumentality of any
20.32 state other than Minnesota exempt from federal income taxes
20.33 under the Internal Revenue Code or any other federal statute,
20.34 and
20.35 (ii) exempt-interest dividends as defined in section
20.36 852(b)(5) of the Internal Revenue Code, except the portion of
21.1 the exempt-interest dividends derived from interest income on
21.2 obligations of the state of Minnesota or its political or
21.3 governmental subdivisions, municipalities, governmental agencies
21.4 or instrumentalities, but only if the portion of the
21.5 exempt-interest dividends from such Minnesota sources paid to
21.6 all shareholders represents 95 percent or more of the
21.7 exempt-interest dividends that are paid by the regulated
21.8 investment company as defined in section 851(a) of the Internal
21.9 Revenue Code, or the fund of the regulated investment company as
21.10 defined in section 851(g) of the Internal Revenue Code, making
21.11 the payment; and
21.12 (iii) for the purposes of items (i) and (ii), interest on
21.13 obligations of an Indian tribal government described in section
21.14 7871(c) of the Internal Revenue Code shall be treated as
21.15 interest income on obligations of the state in which the tribe
21.16 is located;
21.17 (2) the amount of income taxes paid or accrued within the
21.18 taxable year under this chapter and income taxes paid to any
21.19 other state or to any province or territory of Canada, to the
21.20 extent allowed as a deduction under section 63(d) of the
21.21 Internal Revenue Code, but the addition may not be more than the
21.22 amount by which the itemized deductions as allowed under section
21.23 63(d) of the Internal Revenue Code exceeds the amount of the
21.24 standard deduction as defined in section 63(c) of the Internal
21.25 Revenue Code. For the purpose of this paragraph, the
21.26 disallowance of itemized deductions under section 68 of the
21.27 Internal Revenue Code of 1986, income tax is the last itemized
21.28 deduction disallowed;
21.29 (3) the capital gain amount of a lump sum distribution to
21.30 which the special tax under section 1122(h)(3)(B)(ii) of the Tax
21.31 Reform Act of 1986, Public Law Number 99-514, applies;
21.32 (4) the amount of income taxes paid or accrued within the
21.33 taxable year under this chapter and income taxes paid to any
21.34 other state or any province or territory of Canada, to the
21.35 extent allowed as a deduction in determining federal adjusted
21.36 gross income. For the purpose of this paragraph, income taxes
22.1 do not include the taxes imposed by sections 290.0922,
22.2 subdivision 1, paragraph (b), 290.9727, 290.9728, and 290.9729;
22.3 (5) the amount of expense, interest, or taxes disallowed
22.4 pursuant to section 290.10; and
22.5 (6) the amount of a partner's pro rata share of net income
22.6 which does not flow through to the partner because the
22.7 partnership elected to pay the tax on the income under section
22.8 6242(a)(2) of the Internal Revenue Code; and
22.9 (7) 80 percent of the depreciation deduction allowed under
22.10 section 168(k) of the Internal Revenue Code.
22.11 [EFFECTIVE DATE.] This section is effective for tax years
22.12 ending after September 10, 2001.
22.13 Sec. 5. Minnesota Statutes 2001 Supplement, section
22.14 290.01, subdivision 19b, is amended to read:
22.15 Subd. 19b. [SUBTRACTIONS FROM FEDERAL TAXABLE INCOME.] For
22.16 individuals, estates, and trusts, there shall be subtracted from
22.17 federal taxable income:
22.18 (1) interest income on obligations of any authority,
22.19 commission, or instrumentality of the United States to the
22.20 extent includable in taxable income for federal income tax
22.21 purposes but exempt from state income tax under the laws of the
22.22 United States;
22.23 (2) if included in federal taxable income, the amount of
22.24 any overpayment of income tax to Minnesota or to any other
22.25 state, for any previous taxable year, whether the amount is
22.26 received as a refund or as a credit to another taxable year's
22.27 income tax liability;
22.28 (3) the amount paid to others, less the amount used to
22.29 claim the credit allowed under section 290.0674, not to exceed
22.30 $1,625 for each qualifying child in grades kindergarten to 6 and
22.31 $2,500 for each qualifying child in grades 7 to 12, for tuition,
22.32 textbooks, and transportation of each qualifying child in
22.33 attending an elementary or secondary school situated in
22.34 Minnesota, North Dakota, South Dakota, Iowa, or Wisconsin,
22.35 wherein a resident of this state may legally fulfill the state's
22.36 compulsory attendance laws, which is not operated for profit,
23.1 and which adheres to the provisions of the Civil Rights Act of
23.2 1964 and chapter 363. For the purposes of this clause,
23.3 "tuition" includes fees or tuition as defined in section
23.4 290.0674, subdivision 1, clause (1). As used in this clause,
23.5 "textbooks" includes books and other instructional materials and
23.6 equipment purchased or leased for use in elementary and
23.7 secondary schools in teaching only those subjects legally and
23.8 commonly taught in public elementary and secondary schools in
23.9 this state. Equipment expenses qualifying for deduction
23.10 includes expenses as defined and limited in section 290.0674,
23.11 subdivision 1, clause (3). "Textbooks" does not include
23.12 instructional books and materials used in the teaching of
23.13 religious tenets, doctrines, or worship, the purpose of which is
23.14 to instill such tenets, doctrines, or worship, nor does it
23.15 include books or materials for, or transportation to,
23.16 extracurricular activities including sporting events, musical or
23.17 dramatic events, speech activities, driver's education, or
23.18 similar programs. For purposes of the subtraction provided by
23.19 this clause, "qualifying child" has the meaning given in section
23.20 32(c)(3) of the Internal Revenue Code;
23.21 (4) contributions made in taxable years beginning after
23.22 December 31, 1981, and before January 1, 1985, to a qualified
23.23 governmental pension plan, an individual retirement account,
23.24 simplified employee pension, or qualified plan covering a
23.25 self-employed person that were included in Minnesota gross
23.26 income in the taxable year for which the contributions were made
23.27 but were deducted or were not included in the computation of
23.28 federal adjusted gross income, less any amount allowed to be
23.29 subtracted as a distribution under this subdivision or a
23.30 predecessor provision in taxable years that began before January
23.31 1, 2000. This subtraction applies only for taxable years
23.32 beginning after December 31, 1999, and before January 1, 2001.
23.33 If an individual's subtraction under this clause exceeds the
23.34 individual's taxable income, the excess may be carried forward
23.35 to taxable years beginning after December 31, 2000, and before
23.36 January 1, 2002;
24.1 (5) income as provided under section 290.0802;
24.2 (6) (5) to the extent included in federal adjusted gross
24.3 income, income realized on disposition of property exempt from
24.4 tax under section 290.491;
24.5 (7) (6) to the extent not deducted in determining federal
24.6 taxable income or used to claim the long-term care insurance
24.7 credit under section 290.0672, the amount paid for health
24.8 insurance of self-employed individuals as determined under
24.9 section 162(l) of the Internal Revenue Code, except that the
24.10 percent limit does not apply. If the individual deducted
24.11 insurance payments under section 213 of the Internal Revenue
24.12 Code of 1986, the subtraction under this clause must be reduced
24.13 by the lesser of:
24.14 (i) the total itemized deductions allowed under section
24.15 63(d) of the Internal Revenue Code, less state, local, and
24.16 foreign income taxes deductible under section 164 of the
24.17 Internal Revenue Code and the standard deduction under section
24.18 63(c) of the Internal Revenue Code; or
24.19 (ii) the lesser of (A) the amount of insurance qualifying
24.20 as "medical care" under section 213(d) of the Internal Revenue
24.21 Code to the extent not deducted under section 162(1) of the
24.22 Internal Revenue Code or excluded from income or (B) the total
24.23 amount deductible for medical care under section 213(a);
24.24 (8) (7) the exemption amount allowed under Laws 1995,
24.25 chapter 255, article 3, section 2, subdivision 3;
24.26 (9) (8) to the extent included in federal taxable income,
24.27 postservice benefits for youth community service under section
24.28 124D.42 for volunteer service under United States Code, title
24.29 42, sections 12601 to 12604;
24.30 (10) (9) to the extent not deducted in determining federal
24.31 taxable income by an individual who does not itemize deductions
24.32 for federal income tax purposes for the taxable year, an amount
24.33 equal to 50 percent of the excess of charitable contributions
24.34 allowable as a deduction for the taxable year under section
24.35 170(a) of the Internal Revenue Code over $500;
24.36 (11) (10) for taxable years beginning before January 1,
25.1 2008, the amount of the federal small ethanol producer credit
25.2 allowed under section 40(a)(3) of the Internal Revenue Code
25.3 which is included in gross income under section 87 of the
25.4 Internal Revenue Code; and
25.5 (12) (11) for individuals who are allowed a federal foreign
25.6 tax credit for taxes that do not qualify for a credit under
25.7 section 290.06, subdivision 22, an amount equal to the carryover
25.8 of subnational foreign taxes for the taxable year, but not to
25.9 exceed the total subnational foreign taxes reported in claiming
25.10 the foreign tax credit. For purposes of this clause, "federal
25.11 foreign tax credit" means the credit allowed under section 27 of
25.12 the Internal Revenue Code, and "carryover of subnational foreign
25.13 taxes" equals the carryover allowed under section 904(c) of the
25.14 Internal Revenue Code minus national level foreign taxes to the
25.15 extent they exceed the federal foreign tax credit; and
25.16 (12) in each of the five tax years immediately following
25.17 the tax year in which an addition is required under subdivision
25.18 19a, clause (7), an amount equal to one-fifth of the delayed
25.19 depreciation. For purposes of this clause, "delayed
25.20 depreciation" means the amount of the addition made by the
25.21 taxpayer under subdivision 19a, clause (7), minus the positive
25.22 value of any net operating loss under section 172 of the
25.23 Internal Revenue Code generated for the tax year of the
25.24 addition. The resulting delayed depreciation cannot be less
25.25 than zero.
25.26 [EFFECTIVE DATE.] This section is effective the day
25.27 following final enactment, except that clause (12) is effective
25.28 for tax years ending after September 10, 2001.
25.29 Sec. 6. Minnesota Statutes 2001 Supplement, section
25.30 290.01, subdivision 19c, is amended to read:
25.31 Subd. 19c. [CORPORATIONS; ADDITIONS TO FEDERAL TAXABLE
25.32 INCOME.] For corporations, there shall be added to federal
25.33 taxable income:
25.34 (1) the amount of any deduction taken for federal income
25.35 tax purposes for income, excise, or franchise taxes based on net
25.36 income or related minimum taxes, including but not limited to
26.1 the tax imposed under section 290.0922, paid by the corporation
26.2 to Minnesota, another state, a political subdivision of another
26.3 state, the District of Columbia, or any foreign country or
26.4 possession of the United States;
26.5 (2) interest not subject to federal tax upon obligations
26.6 of: the United States, its possessions, its agencies, or its
26.7 instrumentalities; the state of Minnesota or any other state,
26.8 any of its political or governmental subdivisions, any of its
26.9 municipalities, or any of its governmental agencies or
26.10 instrumentalities; the District of Columbia; or Indian tribal
26.11 governments;
26.12 (3) exempt-interest dividends received as defined in
26.13 section 852(b)(5) of the Internal Revenue Code;
26.14 (4) the amount of any net operating loss deduction taken
26.15 for federal income tax purposes under section 172 or 832(c)(10)
26.16 of the Internal Revenue Code or operations loss deduction under
26.17 section 810 of the Internal Revenue Code;
26.18 (5) the amount of any special deductions taken for federal
26.19 income tax purposes under sections 241 to 247 of the Internal
26.20 Revenue Code;
26.21 (6) losses from the business of mining, as defined in
26.22 section 290.05, subdivision 1, clause (a), that are not subject
26.23 to Minnesota income tax;
26.24 (7) the amount of any capital losses deducted for federal
26.25 income tax purposes under sections 1211 and 1212 of the Internal
26.26 Revenue Code;
26.27 (8) the exempt foreign trade income of a foreign sales
26.28 corporation under sections 921(a) and 291 of the Internal
26.29 Revenue Code;
26.30 (9) the amount of percentage depletion deducted under
26.31 sections 611 through 614 and 291 of the Internal Revenue Code;
26.32 (10) for certified pollution control facilities placed in
26.33 service in a taxable year beginning before December 31, 1986,
26.34 and for which amortization deductions were elected under section
26.35 169 of the Internal Revenue Code of 1954, as amended through
26.36 December 31, 1985, the amount of the amortization deduction
27.1 allowed in computing federal taxable income for those
27.2 facilities;
27.3 (11) the amount of any deemed dividend from a foreign
27.4 operating corporation determined pursuant to section 290.17,
27.5 subdivision 4, paragraph (g);
27.6 (12) the amount of any environmental tax paid under section
27.7 59(a) of the Internal Revenue Code;
27.8 (13) the amount of a partner's pro rata share of net income
27.9 which does not flow through to the partner because the
27.10 partnership elected to pay the tax on the income under section
27.11 6242(a)(2) of the Internal Revenue Code; and
27.12 (14) the amount of net income excluded under section 114 of
27.13 the Internal Revenue Code;
27.14 (15) any increase in subpart F income, as defined in
27.15 section 952(a) of the Internal Revenue Code, for the taxable
27.16 year when subpart F income is calculated without regard to the
27.17 provisions of section 614 of Public Law Number 107-147; and
27.18 (16) 80 percent of the depreciation deduction allowed under
27.19 section 168(k) of the Internal Revenue Code.
27.20 [EFFECTIVE DATE.] This section is effective for tax years
27.21 ending after September 10, 2001.
27.22 Sec. 7. Minnesota Statutes 2001 Supplement, section
27.23 290.01, subdivision 19d, is amended to read:
27.24 Subd. 19d. [CORPORATIONS; MODIFICATIONS DECREASING FEDERAL
27.25 TAXABLE INCOME.] For corporations, there shall be subtracted
27.26 from federal taxable income after the increases provided in
27.27 subdivision 19c:
27.28 (1) the amount of foreign dividend gross-up added to gross
27.29 income for federal income tax purposes under section 78 of the
27.30 Internal Revenue Code;
27.31 (2) the amount of salary expense not allowed for federal
27.32 income tax purposes due to claiming the federal jobs credit
27.33 under section 51 of the Internal Revenue Code;
27.34 (3) any dividend (not including any distribution in
27.35 liquidation) paid within the taxable year by a national or state
27.36 bank to the United States, or to any instrumentality of the
28.1 United States exempt from federal income taxes, on the preferred
28.2 stock of the bank owned by the United States or the
28.3 instrumentality;
28.4 (4) amounts disallowed for intangible drilling costs due to
28.5 differences between this chapter and the Internal Revenue Code
28.6 in taxable years beginning before January 1, 1987, as follows:
28.7 (i) to the extent the disallowed costs are represented by
28.8 physical property, an amount equal to the allowance for
28.9 depreciation under Minnesota Statutes 1986, section 290.09,
28.10 subdivision 7, subject to the modifications contained in
28.11 subdivision 19e; and
28.12 (ii) to the extent the disallowed costs are not represented
28.13 by physical property, an amount equal to the allowance for cost
28.14 depletion under Minnesota Statutes 1986, section 290.09,
28.15 subdivision 8;
28.16 (5) the deduction for capital losses pursuant to sections
28.17 1211 and 1212 of the Internal Revenue Code, except that:
28.18 (i) for capital losses incurred in taxable years beginning
28.19 after December 31, 1986, capital loss carrybacks shall not be
28.20 allowed;
28.21 (ii) for capital losses incurred in taxable years beginning
28.22 after December 31, 1986, a capital loss carryover to each of the
28.23 15 taxable years succeeding the loss year shall be allowed;
28.24 (iii) for capital losses incurred in taxable years
28.25 beginning before January 1, 1987, a capital loss carryback to
28.26 each of the three taxable years preceding the loss year, subject
28.27 to the provisions of Minnesota Statutes 1986, section 290.16,
28.28 shall be allowed; and
28.29 (iv) for capital losses incurred in taxable years beginning
28.30 before January 1, 1987, a capital loss carryover to each of the
28.31 five taxable years succeeding the loss year to the extent such
28.32 loss was not used in a prior taxable year and subject to the
28.33 provisions of Minnesota Statutes 1986, section 290.16, shall be
28.34 allowed;
28.35 (6) an amount for interest and expenses relating to income
28.36 not taxable for federal income tax purposes, if (i) the income
29.1 is taxable under this chapter and (ii) the interest and expenses
29.2 were disallowed as deductions under the provisions of section
29.3 171(a)(2), 265 or 291 of the Internal Revenue Code in computing
29.4 federal taxable income;
29.5 (7) in the case of mines, oil and gas wells, other natural
29.6 deposits, and timber for which percentage depletion was
29.7 disallowed pursuant to subdivision 19c, clause (11), a
29.8 reasonable allowance for depletion based on actual cost. In the
29.9 case of leases the deduction must be apportioned between the
29.10 lessor and lessee in accordance with rules prescribed by the
29.11 commissioner. In the case of property held in trust, the
29.12 allowable deduction must be apportioned between the income
29.13 beneficiaries and the trustee in accordance with the pertinent
29.14 provisions of the trust, or if there is no provision in the
29.15 instrument, on the basis of the trust's income allocable to
29.16 each;
29.17 (8) for certified pollution control facilities placed in
29.18 service in a taxable year beginning before December 31, 1986,
29.19 and for which amortization deductions were elected under section
29.20 169 of the Internal Revenue Code of 1954, as amended through
29.21 December 31, 1985, an amount equal to the allowance for
29.22 depreciation under Minnesota Statutes 1986, section 290.09,
29.23 subdivision 7;
29.24 (9) amounts included in federal taxable income that are due
29.25 to refunds of income, excise, or franchise taxes based on net
29.26 income or related minimum taxes paid by the corporation to
29.27 Minnesota, another state, a political subdivision of another
29.28 state, the District of Columbia, or a foreign country or
29.29 possession of the United States to the extent that the taxes
29.30 were added to federal taxable income under section 290.01,
29.31 subdivision 19c, clause (1), in a prior taxable year;
29.32 (10) 80 percent of royalties, fees, or other like income
29.33 accrued or received from a foreign operating corporation or a
29.34 foreign corporation which is part of the same unitary business
29.35 as the receiving corporation;
29.36 (11) income or gains from the business of mining as defined
30.1 in section 290.05, subdivision 1, clause (a), that are not
30.2 subject to Minnesota franchise tax;
30.3 (12) the amount of handicap access expenditures in the
30.4 taxable year which are not allowed to be deducted or capitalized
30.5 under section 44(d)(7) of the Internal Revenue Code;
30.6 (13) the amount of qualified research expenses not allowed
30.7 for federal income tax purposes under section 280C(c) of the
30.8 Internal Revenue Code, but only to the extent that the amount
30.9 exceeds the amount of the credit allowed under section 290.068;
30.10 (14) the amount of salary expenses not allowed for federal
30.11 income tax purposes due to claiming the Indian employment credit
30.12 under section 45A(a) of the Internal Revenue Code;
30.13 (15) the amount of any refund of environmental taxes paid
30.14 under section 59A of the Internal Revenue Code;
30.15 (16) for taxable years beginning before January 1, 2008,
30.16 the amount of the federal small ethanol producer credit allowed
30.17 under section 40(a)(3) of the Internal Revenue Code which is
30.18 included in gross income under section 87 of the Internal
30.19 Revenue Code; and
30.20 (17) for a corporation whose foreign sales corporation, as
30.21 defined in section 922 of the Internal Revenue Code, constituted
30.22 a foreign operating corporation during the taxable years ending
30.23 during calendar year 1992 and a return was filed by August 15,
30.24 1996, claiming the deduction under this subdivision for income
30.25 received from the foreign operating corporation, an amount equal
30.26 to 1.23 multiplied by the amount of income excluded under
30.27 section 114 of the Internal Revenue Code, provided the income is
30.28 not income of a foreign operating company;
30.29 (18) any decrease in subpart F income, as defined in
30.30 section 952(a) of the Internal Revenue Code, for the taxable
30.31 year when subpart F income is calculated without regard to the
30.32 provisions of section 614 of Public Law Number 107-147; and
30.33 (19) in each of the five tax years immediately following
30.34 the tax year in which an addition is required under subdivision
30.35 19c, clause (16), an amount equal to one-fifth of the delayed
30.36 depreciation. For purposes of this clause, "delayed
31.1 depreciation" means the amount of the addition made by the
31.2 taxpayer under subdivision 19c, clause (16). The resulting
31.3 delayed depreciation cannot be less than zero.
31.4 [EFFECTIVE DATE.] This section is effective for tax years
31.5 ending after September 10, 2001.
31.6 Sec. 8. Minnesota Statutes 2001 Supplement, section
31.7 290.01, subdivision 31, is amended to read:
31.8 Subd. 31. [INTERNAL REVENUE CODE.] Unless specifically
31.9 defined otherwise, "Internal Revenue Code" means the Internal
31.10 Revenue Code of 1986, as amended through June 15, 2001 March 15,
31.11 2002.
31.12 [EFFECTIVE DATE.] This section is effective at the same
31.13 time and in the same manner as the federal changes made by the
31.14 Victims of Terrorism Tax Relief Act of 2001, Public Law Number
31.15 107-134, and by the Job Creation and Worker Assistance Act of
31.16 2002, Public Law Number 107-147, become effective.
31.17 Sec. 9. Minnesota Statutes 2000, section 290.067,
31.18 subdivision 1, is amended to read:
31.19 Subdivision 1. [AMOUNT OF CREDIT.] (a) A taxpayer may take
31.20 as a credit against the tax due from the taxpayer and a spouse,
31.21 if any, under this chapter an amount equal to the dependent care
31.22 credit for which the taxpayer is eligible pursuant to the
31.23 provisions of section 21 of the Internal Revenue Code subject to
31.24 the limitations provided in subdivision 2 except that in
31.25 determining whether the child qualified as a dependent, income
31.26 received as a Minnesota family investment program grant or
31.27 allowance to or on behalf of the child must not be taken into
31.28 account in determining whether the child received more than half
31.29 of the child's support from the taxpayer, and the provisions of
31.30 section 32(b)(1)(D) of the Internal Revenue Code do not apply.
31.31 (b) If a child who has not attained the age of six years at
31.32 the close of the taxable year is cared for at a licensed family
31.33 day care home operated by the child's parent, the taxpayer is
31.34 deemed to have paid employment-related expenses. If the child
31.35 is 16 months old or younger at the close of the taxable year,
31.36 the amount of expenses deemed to have been paid equals the
32.1 maximum limit for one qualified individual under section 21(c)
32.2 and (d) of the Internal Revenue Code. If the child is older
32.3 than 16 months of age but has not attained the age of six years
32.4 at the close of the taxable year, the amount of expenses deemed
32.5 to have been paid equals the amount the licensee would charge
32.6 for the care of a child of the same age for the same number of
32.7 hours of care.
32.8 (c) If a married couple:
32.9 (1) has a child who has not attained the age of one year at
32.10 the close of the taxable year;
32.11 (2) files a joint tax return for the taxable year; and
32.12 (3) does not participate in a dependent care assistance
32.13 program as defined in section 129 of the Internal Revenue Code,
32.14 in lieu of the actual employment related expenses paid for that
32.15 child under paragraph (a) or the deemed amount under paragraph
32.16 (b), the lesser of (i) the combined earned income of the couple
32.17 or (ii) $2,400 the amount of the maximum limit for one qualified
32.18 individual under section 21(c) and (d) of the Internal Revenue
32.19 Code will be deemed to be the employment related expense paid
32.20 for that child. The earned income limitation of section 21(d)
32.21 of the Internal Revenue Code shall not apply to this deemed
32.22 amount. These deemed amounts apply regardless of whether any
32.23 employment-related expenses have been paid.
32.24 (d) If the taxpayer is not required and does not file a
32.25 federal individual income tax return for the tax year, no credit
32.26 is allowed for any amount paid to any person unless:
32.27 (1) the name, address, and taxpayer identification number
32.28 of the person are included on the return claiming the credit; or
32.29 (2) if the person is an organization described in section
32.30 501(c)(3) of the Internal Revenue Code and exempt from tax under
32.31 section 501(a) of the Internal Revenue Code, the name and
32.32 address of the person are included on the return claiming the
32.33 credit.
32.34 In the case of a failure to provide the information required
32.35 under the preceding sentence, the preceding sentence does not
32.36 apply if it is shown that the taxpayer exercised due diligence
33.1 in attempting to provide the information required.
33.2 In the case of a nonresident, part-year resident, or a
33.3 person who has earned income not subject to tax under this
33.4 chapter, the credit determined under section 21 of the Internal
33.5 Revenue Code must be allocated based on the ratio by which the
33.6 earned income of the claimant and the claimant's spouse from
33.7 Minnesota sources bears to the total earned income of the
33.8 claimant and the claimant's spouse.
33.9 [EFFECTIVE DATE.] This section is effective for tax years
33.10 beginning after December 31, 2002.
33.11 Sec. 10. Minnesota Statutes 2001 Supplement, section
33.12 290.091, subdivision 2, is amended to read:
33.13 Subd. 2. [DEFINITIONS.] For purposes of the tax imposed by
33.14 this section, the following terms have the meanings given:
33.15 (a) "Alternative minimum taxable income" means the sum of
33.16 the following for the taxable year:
33.17 (1) the taxpayer's federal alternative minimum taxable
33.18 income as defined in section 55(b)(2) of the Internal Revenue
33.19 Code;
33.20 (2) the taxpayer's itemized deductions allowed in computing
33.21 federal alternative minimum taxable income, but excluding:
33.22 (i) the Minnesota charitable contribution deduction;
33.23 (ii) the medical expense deduction;
33.24 (iii) the casualty, theft, and disaster loss deduction; and
33.25 (iv) the impairment-related work expenses of a disabled
33.26 person; and
33.27 (v) holocaust victims' settlement payments to the extent
33.28 allowed under section 290.01, subdivision 19b;
33.29 (3) for depletion allowances computed under section 613A(c)
33.30 of the Internal Revenue Code, with respect to each property (as
33.31 defined in section 614 of the Internal Revenue Code), to the
33.32 extent not included in federal alternative minimum taxable
33.33 income, the excess of the deduction for depletion allowable
33.34 under section 611 of the Internal Revenue Code for the taxable
33.35 year over the adjusted basis of the property at the end of the
33.36 taxable year (determined without regard to the depletion
34.1 deduction for the taxable year);
34.2 (4) to the extent not included in federal alternative
34.3 minimum taxable income, the amount of the tax preference for
34.4 intangible drilling cost under section 57(a)(2) of the Internal
34.5 Revenue Code determined without regard to subparagraph (E); and
34.6 (5) to the extent not included in federal alternative
34.7 minimum taxable income, the amount of interest income as
34.8 provided by section 290.01, subdivision 19a, clause (1); and
34.9 (6) the amount of addition required by section 290.01,
34.10 subdivision 19a, clause (7);
34.11 less the sum of the amounts determined under the following:
34.12 (1) interest income as defined in section 290.01,
34.13 subdivision 19b, clause (1);
34.14 (2) an overpayment of state income tax as provided by
34.15 section 290.01, subdivision 19b, clause (2), to the extent
34.16 included in federal alternative minimum taxable income;
34.17 (3) the amount of investment interest paid or accrued
34.18 within the taxable year on indebtedness to the extent that the
34.19 amount does not exceed net investment income, as defined in
34.20 section 163(d)(4) of the Internal Revenue Code. Interest does
34.21 not include amounts deducted in computing federal adjusted gross
34.22 income; and
34.23 (4) amounts subtracted from federal taxable income as
34.24 provided by section 290.01, subdivision 19b, clause (4) (12).
34.25 In the case of an estate or trust, alternative minimum
34.26 taxable income must be computed as provided in section 59(c) of
34.27 the Internal Revenue Code.
34.28 (b) "Investment interest" means investment interest as
34.29 defined in section 163(d)(3) of the Internal Revenue Code.
34.30 (c) "Tentative minimum tax" equals 6.4 percent of
34.31 alternative minimum taxable income after subtracting the
34.32 exemption amount determined under subdivision 3.
34.33 (d) "Regular tax" means the tax that would be imposed under
34.34 this chapter (without regard to this section and section
34.35 290.032), reduced by the sum of the nonrefundable credits
34.36 allowed under this chapter.
35.1 (e) "Net minimum tax" means the minimum tax imposed by this
35.2 section.
35.3 (f) "Minnesota charitable contribution deduction" means a
35.4 charitable contribution deduction under section 170 of the
35.5 Internal Revenue Code to or for the use of an entity described
35.6 in Minnesota Statutes 2000, section 290.21, subdivision 3,
35.7 clauses (a) to (e). When the federal deduction for charitable
35.8 contributions is limited under section 170(b) of the Internal
35.9 Revenue Code, the allowable contributions in the year of
35.10 contribution are deemed to be first contributions to entities
35.11 described in Minnesota Statutes 2000, section 290.21,
35.12 subdivision 3, clauses (a) to (e).
35.13 [EFFECTIVE DATE.] This section is effective the day
35.14 following final enactment, except that clause (6) is effective
35.15 for tax years ending after September 10, 2001.
35.16 Sec. 11. Minnesota Statutes 2001 Supplement, section
35.17 290.0921, subdivision 3, is amended to read:
35.18 Subd. 3. [ALTERNATIVE MINIMUM TAXABLE INCOME.]
35.19 "Alternative minimum taxable income" is Minnesota net income as
35.20 defined in section 290.01, subdivision 19, and includes the
35.21 adjustments and tax preference items in sections 56, 57, 58, and
35.22 59(d), (e), (f), and (h) of the Internal Revenue Code. If a
35.23 corporation files a separate company Minnesota tax return, the
35.24 minimum tax must be computed on a separate company basis. If a
35.25 corporation is part of a tax group filing a unitary return, the
35.26 minimum tax must be computed on a unitary basis. The following
35.27 adjustments must be made.
35.28 (1) For purposes of the depreciation adjustments under
35.29 section 56(a)(1) and 56(g)(4)(A) of the Internal Revenue Code,
35.30 the basis for depreciable property placed in service in a
35.31 taxable year beginning before January 1, 1990, is the adjusted
35.32 basis for federal income tax purposes, including any
35.33 modification made in a taxable year under section 290.01,
35.34 subdivision 19e, or Minnesota Statutes 1986, section 290.09,
35.35 subdivision 7, paragraph (c).
35.36 For taxable years beginning after December 31, 2000, the
36.1 amount of any remaining modification made under section 290.01,
36.2 subdivision 19e, or Minnesota Statutes 1986, section 290.09,
36.3 subdivision 7, paragraph (c), not previously deducted is a
36.4 depreciation allowance in the first taxable year after December
36.5 31, 2000.
36.6 (2) The portion of the depreciation deduction allowed for
36.7 federal income tax purposes under section 168(k) of the Internal
36.8 Revenue Code that is required as an addition under section
36.9 290.01, subdivision 19c, clause (16), is disallowed in
36.10 determining alternative minimum taxable income.
36.11 (3) The subtraction for depreciation allowed under section
36.12 290.01, subdivision 19d, clause (19), is allowed as a
36.13 depreciation deduction in determining alternative minimum
36.14 taxable income.
36.15 (4) The alternative tax net operating loss deduction under
36.16 sections 56(a)(4) and 56(d) of the Internal Revenue Code does
36.17 not apply.
36.18 (3) (5) The special rule for certain dividends under
36.19 section 56(g)(4)(C)(ii) of the Internal Revenue Code does not
36.20 apply.
36.21 (4) (6) The special rule for dividends from section 936
36.22 companies under section 56(g)(4)(C)(iii) does not apply.
36.23 (5) (7) The tax preference for depletion under section
36.24 57(a)(1) of the Internal Revenue Code does not apply.
36.25 (6) (8) The tax preference for intangible drilling costs
36.26 under section 57(a)(2) of the Internal Revenue Code must be
36.27 calculated without regard to subparagraph (E) and the
36.28 subtraction under section 290.01, subdivision 19d, clause (4).
36.29 (7) (9) The tax preference for tax exempt interest under
36.30 section 57(a)(5) of the Internal Revenue Code does not apply.
36.31 (8) (10) The tax preference for charitable contributions of
36.32 appreciated property under section 57(a)(6) of the Internal
36.33 Revenue Code does not apply.
36.34 (9) (11) For purposes of calculating the tax preference for
36.35 accelerated depreciation or amortization on certain property
36.36 placed in service before January 1, 1987, under section 57(a)(7)
37.1 of the Internal Revenue Code, the deduction allowable for the
37.2 taxable year is the deduction allowed under section 290.01,
37.3 subdivision 19e.
37.4 For taxable years beginning after December 31, 2000, the
37.5 amount of any remaining modification made under section 290.01,
37.6 subdivision 19e, not previously deducted is a depreciation or
37.7 amortization allowance in the first taxable year after December
37.8 31, 2000 2004.
37.9 (10) (12) For purposes of calculating the adjustment for
37.10 adjusted current earnings in section 56(g) of the Internal
37.11 Revenue Code, the term "alternative minimum taxable income" as
37.12 it is used in section 56(g) of the Internal Revenue Code, means
37.13 alternative minimum taxable income as defined in this
37.14 subdivision, determined without regard to the adjustment for
37.15 adjusted current earnings in section 56(g) of the Internal
37.16 Revenue Code.
37.17 (11) (13) For purposes of determining the amount of
37.18 adjusted current earnings under section 56(g)(3) of the Internal
37.19 Revenue Code, no adjustment shall be made under section 56(g)(4)
37.20 of the Internal Revenue Code with respect to (i) the amount of
37.21 foreign dividend gross-up subtracted as provided in section
37.22 290.01, subdivision 19d, clause (1), (ii) the amount of refunds
37.23 of income, excise, or franchise taxes subtracted as provided in
37.24 section 290.01, subdivision 19d, clause (10), or (iii) the
37.25 amount of royalties, fees or other like income subtracted as
37.26 provided in section 290.01, subdivision 19d, clause (11).
37.27 Items of tax preference must not be reduced below zero as a
37.28 result of the modifications in this subdivision.
37.29 [EFFECTIVE DATE.] This section is effective for tax years
37.30 ending after September 10, 2001.
37.31 Sec. 12. Minnesota Statutes 2001 Supplement, section
37.32 290A.03, subdivision 15, is amended to read:
37.33 Subd. 15. [INTERNAL REVENUE CODE.] "Internal Revenue Code"
37.34 means the Internal Revenue Code of 1986, as amended through June
37.35 15, 2001 March 15, 2002.
37.36 [EFFECTIVE DATE.] This section is effective at the same
38.1 time and manner as the changes to federal adjusted gross income
38.2 made by the Victims of Terrorism Tax Relief Act of 2001, Public
38.3 Law Number 107-134, and by the Job Creation and Worker
38.4 Assistance Act of 2002, Public Law Number 107-147, become
38.5 effective.
38.6 ARTICLE 3
38.7 SALES AND USE TAXES
38.8 Section 1. Minnesota Statutes 2000, section 270.60,
38.9 subdivision 4, is amended to read:
38.10 Subd. 4. [PAYMENTS TO COUNTIES.] (a) The commissioner
38.11 shall pay to a county in which an Indian gaming casino is
38.12 located ten percent of the state share of all taxes generated
38.13 from activities on reservations and collected under a tax
38.14 agreement under this section with the tribal government for the
38.15 reservation located in the county. If the tribe has casinos
38.16 located in more than one county, the payment must be divided
38.17 equally among the counties in which the casinos are located.
38.18 (b) A county is a qualified county under this subdivision
38.19 if one of the following conditions is met:
38.20 (1) the county's per capita income is less than 80 percent
38.21 of the state per capita personal income, based on the most
38.22 recent estimates made by the United States Bureau of Economic
38.23 Analysis; or
38.24 (2) 30 percent or more of the total market value of real
38.25 property in the county is exempt from ad valorem taxation.
38.26 (c) The commissioner shall make the payments required under
38.27 this subdivision by February 28 of the year following the year
38.28 the taxes are collected.
38.29 (d) (c) An amount sufficient to make the payments
38.30 authorized by this subdivision, not to exceed $1,100,000 in any
38.31 fiscal year, is annually appropriated from the general fund to
38.32 the commissioner. If the authorized payments exceed the amount
38.33 of the appropriation, the commissioner shall first
38.34 proportionately reduce the payments to counties other than
38.35 qualified counties so that the total amount equals the
38.36 appropriation. If the authorized payments to qualified counties
39.1 also exceed the amount of the appropriation, the commissioner
39.2 shall then proportionately reduce the rate so that the total
39.3 amount to be paid to qualified counties equals the appropriation.
39.4 [EFFECTIVE DATE.] This section is effective for payments
39.5 made after December 31, 2002.
39.6 Sec. 2. Minnesota Statutes 2001 Supplement, section
39.7 289A.20, subdivision 4, is amended to read:
39.8 Subd. 4. [SALES AND USE TAX.] (a) The taxes imposed by
39.9 chapter 297A are due and payable to the commissioner monthly on
39.10 or before the 20th day of the month following the month in which
39.11 the taxable event occurred, or following another reporting
39.12 period as the commissioner prescribes or as allowed under
39.13 section 289A.18, subdivision 4, paragraph (f), except that use
39.14 taxes due on an annual use tax return as provided under section
39.15 289A.11, subdivision 1, are payable by April 15 following the
39.16 close of the calendar year.
39.17 (b) For a fiscal year ending before July 1, 2002, a vendor
39.18 having a liability of $120,000 or more during a fiscal year
39.19 ending June 30 must remit the June liability for the next year
39.20 in the following manner:
39.21 (1) Two business days before June 30 of the year, the
39.22 vendor must remit 62 75 percent of the estimated June liability
39.23 to the commissioner.
39.24 (2) On or before August 20 of the year, the vendor must pay
39.25 any additional amount of tax not remitted in June.
39.26 (c) A vendor having a liability of $120,000 or more during
39.27 a fiscal year ending June 30 must remit all liabilities on
39.28 returns due for periods beginning in the subsequent calendar
39.29 year by electronic means on or before the 20th day of the month
39.30 following the month in which the taxable event occurred, or on
39.31 or before the 20th day of the month following the month in which
39.32 the sale is reported under section 289A.18, subdivision 4,
39.33 except for 62 75 percent of the estimated June liability, which
39.34 is due two business days before June 30. The remaining amount
39.35 of the June liability is due on August 20.
39.36 [EFFECTIVE DATE.] This section is effective for June 2002
40.1 and June 2003 tax liabilities.
40.2 Sec. 3. Minnesota Statutes 2001 Supplement, section
40.3 297A.61, subdivision 3, is amended to read:
40.4 Subd. 3. [SALE AND PURCHASE.] (a) "Sale" and "purchase"
40.5 include, but are not limited to, each of the transactions listed
40.6 in this subdivision.
40.7 (b) Sale and purchase include:
40.8 (1) any transfer of title or possession, or both, of
40.9 tangible personal property, whether absolutely or conditionally,
40.10 for a consideration in money or by exchange or barter; and
40.11 (2) the leasing of or the granting of a license to use or
40.12 consume, for a consideration in money or by exchange or barter,
40.13 tangible personal property, other than a manufactured home used
40.14 for residential purposes for a continuous period of 30 days or
40.15 more.
40.16 (c) Sale and purchase include the production, fabrication,
40.17 printing, or processing of tangible personal property for a
40.18 consideration for consumers who furnish either directly or
40.19 indirectly the materials used in the production, fabrication,
40.20 printing, or processing.
40.21 (d) Sale and purchase include the preparing for a
40.22 consideration of food. Notwithstanding section 297A.67,
40.23 subdivision 2, taxable food includes, but is not limited to, the
40.24 following:
40.25 (1) prepared food sold by the retailer;
40.26 (2) soft drinks;
40.27 (3) candy; and
40.28 (4) all food sold through vending machines.
40.29 (e) A sale and a purchase includes the furnishing for a
40.30 consideration of electricity, gas, water, or steam for use or
40.31 consumption within this state.
40.32 (f) A sale and a purchase includes the transfer for a
40.33 consideration of computer software.
40.34 (g) A sale and a purchase includes the furnishing for a
40.35 consideration of the following services:
40.36 (1) the privilege of admission to places of amusement,
41.1 recreational areas, or athletic events, and the making available
41.2 of amusement devices, tanning facilities, reducing salons, steam
41.3 baths, turkish baths, health clubs, and spas or athletic
41.4 facilities;
41.5 (2) lodging and related services by a hotel, rooming house,
41.6 resort, campground, motel, or trailer camp and the granting of
41.7 any similar license to use real property other than the renting
41.8 or leasing of it for a continuous period of 30 days or more;
41.9 (3) parking services, whether on a contractual, hourly, or
41.10 other periodic basis, except for parking at a meter;
41.11 (4) the granting of membership in a club, association, or
41.12 other organization if:
41.13 (i) the club, association, or other organization makes
41.14 available for the use of its members sports and athletic
41.15 facilities, without regard to whether a separate charge is
41.16 assessed for use of the facilities; and
41.17 (ii) use of the sports and athletic facility is not made
41.18 available to the general public on the same basis as it is made
41.19 available to members.
41.20 Granting of membership means both one-time initiation fees and
41.21 periodic membership dues. Sports and athletic facilities
41.22 include golf courses; tennis, racquetball, handball, and squash
41.23 courts; basketball and volleyball facilities; running tracks;
41.24 exercise equipment; swimming pools; and other similar athletic
41.25 or sports facilities; and
41.26 (5) delivery of aggregate materials and concrete block; and
41.27 (6) services as provided in this clause:
41.28 (i) laundry and dry cleaning services including cleaning,
41.29 pressing, repairing, altering, and storing clothes, linen
41.30 services and supply, cleaning and blocking hats, and carpet,
41.31 drapery, upholstery, and industrial cleaning. Laundry and dry
41.32 cleaning services do not include services provided by coin
41.33 operated facilities operated by the customer;
41.34 (ii) motor vehicle washing, waxing, and cleaning services,
41.35 including services provided by coin operated facilities operated
41.36 by the customer, and rustproofing, undercoating, and towing of
42.1 motor vehicles;
42.2 (iii) building and residential cleaning, maintenance, and
42.3 disinfecting and exterminating services;
42.4 (iv) detective, security, burglar, fire alarm, and armored
42.5 car services; but not including services performed within the
42.6 jurisdiction they serve by off-duty licensed peace officers as
42.7 defined in section 626.84, subdivision 1, or services provided
42.8 by a nonprofit organization for monitoring and electronic
42.9 surveillance of persons placed on in-home detention pursuant to
42.10 court order or under the direction of the Minnesota department
42.11 of corrections;
42.12 (v) pet grooming services;
42.13 (vi) lawn care, fertilizing, mowing, spraying and sprigging
42.14 services; garden planting and maintenance; tree, bush, and shrub
42.15 pruning, bracing, spraying, and surgery; indoor plant care;
42.16 tree, bush, shrub, and stump removal; and tree trimming for
42.17 public utility lines. Services performed under a construction
42.18 contract for the installation of shrubbery, plants, sod, trees,
42.19 bushes, and similar items are not taxable;
42.20 (vii) massages, except when provided by a licensed health
42.21 care facility or professional or upon written referral from a
42.22 licensed health care facility or professional for treatment of
42.23 illness, injury, or disease; and
42.24 (viii) the furnishing of lodging, board, and care services
42.25 for animals in kennels and other similar arrangements, but
42.26 excluding veterinary and horse boarding services.
42.27 In applying the provisions of this chapter, the terms
42.28 "tangible personal property" and "sales at retail" include
42.29 taxable services and the provision of taxable services, unless
42.30 specifically provided otherwise. Services performed by an
42.31 employee for an employer are not taxable. Services performed by
42.32 a partnership or association for another partnership or
42.33 association are not taxable if one of the entities owns or
42.34 controls more than 80 percent of the voting power of the equity
42.35 interest in the other entity. Services performed between
42.36 members of an affiliated group of corporations are not taxable.
43.1 For purposes of this section, "affiliated group of corporations"
43.2 includes those entities that would be classified as members of
43.3 an affiliated group under United States Code, title 26, section
43.4 1504, and that are eligible to file a consolidated tax return
43.5 for federal income tax purposes.
43.6 (h) A sale and a purchase includes the furnishing for a
43.7 consideration of tangible personal property or taxable services
43.8 by the United States or any of its agencies or
43.9 instrumentalities, or the state of Minnesota, its agencies,
43.10 instrumentalities, or political subdivisions.
43.11 (i) A sale and a purchase includes the furnishing for a
43.12 consideration of telecommunications services, including cable
43.13 television services and direct satellite services.
43.14 Telecommunications services are taxed to the extent allowed
43.15 under federal law if those services:
43.16 (1) either (i) originate and terminate in this state; or
43.17 (ii) originate in this state and terminate outside the state and
43.18 the service is charged to a telephone number customer located in
43.19 this state or to the account of any transmission instrument in
43.20 this state; or (iii) originate outside this state and terminate
43.21 in this state and the service is charged to a telephone number
43.22 customer located in this state or to the account of any
43.23 transmission instrument in this state; or
43.24 (2) are rendered by providing a private communications
43.25 service for which the customer has one or more locations within
43.26 Minnesota connected to the service and the service is charged to
43.27 a telephone number customer located in this state or to the
43.28 account of any transmission instrument in this state.
43.29 All charges for mobile telecommunications services, as
43.30 defined in United States Code, title 4, section 124, are deemed
43.31 to be provided by the customer's home service provider and
43.32 sourced to the customer's place of primary use and are subject
43.33 to tax based upon the customer's place of primary use in
43.34 accordance with the Mobile Telecommunications Sourcing Act,
43.35 United States Code, title 4, sections 116 to 126. All other
43.36 definitions and provisions of the Mobile Telecommunications
44.1 Sourcing Act as provided in United States Code, title 4, are
44.2 hereby adopted.
44.3 (j) A sale and a purchase includes the furnishing for a
44.4 consideration of installation if the installation charges would
44.5 be subject to the sales tax if the installation were provided by
44.6 the seller of the item being installed.
44.7 [EFFECTIVE DATE.] This section is effective for sales made
44.8 after June 30, 2002.
44.9 Sec. 4. Minnesota Statutes 2001 Supplement, section
44.10 297A.61, subdivision 31, is amended to read:
44.11 Subd. 31. [PREPARED FOOD.] "Prepared food" means (i) food
44.12 that meets either of the following conditions:
44.13 (1) the food is sold with eating utensils provided by the
44.14 seller, including plates, knives, forks, spoons, glasses, cups,
44.15 napkins, or straws; or
44.16 (2) the food is sold in a heated state or heated by the
44.17 seller; (ii) or two or more food ingredients are mixed or
44.18 combined by the seller for sale as a single item; or (iii) food
44.19 sold with eating utensils provided by the seller, including
44.20 plates, knives, forks, spoons, glasses, cups, napkins, or
44.21 straws. Prepared food does not include, except for:
44.22 (i) bakery items, including, but not limited to, bread,
44.23 rolls, buns, biscuits, bagels, croissants, pastries, donuts,
44.24 danish, cakes, tortes, pies, tarts, muffins, bars, cookies,
44.25 tortillas;
44.26 (ii) ready-to-eat meat and seafood in an unheated state
44.27 sold by weight;
44.28 (iii) eggs, fish, meat, poultry, and foods containing these
44.29 raw animal foods requiring cooking by the consumer as
44.30 recommended by the Food and Drug Administration in chapter 3,
44.31 part 401.11 of its food code so as to prevent food borne
44.32 illnesses; or
44.33 (iv) food that is only sliced, repackaged, or pasteurized
44.34 by the seller.
44.35 [EFFECTIVE DATE.] With the exception of clause (2), item
44.36 (ii), this section is effective for sales and purchases made
45.1 after June 30, 2002. Clause (2), item (ii), is effective for
45.2 sales and purchases made after June 30, 2002, and before January
45.3 1, 2006.
45.4 Sec. 5. Minnesota Statutes 2001 Supplement, section
45.5 297A.66, subdivision 1, is amended to read:
45.6 Subdivision 1. [DEFINITIONS.] (a) To the extent allowed by
45.7 the United States Constitution and the laws of the United
45.8 States, "retailer maintaining a place of business in this
45.9 state," or a similar term, means a retailer:
45.10 (1) having or maintaining within this state, directly or by
45.11 a subsidiary or an affiliate, an office, place of distribution,
45.12 sales or sample room or place, warehouse, or other place of
45.13 business; or
45.14 (2) having a representative, including, but not limited to,
45.15 an affiliate agent, salesperson, canvasser, or solicitor
45.16 operating in this state under the authority of the retailer or
45.17 its subsidiary, for any purpose, including the repairing,
45.18 selling, delivering, installing, or soliciting of orders for the
45.19 retailer's goods or services, or the leasing of tangible
45.20 personal property located in this state, whether the place of
45.21 business or agent, representative, affiliate, salesperson,
45.22 canvasser, or solicitor is located in the state permanently or
45.23 temporarily, or whether or not the retailer or, subsidiary, or
45.24 affiliate is authorized to do business in this state.
45.25 (b) "Destination of a sale" means the location to which the
45.26 retailer makes delivery of the property sold, or causes the
45.27 property to be delivered, to the purchaser of the property, or
45.28 to the agent or designee of the purchaser. The delivery may be
45.29 made by any means, including the United States Postal Service or
45.30 a for-hire carrier.
45.31 [EFFECTIVE DATE.] (a) This section is effective the day
45.32 following final enactment and is intended to confirm the
45.33 original intent of the legislature in enacting Minnesota
45.34 Statutes, section 297A.66, and its predecessor provisions.
45.35 (b) A retailer may elect that the provisions of this
45.36 section apply only to sales it made after August 31, 2002, by
46.1 notifying the commissioner and by applying for a permit under
46.2 Minnesota Statutes, section 297A.84, by August 15, 2002, to
46.3 collect the tax imposed under Minnesota Statutes, chapter 297A.
46.4 A retailer qualifies under this paragraph only if it:
46.5 (1) did not maintain an office, place of distribution,
46.6 sales or sample room or place, warehouse, or other place of
46.7 business in Minnesota except through an affiliate or did not
46.8 have a representative, agent, salesperson, canvasser, or
46.9 solicitor in Minnesota except through an affiliate; and
46.10 (2) has not registered to collect tax under Minnesota
46.11 Statutes, chapter 297A, as of the date of enactment of this
46.12 section.
46.13 Sec. 6. Minnesota Statutes 2000, section 297A.66, is
46.14 amended by adding a subdivision to read:
46.15 Subd. 4. [AFFILIATED ENTITIES.] (a) An entity is an
46.16 "affiliate" of the retailer for purposes of subdivision 1,
46.17 paragraph (a), if:
46.18 (1) the entity uses its facilities or employees in this
46.19 state to advertise, promote, or facilitate the establishment or
46.20 maintenance of a market for sales of items by the retailer to
46.21 purchasers in this state or for the provision of services to the
46.22 retailer's purchasers in this state, such as accepting returns
46.23 of purchases for the retailer, providing assistance in resolving
46.24 customer complaints of the retailer, or providing other
46.25 services; and
46.26 (2) the retailer and the entity are related parties.
46.27 (b) Two entities are related parties under this section if
46.28 one of the entities meets at least one of the following tests
46.29 with respect to the other entity:
46.30 (1) one or both entities is a corporation, and one entity
46.31 and any party related to that entity in a manner that would
46.32 require an attribution of stock from the corporation to the
46.33 party or from the party to the corporation under the attribution
46.34 rules of section 318 of the Internal Revenue Code owns directly,
46.35 indirectly, beneficially, or constructively at least 50 percent
46.36 of the value of the corporation's outstanding stock;
47.1 (2) one or both entities is a partnership, estate, or trust
47.2 and any partner or beneficiary, and the partnership, estate, or
47.3 trust and its partners or beneficiaries own directly,
47.4 indirectly, beneficially, or constructively, in the aggregate,
47.5 at least 50 percent of the profits, capital, stock, or value of
47.6 the other entity or both entities; or
47.7 (3) an individual stockholder and the members of the
47.8 stockholder's family (as defined in section 318 of the Internal
47.9 Revenue Code) owns directly, indirectly, beneficially, or
47.10 constructively, in the aggregate, at least 50 percent of the
47.11 value of both entities' outstanding stock.
47.12 (c) An entity is an affiliate under the provisions of this
47.13 subdivision if the requirements of paragraphs (a) and (b) are
47.14 met during any part of the 12-month period ending on the first
47.15 day of the month before the month in which the sale was made.
47.16 [EFFECTIVE DATE.] (a) This section is effective the day
47.17 following final enactment and is intended to confirm the
47.18 original intent of the legislature in enacting Minnesota
47.19 Statutes, section 297A.66, and its predecessor provisions.
47.20 (b) A retailer may elect that the provisions of this
47.21 section apply only to sales it made after August 31, 2002, by
47.22 notifying the commissioner and by applying for a permit under
47.23 Minnesota Statutes, section 297A.84, by August 15, 2002, to
47.24 collect the tax imposed under Minnesota Statutes, chapter 297A.
47.25 A retailer qualifies under this paragraph only if it:
47.26 (1) did not maintain an office, place of distribution,
47.27 sales or sample room or place, warehouse, or other place of
47.28 business in Minnesota except through an affiliate or did not
47.29 have a representative, agent, salesperson, canvasser, or
47.30 solicitor in Minnesota except through an affiliate; and
47.31 (2) has not registered to collect tax under Minnesota
47.32 Statutes, chapter 297A, as of the date of enactment of this
47.33 section.
47.34 Sec. 7. Minnesota Statutes 2000, section 297A.67,
47.35 subdivision 5, is amended to read:
47.36 Subd. 5. [EXEMPT MEALS AT SCHOOLS.] Meals and lunches
48.1 served at public and private elementary, middle, or secondary
48.2 schools, universities, or colleges as defined in section 120A.05
48.3 are exempt. Meals and lunches served to students at a college,
48.4 university, or private career school under a board contract are
48.5 exempt. For purposes of this subdivision, "meals and lunches"
48.6 does not include sales from vending machines.
48.7 [EFFECTIVE DATE.] This section is effective for sales and
48.8 purchases made after June 30, 2002. However, for vending
48.9 machine contracts entered into by a school, as defined in
48.10 section 120A.05, prior to May 30, 2002, food sales from vending
48.11 machines continue to be exempt under this subdivision for one
48.12 year after the effective date of the contract.
48.13 Sec. 8. Minnesota Statutes 2000, section 297A.67, is
48.14 amended by adding a subdivision to read:
48.15 Subd. 13a. [INSTRUCTIONAL MATERIALS.] Instructional
48.16 materials, other than textbooks, that are prescribed for use in
48.17 conjunction with a course of study in a post-secondary school,
48.18 college, university, or private career school to students who
48.19 are regularly enrolled at such institutions are exempt. For
48.20 purposes of this subdivision, "instructional materials" means
48.21 materials required to be used directly in the completion of the
48.22 course of study, including, but not limited to, interactive CDs,
48.23 tapes, and computer software.
48.24 Instructional materials do not include general reference
48.25 works or other items incidental to the instructional process
48.26 such as pens, pencils, paper, folders, or computers. For
48.27 purposes of this subdivision, "school" and "private career
48.28 school" have the meanings given in subdivision 13.
48.29 [EFFECTIVE DATE.] This section is effective for sales after
48.30 June 30, 2003.
48.31 Sec. 9. Minnesota Statutes 2001 Supplement, section
48.32 297A.67, subdivision 25, is amended to read:
48.33 Subd. 25. [MAINTENANCE OF CEMETERY GROUNDS.] Lawn care and
48.34 related services used in the maintenance of cemetery grounds are
48.35 exempt. For purposes of this subdivision, "lawn care and
48.36 related services" means the services listed in section 297A.61,
49.1 subdivision 3, paragraph (g), clause (5) (6), item (vi), and
49.2 "cemetery" means a cemetery for human burial.
49.3 Sec. 10. Minnesota Statutes 2001 Supplement, section
49.4 297A.67, subdivision 29, is amended to read:
49.5 Subd. 29. [ENERGY EFFICIENT PRODUCTS.] (a) A residential
49.6 lighting fixture or a compact fluorescent bulb is exempt if it
49.7 has an energy star label.
49.8 (b) The following products are exempt if they have an
49.9 energyguide label that indicates that the product meets or
49.10 exceeds the standards listed below:
49.11 (1) an electric heat pump hot water heater with an energy
49.12 factor of at least 1.9;
49.13 (2) a natural gas water heater with an energy factor of at
49.14 least 0.62; and
49.15 (3) a propane gas or fuel oil water heater with an energy
49.16 factor of at least 0.62;
49.17 (4) a natural gas furnace with an annual fuel utilization
49.18 efficiency greater than 92 percent; and
49.19 (5) a propane gas or fuel oil furnace with an annual fuel
49.20 utilization efficiency greater than 92 percent.
49.21 (c) A photovoltaic device is exempt. For purposes of this
49.22 subdivision, "photovoltaic device" means a solid-state
49.23 electrical device, such as a solar module, that converts light
49.24 directly into direct current electricity of voltage-current
49.25 characteristics that are a function of the characteristics of
49.26 the light source and the materials in and design of the device.
49.27 A "solar module" is a photovoltaic device that produces a
49.28 specified power output under defined test conditions, usually
49.29 composed of groups of solar cells connected in series, in
49.30 parallel, or in series-parallel combinations.
49.31 (d) For purposes of this subdivision, "energy star label"
49.32 means the label granted to certain products that meet United
49.33 States Environmental Protection Agency and United States
49.34 Department of Energy criteria for energy efficiency. For
49.35 purposes of this subdivision, "energyguide label" means the
49.36 label that the United States Federal Trade Commissioner requires
50.1 manufacturers to apply to certain appliances under United States
50.2 Code, title 16, part 305.
50.3 [EFFECTIVE DATE.] This section is effective for sales and
50.4 purchases made on or after the day following final enactment and
50.5 before August 1, 2005.
50.6 Sec. 11. Minnesota Statutes 2001 Supplement, section
50.7 297A.68, subdivision 3, is amended to read:
50.8 Subd. 3. [MATERIALS USED IN PROVIDING CERTAIN TAXABLE
50.9 SERVICES.] (a) Materials stored, used, or consumed in providing
50.10 a taxable service listed in section 297A.61, subdivision 3,
50.11 paragraph (g), clause (5) (6), intended to be sold ultimately at
50.12 retail are exempt.
50.13 (b) This exemption includes, but is not limited to:
50.14 (1) chemicals, lubricants, packaging materials, seeds,
50.15 trees, fertilizers, and herbicides, if these items are used or
50.16 consumed in providing the taxable service;
50.17 (2) chemicals used to treat waste generated as a result of
50.18 providing the taxable service;
50.19 (3) accessory tools, equipment, and other items that are
50.20 separate detachable units used in providing the service and that
50.21 have an ordinary useful life of less than 12 months; and
50.22 (4) fuel, electricity, gas, and steam used or consumed in
50.23 the production process, except that electricity, gas, or steam
50.24 used for space heating, cooling, or lighting is exempt if (i) it
50.25 is in excess of average climate control or lighting, and (ii) it
50.26 is necessary to produce that particular service.
50.27 (c) This exemption does not include machinery, equipment,
50.28 implements, tools, accessories, appliances, contrivances,
50.29 furniture, and fixtures used in providing the taxable service.
50.30 Sec. 12. Minnesota Statutes 2001 Supplement, section
50.31 297A.70, subdivision 10, is amended to read:
50.32 Subd. 10. [NONPROFIT TICKETS OR ADMISSIONS.] (a) Tickets
50.33 or admissions to an event are exempt if all the gross receipts
50.34 are recorded as such, in accordance with generally accepted
50.35 accounting principles, on the books of one or more organizations
50.36 that provide an opportunity for citizens of the state to
51.1 participate in the creation, performance, or appreciation of the
51.2 arts, and provided that each organization is either:
51.3 (1) an organization described in section 501(c)(3) of the
51.4 Internal Revenue Code in which voluntary contributions make up
51.5 at least the following percent of the organization's annual
51.6 revenue in its most recently completed 12-month fiscal year, or
51.7 in the current year if the organization has not completed a
51.8 12-month fiscal year:
51.9 (i) for sales made after July 31, 2001, and before July 1,
51.10 2002, for the organization's fiscal year completed in calendar
51.11 year 2000, three percent;
51.12 (ii) for sales made on or after July 1, 2002, and on or
51.13 before June 30, 2003, for the organization's fiscal year
51.14 completed in calendar year 2001, three percent;
51.15 (iii) for sales made on or after July 1, 2003, and on or
51.16 before June 30, 2004, for the organization's fiscal year
51.17 completed in calendar year 2002, four percent; and
51.18 (iv) for sales made in each 12-month period, beginning on
51.19 July 1, 2004, and each subsequent year, for the organization's
51.20 fiscal year completed in the preceding calendar year, five
51.21 percent; or
51.22 (2) a municipal board that promotes cultural and arts
51.23 activities; or
51.24 (3) the University of Minnesota, provided that the event is
51.25 held at a university-owned facility.
51.26 The exemption only applies if the entire proceeds, after
51.27 reasonable expenses, are used solely to provide opportunities
51.28 for citizens of the state to participate in the creation,
51.29 performance, or appreciation of the arts.
51.30 (b) Tickets or admissions to the premises of the Minnesota
51.31 zoological garden are exempt, provided that the exemption under
51.32 this paragraph does not apply to tickets or admissions to
51.33 performances or events held on the premises unless the
51.34 performance or event is sponsored and conducted exclusively by
51.35 the Minnesota zoological board or employees of the Minnesota
51.36 zoological garden.
52.1 [EFFECTIVE DATE.] This section is effective for tickets and
52.2 admissions to events held after July 31, 2001, but does not
52.3 apply to events for which sales of tickets or admissions were
52.4 made prior to August 1, 2001.
52.5 Sec. 13. Minnesota Statutes 2001 Supplement, section
52.6 297A.71, subdivision 23, is amended to read:
52.7 Subd. 23. [CONSTRUCTION MATERIALS FOR QUALIFIED LOW-INCOME
52.8 HOUSING PROJECTS.] (a) Purchases of materials and supplies used
52.9 or consumed in and equipment incorporated into the construction,
52.10 improvement, or expansion of qualified low-income housing
52.11 projects are exempt from the tax imposed under this chapter if
52.12 the owner of the qualified low-income housing project is:
52.13 (1) the public housing agency or housing and redevelopment
52.14 authority of a political subdivision;
52.15 (2) an entity exercising the powers of a housing and
52.16 redevelopment authority within a political subdivision;
52.17 (3) a limited partnership in which the sole general partner
52.18 is an authority under clause (1) or an entity under clause (2);
52.19 or
52.20 (4) a nonprofit corporation subject to the provisions of
52.21 chapter 317A, and qualifying under section 501(c)(3) or
52.22 501(c)(4) of the Internal Revenue Code of 1986, as amended; or
52.23 (5) an owner entity, as defined in Code of Federal
52.24 Regulations, title 24, part 941.604, for a qualified low-income
52.25 housing project described in paragraph (b), clause (5).
52.26 This exemption applies regardless of whether the purchases
52.27 are made by the owner of the facility or a contractor.
52.28 (b) For purposes of this exemption, "qualified low-income
52.29 housing project" means:
52.30 (1) a housing or mixed use project in which at least 20
52.31 percent of the residential units are qualifying low-income
52.32 rental housing units as defined in section 273.126;
52.33 (2) a federally assisted low-income housing project
52.34 financed by a mortgage insured or held by the United States
52.35 Department of Housing and Urban Development under United States
52.36 Code, title 12, section 1701s, 1715l(d)(3), 1715l(d)(4), or
53.1 1715z-1; United States Code, title 42, section 1437f; the Native
53.2 American Housing Assistance and Self-Determination Act, United
53.3 States Code, title 25, section 4101 et seq.; or any similar
53.4 successor federal low-income housing program;
53.5 (3) a qualified low-income housing project as defined in
53.6 United States Code, title 26, section 42(g), meeting all of the
53.7 requirements for a low-income housing credit under section 42 of
53.8 the Internal Revenue Code regardless of whether the project
53.9 actually applies for or receives a low-income housing credit; or
53.10 (4) a project that will be operated in compliance with
53.11 Internal Revenue Service revenue procedure 96-32; or
53.12 (5) a housing or mixed use project in which all or a
53.13 portion of the residential units are subject to the requirements
53.14 of section 5 of the United States Housing Act of 1937.
53.15 (c) For a project, a portion of which is not used for
53.16 low-income housing units, the amount of purchases that are
53.17 exempt under this subdivision must be determined by multiplying
53.18 the total purchases, as specified in paragraph (a), by the ratio
53.19 of:
53.20 (1) the total gross square footage of units subject to the
53.21 income limits under section 273.126, the financing for the
53.22 project, the federal low-income housing tax credit, revenue
53.23 procedure 96-32, or section 5 of the United States Housing Act
53.24 of 1937, as applicable to the project; and
53.25 (2) the total gross square footage of all units in the
53.26 project.
53.27 (d) The tax must be imposed and collected as if the rate
53.28 under section 297A.62, subdivision 1, applied, and then refunded
53.29 in the manner provided in section 297A.75.
53.30 [EFFECTIVE DATE.] Paragraph (a), clause (5), and paragraph
53.31 (b), clause (5), are effective retroactive for sales and
53.32 purchases made after July 31, 2001. For sales and purchases
53.33 made after July 31, 2001, and before July 1, 2002, an owner
53.34 entity under this section must apply to the commissioner of
53.35 revenue for a refund of the tax paid on the exempt amount as
53.36 determined under this section. The rest of the section is
54.1 effective for sales made after June 30, 2002.
54.2 Sec. 14. Minnesota Statutes 2000, section 297A.71, is
54.3 amended by adding a subdivision to read:
54.4 Subd. 28. [CONSTRUCTION MATERIALS AND EQUIPMENT;
54.5 REPLACEMENT AGRICULTURAL PROCESSING FACILITY.] Materials and
54.6 supplies used or consumed in, and machinery and equipment
54.7 incorporated into, the construction of a meat-packing or
54.8 meat-processing facility are exempt if:
54.9 (1) the cost of the project exceeds $75,000,000; and
54.10 (2) the facility replaces a facility that was destroyed by
54.11 fire.
54.12 [EFFECTIVE DATE.] This section is effective for sales and
54.13 purchases made after March 31, 2002, and before January 1, 2005.
54.14 Sec. 15. Minnesota Statutes 2000, section 297A.71, is
54.15 amended by adding a subdivision to read:
54.16 Subd. 29. [HYDROELECTRIC GENERATING FACILITY.] Materials
54.17 and supplies used or consumed in the construction of a
54.18 hydroelectric generating facility that meets the requirements of
54.19 this subdivision are exempt. To qualify for the exemption under
54.20 this subdivision, a hydroelectric generating facility must:
54.21 (1) utilize two turbine generators at a dam site existing
54.22 on March 31, 1994;
54.23 (2) be located on publicly owned land and within 2,500 feet
54.24 of a 13.8 kilovolt distribution circuit; and
54.25 (3) be eligible to receive a renewable energy production
54.26 incentive payment under section 216C.41.
54.27 [EFFECTIVE DATE.] This section is effective for sales made
54.28 after August 31, 2002, and on or before December 31, 2003.
54.29 Sec. 16. Minnesota Statutes 2000, section 297A.71, is
54.30 amended by adding a subdivision to read:
54.31 Subd. 30. [NONPROFIT ARTS ORGANIZATION.] Materials,
54.32 equipment, and supplies incorporated into the construction or
54.33 renovation of a state bond financed facility funded in 2002
54.34 which is owned or operated by a nonprofit arts organization are
54.35 exempt.
54.36 [EFFECTIVE DATE.] This section is effective for sales and
55.1 purchases made the day after final enactment and before July 1,
55.2 2007.
55.3 Sec. 17. Minnesota Statutes 2001 Supplement, section
55.4 297A.75, is amended to read:
55.5 297A.75 [REFUND; APPROPRIATION.]
55.6 Subdivision 1. [TAX COLLECTED.] The tax on the gross
55.7 receipts from the sale of the following exempt items must be
55.8 imposed and collected as if the sale were taxable and the rate
55.9 under section 297A.62, subdivision 1, applied. The exempt items
55.10 include:
55.11 (1) capital equipment exempt under section 297A.68,
55.12 subdivision 5;
55.13 (2) building materials for an agricultural processing
55.14 facility exempt under section 297A.71, subdivision 13;
55.15 (3) building materials for mineral production facilities
55.16 exempt under section 297A.71, subdivision 14;
55.17 (4) building materials for correctional facilities under
55.18 section 297A.71, subdivision 3;
55.19 (5) building materials used in a residence for disabled
55.20 veterans exempt under section 297A.71, subdivision 11;
55.21 (6) chair lifts, ramps, elevators, and associated building
55.22 materials exempt under section 297A.71, subdivision 12;
55.23 (7) building materials for the Long Lake Conservation
55.24 Center exempt under section 297A.71, subdivision 17; and
55.25 (8) materials, supplies, fixtures, furnishings, and
55.26 equipment for a county law enforcement and family service center
55.27 under section 297A.71, subdivision 26; and
55.28 (9) materials and supplies for qualified low-income housing
55.29 under section 297A.71, subdivision 23.
55.30 Subd. 2. [REFUND; ELIGIBLE PERSONS.] Upon application on
55.31 forms prescribed by the commissioner, a refund equal to the tax
55.32 paid on the gross receipts of the exempt items must be paid to
55.33 the applicant. Only the following persons may apply for the
55.34 refund:
55.35 (1) for subdivision 1, clauses (1) to (3), the applicant
55.36 must be the purchaser;
56.1 (2) for subdivision 1, clauses (4), (7), and (8), the
56.2 applicant must be the governmental subdivision;
56.3 (3) for subdivision 1, clause (5), the applicant must be
56.4 the recipient of the benefits provided in United States Code,
56.5 title 38, chapter 21; and
56.6 (4) for subdivision 1, clause (6), the applicant must be
56.7 the owner of the homestead property; and
56.8 (5) for subdivision 1, clause (9), the owner of the
56.9 qualified low-income housing project.
56.10 Subd. 3. [APPLICATION.] (a) The application must include
56.11 sufficient information to permit the commissioner to verify the
56.12 tax paid. If the tax was paid by a contractor, subcontractor,
56.13 or builder, under subdivision 1, clause (4), (5), (6),
56.14 (7), or (8), or (9), the contractor, subcontractor, or builder
56.15 must furnish to the refund applicant a statement including the
56.16 cost of the exempt items and the taxes paid on the items unless
56.17 otherwise specifically provided by this subdivision. The
56.18 provisions of sections 289A.40 and 289A.50 apply to refunds
56.19 under this section.
56.20 (b) An applicant may not file more than two applications
56.21 per calendar year for refunds for taxes paid on capital
56.22 equipment exempt under section 297A.68, subdivision 5.
56.23 Subd. 4. [INTEREST.] Interest must be paid on the refund
56.24 at the rate in section 270.76 from the date the refund claim is
56.25 filed for taxes paid under subdivision 1, clauses (1) to (3),
56.26 and (5), and from 60 days after the date the refund claim is
56.27 filed with the commissioner for claims filed under subdivision
56.28 1, clauses (4), (6), (7), and (8), and (9).
56.29 Subd. 5. [APPROPRIATION.] The amount required to make the
56.30 refunds is annually appropriated to the commissioner.
56.31 [EFFECTIVE DATE.] This section is effective for sales made
56.32 after June 30, 2002.
56.33 Sec. 18. Minnesota Statutes 2000, section 297A.96, is
56.34 amended to read:
56.35 297A.96 [LOCAL ADMISSIONS AND AMUSEMENT TAXES; EXEMPTION
56.36 FOR ARTS ORGANIZATIONS.]
57.1 If an event is sponsored by a nonprofit arts organization,
57.2 then Amounts charged for admission to the an event or to the
57.3 organization's premises described in section 297A.70,
57.4 subdivision 10, paragraph (a), are not subject to a tax imposed
57.5 by a local unit of government or imposed on sales taking place
57.6 in a single named local unit of government on sales of
57.7 admissions or amusements, under a law other than a general sales
57.8 tax law.
57.9 [EFFECTIVE DATE.] This section is effective for tickets and
57.10 admissions to events held after July 31, 2001, but does not
57.11 apply to events for which sales of tickets or admissions were
57.12 made prior to August 1, 2001.
57.13 Sec. 19. Minnesota Statutes 2001 Supplement, section
57.14 297A.995, subdivision 4, is amended to read:
57.15 Subd. 4. [AUTHORITY TO ENTER AGREEMENT.] The commissioner
57.16 of revenue is authorized and directed to enter into the
57.17 agreement with one or more states to simplify and modernize
57.18 sales and use tax administration in order to substantially
57.19 reduce the burden of tax compliance for all sellers and for all
57.20 types of commerce. In furtherance of the agreement, the
57.21 commissioner is authorized to act jointly with other states that
57.22 are members of the agreement to establish standards for
57.23 certification of a certified service provider and certified
57.24 automated system and establish performance standards for
57.25 multistate sellers.
57.26 The commissioner of revenue is further directed to
57.27 negotiate the agreement with the express intention of ensuring
57.28 uniform sales and use taxation as applied to like-kind
57.29 transactions.
57.30 The commissioner is further authorized to take other
57.31 actions reasonably required to implement the provisions set
57.32 forth in this article. Other actions authorized by this section
57.33 include, but are not limited to, the adoption of rules and
57.34 regulations and the joint procurement, with other member states,
57.35 of goods and services in furtherance of the cooperative
57.36 agreement.
58.1 The commissioner or the commissioner's designee is
58.2 following officials are authorized to represent this state
58.3 before the other states that are signatories to the agreement:
58.4 (1) the commissioner or the commissioner's designee;
58.5 (2) the chair of the house committee with jurisdiction over
58.6 taxes or the house chair's designee; and
58.7 (3) the chair of the senate committee with jurisdiction
58.8 over taxes or the senate chair's designee.
58.9 [EFFECTIVE DATE.] This section is effective the day
58.10 following final enactment.
58.11 Sec. 20. Laws 1990, chapter 604, article 6, section 9,
58.12 subdivision 1, as amended by Laws 1991, chapter 291, article 8,
58.13 section 25, is amended to read:
58.14 Subdivision 1. [AUTHORIZATION.] Notwithstanding Minnesota
58.15 Statutes, section 469.190, 477A.016, or other law, in addition
58.16 to the tax authorized in Laws 1986, chapter 391, section 4, the
58.17 governing body of the city of Bloomington may impose a tax of up
58.18 to one two percent on the gross receipts from the furnishing for
58.19 consideration of lodging at a hotel, motel, rooming house,
58.20 tourist court, or resort, other than the renting or leasing of
58.21 it for a continuous period of 30 days or more, located in the
58.22 city. The city may agree with the commissioner of revenue that
58.23 a tax imposed under this section shall be collected by the
58.24 commissioner together with the tax imposed by Minnesota
58.25 Statutes, chapter 297A, and subject to the same interest,
58.26 penalties, and other rules and that its proceeds, less the cost
58.27 of collection, shall be remitted to the city. The proceeds of
58.28 the tax must be used by the Bloomington convention bureau only
58.29 to market and promote the city as a tourist or convention
58.30 center. If the duties of the convention bureau as they existed
58.31 on January 1, 1991, are assigned to another agency, the tax
58.32 shall cease.
58.33 [EFFECTIVE DATE; LOCAL APPROVAL.] This section takes effect
58.34 the day after the governing body of the city of Bloomington
58.35 complies with Minnesota Statutes, section 645.021, subdivision 3.
58.36 Sec. 21. Laws 1998, chapter 389, article 8, section 37,
59.1 subdivision 2, is amended to read:
59.2 Subd. 2. [APPOINTMENT OF MEMBERS.] The citizen review
59.3 panel must consist of 17 members, each of whom represents one of
59.4 the district councils consists of three residents from each of
59.5 the seven city council wards, for a total of 21 members. The
59.6 mayor must appoint the members, and the appointments are subject
59.7 to confirmation by a majority vote of the city council. Members
59.8 serve for a term of four years. Elected officials and employees
59.9 of the city are ineligible to serve as members of the panel.
59.10 [EFFECTIVE DATE.] This section is effective upon approval
59.11 by the governing body of the city of St. Paul and compliance
59.12 with Minnesota Statutes, section 645.021.
59.13 Sec. 22. Laws 2001, First Special Session chapter 5,
59.14 article 12, section 11, the effective date, is amended to read:
59.15 [EFFECTIVE DATE.] This section is effective January 1,
59.16 2002, however, for contracts entered into before January 1,
59.17 2002, the sale price for aggregate materials and concrete block
59.18 does not include delivery charges until January 1, 2005.
59.19 Sec. 23. Laws 2001, First Special Session chapter 5,
59.20 article 12, section 82, the effective date, is amended to read:
59.21 [EFFECTIVE DATE.] This section is effective January 1, 2003
59.22 for sales and purchases made after December 31, 2005.
59.23 Sec. 24. Laws 2001, First Special Session chapter 5,
59.24 article 12, section 95, is amended to read:
59.25 Sec. 95. [REPEALER.]
59.26 (a) Minnesota Statutes 2000, sections 297A.61, subdivision
59.27 16; 297A.68, subdivision 21; and 297A.71, subdivisions
59.28 subdivision 2 and 16, are repealed effective for sales and
59.29 purchases occurring after June 30, 2001, except that the repeal
59.30 of section 297A.61, subdivision 16, paragraph (d), is effective
59.31 for sales and purchases occurring after July 31, 2001.
59.32 (b) Minnesota Statutes 2000, sections 297A.62, subdivision
59.33 2, and 297A.64, subdivision 1, are repealed effective for sales
59.34 and purchases made after December 31, 2005.
59.35 (c) Minnesota Statutes 2000, section 297A.71, subdivision
59.36 15, is repealed effective for sales and purchases made after
60.1 June 30, 2002.
60.2 (d) Minnesota Statutes 2000, section 289A.60, subdivision
60.3 15, is repealed effective for liabilities after January 1,
60.4 2003 2004.
60.5 (e) Minnesota Statutes 2000, section 297A.71, subdivision
60.6 16, is repealed effective for sales and purchases occuring after
60.7 December 31, 2002.
60.8 [EFFECTIVE DATE.] Paragraph (d) is effective the day after
60.9 final enactment. Paragraphs (a) and (e) are effective for sales
60.10 and purchases made on or after June 30, 2001, for projects begun
60.11 prior to June 30, 2001.
60.12 Sec. 25. [ROCHESTER LODGING TAX.]
60.13 Subdivision 1. [AUTHORIZATION.] Notwithstanding Minnesota
60.14 Statutes, section 469.190 or 477A.016, or any other law, the
60.15 city of Rochester may impose an additional tax of one percent on
60.16 the gross receipts from the furnishing for consideration of
60.17 lodging at a hotel, motel, rooming house, tourist court, or
60.18 resort, other than the renting or leasing of it for a continuous
60.19 period of 30 days or more.
60.20 Subd. 2. [DISPOSITION OF PROCEEDS.] The gross proceeds
60.21 from any tax imposed under subdivision 1 must be used by the
60.22 city to fund a local convention or tourism bureau for the
60.23 purpose of marketing and promoting the city as a tourist or
60.24 convention center.
60.25 [EFFECTIVE DATE.] This section is effective for lodging
60.26 furnished on or after July 1, 2002.
60.27 Sec. 26. [REPEALER.]
60.28 Minnesota Statutes 2000, section 297A.68, subdivision 26,
60.29 is repealed effective for sales and purchases made after June
60.30 30, 2002.
60.31 ARTICLE 4
60.32 PROPERTY TAXES
60.33 Section 1. Minnesota Statutes 2000, section 168A.05, is
60.34 amended by adding a subdivision to read:
60.35 Subd. 1a. [MANUFACTURED HOMES; PROPERTY TAXES MUST BE
60.36 PAID.] In the case of a manufactured home as defined in section
61.1 327.31, subdivision 6, the department shall not issue a
61.2 certificate of title unless the application under section
61.3 168A.04 is accompanied with a statement from the county auditor
61.4 or county treasurer where the manufactured home is presently
61.5 located, stating that all personal property taxes levied on the
61.6 unit that are due from the current owner at the time of transfer
61.7 for which the application applies, have been paid.
61.8 [EFFECTIVE DATE.] This section is effective for
61.9 certificates of title issued by the department on or after July
61.10 1, 2002.
61.11 Sec. 2. Minnesota Statutes 2000, section 168A.05, is
61.12 amended by adding a subdivision to read:
61.13 Subd. 1b. [EXEMPTION.] The provisions of subdivision 1a
61.14 shall not apply to: (i) a manufactured home which is sold or
61.15 otherwise disposed of pursuant to section 504B.271 by the owner
61.16 of a manufactured home park as defined in section 327.14,
61.17 subdivision 3, or (ii) a manufactured home which is sold
61.18 pursuant to section 504B.265 by the owner of a manufactured home
61.19 park.
61.20 [EFFECTIVE DATE.] This section is effective for
61.21 certificates of title issued by the department on or after July
61.22 1, 2002.
61.23 Sec. 3. Minnesota Statutes 2001 Supplement, section
61.24 216B.1646, is amended to read:
61.25 216B.1646 [RATE REDUCTION; PROPERTY TAX REDUCTION.]
61.26 (a) The commission shall, by any method the commission
61.27 finds appropriate, reduce the amounts rates each electric
61.28 utility subject to rate regulation by the commission charges its
61.29 customers to reflect, on an ongoing basis, the amount by which
61.30 each utility's property tax on the personal property of its
61.31 electric generation, transmission, or distribution system from
61.32 taxes payable in 2001 to taxes payable in 2002 is reduced. The
61.33 commission must ensure that, to the extent feasible, each dollar
61.34 of personal property tax reduction allocated to Minnesota
61.35 consumers retroactive to January 1, 2002, results in a dollar of
61.36 savings to the utility's customers. A utility may voluntarily
62.1 pass on any additional property tax savings in the same manner
62.2 as approved by the commission under this paragraph.
62.3 (b) By April 10, 2002, each utility shall submit a filing
62.4 to the commission containing:
62.5 (1) certified information regarding the utility's property
62.6 tax savings allocated to Minnesota retail customers; and
62.7 (2) a proposed method of passing these savings on to
62.8 Minnesota retail customers.
62.9 The utility shall provide the information in clause (1) to
62.10 the commissioner of revenue at the same time. The commissioner
62.11 shall notify the commission within 30 days as to the accuracy of
62.12 the property tax data submitted by the utility.
62.13 (c) For purposes of this section, "personal property"
62.14 means tools, implements, and machinery of the generating plant.
62.15 It does not apply to transformers, transmission lines,
62.16 distribution lines, or any other tools, implements, and
62.17 machinery that are part of an electric substation, wherever
62.18 located.
62.19 [EFFECTIVE DATE.] This section is effective retroactive to
62.20 July 1, 2001.
62.21 Sec. 4. Minnesota Statutes 2001 Supplement, section
62.22 271.01, subdivision 5, is amended to read:
62.23 Subd. 5. [JURISDICTION.] The tax court shall have
62.24 statewide jurisdiction. Except for an appeal to the supreme
62.25 court or any other appeal allowed under this subdivision, the
62.26 tax court shall be the sole, exclusive, and final authority for
62.27 the hearing and determination of all questions of law and fact
62.28 arising under the tax laws of the state, as defined in this
62.29 subdivision, in those cases that have been appealed to the tax
62.30 court and in any case that has been transferred by the district
62.31 court to the tax court. The tax court shall have no
62.32 jurisdiction in any case that does not arise under the tax laws
62.33 of the state or in any criminal case or in any case determining
62.34 or granting title to real property or in any case that is under
62.35 the probate jurisdiction of the district court. The small
62.36 claims division of the tax court shall have no jurisdiction in
63.1 any case dealing with property valuation or assessment for
63.2 property tax purposes until the taxpayer has appealed the
63.3 valuation or assessment to the county board of equalization, and
63.4 in those towns and cities which have not transferred their
63.5 duties to the county, the town or city board of equalization,
63.6 except for: (i) those taxpayers whose original assessments are
63.7 determined by the commissioner of revenue; (ii) those taxpayers
63.8 appealing a denial of a current year application for the
63.9 homestead classification for their property and the denial was
63.10 not reflected on a valuation notice issued in the year; and
63.11 (iii) any case dealing with property valuation, assessment, or
63.12 taxation for property tax purposes and meeting the
63.13 jurisdictional requirements of section 271.21, subdivision 2,
63.14 paragraph (c) only as provided in section 271.21, subdivision 2.
63.15 The tax court shall have no jurisdiction in any case involving
63.16 an order of the state board of equalization unless a taxpayer
63.17 contests the valuation of property. Laws governing taxes, aids,
63.18 and related matters administered by the commissioner of revenue,
63.19 laws dealing with property valuation, assessment or taxation of
63.20 property for property tax purposes, and any other laws that
63.21 contain provisions authorizing review of taxes, aids, and
63.22 related matters by the tax court shall be considered tax laws of
63.23 this state subject to the jurisdiction of the tax court. This
63.24 subdivision shall not be construed to prevent an appeal, as
63.25 provided by law, to an administrative agency, board of
63.26 equalization, review under section 274.13, subdivision 1c, or to
63.27 the commissioner of revenue. Wherever used in this chapter, the
63.28 term commissioner shall mean the commissioner of revenue, unless
63.29 otherwise specified.
63.30 [EFFECTIVE DATE.] This section is effective for petitions
63.31 filed pertaining to the 2002 assessment, and thereafter.
63.32 Sec. 5. Minnesota Statutes 2001 Supplement, section
63.33 271.21, subdivision 2, is amended to read:
63.34 Subd. 2. [JURISDICTION.] At the election of the taxpayer,
63.35 the small claims division shall have jurisdiction only in the
63.36 following matters:
64.1 (a) cases involving valuation, assessment, or taxation of
64.2 real or personal property, if the taxpayer has satisfied the
64.3 requirements of section 271.01, subdivision 5, and:
64.4 (i) the issue is a denial of a current year application for
64.5 the homestead classification for the taxpayer's property and the
64.6 denial was not reflected on a valuation notice issued in the
64.7 year; or
64.8 (ii) in the case of nonhomestead property, only one parcel
64.9 is included in the petition, the entire parcel is classified as
64.10 homestead class 1a or 1b under section 273.13 and the parcel
64.11 contains no more than one dwelling unit;
64.12 (iii) the entire property is classified as agricultural
64.13 homestead class 2a or 1b under section 273.13; or
64.14 (iv) the assessor's estimated market value of the property
64.15 included in the petition is less than $100,000 $300,000; or
64.16 (b) any other case concerning the tax laws as defined in
64.17 section 271.01, subdivision 5, not involving valuation,
64.18 assessment, or taxation of real and personal property in which
64.19 the amount in controversy does not exceed $5,000, including
64.20 penalty and interest; or.
64.21 (c) cases involving valuation, assessment, or taxation of
64.22 real or personal property if:
64.23 (i) the issue is a denial of a current year application for
64.24 the homestead classification for the taxpayer's property;
64.25 (ii) only one parcel is included in the petition, the
64.26 entire parcel is classified as homestead 1a or 1b pursuant to
64.27 section 273.13, and the parcel contains no more than one
64.28 dwelling unit; or
64.29 (iii) the assessor's estimated market value of the property
64.30 included in the petition is less than $300,000.
64.31 [EFFECTIVE DATE.] This section is effective for petitions
64.32 filed pertaining to the 2002 assessment, and thereafter.
64.33 Sec. 6. Minnesota Statutes 2001 Supplement, section
64.34 272.02, subdivision 22, is amended to read:
64.35 Subd. 22. [WIND ENERGY CONVERSION SYSTEMS.] (a) Small
64.36 scale wind energy conversion systems installed after January 1,
65.1 1991, and used as an electric power source are exempt.
65.2 "Small scale wind energy conversion systems" are wind
65.3 energy conversion systems, as defined in section 216C.06,
65.4 subdivision 12, including the foundation or support pad, which
65.5 (i) are used as an electric power source; (ii) are located
65.6 within one county and owned by the same owner; and (iii) produce
65.7 two megawatts or less of electricity as measured by nameplate
65.8 ratings.
65.9 (b) Medium scale wind energy conversion systems installed
65.10 after January 1, 1991, are treated as follows: (i) the
65.11 foundation and support pad are taxable; (ii) the associated
65.12 supporting and protective structures are exempt for the first
65.13 five assessment years after they have been constructed, and
65.14 thereafter, 30 percent of the market value of the associated
65.15 supporting and protective structures are taxable; and (iii) the
65.16 turbines, blades, transformers, and its related equipment, are
65.17 exempt. "Medium scale wind energy conversion systems" are wind
65.18 energy conversion systems as defined in section 216C.06,
65.19 subdivision 12, including the foundation or support pad, which:
65.20 (i) are used as an electric power source; (ii) are located
65.21 within one county and owned by the same owner; and (iii) produce
65.22 more than two but equal to or less than 12 megawatts of energy
65.23 as measured by nameplate ratings.
65.24 (c) Large scale wind energy conversion systems installed
65.25 after January 1, 1991, are treated as follows: 25 percent of
65.26 the market value of all property is taxable, including (i) the
65.27 foundation and support pad; (ii) the associated supporting and
65.28 protective structures; and (iii) the turbines, blades,
65.29 transformers, and its related equipment. "Large scale wind
65.30 energy conversion systems" are wind energy conversion systems as
65.31 defined in section 216C.06, subdivision 12, including the
65.32 foundation or support pad, which (i) are used as an electric
65.33 power source; and (ii) produce more than 12 megawatts of energy
65.34 as measured by nameplate ratings.
65.35 (d) The total size of a wind energy conversion system under
65.36 this subdivision shall be determined according to this paragraph.
66.1 Unless the systems are interconnected with different
66.2 distribution systems, the nameplate capacity of one wind energy
66.3 conversion system shall be combined with the nameplate capacity
66.4 of any other wind energy conversion system that is:
66.5 (1) located within five miles of the wind energy conversion
66.6 system;
66.7 (2) constructed within the same calendar year as the wind
66.8 energy conversion system; and
66.9 (3) under common ownership.
66.10 In the case of a dispute, the commissioner of commerce
66.11 shall determine the total size of the system, and shall draw all
66.12 reasonable inferences in favor of combining the systems.
66.13 (e) In making a determination under paragraph (d), the
66.14 commissioner of commerce may determine that two wind energy
66.15 conversion systems are under common ownership when the
66.16 underlying ownership structure contains similar persons or
66.17 entities, even if the ownership shares differ between the two
66.18 systems. Wind energy conversion systems are not under common
66.19 ownership solely because the same person or entity provided
66.20 equity financing for the systems. All real and personal
66.21 property of a wind energy conversion system as defined in
66.22 section 272.029, subdivision 2, is exempt from property tax
66.23 except that the land on which the property is located remains
66.24 taxable.
66.25 [EFFECTIVE DATE.] This section is effective for taxes
66.26 payable in 2003 and thereafter.
66.27 Sec. 7. Minnesota Statutes 2000, section 272.02, is
66.28 amended by adding a subdivision to read:
66.29 Subd. 51. [ELECTRIC GENERATION FACILITY; PERSONAL
66.30 PROPERTY.] Notwithstanding subdivision 9, clause (a), attached
66.31 machinery and other personal property which is part of a
66.32 combined cycle natural gas turbine electric generation facility
66.33 of between 43 and 46 megawatts of installed capacity and that
66.34 meets the requirements of this subdivision is exempt. At the
66.35 time of construction, the facility must:
66.36 (1) utilize a combined cycle gas turbine generator fueled
67.1 by natural gas;
67.2 (2) be connected to an existing 115-kilovolt high-voltage
67.3 electric transmission line that is within one mile of the
67.4 facility;
67.5 (3) be located on an underground natural gas storage
67.6 aquifer;
67.7 (4) be designed as an intermediate load facility; and
67.8 (5) have received, by resolution, the approval from the
67.9 governing body of the county for the exemption of personal
67.10 property under this subdivision.
67.11 Construction of the facility must be commenced after
67.12 January 1, 2002, and before January 1, 2004. Property eligible
67.13 for this exemption does not include electric transmission lines
67.14 and interconnections or gas pipelines and interconnections
67.15 appurtenant to the property or the facility.
67.16 [EFFECTIVE DATE.] This section is effective for assessment
67.17 year 2002 and thereafter.
67.18 Sec. 8. Minnesota Statutes 2000, section 272.02, is
67.19 amended by adding a subdivision to read:
67.20 Subd. 52. [ELECTRIC GENERATION FACILITY; PERSONAL
67.21 PROPERTY.] Notwithstanding subdivision 9, clause (a), attached
67.22 machinery and other personal property which is part of a
67.23 simple-cycle combustion-turbine electric generation facility of
67.24 more than 40 megawatts and less than 50 megawatts of installed
67.25 capacity and that meets the requirements of this subdivision is
67.26 exempt. At the time of construction, the facility must:
67.27 (1) utilize natural gas as a primary fuel;
67.28 (2) be located within two miles of parallel existing
67.29 36-inch natural gas pipelines and an existing 115-kilovolt
67.30 high-voltage electric transmission line;
67.31 (3) be designed to provide peaking, emergency backup, or
67.32 contingency services; and
67.33 (4) satisfy a resource deficiency identified in an approved
67.34 integrated resource plan filed under section 216B.2422.
67.35 Construction of the facility must be commenced after
67.36 January 1, 2001, and before January 1, 2005. Property eligible
68.1 for this exemption does not include electric transmission lines
68.2 and interconnections or gas pipelines and interconnections
68.3 appurtenant to the property or the facility.
68.4 [EFFECTIVE DATE.] This section is effective for assessment
68.5 year 2002 and thereafter.
68.6 Sec. 9. Minnesota Statutes 2000, section 272.02, is
68.7 amended by adding a subdivision to read:
68.8 Subd. 53. [ELECTRIC GENERATION FACILITY; PERSONAL
68.9 PROPERTY.] Notwithstanding subdivision 9, clause (a), attached
68.10 machinery and other personal property which is part of a 3.2
68.11 megawatt run-of-the-river hydroelectric generation facility and
68.12 that meets the requirements of this subdivision is exempt. At
68.13 the time of construction, the facility must:
68.14 (1) utilize two turbine generators at a dam site existing
68.15 on March 31, 1994;
68.16 (2) be located on publicly owned land and within 1,500 feet
68.17 of a 13.8 kilovolt distribution substation; and
68.18 (3) be eligible to receive a renewable energy production
68.19 incentive payment under section 216C.41.
68.20 Construction of the facility must be commenced after
68.21 January 1, 2002, and before January 1, 2004. Property eligible
68.22 for this exemption does not include electric transmission lines
68.23 and interconnections or gas pipelines and interconnections
68.24 appurtenant to the property or the facility.
68.25 [EFFECTIVE DATE.] This section is effective for assessment
68.26 year 2002 and thereafter.
68.27 Sec. 10. Minnesota Statutes 2000, section 272.02, is
68.28 amended by adding a subdivision to read:
68.29 Subd. 54. [SMALL BIOMASS ELECTRIC GENERATION FACILITY;
68.30 PERSONAL PROPERTY.] Notwithstanding subdivision 9, clause (a),
68.31 attached machinery and other personal property which is part of
68.32 an electrical generating facility that meets the requirements of
68.33 this subdivision is exempt. At the time of construction the
68.34 facility must:
68.35 (1) have a generation capacity of less than 25 megawatts;
68.36 (2) provide process heating needs in addition to electrical
69.1 generation; and
69.2 (3) utilize agricultural by-products from the malting
69.3 process and other biomass fuels as its primary fuel source.
69.4 Construction of the facility must be commenced after
69.5 January 1, 2002, and before January 1, 2006. Property eligible
69.6 for this exemption does not include electric transmission lines
69.7 and interconnections or gas pipelines and interconnections
69.8 appurtenant to the property or facility.
69.9 [EFFECTIVE DATE.] This section is effective for assessment
69.10 year 2003 and thereafter.
69.11 Sec. 11. Minnesota Statutes 2000, section 272.02, is
69.12 amended by adding a subdivision to read:
69.13 Subd. 55. [ELECTRIC GENERATION FACILITY; PERSONAL
69.14 PROPERTY.] Notwithstanding subdivision 9, clause (a), attached
69.15 machinery and other personal property which is part of an
69.16 electric generating facility that meets the requirements of this
69.17 subdivision is exempt. At the time of construction, the
69.18 facility must be sited on an energy park that (i) is located on
69.19 an active mining site, or on a former mining or industrial site
69.20 where mining or industrial operations have terminated, (ii) is
69.21 within a tax relief area as defined in section 273.134, (iii)
69.22 has on-site access to existing railroad infrastructure, (iv) has
69.23 direct rail access to a Great Lakes port, (v) has sufficient
69.24 private water resources on site, and (vi) is designed to host at
69.25 least 500 megawatts of electrical generation.
69.26 Construction of the first 250 megawatts of the facility
69.27 must be commenced after January 1, 2002, and before January 1,
69.28 2005. Construction of up to an additional 750 megawatts of
69.29 generation must be commenced before January 1, 2010. Property
69.30 eligible for this exemption does not include electric
69.31 transmission lines and interconnections or gas pipelines and
69.32 interconnections appurtenant to the property or the facility.
69.33 [EFFECTIVE DATE.] This section is effective for assessment
69.34 year 2003 and thereafter.
69.35 Sec. 12. Minnesota Statutes 2001 Supplement, section
69.36 272.028, is amended to read:
70.1 272.028 [PAYMENT IN LIEU OF PERSONAL PROPERTY PRODUCTION
70.2 TAX; WIND GENERATION FACILITIES.]
70.3 A developer of a new or existing medium or large scale wind
70.4 energy conversion system, as defined under section 272.02,
70.5 subdivision 22, paragraphs (b) and (c), 272.029, subdivision 2,
70.6 may negotiate with the city or town and the county where the
70.7 wind energy conversion system is located to establish a payment
70.8 in lieu of tax on personal property used to generate electric
70.9 power the wind energy production tax imposed under section
70.10 272.029. The in lieu payment is to provide fees or compensation
70.11 to the host jurisdictions to maintain public infrastructure and
70.12 services. A host jurisdiction includes a city or town and the
70.13 county in which a facility is located. The payment in lieu of
70.14 personal property the wind energy production tax may be based on
70.15 production capacity, historical production, or other factors
70.16 agreed upon by the parties. The payment in lieu of tax
70.17 agreement must be signed by the parties and filed with the
70.18 commissioner of revenue and the county recorder. Upon execution
70.19 and filing of the agreement, the personal property to which the
70.20 in lieu payment applies shall be deemed exempt from tax under
70.21 section 272.02, subdivision 22, paragraphs (b) and (c). This
70.22 Exemption from the tax under section 272.029 shall be
70.23 effective for the assessment year in which the in lieu payment
70.24 is agreed upon and shall remain exempt for the same duration as
70.25 the in lieu payments under this section are in effect.
70.26 Sec. 13. [272.029] [WIND ENERGY PRODUCTION TAX.]
70.27 Subdivision 1. [PRODUCTION TAX.] A tax is imposed on the
70.28 production of electricity from a wind energy conversion system
70.29 installed after January 1, 1991, and used as an electric power
70.30 source.
70.31 Subd. 2. [DEFINITIONS.] (a) For the purposes of this
70.32 section, the term:
70.33 (1) "wind energy conversion system" has the meaning given
70.34 it in section 216C.06, subdivision 12;
70.35 (2) "large scale wind energy conversion system" means a
70.36 wind energy conversion system of more than 12 megawatts, as
71.1 measured by the nameplate capacity of the system or as combined
71.2 with other systems as provided in paragraph (b);
71.3 (3) "medium scale wind energy conversion system" means a
71.4 wind energy conversion system of over two and not more than 12
71.5 megawatts, as measured by the nameplate capacity of the system
71.6 or as combined with other systems as provided in paragraph (b);
71.7 and
71.8 (4) "small scale wind energy conversion system" means a
71.9 wind energy conversion system of two megawatts and under, as
71.10 measured by the nameplate capacity of the system or as combined
71.11 with other systems as provided in paragraph (b).
71.12 (b) For systems installed and contracted for after January
71.13 1, 2002, the total size of a wind energy conversion system under
71.14 this subdivision shall be determined according to this paragraph.
71.15 Unless the systems are interconnected with different
71.16 distribution systems, the nameplate capacity of one wind energy
71.17 conversion system shall be combined with the nameplate capacity
71.18 of any other wind energy conversion system that is:
71.19 (1) located within five miles of the wind energy conversion
71.20 system;
71.21 (2) constructed within the same calendar year as the wind
71.22 energy conversion system; and
71.23 (3) under common ownership.
71.24 In the case of a dispute, the commissioner of commerce
71.25 shall determine the total size of the system, and shall draw all
71.26 reasonable inferences in favor of combining the systems.
71.27 (c) In making a determination under paragraph (b), the
71.28 commissioner of commerce may determine that two wind energy
71.29 conversion systems are under common ownership when the
71.30 underlying ownership structure contains similar persons or
71.31 entities, even if the ownership shares differ between the two
71.32 systems. Wind energy conversion systems are not under common
71.33 ownership solely because the same person or entity provided
71.34 equity financing for the systems.
71.35 Subd. 3. [RATE OF TAX.] (a) The owner of a wind energy
71.36 conversion system shall pay a tax based on the following
72.1 schedule:
72.2 (1) for a large scale wind energy conversion system, .12
72.3 cents per kilowatt-hour of electricity produced by the system;
72.4 (2) for a medium scale wind energy conversion system, .036
72.5 cents per kilowatt-hour of electricity produced by the system;
72.6 and
72.7 (3) for a small scale wind energy conversion system of two
72.8 megawatts or less, but greater than .25 megawatts capacity, .012
72.9 cents per kilowatt-hour of electricity produced by the system.
72.10 (b) Small scale wind energy conversion systems with the
72.11 capacity of .25 megawatts or less, and small scale wind energy
72.12 conversion systems with a capacity of two megawatts or less that
72.13 are owned by a political subdivision, are exempt from the wind
72.14 energy production tax.
72.15 Subd. 4. [REPORTS.] (a) An owner of a wind energy
72.16 conversion system subject to tax under subdivision 3 shall file
72.17 a report with the commissioner of revenue annually on or before
72.18 March 1 detailing the amount of electricity in kilowatt-hours
72.19 that was produced by the wind energy conversion system for the
72.20 previous calendar year. The commissioner shall prescribe the
72.21 form of the report. The report must contain the information
72.22 required by the commissioner to determine the tax due to each
72.23 county under this section for the current year. If an owner of
72.24 a wind energy conversion system subject to taxation under this
72.25 section fails to file the report by the due date, the
72.26 commissioner of revenue shall determine the tax based upon the
72.27 nameplate capacity of the system multiplied by a capacity factor
72.28 of 40 percent.
72.29 (b) On or before March 31, the commissioner of revenue
72.30 shall notify the owner of the wind energy conversion systems of
72.31 the tax due to each county for the current year and shall
72.32 certify to the county auditor of each county in which the
72.33 systems are located the tax due from each owner for the current
72.34 year.
72.35 Subd. 5. [PAYMENT OF TAX; COLLECTION.] The amount of
72.36 production tax determined under subdivision 4 must be paid to
73.1 the county treasurer at the time and in the manner provided for
73.2 payment of property taxes under section 277.01, subdivision 3,
73.3 and, if unpaid, is subject to the same enforcement, collection,
73.4 and interest and penalties as delinquent personal property
73.5 taxes. Except to the extent inconsistent with this section, the
73.6 provisions of sections 277.01 to 277.24 and 278.01 to 278.13
73.7 apply to the taxes imposed under this section, and for purposes
73.8 of those provisions, the taxes imposed under this section are
73.9 considered personal property taxes.
73.10 Subd. 6. [DISTRIBUTION OF REVENUES.] Revenues from the
73.11 taxes imposed under subdivision 5 must be part of the settlement
73.12 between the county treasurer and the county auditor under
73.13 section 276.09. The revenue must be distributed by the county
73.14 auditor or the county treasurer to all taxing jurisdictions in
73.15 which the wind energy conversion system is located, in the same
73.16 proportion that each of the taxing jurisdiction's current year's
73.17 net tax capacity based tax rate is to the current year's total
73.18 net tax capacity based rate.
73.19 [EFFECTIVE DATE.] This section is effective for all energy
73.20 produced by wind energy conversion systems after December 31,
73.21 2002.
73.22 Sec. 14. Minnesota Statutes 2001 Supplement, section
73.23 273.124, subdivision 11, is amended to read:
73.24 Subd. 11. [LIMITATION ON HOMESTEAD REDUCTIONS
73.25 TREATMENT.] (a) For taxes payable in 2003 through 2005 only, if
73.26 the assessor has classified a property as both homestead and
73.27 nonhomestead, the greater of:
73.28 (1) the value attributable to the portion of the property
73.29 used as a homestead; or
73.30 (2) the homestead value amount determined under paragraph
73.31 (b), is entitled to assessment as a homestead under section
73.32 273.13, subdivision 22 or 23.
73.33 (b) For taxes payable in 2003 only, the homestead value
73.34 amount is $60,000. For taxes payable in 2004 only, the
73.35 homestead value amount is $45,000. For taxes payable in 2005
73.36 only, the homestead value amount is $30,000.
74.1 (c) If the assessor has classified a property as both
74.2 homestead and nonhomestead, the reductions in tax provided under
74.3 sections 273.135 and 273.1391 apply to the value of both the
74.4 homestead and the nonhomestead portions of the property.
74.5 Sec. 15. Minnesota Statutes 2000, section 273.125,
74.6 subdivision 3, is amended to read:
74.7 Subd. 3. [TAX STATEMENTS; PENALTIES; COLLECTIONS.] Not
74.8 later than July 15 in the year of assessment the county
74.9 treasurer shall mail to the taxpayer a statement of tax due on a
74.10 manufactured home. The taxes are due on the last day of August,
74.11 or 20 days after the postmark date on the envelope containing
74.12 the property tax statement, whichever is later, except that if
74.13 the tax exceeds $50, one-half of the amount due may be paid on
74.14 August 31, or 20 days after the postmark date on the envelope
74.15 containing the property tax statement, whichever is later, and
74.16 the remainder on November 15. Taxes remaining unpaid after the
74.17 due date are delinquent, and a penalty of eight percent must be
74.18 assessed and collected as part of the unpaid taxes. The tax
74.19 statement must contain a sentence notifying the taxpayer that
74.20 the title to the manufactured home cannot be transferred unless
74.21 the property taxes are paid.
74.22 [EFFECTIVE DATE.] This section is effective for tax
74.23 statements issued in 2003 and thereafter.
74.24 Sec. 16. Minnesota Statutes 2001 Supplement, section
74.25 273.13, subdivision 22, is amended to read:
74.26 Subd. 22. [CLASS 1.] (a) Except as provided in subdivision
74.27 23 and in paragraphs (b) and (c), real estate which is
74.28 residential and used for homestead purposes is class 1a. In the
74.29 case of a duplex or triplex in which one of the units is used
74.30 for homestead purposes, the entire property is deemed to be used
74.31 for homestead purposes. The market value of class 1a property
74.32 must be determined based upon the value of the house, garage,
74.33 and land.
74.34 The first $500,000 of market value of class 1a property has
74.35 a net class rate of one percent of its market value; and the
74.36 market value of class 1a property that exceeds $500,000 has a
75.1 class rate of 1.25 percent of its market value.
75.2 (b) Class 1b property includes homestead real estate or
75.3 homestead manufactured homes used for the purposes of a
75.4 homestead by
75.5 (1) any blind person, or the blind person and the blind
75.6 person's spouse; or
75.7 (2) any person, hereinafter referred to as "veteran," who:
75.8 (i) served in the active military or naval service of the
75.9 United States; and
75.10 (ii) is entitled to compensation under the laws and
75.11 regulations of the United States for permanent and total
75.12 service-connected disability due to the loss, or loss of use, by
75.13 reason of amputation, ankylosis, progressive muscular
75.14 dystrophies, or paralysis, of both lower extremities, such as to
75.15 preclude motion without the aid of braces, crutches, canes, or a
75.16 wheelchair; and
75.17 (iii) has acquired a special housing unit with special
75.18 fixtures or movable facilities made necessary by the nature of
75.19 the veteran's disability, or the surviving spouse of the
75.20 deceased veteran for as long as the surviving spouse retains the
75.21 special housing unit as a homestead; or
75.22 (3) any person who:
75.23 (i) is permanently and totally disabled and
75.24 (ii) receives 90 percent or more of total household income,
75.25 as defined in section 290A.03, subdivision 5, from
75.26 (A) aid from any state as a result of that disability; or
75.27 (B) supplemental security income for the disabled; or
75.28 (C) workers' compensation based on a finding of total and
75.29 permanent disability; or
75.30 (D) social security disability, including the amount of a
75.31 disability insurance benefit which is converted to an old age
75.32 insurance benefit and any subsequent cost of living increases;
75.33 or
75.34 (E) aid under the federal Railroad Retirement Act of 1937,
75.35 United States Code Annotated, title 45, section 228b(a)5; or
75.36 (F) a pension from any local government retirement fund
76.1 located in the state of Minnesota as a result of that
76.2 disability; or
76.3 (G) pension, annuity, or other income paid as a result of
76.4 that disability from a private pension or disability plan,
76.5 including employer, employee, union, and insurance plans and
76.6 (iii) has household income as defined in section 290A.03,
76.7 subdivision 5, of $50,000 or less; or
76.8 (4) any person who is permanently and totally disabled and
76.9 whose household income as defined in section 290A.03,
76.10 subdivision 5, is 275 percent or less of the federal poverty
76.11 level.
76.12 Property is classified and assessed under clause (4) only
76.13 if the government agency or income-providing source certifies,
76.14 upon the request of the homestead occupant, that the homestead
76.15 occupant satisfies the disability requirements of this paragraph.
76.16 Property is classified and assessed pursuant to clause (1)
76.17 only if the commissioner of economic security certifies to the
76.18 assessor that the homestead occupant satisfies the requirements
76.19 of this paragraph.
76.20 Permanently and totally disabled for the purpose of this
76.21 subdivision means a condition which is permanent in nature and
76.22 totally incapacitates the person from working at an occupation
76.23 which brings the person an income. The first $32,000 market
76.24 value of class 1b property has a net class rate of .45 percent
76.25 of its market value. The remaining market value of class 1b
76.26 property has a class rate using the rates for class 1a or class
76.27 2a property, whichever is appropriate, of similar market value.
76.28 (c) Class 1c property is commercial use real property that
76.29 abuts a lakeshore line and is devoted to temporary and seasonal
76.30 residential occupancy for recreational purposes but not devoted
76.31 to commercial purposes for more than 250 days in the year
76.32 preceding the year of assessment, and that includes a portion
76.33 used as a homestead by the owner, which includes a dwelling
76.34 occupied as a homestead by a shareholder of a corporation that
76.35 owns the resort or a partner in a partnership that owns the
76.36 resort, even if the title to the homestead is held by the
77.1 corporation or partnership. For purposes of this clause,
77.2 property is devoted to a commercial purpose on a specific day if
77.3 any portion of the property, excluding the portion used
77.4 exclusively as a homestead, is used for residential occupancy
77.5 and a fee is charged for residential occupancy. The first
77.6 $500,000 of market value of class 1c property has a class rate
77.7 of one percent, and the remaining market value of class 1c
77.8 property has a class rate of one percent, with the following
77.9 limitation: the area of the property must not exceed 100 feet
77.10 of lakeshore footage for each cabin or campsite located on the
77.11 property up to a total of 800 feet and 500 feet in depth,
77.12 measured away from the lakeshore. If any portion of the class
77.13 1c resort property is classified as class 4c under subdivision
77.14 25, the entire property must meet the requirements of
77.15 subdivision 25, paragraph (d), clause (1), to qualify for class
77.16 1c treatment under this paragraph.
77.17 (d) Class 1d property includes structures that meet all of
77.18 the following criteria:
77.19 (1) the structure is located on property that is classified
77.20 as agricultural property under section 273.13, subdivision 23;
77.21 (2) the structure is occupied exclusively by seasonal farm
77.22 workers during the time when they work on that farm, and the
77.23 occupants are not charged rent for the privilege of occupying
77.24 the property, provided that use of the structure for storage of
77.25 farm equipment and produce does not disqualify the property from
77.26 classification under this paragraph;
77.27 (3) the structure meets all applicable health and safety
77.28 requirements for the appropriate season; and
77.29 (4) the structure is not salable as residential property
77.30 because it does not comply with local ordinances relating to
77.31 location in relation to streets or roads.
77.32 The market value of class 1d property has the same class
77.33 rates as class 1a property under paragraph (a).
77.34 [EFFECTIVE DATE.] This section is effective for taxes
77.35 payable in 2003 and subsequent years.
77.36 Sec. 17. Minnesota Statutes 2001 Supplement, section
78.1 273.13, subdivision 25, is amended to read:
78.2 Subd. 25. [CLASS 4.] (a) Class 4a is residential real
78.3 estate containing four or more units and used or held for use by
78.4 the owner or by the tenants or lessees of the owner as a
78.5 residence for rental periods of 30 days or more. Class 4a also
78.6 includes hospitals licensed under sections 144.50 to 144.56,
78.7 other than hospitals exempt under section 272.02, and contiguous
78.8 property used for hospital purposes, without regard to whether
78.9 the property has been platted or subdivided. The market value
78.10 of class 4a property has a class rate of 1.8 percent for taxes
78.11 payable in 2002, 1.5 percent for taxes payable in 2003, and 1.25
78.12 percent for taxes payable in 2004 and thereafter, except that
78.13 class 4a property consisting of a structure for which
78.14 construction commenced after June 30, 2001, has a class rate of
78.15 1.25 percent of market value for taxes payable in 2003 and
78.16 subsequent years.
78.17 (b) Class 4b includes:
78.18 (1) residential real estate containing less than four units
78.19 that does not qualify as class 4bb, other than seasonal
78.20 residential, and recreational;
78.21 (2) manufactured homes not classified under any other
78.22 provision;
78.23 (3) a dwelling, garage, and surrounding one acre of
78.24 property on a nonhomestead farm classified under subdivision 23,
78.25 paragraph (b) containing two or three units;
78.26 (4) unimproved property that is classified residential as
78.27 determined under subdivision 33.
78.28 The market value of class 4b property has a class rate of
78.29 1.5 percent for taxes payable in 2002, and 1.25 percent for
78.30 taxes payable in 2003 and thereafter.
78.31 (c) Class 4bb includes:
78.32 (1) nonhomestead residential real estate containing one
78.33 unit, other than seasonal residential, and recreational; and
78.34 (2) a single family dwelling, garage, and surrounding one
78.35 acre of property on a nonhomestead farm classified under
78.36 subdivision 23, paragraph (b).
79.1 Class 4bb property has the same class rates as class 1a
79.2 property under subdivision 22.
79.3 Property that has been classified as seasonal recreational
79.4 residential property at any time during which it has been owned
79.5 by the current owner or spouse of the current owner does not
79.6 qualify for class 4bb.
79.7 (d) Class 4c property includes:
79.8 (1) except as provided in subdivision 22, paragraph (c),
79.9 real property devoted to temporary and seasonal residential
79.10 occupancy for recreation purposes, including real property
79.11 devoted to temporary and seasonal residential occupancy for
79.12 recreation purposes and not devoted to commercial purposes for
79.13 more than 250 days in the year preceding the year of
79.14 assessment. For purposes of this clause, property is devoted to
79.15 a commercial purpose on a specific day if any portion of the
79.16 property is used for residential occupancy, and a fee is charged
79.17 for residential occupancy. In order for a property to be
79.18 classified as class 4c, seasonal recreational residential for
79.19 commercial purposes, at least 40 percent of the annual gross
79.20 lodging receipts related to the property must be from business
79.21 conducted during 90 consecutive days and either (i) at least 60
79.22 percent of all paid bookings by lodging guests during the year
79.23 must be for periods of at least two consecutive nights; or (ii)
79.24 at least 20 percent of the annual gross receipts must be from
79.25 charges for rental of fish houses, boats and motors,
79.26 snowmobiles, downhill or cross-country ski equipment, or charges
79.27 for marina services, launch services, and guide services, or the
79.28 sale of bait and fishing tackle. For purposes of this
79.29 determination, a paid booking of five or more nights shall be
79.30 counted as two bookings. Class 4c also includes commercial use
79.31 real property used exclusively for recreational purposes in
79.32 conjunction with class 4c property devoted to temporary and
79.33 seasonal residential occupancy for recreational purposes, up to
79.34 a total of two acres, provided the property is not devoted to
79.35 commercial recreational use for more than 250 days in the year
79.36 preceding the year of assessment and is located within two miles
80.1 of the class 4c property with which it is used. Class 4c
80.2 property classified in this clause also includes the remainder
80.3 of class 1c resorts provided that the entire property including
80.4 that portion of the property classified as class 1c also meets
80.5 the requirements for class 4c under this clause; otherwise the
80.6 entire property is classified as class 3. Owners of real
80.7 property devoted to temporary and seasonal residential occupancy
80.8 for recreation purposes and all or a portion of which was
80.9 devoted to commercial purposes for not more than 250 days in the
80.10 year preceding the year of assessment desiring classification as
80.11 class 1c or 4c, must submit a declaration to the assessor
80.12 designating the cabins or units occupied for 250 days or less in
80.13 the year preceding the year of assessment by January 15 of the
80.14 assessment year. Those cabins or units and a proportionate
80.15 share of the land on which they are located will be designated
80.16 class 1c or 4c as otherwise provided. The remainder of the
80.17 cabins or units and a proportionate share of the land on which
80.18 they are located will be designated as class 3a. The owner of
80.19 property desiring designation as class 1c or 4c property must
80.20 provide guest registers or other records demonstrating that the
80.21 units for which class 1c or 4c designation is sought were not
80.22 occupied for more than 250 days in the year preceding the
80.23 assessment if so requested. The portion of a property operated
80.24 as a (1) restaurant, (2) bar, (3) gift shop, and (4) other
80.25 nonresidential facility operated on a commercial basis not
80.26 directly related to temporary and seasonal residential occupancy
80.27 for recreation purposes shall not qualify for class 1c or 4c;
80.28 (2) qualified property used as a golf course if:
80.29 (i) it is open to the public on a daily fee basis. It may
80.30 charge membership fees or dues, but a membership fee may not be
80.31 required in order to use the property for golfing, and its green
80.32 fees for golfing must be comparable to green fees typically
80.33 charged by municipal courses; and
80.34 (ii) it meets the requirements of section 273.112,
80.35 subdivision 3, paragraph (d).
80.36 A structure used as a clubhouse, restaurant, or place of
81.1 refreshment in conjunction with the golf course is classified as
81.2 class 3a property;
81.3 (3) real property up to a maximum of one acre of land owned
81.4 by a nonprofit community service oriented organization; provided
81.5 that the property is not used for a revenue-producing activity
81.6 for more than six days in the calendar year preceding the year
81.7 of assessment and the property is not used for residential
81.8 purposes on either a temporary or permanent basis. For purposes
81.9 of this clause, a "nonprofit community service oriented
81.10 organization" means any corporation, society, association,
81.11 foundation, or institution organized and operated exclusively
81.12 for charitable, religious, fraternal, civic, or educational
81.13 purposes, and which is exempt from federal income taxation
81.14 pursuant to section 501(c)(3), (10), or (19) of the Internal
81.15 Revenue Code of 1986, as amended through December 31, 1990. For
81.16 purposes of this clause, "revenue-producing activities" shall
81.17 include but not be limited to property or that portion of the
81.18 property that is used as an on-sale intoxicating liquor or 3.2
81.19 percent malt liquor establishment licensed under chapter 340A, a
81.20 restaurant open to the public, bowling alley, a retail store,
81.21 gambling conducted by organizations licensed under chapter 349,
81.22 an insurance business, or office or other space leased or rented
81.23 to a lessee who conducts a for-profit enterprise on the
81.24 premises. Any portion of the property which is used for
81.25 revenue-producing activities for more than six days in the
81.26 calendar year preceding the year of assessment shall be assessed
81.27 as class 3a. The use of the property for social events open
81.28 exclusively to members and their guests for periods of less than
81.29 24 hours, when an admission is not charged nor any revenues are
81.30 received by the organization shall not be considered a
81.31 revenue-producing activity;
81.32 (4) post-secondary student housing of not more than one
81.33 acre of land that is owned by a nonprofit corporation organized
81.34 under chapter 317A and is used exclusively by a student
81.35 cooperative, sorority, or fraternity for on-campus housing or
81.36 housing located within two miles of the border of a college
82.1 campus;
82.2 (5) manufactured home parks as defined in section 327.14,
82.3 subdivision 3;
82.4 (6) real property that is actively and exclusively devoted
82.5 to indoor fitness, health, social, recreational, and related
82.6 uses, is owned and operated by a not-for-profit corporation, and
82.7 is located within the metropolitan area as defined in section
82.8 473.121, subdivision 2; and
82.9 (7) a leased or privately owned noncommercial aircraft
82.10 storage hangar not exempt under section 272.01, subdivision 2,
82.11 and the land on which it is located, provided that:
82.12 (i) the land is on an airport owned or operated by a city,
82.13 town, county, metropolitan airports commission, or group
82.14 thereof; and
82.15 (ii) the land lease, or any ordinance or signed agreement
82.16 restricting the use of the leased premise, prohibits commercial
82.17 activity performed at the hangar.
82.18 If a hangar classified under this clause is sold after June
82.19 30, 2000, a bill of sale must be filed by the new owner with the
82.20 assessor of the county where the property is located within 60
82.21 days of the sale; and
82.22 (8) residential real estate, a portion of which is used by
82.23 the owner for homestead purposes, and that is also a place of
82.24 lodging, if all of the following criteria are met:
82.25 (i) rooms are provided for rent to transient guests that
82.26 generally stay for periods of 14 or fewer days;
82.27 (ii) meals are provided to persons who rent rooms, the cost
82.28 of which is incorporated in the basic room rate;
82.29 (iii) meals are not provided to the general public except
82.30 for special events on fewer than seven days in the calendar year
82.31 preceding the year of the assessment; and
82.32 (iv) the owner is the operator of the property.
82.33 The market value subject to the 4c classification under this
82.34 clause is limited to five rental units. Any rental units on the
82.35 property in excess of five, must be valued and assessed as class
82.36 3a. The portion of the property used for purposes of a
83.1 homestead by the owner must be classified as class 1a property
83.2 under subdivision 22.
83.3 Class 4c property has a class rate of 1.5 percent of market
83.4 value, except that (i) each parcel of seasonal residential
83.5 recreational property not used for commercial purposes has the
83.6 same class rates as class 4bb property, (ii) manufactured home
83.7 parks assessed under clause (5) have the same class rate as
83.8 class 4b property, (iii) commercial-use seasonal residential
83.9 recreational property has a class rate of one percent for the
83.10 first $500,000 of market value, which includes any market value
83.11 receiving the one percent rate under subdivision 22, and 1.25
83.12 percent for the remaining market value, (iv) the market value of
83.13 property described in clause (4) has a class rate of one
83.14 percent, and (v) the market value of property described in
83.15 clauses (2) and (6) has a class rate of 1.25 percent, and (vi)
83.16 that portion of the market value of property in clause (8)
83.17 qualifying for class 4c property has a class rate of 1.25
83.18 percent.
83.19 (e) Class 4d property is qualifying low-income rental
83.20 housing certified to the assessor by the housing finance agency
83.21 under sections 273.126 and 462A.071. Class 4d includes land in
83.22 proportion to the total market value of the building that is
83.23 qualifying low-income rental housing. For all properties
83.24 qualifying as class 4d, the market value determined by the
83.25 assessor must be based on the normal approach to value using
83.26 normal unrestricted rents.
83.27 Class 4d property has a class rate of 0.9 percent for taxes
83.28 payable in 2002, and one percent for taxes payable in 2003 and
83.29 1.25 percent for taxes payable in 2004 and thereafter.
83.30 [EFFECTIVE DATE.] This section is effective for assessment
83.31 year 2002 and thereafter, for taxes payable in 2003 and
83.32 thereafter.
83.33 Sec. 18. Minnesota Statutes 2001 Supplement, section
83.34 273.1384, subdivision 1, is amended to read:
83.35 Subdivision 1. [RESIDENTIAL HOMESTEAD MARKET VALUE
83.36 CREDIT.] Each county auditor shall determine a homestead credit
84.1 for each class 1a, 1b, 1c, and 2a homestead property within the
84.2 county equal to 0.4 percent of the market value of the
84.3 property. The amount of homestead credit for a homestead may
84.4 not exceed $304 and is reduced by .09 percent of the market
84.5 value in excess of $76,000. In the case of an agricultural or
84.6 resort homestead, only the market value of the house, garage,
84.7 and immediately surrounding one acre of land is eligible in
84.8 determining the property's homestead credit. In the case of a
84.9 property which is classified as part homestead and part
84.10 nonhomestead, the credit shall apply only to the homestead
84.11 portion of the property.
84.12 [EFFECTIVE DATE.] This section is effective for taxes
84.13 payable in 2003 and subsequent years.
84.14 Sec. 19. Minnesota Statutes 2001 Supplement, section
84.15 273.1384, subdivision 2, is amended to read:
84.16 Subd. 2. [AGRICULTURAL HOMESTEAD MARKET VALUE CREDIT.]
84.17 Property classified as class 2a agricultural homestead is
84.18 eligible for an agricultural credit. The credit is equal to 0.2
84.19 0.3 percent of the first $115,000 of the property's market
84.20 value. The credit under this subdivision is limited
84.21 to $230 $345 for each homestead. The credit is reduced by .05
84.22 percent of the market value in excess of $115,000, subject to a
84.23 maximum reduction of $115.
84.24 [EFFECTIVE DATE.] This section is effective for taxes
84.25 payable in 2003 and thereafter.
84.26 Sec. 20. Minnesota Statutes 2000, section 273.1398,
84.27 subdivision 1a, is amended to read:
84.28 Subd. 1a. [TAX BASE DIFFERENTIAL.] (a) For aids payable in
84.29 2000 2003, the tax base differential is:
84.30 (1) 0.45 percent of the assessment year 1998 taxable market
84.31 value of class 2a agricultural homestead property, excluding the
84.32 house, garage, and surrounding one acre of land, between
84.33 $115,000 and $600,000 and over 320 acres, minus the value over
84.34 $600,000 that is less than 320 acres 31 percent of the
84.35 assessment year 2000 net tax capacity of public utility property
84.36 reported by the county on the 2000 abstract of assessment as
85.1 public utility land and buildings valued up to $150,000; plus
85.2 (2) 0.5 percent of the assessment year 1998 taxable market
85.3 value of noncommercial seasonal recreational residential
85.4 property over $75,000 in value 34 percent of the assessment year
85.5 2000 net tax capacity of public utility property reported by the
85.6 county on the 2000 abstract of assessment as public utility land
85.7 and buildings valued over $150,000; plus
85.8 (3) for purposes of computing the fiscal disparity
85.9 adjustment only, 0.2 percent of the assessment year 1998 taxable
85.10 market value of class 3 commercial-industrial property over
85.11 $150,000 34 percent of the assessment year 2000 net tax capacity
85.12 of public utility property reported by the county on the 2000
85.13 abstract of assessment as public utility machinery, systems of
85.14 electric utilities-transmission, systems of electric
85.15 utilities-distribution, and systems of gas utilities.
85.16 (b) For the purposes of the distribution of homestead and
85.17 agricultural credit aid for aids payable in 2000, the
85.18 commissioner of revenue shall use the best information available
85.19 as of June 30, 1999, to make an estimate of the value described
85.20 in paragraph (a), clause (1). The commissioner shall adjust the
85.21 distribution of homestead and agricultural credit aid for aids
85.22 payable in 2001 and subsequent years if new information
85.23 regarding the value described in paragraph (a), clause (1),
85.24 becomes available after June 30, 1999 Notwithstanding the
85.25 computation in paragraph (a), the tax base differential shall be
85.26 zero in all counties in which the sum of the net tax capacities
85.27 of properties described in paragraph (a) does not exceed 40
85.28 percent of the total assessment year 2000 net tax capacity of
85.29 the county.
85.30 Sec. 21. Minnesota Statutes 2000, section 273.1398,
85.31 subdivision 2, is amended to read:
85.32 Subd. 2. [HOMESTEAD AND AGRICULTURAL CREDIT AID.] (a)
85.33 Homestead and agricultural credit aid for each unique taxing
85.34 jurisdiction equals the product of (1) the homestead and
85.35 agricultural credit aid base, and (2) the growth adjustment
85.36 factor, plus the net tax capacity adjustment and the fiscal
86.1 disparity adjustment.
86.2 (b) For the purposes of determining the net tax capacity
86.3 adjustment for aids payable in 2003, the "current local tax
86.4 rate" and the "previous net tax capacity" as defined under
86.5 subdivision 1 shall be determined using tax capacities and tax
86.6 rates in effect for taxes payable in 2001.
86.7 Sec. 22. Minnesota Statutes 2001 Supplement, section
86.8 275.065, subdivision 3, is amended to read:
86.9 Subd. 3. [NOTICE OF PROPOSED PROPERTY TAXES.] (a) The
86.10 county auditor shall prepare and the county treasurer shall
86.11 deliver after November 10 and on or before November 24 each
86.12 year, by first class mail to each taxpayer at the address listed
86.13 on the county's current year's assessment roll, a notice of
86.14 proposed property taxes.
86.15 (b) The commissioner of revenue shall prescribe the form of
86.16 the notice.
86.17 (c) The notice must inform taxpayers that it contains the
86.18 amount of property taxes each taxing authority proposes to
86.19 collect for taxes payable the following year. In the case of a
86.20 town, or in the case of the state determined portion of the
86.21 school district levy general tax, the final tax amount will be
86.22 its proposed tax. In the case of taxing authorities required to
86.23 hold a public meeting under subdivision 6, the notice must
86.24 clearly state that each taxing authority, including regional
86.25 library districts established under section 134.201, and
86.26 including the metropolitan taxing districts as defined in
86.27 paragraph (i), but excluding all other special taxing districts
86.28 and towns, will hold a public meeting to receive public
86.29 testimony on the proposed budget and proposed or final property
86.30 tax levy, or, in case of a school district, on the current
86.31 budget and proposed property tax levy. It must clearly state
86.32 the time and place of each taxing authority's meeting, a
86.33 telephone number for the taxing authority that taxpayers may
86.34 call if they have questions related to the notice, and an
86.35 address where comments will be received by mail.
86.36 (d) The notice must state for each parcel:
87.1 (1) the market value of the property as determined under
87.2 section 273.11, and used for computing property taxes payable in
87.3 the following year and for taxes payable in the current year as
87.4 each appears in the records of the county assessor on November 1
87.5 of the current year; and, in the case of residential property,
87.6 whether the property is classified as homestead or
87.7 nonhomestead. The notice must clearly inform taxpayers of the
87.8 years to which the market values apply and that the values are
87.9 final values;
87.10 (2) the items listed below, shown separately by county,
87.11 city or town, and state determined school general tax, net of
87.12 the education residential and agricultural homestead credit
87.13 under section 273.1382 273.1384, voter approved school levy,
87.14 other local school levy, and the sum of the special taxing
87.15 districts, and as a total of all taxing authorities:
87.16 (i) the actual tax for taxes payable in the current year;
87.17 (ii) the tax change due to spending factors, defined as the
87.18 proposed tax minus the constant spending tax amount;
87.19 (iii) the tax change due to other factors, defined as the
87.20 constant spending tax amount minus the actual current year tax;
87.21 and
87.22 (iv) the proposed tax amount.
87.23 If the county levy under clause (2) includes an amount for
87.24 a lake improvement district as defined under sections 103B.501
87.25 to 103B.581, the amount attributable for that purpose must be
87.26 separately stated from the remaining county levy amount.
87.27 In the case of a town or the state determined school
87.28 general tax, the final tax shall also be its proposed tax unless
87.29 the town changes its levy at a special town meeting under
87.30 section 365.52. If a school district has certified under
87.31 section 126C.17, subdivision 9, that a referendum will be held
87.32 in the school district at the November general election, the
87.33 county auditor must note next to the school district's proposed
87.34 amount that a referendum is pending and that, if approved by the
87.35 voters, the tax amount may be higher than shown on the notice.
87.36 In the case of the city of Minneapolis, the levy for the
88.1 Minneapolis library board and the levy for Minneapolis park and
88.2 recreation shall be listed separately from the remaining amount
88.3 of the city's levy. In the case of a parcel where tax increment
88.4 or the fiscal disparities areawide tax under chapter 276A or
88.5 473F applies, the proposed tax levy on the captured value or the
88.6 proposed tax levy on the tax capacity subject to the areawide
88.7 tax must each be stated separately and not included in the sum
88.8 of the special taxing districts; and
88.9 (3) the increase or decrease between the total taxes
88.10 payable in the current year and the total proposed taxes,
88.11 expressed as a percentage.
88.12 For purposes of this section, the amount of the tax on
88.13 homesteads qualifying under the senior citizens' property tax
88.14 deferral program under chapter 290B is the total amount of
88.15 property tax before subtraction of the deferred property tax
88.16 amount.
88.17 (e) The notice must clearly state that the proposed or
88.18 final taxes do not include the following:
88.19 (1) special assessments;
88.20 (2) levies approved by the voters after the date the
88.21 proposed taxes are certified, including bond referenda, school
88.22 district levy referenda, and levy limit increase referenda;
88.23 (3) amounts necessary to pay cleanup or other costs due to
88.24 a natural disaster occurring after the date the proposed taxes
88.25 are certified;
88.26 (4) amounts necessary to pay tort judgments against the
88.27 taxing authority that become final after the date the proposed
88.28 taxes are certified; and
88.29 (5) the contamination tax imposed on properties which
88.30 received market value reductions for contamination.
88.31 (f) Except as provided in subdivision 7, failure of the
88.32 county auditor to prepare or the county treasurer to deliver the
88.33 notice as required in this section does not invalidate the
88.34 proposed or final tax levy or the taxes payable pursuant to the
88.35 tax levy.
88.36 (g) If the notice the taxpayer receives under this section
89.1 lists the property as nonhomestead, and satisfactory
89.2 documentation is provided to the county assessor by the
89.3 applicable deadline, and the property qualifies for the
89.4 homestead classification in that assessment year, the assessor
89.5 shall reclassify the property to homestead for taxes payable in
89.6 the following year.
89.7 (h) In the case of class 4 residential property used as a
89.8 residence for lease or rental periods of 30 days or more, the
89.9 taxpayer must either:
89.10 (1) mail or deliver a copy of the notice of proposed
89.11 property taxes to each tenant, renter, or lessee; or
89.12 (2) post a copy of the notice in a conspicuous place on the
89.13 premises of the property.
89.14 The notice must be mailed or posted by the taxpayer by
89.15 November 27 or within three days of receipt of the notice,
89.16 whichever is later. A taxpayer may notify the county treasurer
89.17 of the address of the taxpayer, agent, caretaker, or manager of
89.18 the premises to which the notice must be mailed in order to
89.19 fulfill the requirements of this paragraph.
89.20 (i) For purposes of this subdivision, subdivisions 5a and
89.21 6, "metropolitan special taxing districts" means the following
89.22 taxing districts in the seven-county metropolitan area that levy
89.23 a property tax for any of the specified purposes listed below:
89.24 (1) metropolitan council under section 473.132, 473.167,
89.25 473.249, 473.325, 473.446, 473.521, 473.547, or 473.834;
89.26 (2) metropolitan airports commission under section 473.667,
89.27 473.671, or 473.672; and
89.28 (3) metropolitan mosquito control commission under section
89.29 473.711.
89.30 For purposes of this section, any levies made by the
89.31 regional rail authorities in the county of Anoka, Carver,
89.32 Dakota, Hennepin, Ramsey, Scott, or Washington under chapter
89.33 398A shall be included with the appropriate county's levy and
89.34 shall be discussed at that county's public hearing.
89.35 (j) If a statutory or home rule charter city or a town has
89.36 exercised the local levy option provided by section 473.388,
90.1 subdivision 7, it may include in the notice of its proposed
90.2 taxes the amount of its proposed taxes attributable to its
90.3 exercise of the option. In the first year of the city or town's
90.4 exercise of this option, the statement shall include an estimate
90.5 of the reduction of the metropolitan council's tax on the parcel
90.6 due to exercise of that option. The metropolitan council's levy
90.7 shall be adjusted accordingly.
90.8 [EFFECTIVE DATE.] This section is effective for notices of
90.9 proposed property taxes prepared in 2002, for taxes payable in
90.10 2003, and thereafter.
90.11 Sec. 23. Minnesota Statutes 2001 Supplement, section
90.12 276.04, subdivision 2, is amended to read:
90.13 Subd. 2. [CONTENTS OF TAX STATEMENTS.] (a) The treasurer
90.14 shall provide for the printing of the tax statements. The
90.15 commissioner of revenue shall prescribe the form of the property
90.16 tax statement and its contents. The statement must contain a
90.17 tabulated statement of the dollar amount due to each taxing
90.18 authority and the amount of the state tax from the parcel of
90.19 real property for which a particular tax statement is prepared.
90.20 The dollar amounts attributable to the county, the state tax,
90.21 the voter approved school tax, the other local school tax, the
90.22 township or municipality, and the total of the metropolitan
90.23 special taxing districts as defined in section 275.065,
90.24 subdivision 3, paragraph (i), must be separately stated. The
90.25 amounts due all other special taxing districts, if any, may be
90.26 aggregated. If the county levy under this paragraph includes an
90.27 amount for a lake improvement district as defined under sections
90.28 103B.501 to 103B.581, the amount attributable for that purpose
90.29 must be separately stated from the remaining county levy
90.30 amount. The amount of the tax on homesteads qualifying under
90.31 the senior citizens' property tax deferral program under chapter
90.32 290B is the total amount of property tax before subtraction of
90.33 the deferred property tax amount. The amount of the tax on
90.34 contamination value imposed under sections 270.91 to 270.98, if
90.35 any, must also be separately stated. The dollar amounts,
90.36 including the dollar amount of any special assessments, may be
91.1 rounded to the nearest even whole dollar. For purposes of this
91.2 section whole odd-numbered dollars may be adjusted to the next
91.3 higher even-numbered dollar. The amount of market value
91.4 excluded under section 273.11, subdivision 16, if any, must also
91.5 be listed on the tax statement.
91.6 (b) The property tax statements for manufactured homes and
91.7 sectional structures taxed as personal property shall contain
91.8 the same information that is required on the tax statements for
91.9 real property.
91.10 (c) Real and personal property tax statements must contain
91.11 the following information in the order given in this paragraph.
91.12 The information must contain the current year tax information in
91.13 the right column with the corresponding information for the
91.14 previous year in a column on the left:
91.15 (1) the property's estimated market value under section
91.16 273.11, subdivision 1;
91.17 (2) the property's taxable market value after reductions
91.18 under section 273.11, subdivisions 1a and 16;
91.19 (3) the property's gross tax, calculated by adding the
91.20 property's total property tax to the sum of the aids enumerated
91.21 in clause (4);
91.22 (4) a total of the following aids:
91.23 (i) education aids payable under chapters 122A, 123A, 123B,
91.24 124D, 125A, 126C, and 127A;
91.25 (ii) local government aids for cities, towns, and counties
91.26 under chapter 477A;
91.27 (iii) disparity reduction aid under section 273.1398; and
91.28 (iv) homestead and agricultural credit aid under section
91.29 273.1398;
91.30 (5) for homestead residential and agricultural properties,
91.31 the credits under section 273.1384;
91.32 (6) any credits received under sections 273.119; 273.123;
91.33 273.135; 273.1391; 273.1398, subdivision 4; 469.171; and
91.34 473H.10, except that the amount of credit received under section
91.35 273.135 must be separately stated and identified as "taconite
91.36 tax relief"; and
92.1 (7) the net tax payable in the manner required in paragraph
92.2 (a).
92.3 (d) If the county uses envelopes for mailing property tax
92.4 statements and if the county agrees, a taxing district may
92.5 include a notice with the property tax statement notifying
92.6 taxpayers when the taxing district will begin its budget
92.7 deliberations for the current year, and encouraging taxpayers to
92.8 attend the hearings. If the county allows notices to be
92.9 included in the envelope containing the property tax statement,
92.10 and if more than one taxing district relative to a given
92.11 property decides to include a notice with the tax statement, the
92.12 county treasurer or auditor must coordinate the process and may
92.13 combine the information on a single announcement.
92.14 The commissioner of revenue shall certify to the county
92.15 auditor the actual or estimated aids enumerated in clause (4)
92.16 that local governments will receive in the following year. The
92.17 commissioner must certify this amount by January 1 of each year.
92.18 [EFFECTIVE DATE.] This section is effective for property
92.19 tax statements prepared in 2003 and thereafter.
92.20 Sec. 24. Laws 1998, chapter 389, article 3, section 42, is
92.21 amended to read:
92.22 Sec. 42. [TRANSFER OF PROPERTY; PAYMENT OF DEFERRED
92.23 TAXES.]
92.24 Subdivision 1. [ADDITIONAL TAX.] The assessor shall make a
92.25 separate determination of the market value and net tax capacity
92.26 of a property qualifying under section 38 as if sections 39 and
92.27 40 did not apply. The tax based upon the appropriate local tax
92.28 rate applicable to such property in the taxing district shall be
92.29 recorded on the property assessment records.
92.30 Subd. 2. [RECAPTURE.] (a) Property or any portion thereof
92.31 qualifying under section 38 is subject to additional taxes if:
92.32 (1) ownership of the property is transferred to anyone
92.33 other than the spouse or child of the current owner, or;
92.34 (2) the current owner or the spouse or child of the current
92.35 owner has not conveyed or entered into a contract before July 1,
92.36 2002 2007, to convey the property to a nonprofit foundation or
93.1 corporation created to own and operate operating the property as
93.2 an art park providing the services included in section 38,
93.3 clauses (2) to (5); or
93.4 (3) the nonprofit foundation or corporation to which the
93.5 property was transferred ceases to provide the services included
93.6 in section 38, clauses (2) to (5), earlier than ten years
93.7 following the effective date of the conveyance or of the
93.8 execution of the contract to convey.
93.9 (b) The additional taxes are imposed at the earlier of (1)
93.10 the year following transfer of ownership to anyone other than
93.11 the spouse or child of the current owner or a nonprofit
93.12 foundation or corporation created to own and operate operating
93.13 the property as an art park, or (2) for taxes payable in 2003
93.14 2008, or in the event the nonprofit foundation or corporation to
93.15 which the property was conveyed ceases to provide the required
93.16 services within ten years after the conveyance, for taxes
93.17 payable in the year following the year when it ceased to do so.
93.18 The additional taxes are equal to the difference between the
93.19 taxes determined under sections 39 and 40 and the amount
93.20 determined under subdivision 1 for all years that the property
93.21 qualified under section 38. The additional taxes must be
93.22 extended against the property on the tax list for the current
93.23 year; provided, however, that no interest or penalties may be
93.24 levied on the additional taxes if timely paid.
93.25 Subd. 3. [CURRENT OWNER.] For purposes of this section,
93.26 "current owner" means the owner of property qualifying under
93.27 section 38 on the date of final enactment of this act or that
93.28 owner's spouse or child.
93.29 Subd. 4. [NONPROFIT FOUNDATION OR CORPORATION.] For
93.30 purposes of this act, "nonprofit foundation or corporation"
93.31 means a nonprofit entity created to own and operate as defined
93.32 under section 501(c)(3) of the Internal Revenue Code that is
93.33 operating the property as an art park providing the services
93.34 included in section 38, clauses (2) to (5).
93.35 [EFFECTIVE DATE.] This section is effective the day
93.36 following final enactment.
94.1 Sec. 25. [COOK COUNTY; EXPENDITURE OF ROAD AND BRIDGE
94.2 LEVY.]
94.3 Notwithstanding Minnesota Statutes, section 163.06,
94.4 subdivisions 4 and 5, the county board of Cook county, by
94.5 resolution, may expend the proceeds of the levy under Minnesota
94.6 Statutes, section 163.06, in any organized or unorganized
94.7 township or portion thereof in the county.
94.8 [EFFECTIVE DATE.] This section is effective the day after
94.9 the governing body of Cook county and its chief clerical officer
94.10 timely complete their compliance with Minnesota Statutes,
94.11 section 645.021, subdivisions 2 and 3.
94.12 Sec. 26. [REPEALER.]
94.13 Laws 2001, First Special Session chapter 5, article 3,
94.14 section 88, is repealed effective July 1, 2002.
94.15 ARTICLE 5
94.16 EDUCATION LEVIES AND REVENUES
94.17 Section 1. Minnesota Statutes 2001 Supplement, section
94.18 124D.86, subdivision 3, is amended to read:
94.19 Subd. 3. [INTEGRATION REVENUE.] Integration revenue equals
94.20 the following amounts:
94.21 (1) for independent school district No. 709, Duluth, $207
94.22 times the adjusted pupil units for the school year;
94.23 (2) for independent school district No. 625, St. Paul, and
94.24 for special school district No. 1, Minneapolis, $446 times the
94.25 adjusted pupil units for the school year;
94.26 (3) for special school district No. 1, Minneapolis, the sum
94.27 of $446 times the adjusted pupil units for the school year and
94.28 an additional $35 times the adjusted pupil units for the school
94.29 year that is provided entirely through a local levy;
94.30 (4) for a district not listed in clause (1) or, (2), or
94.31 (3), that must implement a plan under Minnesota Rules, parts
94.32 3535.0100 to 3535.0180, where the district's enrollment of
94.33 protected students, as defined under Minnesota Rules, part
94.34 3535.0110, exceeds 15 percent, the lesser of (i) the actual cost
94.35 of implementing the plan during the fiscal year minus the aid
94.36 received under subdivision 6, or (ii) $130 times the adjusted
95.1 pupil units for the school year;
95.2 (4) (5) for a district not listed in clause (1), (2),
95.3 or (3), or (4), that is required to implement a plan according
95.4 to the requirements of Minnesota Rules, parts 3535.0100 to
95.5 3535.0180, the lesser of
95.6 (i) the actual cost of implementing the plan during the
95.7 fiscal year minus the aid received under subdivision 6, or
95.8 (ii) $93 times the adjusted pupil units for the school year.
95.9 Any money received by districts in clauses (1) to (3) (4)
95.10 which exceeds the amount received in fiscal year 2000 shall be
95.11 subject to the budget requirements in subdivision 1a; and
95.12 (5) (6) for a member district of a multidistrict
95.13 integration collaborative that files a plan with the
95.14 commissioner, but is not contiguous to a racially isolated
95.15 district, integration revenue equals the amount defined in
95.16 clause (4) (5).
95.17 [EFFECTIVE DATE.] This section is effective the day
95.18 following final enactment for revenue for fiscal year 2003.
95.19 Sec. 2. Minnesota Statutes 2001 Supplement, section
95.20 126C.40, subdivision 1, is amended to read:
95.21 Subdivision 1. [TO LEASE BUILDING OR LAND.] (a) When a an
95.22 independent or a special school district or a group of
95.23 independent or special school districts finds it economically
95.24 advantageous to rent or lease a building or land for any
95.25 instructional purposes or for school storage or furniture
95.26 repair, and it determines that the operating capital revenue
95.27 authorized under section 126C.10, subdivision 13, is
95.28 insufficient for this purpose, it may apply to the commissioner
95.29 for permission to make an additional capital expenditure levy
95.30 for this purpose. An application for permission to levy under
95.31 this subdivision must contain financial justification for the
95.32 proposed levy, the terms and conditions of the proposed lease,
95.33 and a description of the space to be leased and its proposed use.
95.34 (b) The criteria for approval of applications to levy under
95.35 this subdivision must include: the reasonableness of the price,
95.36 the appropriateness of the space to the proposed activity, the
96.1 feasibility of transporting pupils to the leased building or
96.2 land, conformity of the lease to the laws and rules of the state
96.3 of Minnesota, and the appropriateness of the proposed lease to
96.4 the space needs and the financial condition of the district.
96.5 The commissioner must not authorize a levy under this
96.6 subdivision in an amount greater than the cost to the district
96.7 of renting or leasing a building or land for approved purposes.
96.8 The proceeds of this levy must not be used for custodial or
96.9 other maintenance services. A district may not levy under this
96.10 subdivision for the purpose of leasing or renting a
96.11 district-owned building or site to itself.
96.12 (c) For agreements finalized after July 1, 1997, a district
96.13 may not levy under this subdivision for the purpose of leasing:
96.14 (1) a newly constructed building used primarily for regular
96.15 kindergarten, elementary, or secondary instruction; or (2) a
96.16 newly constructed building addition or additions used primarily
96.17 for regular kindergarten, elementary, or secondary instruction
96.18 that contains more than 20 percent of the square footage of the
96.19 previously existing building.
96.20 (d) Notwithstanding paragraph (b), a district may levy
96.21 under this subdivision for the purpose of leasing or renting a
96.22 district-owned building or site to itself only if the amount is
96.23 needed by the district to make payments required by a lease
96.24 purchase agreement, installment purchase agreement, or other
96.25 deferred payments agreement authorized by law, and the levy
96.26 meets the requirements of paragraph (c). A levy authorized for
96.27 a district by the commissioner under this paragraph may be in
96.28 the amount needed by the district to make payments required by a
96.29 lease purchase agreement, installment purchase agreement, or
96.30 other deferred payments agreement authorized by law, provided
96.31 that any agreement include a provision giving the school
96.32 districts the right to terminate the agreement annually without
96.33 penalty.
96.34 (e) The total levy under this subdivision for a district
96.35 for any year must not exceed $100 times the resident pupil units
96.36 for the fiscal year to which the levy is attributable.
97.1 (f) For agreements for which a review and comment have been
97.2 submitted to the department of children, families, and learning
97.3 after April 1, 1998, the term "instructional purpose" as used in
97.4 this subdivision excludes expenditures on stadiums.
97.5 (g) The commissioner of children, families, and learning
97.6 may authorize a school district to exceed the limit in paragraph
97.7 (e) if the school district petitions the commissioner for
97.8 approval. The commissioner shall grant approval to a school
97.9 district to exceed the limit in paragraph (e) for not more than
97.10 five years if the district meets the following criteria:
97.11 (1) the school district has been experiencing pupil
97.12 enrollment growth in the preceding five years;
97.13 (2) the purpose of the increased levy is in the long-term
97.14 public interest;
97.15 (3) the purpose of the increased levy promotes colocation
97.16 of government services; and
97.17 (4) the purpose of the increased levy is in the long-term
97.18 interest of the district by avoiding over construction of school
97.19 facilities.
97.20 (h) A school district that is a member of an intermediate
97.21 school district may include in its authority under this section
97.22 the costs associated with leases of administrative and classroom
97.23 space for intermediate school district programs. This authority
97.24 must not exceed $25 times the adjusted marginal cost pupil units
97.25 of the member districts. This authority is in addition to any
97.26 other authority authorized under this section.
97.27 (i) In addition to the allowable capital levies in
97.28 paragraph (a), a district that is a member of the "Technology
97.29 and Information Education Systems" data processing joint board,
97.30 that finds it economically advantageous to enter into a lease
97.31 purchase agreement for a building for a group of school
97.32 districts or special school districts for staff development
97.33 purposes, may levy for its portion of lease costs attributed to
97.34 the district within the total levy limit in paragraph (e).
97.35 [EFFECTIVE DATE.] This section is effective for taxes
97.36 payable in 2003.
98.1 Sec. 3. Minnesota Statutes 2001 Supplement, section
98.2 126C.43, subdivision 3, is amended to read:
98.3 Subd. 3. [TAX LEVY FOR JUDGMENT.] A district may levy the
98.4 amounts necessary to pay judgments against the district under
98.5 section 123B.25 that became final after the date the district
98.6 certified its proposed levy in the previous year. With the
98.7 approval of the commissioner, a district may spread this levy
98.8 over a period not to exceed three years. Upon approval through
98.9 the adoption of a resolution by each of an intermediate
98.10 district's member school district boards, a member school
98.11 district may include its proportionate share of the costs of a
98.12 judgment against an intermediate school district that became
98.13 final under section 123B.25 after the date that the earliest
98.14 member school district certified its proposed levy in the
98.15 previous year. With the approval of the commissioner, an
98.16 intermediate school district member school district may spread
98.17 this levy over a period not to exceed three years.
98.18 [EFFECTIVE DATE.] This section is effective for taxes
98.19 payable in 2003.
98.20 Sec. 4. Minnesota Statutes 2000, section 126C.44, is
98.21 amended to read:
98.22 126C.44 [CRIME-RELATED COSTS SAFE SCHOOLS LEVY.]
98.23 Each district may make a levy on all taxable property
98.24 located within the district for the purposes specified in this
98.25 section. The maximum amount which may be levied for all costs
98.26 under this section shall be equal to $11 $30 multiplied by the
98.27 district's adjusted marginal cost pupil units for the school
98.28 year. The proceeds of the levy must be used for directly
98.29 funding the following purposes or for reimbursing the cities and
98.30 counties who contract with the district for the following
98.31 purposes: (1) to pay the costs incurred for the salaries,
98.32 benefits, and transportation costs of peace officers and
98.33 sheriffs for liaison in services in the district's schools; (2)
98.34 to pay the costs for a drug abuse prevention program as defined
98.35 in section 609.101, subdivision 3, paragraph (e), in the
98.36 elementary schools; (3) to pay the costs for a gang resistance
99.1 education training curriculum in the district's schools; (4) to
99.2 pay the costs for security in the district's schools and on
99.3 school property; or (5) to pay the costs for other crime
99.4 prevention, drug abuse, student and staff safety, and violence
99.5 prevention measures taken by the school district. The district
99.6 must initially attempt to contract for services to be provided
99.7 by peace officers or sheriffs with the police department of each
99.8 city or the sheriff's department of the county within the
99.9 district containing the school receiving the services. If a
99.10 local police department or a county sheriff's department does
99.11 not wish to provide the necessary services, the district may
99.12 contract for these services with any other police or sheriff's
99.13 department located entirely or partially within the school
99.14 district's boundaries. The levy authorized under this section
99.15 is not included in determining the school district's levy
99.16 limitations.
99.17 [EFFECTIVE DATE.] This section is effective for taxes
99.18 payable in 2003.
99.19 Sec. 5. Laws 2001, First Special Session chapter 6,
99.20 article 1, section 53, is amended to read:
99.21 Sec. 53. [REFERENDUM CONVERSION ADJUSTMENT FOR INTEREST
99.22 EARNED.]
99.23 (a) The commissioner of children, families, and learning
99.24 shall calculate the change in estimated net interest earnings
99.25 for each district attributable to the repeal of the general
99.26 education levy as provided in this section.
99.27 (b) The interest calculations must assume an annual
99.28 interest rate of five percent, and must be based on the amount
99.29 by which the district's cumulative net general education levy
99.30 receipts for taxes payable in 2000, based on the assumptions
99.31 specified in Minnesota Statutes, section 127A.45, subdivision 8,
99.32 exceeds the cumulative amount that would have been guaranteed
99.33 for each payment in fiscal year 2001, as defined in Minnesota
99.34 Statutes, section 127A.45, subdivisions 2 and 3, calculated
99.35 using data as of the June 20, 2001, payment, and assuming that
99.36 the repeal of the general education levy was effective for
100.1 fiscal year 2001. The commissioner shall divide the interest
100.2 revenue in fiscal year 2001 by the number of resident marginal
100.3 cost pupil units in fiscal year 2001. The interest calculations
100.4 must assume an annual interest rate of five percent, and must be
100.5 based on the difference between (1) the district's estimated aid
100.6 payments and levy receipts for fiscal year 2003, based upon the
100.7 payment schedule specified in Minnesota Statutes, section
100.8 127A.45, and (2) the amount that the district's estimated aid
100.9 payments and levy receipts for fiscal year 2003 would have been
100.10 had the general education levy for fiscal year 2003 been set at
100.11 the amount of the district's general education levy for taxes
100.12 payable in 2001. For the purposes of this section, the general
100.13 education levy must not include the education homestead credit
100.14 or the education agricultural credit.
100.15 (c) The amount calculated in paragraph (a) may be converted
100.16 to an additional referendum allowance according to Minnesota
100.17 Statutes, section 126C.17, subdivision 11. The amount
100.18 calculated in paragraph (b), less any interest conversion
100.19 revenue calculated for the district under Laws 2001, First
100.20 Special Session chapter 6, article 1, section 53, is added to
100.21 the district's levy limitation for taxes payable in 2003 through
100.22 2006.
100.23 (d) Any additional referendum allowance as a result of a
100.24 conversion under paragraph (b) shall be included in the
100.25 referendum conversion allowance used to determine the referendum
100.26 allowance limit under Minnesota Statutes, section 126C.17,
100.27 subdivision 2. If the state total levy under paragraph (c)
100.28 exceeds $3,000,000, the commissioner shall reduce the levy
100.29 authority proportionately for each eligible district such that
100.30 the state total levy equals $3,000,000.
100.31 (e) The commissioner must calculate an adjustment for taxes
100.32 payable in 2002 for each school district as though this section
100.33 were in effect for that tax year.
100.34 [EFFECTIVE DATE.] This section is effective for revenue for
100.35 taxes payable in 2003 and later.
100.36 Sec. 6. Laws 2001, First Special Session chapter 6,
101.1 article 4, section 25, is amended to read:
101.2 Sec. 25. [INTERACTIVE WEB-BASED AND INDEPENDENT STUDY
101.3 PROGRAMS.]
101.4 Subdivision 1. [PUPIL REVENUE.] (a) General education
101.5 revenue for an eligible pupil in an approved interactive
101.6 Web-based program offered by a school district or a charter
101.7 school, or an approved alternative program that has an
101.8 independent study component offered by a charter school, under
101.9 the supervision of a teacher with a Minnesota license, must be
101.10 paid for each hour of completed coursework needed for grade
101.11 progression, credit, or alignment with state graduation
101.12 standards. For purposes of this section, an eligible pupil is a
101.13 public school pupil concurrently enrolled in the district or
101.14 charter school or concurrently enrolled in another district or
101.15 charter school and participating in the program by agreement
101.16 with the district or charter school of enrollment. The course
101.17 of study must be approved by the commissioner of children,
101.18 families, and learning for alignment with the state graduation
101.19 standards and compliance with Minnesota Statutes, chapter 125A.
101.20 An alternative program that has an independent study component
101.21 must also meet the requirements of Minnesota Statutes, section
101.22 126C.05, subdivision 15, paragraph (b), clauses (i) and (iv).
101.23 Average daily membership for a pupil shall equal the number of
101.24 hours of coursework completed divided by the number of hours
101.25 required for a full-time student in the district or charter
101.26 school. Pupils enrolled in the program must not be counted as
101.27 more than 1.0 pupil in average daily membership. A school
101.28 district or charter school is not required to provide a pupil
101.29 enrolled in the program with access to a computer or to the
101.30 Internet.
101.31 (b) Notwithstanding paragraph (a), pupils enrolled in a
101.32 Web-based public alternative program approved by the
101.33 commissioner before June 1, 2001, are not required to be
101.34 concurrently enrolled in the district and may be counted as more
101.35 than 1.0 pupil in average daily membership under Minnesota
101.36 Statutes, section 126C.05, subdivision 15.
102.1 (c) Notwithstanding paragraph (a), pupils enrolled in a
102.2 charter school with a Web-based program, approved by the
102.3 commissioner before June 1, 2001, are not required to be
102.4 concurrently enrolled in the charter school.
102.5 (d) Notwithstanding paragraph (a), pupils enrolled in a
102.6 charter school with an alternative program that has an
102.7 independent study component, approved by the commissioner for
102.8 fiscal year 2001, may be counted as more than 1.0 pupil in
102.9 average daily membership under Minnesota Statutes, section
102.10 126C.05, subdivision 15, paragraph (b), clause (iii).
102.11 Subd. 2. [REIMBURSEMENT.] Notwithstanding Minnesota
102.12 Statutes, section 126C.19, subdivision 4, for fiscal year years
102.13 2002 and 2003 only, the commissioner shall establish a process
102.14 for providing additional revenue to school districts or charter
102.15 schools for:
102.16 (1) an eligible pupil in an approved interactive Web-based
102.17 program under subdivision 1, paragraph (a), that may be counted
102.18 as more than 1.0 pupil in average daily membership; or
102.19 (2) a nonpublic pupil in an approved interactive Web-based
102.20 program in a public school under subdivision 1, paragraph (a).
102.21 The commissioner may award additional general education revenue
102.22 to school districts and charter schools up to the amount
102.23 appropriated for this section. The amount of additional revenue
102.24 awarded to a school district under this section shall be based
102.25 on additional pupils in average daily membership that are
102.26 generated according to this subdivision with the prior approval
102.27 from the commissioner. The commissioner shall establish a
102.28 process to prioritize the awards under this subdivision based on
102.29 the estimated number of students the school district or charter
102.30 school expects to serve under this section.
102.31 [EFFECTIVE DATE.] This section is effective for revenue for
102.32 fiscal year 2003 only.
102.33 Sec. 7. Laws 2001, First Special Session chapter 6,
102.34 article 4, section 27, subdivision 9, is amended to read:
102.35 Subd. 9. [REIMBURSEMENT FOR WEB-BASED AND INDEPENDENT
102.36 STUDY COURSES.] For grants to school districts and charter
103.1 schools for additional pupils taking on-line courses according
103.2 to section 25:
103.3 $100,000 ..... 2002
103.4 This appropriation is available until June 30, 2003.
103.5 Sec. 8. [DISABLED ACCESS LEVY AUTHORITY; WESTBROOK-WALNUT
103.6 GROVE.]
103.7 Notwithstanding the time limit in Minnesota Statutes,
103.8 section 123B.58, subdivision 3, independent school district No.
103.9 2898, Westbrook-Walnut Grove, may levy its remaining disabled
103.10 access levy authority over five or fewer years.
103.11 [EFFECTIVE DATE.] This section is effective the day
103.12 following final enactment.
103.13 Sec. 9. [DISABLED ACCESS LEVY AUTHORITY; PINE CITY.]
103.14 Notwithstanding the time limits in Minnesota Statutes,
103.15 section 123B.58, subdivision 3, independent school district No.
103.16 578, Pine City, may levy its remaining disabled access levy
103.17 authority over five or fewer years.
103.18 [EFFECTIVE DATE.] This section is effective the day
103.19 following final enactment.
103.20 ARTICLE 6
103.21 AIDS AND LEVIES
103.22 Section 1. Minnesota Statutes 2000, section 69.77, is
103.23 amended by adding a subdivision to read:
103.24 Subd. 12. [APPLICATION OF OTHER LAWS TO CONTRIBUTION
103.25 RATE.] In the absence of any specific provision to the contrary,
103.26 no general or special law previously enacted may be construed as
103.27 reducing the levy amount or rate of contribution to a police or
103.28 firefighters relief association to which subdivision 1a applies,
103.29 by a municipality or member of the association, which is
103.30 required as a condition for the use of public funds or the levy
103.31 of taxes for the support of the association. Each association,
103.32 the municipality in which it is organized, and the officers of
103.33 each, are authorized to do all things required by this section
103.34 as a condition for the use of public funds or the levy of taxes
103.35 for the support of the association.
103.36 Sec. 2. [126C.445] [TREE GROWTH REPLACEMENT REVENUE.]
104.1 For taxes payable in 2003 and later, a school district may
104.2 levy an amount not to exceed its miscellaneous revenue for tree
104.3 growth revenue for taxes payable in 2001.
104.4 [EFFECTIVE DATE.] This section is effective beginning with
104.5 taxes levied in 2002, payable in 2003.
104.6 Sec. 3. Minnesota Statutes 2000, section 273.1398,
104.7 subdivision 3, is amended to read:
104.8 Subd. 3. [DISPARITY REDUCTION AID.] (a) For taxes payable
104.9 in 1995, 2003 and subsequent years, the amount of disparity aid
104.10 certified for each taxing district within each unique taxing
104.11 jurisdiction for taxes payable in the prior year shall be
104.12 multiplied by the ratio of (1) the jurisdiction's tax capacity
104.13 using the class rates for taxes payable in the year for which
104.14 aid is being computed, to (2) its tax capacity using the class
104.15 rates for taxes payable in the year prior to that for which aid
104.16 is being computed, both based upon market values for taxes
104.17 payable in the year prior to that for which aid is being
104.18 computed. For the purposes of this aid determination, disparity
104.19 reduction aid certified for taxes payable in the prior year for
104.20 a taxing entity other than a town or school district is deemed
104.21 to be county government disparity reduction aid. For taxes
104.22 payable in 1992 and subsequent years, The amount of disparity
104.23 aid certified to each taxing jurisdiction shall be reduced by
104.24 any reductions required in the current year or permanent
104.25 reductions required in previous years under section 477A.0132.
104.26 (b) For aid payable in 2003, in each unique taxing
104.27 jurisdiction where the total tax rate for taxes payable in 2002
104.28 exceeds 135 percent of taxable net tax capacity, an amount shall
104.29 be permanently added to the unique taxing jurisdiction's aid
104.30 amount under paragraph (a) equal to the lesser of: (i) the
104.31 amount, if any, by which 87 percent of the aid certified for
104.32 2001 exceeds the amount certified for 2002, or (ii) the amount
104.33 that would be necessary to reduce the total payable 2002 tax
104.34 rate for the unique taxing jurisdiction to 135 percent of
104.35 taxable net tax capacity. The amount determined under this
104.36 paragraph must be added before the class rate adjustment
105.1 described in paragraph (a).
105.2 [EFFECTIVE DATE.] This section is effective for aids
105.3 payable in 2003 and subsequent years.
105.4 Sec. 4. Minnesota Statutes 2001 Supplement, section
105.5 273.1398, subdivision 4d, is amended to read:
105.6 Subd. 4d. [AID OFFSET FOR OUT-OF-HOME PLACEMENT COSTS.]
105.7 For aid payable in 2003 2004, each county's aid under
105.8 subdivision 2 shall be permanently reduced by an amount equal to
105.9 the county's 2003 2004 reimbursement for nonfederal expenditures
105.10 for out-of-home placements, as provided in section 245.775,
105.11 provided that payments will be made under section 477A.0123 in
105.12 calendar year 2003 2004. The counties shall provide all
105.13 information requested by the commissioner of human services
105.14 necessary to allow the commissioner to certify the previous
105.15 three years' average nonfederal costs to the commissioner of
105.16 revenue by July 15, 2003 2004. The aid reduction under this
105.17 subdivision must be made prior to not exceed the difference
105.18 between (1) the amount of aid calculated for the county for
105.19 calendar year 2004 under subdivision 2, including any addition
105.20 under section 477A.07, and (2) the amount of any aid reductions
105.21 for the state takeover of courts contained in Laws 2001, First
105.22 Special Session chapter 5, article 5.
105.23 [EFFECTIVE DATE.] This section is effective for aids
105.24 payable in 2004.
105.25 Sec. 5. Minnesota Statutes 2001 Supplement, section
105.26 275.70, subdivision 5, is amended to read:
105.27 Subd. 5. [SPECIAL LEVIES.] "Special levies" means those
105.28 portions of ad valorem taxes levied by a local governmental unit
105.29 for the following purposes or in the following manner:
105.30 (1) to pay the costs of the principal and interest on
105.31 bonded indebtedness or to reimburse for the amount of liquor
105.32 store revenues used to pay the principal and interest due on
105.33 municipal liquor store bonds in the year preceding the year for
105.34 which the levy limit is calculated;
105.35 (2) to pay the costs of principal and interest on
105.36 certificates of indebtedness issued for any corporate purpose
106.1 except for the following:
106.2 (i) tax anticipation or aid anticipation certificates of
106.3 indebtedness;
106.4 (ii) certificates of indebtedness issued under sections
106.5 298.28 and 298.282;
106.6 (iii) certificates of indebtedness used to fund current
106.7 expenses or to pay the costs of extraordinary expenditures that
106.8 result from a public emergency; or
106.9 (iv) certificates of indebtedness used to fund an
106.10 insufficiency in tax receipts or an insufficiency in other
106.11 revenue sources;
106.12 (3) to provide for the bonded indebtedness portion of
106.13 payments made to another political subdivision of the state of
106.14 Minnesota;
106.15 (4) to fund payments made to the Minnesota state armory
106.16 building commission under section 193.145, subdivision 2, to
106.17 retire the principal and interest on armory construction bonds;
106.18 (5) property taxes approved by voters which are levied
106.19 against the referendum market value as provided under section
106.20 275.61;
106.21 (6) to fund matching requirements needed to qualify for
106.22 federal or state grants or programs to the extent that either
106.23 (i) the matching requirement exceeds the matching requirement in
106.24 calendar year 2001, or (ii) it is a new matching requirement
106.25 that didn't exist prior to 2002;
106.26 (7) to pay the expenses reasonably and necessarily incurred
106.27 in preparing for or repairing the effects of natural disaster
106.28 including the occurrence or threat of widespread or severe
106.29 damage, injury, or loss of life or property resulting from
106.30 natural causes, in accordance with standards formulated by the
106.31 emergency services division of the state department of public
106.32 safety, as allowed by the commissioner of revenue under section
106.33 275.74, paragraph (b);
106.34 (8) pay amounts required to correct an error in the levy
106.35 certified to the county auditor by a city or county in a levy
106.36 year, but only to the extent that when added to the preceding
107.1 year's levy it is not in excess of an applicable statutory,
107.2 special law or charter limitation, or the limitation imposed on
107.3 the governmental subdivision by sections 275.70 to 275.74 in the
107.4 preceding levy year;
107.5 (9) to pay an abatement under section 469.1815;
107.6 (10) to pay any costs attributable to increases in the
107.7 employer contribution rates under chapter 353 that are effective
107.8 after June 30, 2001;
107.9 (11) to pay the operating or maintenance costs of a county
107.10 jail as authorized in section 641.01 or 641.262, or of a
107.11 correctional facility as defined in section 241.021, subdivision
107.12 1, paragraph (5), to the extent that the county can demonstrate
107.13 to the commissioner of revenue that the amount has been included
107.14 in the county budget as a direct result of a rule, minimum
107.15 requirement, minimum standard, or directive of the department of
107.16 corrections, or to pay the operating or maintenance costs of a
107.17 regional jail as authorized in section 641.262. For purposes of
107.18 this clause, a district court order is not a rule, minimum
107.19 requirement, minimum standard, or directive of the department of
107.20 corrections. If the county utilizes this special levy, any
107.21 amount levied by the county in the previous levy year for the
107.22 purposes specified under this clause and included in the
107.23 county's previous year's levy limitation computed under section
107.24 275.71, shall be deducted from the levy limit base under section
107.25 275.71, subdivision 2, when determining the county's current
107.26 year levy limitation. The county shall provide the necessary
107.27 information to the commissioner of revenue for making this
107.28 determination;
107.29 (12) to pay for operation of a lake improvement district,
107.30 as authorized under section 103B.555. If the county utilizes
107.31 this special levy, any amount levied by the county in the
107.32 previous levy year for the purposes specified under this clause
107.33 and included in the county's previous year's levy limitation
107.34 computed under section 275.71 shall be deducted from the levy
107.35 limit base under section 275.71, subdivision 2, when determining
107.36 the county's current year levy limitation. The county shall
108.1 provide the necessary information to the commissioner of revenue
108.2 for making this determination;
108.3 (13) to repay a state or federal loan used to fund the
108.4 direct or indirect required spending by the local government due
108.5 to a state or federal transportation project or other state or
108.6 federal capital project. This authority may only be used if the
108.7 project is not a local government initiative;
108.8 (14) for counties only, to pay the costs reasonably
108.9 expected to be incurred in 2002 related to the redistricting of
108.10 election districts and establishment of election precincts under
108.11 sections 204B.135 and 204B.14, the notice required by section
108.12 204B.14, subdivision 4, and the reassignment of voters in the
108.13 statewide registration system, not to exceed $1 per capita,
108.14 provided that the county shall distribute a portion of the
108.15 amount levied under this clause equal to 25 cents times the
108.16 population of the city to all cities in the county with a
108.17 population of 30,000 or more; and
108.18 (15) to pay for court administration costs as required
108.19 under section 273.1398, subdivision 4b, less the county's share
108.20 of transferred fines and fees collected by the district courts
108.21 in the county for calendar year 2001; however, for taxes levied
108.22 to pay for these costs in the year in which the court financing
108.23 is transferred to the state, the amount under this section is
108.24 limited to one-third of the aid reduction under section
108.25 273.1398, subdivision 4a; and
108.26 (16) to fund a police or firefighters relief association as
108.27 required under section 69.77 to the extent that the required
108.28 amount exceeds the amount levied for this purpose in 2001.
108.29 [EFFECTIVE DATE.] This section is effective for taxes
108.30 levied beginning in 2002.
108.31 Sec. 6. Minnesota Statutes 2001 Supplement, section
108.32 275.71, subdivision 2, is amended to read:
108.33 Subd. 2. [LEVY LIMIT BASE.] (a) The levy limit base for a
108.34 local governmental unit for taxes levied in 2001 is equal to the
108.35 greater of:
108.36 (1) the sum of its adjusted levy limit base for taxes
109.1 levied in 1999 plus the amount it levied in 1999 under Minnesota
109.2 Statutes 1999 Supplement, section 275.70, subdivision 5, clauses
109.3 (8) and (13), multiplied by:
109.4 (i) one plus the percentage growth in the implicit price
109.5 deflator for the 12-month period ending March 30, 2000;
109.6 (ii) one plus a percentage equal to the annual percentage
109.7 increase in the estimated number of households, if any, for the
109.8 most recent 12-month period that was available on July 1, 2000;
109.9 and
109.10 (iii) one plus a percentage equal to 50 percent of the
109.11 percentage increase in the taxable market value of the
109.12 jurisdiction due to new construction of class 3 property, as
109.13 defined in section 273.13, subdivision 24, except for
109.14 state-assessed utility and railroad operating property, for the
109.15 most recent year for which data was available as of July 1,
109.16 2000; or
109.17 (2) an amount equal to:
109.18 (i) the sum of the amount it levied in 2000 plus the amount
109.19 of aids it was certified to receive in calendar year 2001 under
109.20 sections 273.1398, 298.282, 477A.011 to 477A.03, prior to any
109.21 aid reductions under section 273.1399, subdivision 5, 477A.06,
109.22 and 477A.065; less
109.23 (ii) the amount it levied in 2000 that would qualify as
109.24 special levies under section 275.70, subdivision 6, for taxes
109.25 levied in 2001. The local governmental unit shall provide the
109.26 commissioner of revenue with sufficient information to make this
109.27 calculation.
109.28 (b) If the governmental unit was not subject to levy limits
109.29 for taxes levied in 1999, its levy limit base for taxes levied
109.30 in 2001 is equal to the amount calculated under paragraph (a),
109.31 clause (2).
109.32 (c) The levy limit base for a local governmental unit for
109.33 taxes levied in 2002 is equal to its adjusted levy limit base in
109.34 the previous year, plus the amount of tree growth tax it
109.35 received in calendar year 2001 under sections 270.31 to 270.39,
109.36 and plus, in the case of a city, the amount it was certified to
110.1 receive in calendar year 2001 under section 273.166, subject to
110.2 any adjustments under section 275.72.
110.3 [EFFECTIVE DATE.] This section is effective for taxes
110.4 levied in 2002, payable in 2003.
110.5 Sec. 7. Minnesota Statutes 2001 Supplement, section
110.6 275.71, subdivision 3, is amended to read:
110.7 Subd. 3. [ADJUSTMENTS FOR STATE TAKEOVERS.] (a) The levy
110.8 limit base for each local unit of government shall be adjusted
110.9 to reflect the assumption by the state of financing for certain
110.10 government functions as indicated in this subdivision.
110.11 (b) For a county in a judicial district for which financing
110.12 has not been transferred to the state by January 1, 2001, the
110.13 levy limit base for 2001 is permanently reduced by the amount of
110.14 the county's 2001 budget for court administration costs, as
110.15 certified under section 273.1398, subdivision 4b, paragraph (b),
110.16 net of the county's share of transferred fines and fees
110.17 collected by the district courts in the county for the same
110.18 budget period.
110.19 (c) For a governmental unit which levied a tax in 2000
110.20 under section 473.388, subdivision 7, the levy limit base for
110.21 2001 is permanently reduced by an amount equal to the sum of the
110.22 governmental unit's taxes payable 2001 nondebt transit services
110.23 levy plus the portion of its 2001 homestead and agricultural
110.24 credit aid under section 273.1398, subdivision 2, attributable
110.25 to nondebt transit services.
110.26 (d) For counties in a judicial district in which the state
110.27 assumed financing of mandated services costs as defined in
110.28 section 480.181, subdivision 4, on July 1, 2001, the levy limit
110.29 base for taxes levied in 2001 is permanently reduced by an
110.30 amount equal to one-half of the aid reduction under section
110.31 273.1398, subdivision 4a, paragraph (g).
110.32 [EFFECTIVE DATE.] This section is effective retroactively
110.33 for taxes payable in 2002 and 2003.
110.34 Sec. 8. Minnesota Statutes 2001 Supplement, section
110.35 275.71, subdivision 6, is amended to read:
110.36 Subd. 6. [LEVIES IN EXCESS OF LEVY LIMITS.] (a) If the
111.1 levy made by a city or county exceeds the levy limit provided in
111.2 sections 275.70 to 275.74, except when the excess levy is due to
111.3 the rounding of the rate in accordance with section 275.28, the
111.4 county auditor shall only extend the amount of taxes permitted
111.5 under sections 275.70 to 275.74, as provided for in section
111.6 275.16.
111.7 (b) For taxes levied in 2002, payable in 2003 only, if an
111.8 error was made in calculating the levy limit adjustment related
111.9 to a special levy for jails authorized under section 275.70,
111.10 subdivision 5, clause (11), in the previous year, the following
111.11 adjustments must be made:
111.12 (1) the county's levy limit base for taxes levied in 2002
111.13 must be based on the corrected adjusted levy limit base for
111.14 taxes levied in 2001; and
111.15 (2) the county's final levy limit for taxes levied in 2002,
111.16 payable in 2003, must also be temporarily reduced by an amount
111.17 equal to the amount of county levy spread in the previous year
111.18 in excess of the total recalculated levy limit plus authorized
111.19 special levies for taxes levied in 2001, payable in 2002.
111.20 (c) The commissioner of revenue shall inform counties
111.21 affected by paragraph (b) of the levy error and levy adjustments
111.22 required under this provision by June 15, 2002. The county may
111.23 provide additional information to the commissioner indicating
111.24 why these adjustments may be in error by July 15, 2002. The
111.25 commissioner shall certify the final levy adjustment to the
111.26 affected counties by August 1, 2002. The levy reduction imposed
111.27 under paragraph (b), clause (2), may be spread over a period not
111.28 to exceed three years, upon agreement between the county and the
111.29 commissioner.
111.30 [EFFECTIVE DATE.] This section is effective for taxes
111.31 levied in 2002, payable in 2003 only.
111.32 Sec. 9. Minnesota Statutes 2001 Supplement, section
111.33 477A.011, subdivision 36, is amended to read:
111.34 Subd. 36. [CITY AID BASE.] (a) Except as otherwise
111.35 provided in paragraphs (b) to (o) this subdivision, "city aid
111.36 base" means, for each city, the sum of the local government aid
112.1 and equalization aid it was originally certified to receive in
112.2 calendar year 1993 under Minnesota Statutes 1992, section
112.3 477A.013, subdivisions 3 and 5, and the amount of disparity
112.4 reduction aid it received in calendar year 1993 under Minnesota
112.5 Statutes 1992, section 273.1398, subdivision 3.
112.6 (b) For aids payable in 1996 and thereafter, a city that in
112.7 1992 or 1993 transferred an amount from governmental funds to
112.8 its sewer and water fund, which amount exceeded its net levy for
112.9 taxes payable in the year in which the transfer occurred, has a
112.10 "city aid base" equal to the sum of (i) its city aid base, as
112.11 calculated under paragraph (a), and (ii) one-half of the
112.12 difference between its city aid distribution under section
112.13 477A.013, subdivision 9, for aids payable in 1995 and its city
112.14 aid base for aids payable in 1995.
112.15 (c) The city aid base for any city with a population less
112.16 than 500 is increased by $40,000 for aids payable in calendar
112.17 year 1995 and thereafter, and the maximum amount of total aid it
112.18 may receive under section 477A.013, subdivision 9, paragraph
112.19 (c), is also increased by $40,000 for aids payable in calendar
112.20 year 1995 only, provided that:
112.21 (i) the average total tax capacity rate for taxes payable
112.22 in 1995 exceeds 200 percent;
112.23 (ii) the city portion of the tax capacity rate exceeds 100
112.24 percent; and
112.25 (iii) its city aid base is less than $60 per capita.
112.26 (d) The city aid base for a city is increased by $20,000 in
112.27 1998 and thereafter and the maximum amount of total aid it may
112.28 receive under section 477A.013, subdivision 9, paragraph (c), is
112.29 also increased by $20,000 in calendar year 1998 only, provided
112.30 that:
112.31 (i) the city has a population in 1994 of 2,500 or more;
112.32 (ii) the city is located in a county, outside of the
112.33 metropolitan area, which contains a city of the first class;
112.34 (iii) the city's net tax capacity used in calculating its
112.35 1996 aid under section 477A.013 is less than $400 per capita;
112.36 and
113.1 (iv) at least four percent of the total net tax capacity,
113.2 for taxes payable in 1996, of property located in the city is
113.3 classified as railroad property.
113.4 (e) The city aid base for a city is increased by $200,000
113.5 in 1999 and thereafter and the maximum amount of total aid it
113.6 may receive under section 477A.013, subdivision 9, paragraph
113.7 (c), is also increased by $200,000 in calendar year 1999 only,
113.8 provided that:
113.9 (i) the city was incorporated as a statutory city after
113.10 December 1, 1993;
113.11 (ii) its city aid base does not exceed $5,600; and
113.12 (iii) the city had a population in 1996 of 5,000 or more.
113.13 (f) The city aid base for a city is increased by $450,000
113.14 in 1999 to 2008 and the maximum amount of total aid it may
113.15 receive under section 477A.013, subdivision 9, paragraph (c), is
113.16 also increased by $450,000 in calendar year 1999 only, provided
113.17 that:
113.18 (i) the city had a population in 1996 of at least 50,000;
113.19 (ii) its population had increased by at least 40 percent in
113.20 the ten-year period ending in 1996; and
113.21 (iii) its city's net tax capacity for aids payable in 1998
113.22 is less than $700 per capita.
113.23 (g) Beginning in 2002 2004, the city aid base for a city is
113.24 equal to the sum of its city aid base in 2001 2003 and the
113.25 amount of additional aid it was certified to receive under
113.26 section 477A.06 in 2001 2003. For 2002 2004 only, the maximum
113.27 amount of total aid a city may receive under section 477A.013,
113.28 subdivision 9, paragraph (c), is also increased by the amount it
113.29 was certified to receive under section 477A.06 in 2001 2003.
113.30 (h) The city aid base for a city is increased by $150,000
113.31 for aids payable in 2000 and thereafter, and the maximum amount
113.32 of total aid it may receive under section 477A.013, subdivision
113.33 9, paragraph (c), is also increased by $150,000 in calendar year
113.34 2000 only, provided that:
113.35 (1) the city has a population that is greater than 1,000
113.36 and less than 2,500;
114.1 (2) its commercial and industrial percentage for aids
114.2 payable in 1999 is greater than 45 percent; and
114.3 (3) the total market value of all commercial and industrial
114.4 property in the city for assessment year 1999 is at least 15
114.5 percent less than the total market value of all commercial and
114.6 industrial property in the city for assessment year 1998.
114.7 (i) The city aid base for a city is increased by $200,000
114.8 in 2000 and thereafter, and the maximum amount of total aid it
114.9 may receive under section 477A.013, subdivision 9, paragraph
114.10 (c), is also increased by $200,000 in calendar year 2000 only,
114.11 provided that:
114.12 (1) the city had a population in 1997 of 2,500 or more;
114.13 (2) the net tax capacity of the city used in calculating
114.14 its 1999 aid under section 477A.013 is less than $650 per
114.15 capita;
114.16 (3) the pre-1940 housing percentage of the city used in
114.17 calculating 1999 aid under section 477A.013 is greater than 12
114.18 percent;
114.19 (4) the 1999 local government aid of the city under section
114.20 477A.013 is less than 20 percent of the amount that the formula
114.21 aid of the city would have been if the need increase percentage
114.22 was 100 percent; and
114.23 (5) the city aid base of the city used in calculating aid
114.24 under section 477A.013 is less than $7 per capita.
114.25 (j) The city aid base for a city is increased by $225,000
114.26 in calendar years 2000 to 2002 and the maximum amount of total
114.27 aid it may receive under section 477A.013, subdivision 9,
114.28 paragraph (c), is also increased by $225,000 in calendar year
114.29 2000 only, provided that:
114.30 (1) the city had a population of at least 5,000;
114.31 (2) its population had increased by at least 50 percent in
114.32 the ten-year period ending in 1997;
114.33 (3) the city is located outside of the Minneapolis-St. Paul
114.34 metropolitan statistical area as defined by the United States
114.35 Bureau of the Census; and
114.36 (4) the city received less than $30 per capita in aid under
115.1 section 477A.013, subdivision 9, for aids payable in 1999.
115.2 (k) The city aid base for a city is increased by $102,000
115.3 in 2000 and thereafter, and the maximum amount of total aid it
115.4 may receive under section 477A.013, subdivision 9, paragraph
115.5 (c), is also increased by $102,000 in calendar year 2000 only,
115.6 provided that:
115.7 (1) the city has a population in 1997 of 2,000 or more;
115.8 (2) the net tax capacity of the city used in calculating
115.9 its 1999 aid under section 477A.013 is less than $455 per
115.10 capita;
115.11 (3) the net levy of the city used in calculating 1999 aid
115.12 under section 477A.013 is greater than $195 per capita; and
115.13 (4) the 1999 local government aid of the city under section
115.14 477A.013 is less than 38 percent of the amount that the formula
115.15 aid of the city would have been if the need increase percentage
115.16 was 100 percent.
115.17 (l) The city aid base for a city is increased by $32,000 in
115.18 2001 and thereafter, and the maximum amount of total aid it may
115.19 receive under section 477A.013, subdivision 9, paragraph (c), is
115.20 also increased by $32,000 in calendar year 2001 only, provided
115.21 that:
115.22 (1) the city has a population in 1998 that is greater than
115.23 200 but less than 500;
115.24 (2) the city's revenue need used in calculating aids
115.25 payable in 2000 was greater than $200 per capita;
115.26 (3) the city net tax capacity for the city used in
115.27 calculating aids available in 2000 was equal to or less than
115.28 $200 per capita;
115.29 (4) the city aid base of the city used in calculating aid
115.30 under section 477A.013 is less than $65 per capita; and
115.31 (5) the city's formula aid for aids payable in 2000 was
115.32 greater than zero.
115.33 (m) The city aid base for a city is increased by $7,200 in
115.34 2001 and thereafter, and the maximum amount of total aid it may
115.35 receive under section 477A.013, subdivision 9, paragraph (c), is
115.36 also increased by $7,200 in calendar year 2001 only, provided
116.1 that:
116.2 (1) the city had a population in 1998 that is greater than
116.3 200 but less than 500;
116.4 (2) the city's commercial industrial percentage used in
116.5 calculating aids payable in 2000 was less than ten percent;
116.6 (3) more than 25 percent of the city's population was 60
116.7 years old or older according to the 1990 census;
116.8 (4) the city aid base of the city used in calculating aid
116.9 under section 477A.013 is less than $15 per capita; and
116.10 (5) the city's formula aid for aids payable in 2000 was
116.11 greater than zero.
116.12 (n) The city aid base for a city is increased by $45,000 in
116.13 2001 and thereafter and by an additional $50,000 in calendar
116.14 years 2002 to 2011, and the maximum amount of total aid it may
116.15 receive under section 477A.013, subdivision 9, paragraph (c), is
116.16 also increased by $45,000 in calendar year 2001 only, and by
116.17 $50,000 in calendar year 2002 only, provided that:
116.18 (1) the net tax capacity of the city used in calculating
116.19 its 2000 aid under section 477A.013 is less than $810 per
116.20 capita;
116.21 (2) the population of the city declined more than two
116.22 percent between 1988 and 1998;
116.23 (3) the net levy of the city used in calculating 2000 aid
116.24 under section 477A.013 is greater than $240 per capita; and
116.25 (4) the city received less than $36 per capita in aid under
116.26 section 477A.013, subdivision 9, for aids payable in 2000.
116.27 (o) The city aid base for a city with a population of
116.28 10,000 or more which is located outside of the seven-county
116.29 metropolitan area is increased in 2002 and thereafter, and the
116.30 maximum amount of total aid it may receive under section
116.31 477A.013, subdivision 9, paragraph (b) or (c), is also increased
116.32 in calendar year 2002 only, by an amount equal to the lesser of:
116.33 (1)(i) the total population of the city, as determined by
116.34 the United States Bureau of the Census, in the 2000 census, (ii)
116.35 minus 5,000, (iii) times 60; or
116.36 (2) $2,500,000.
117.1 (p) The city aid base is increased by $50,000 in 2002 and
117.2 thereafter, and the maximum amount of total aid it may receive
117.3 under section 477A.013, subdivision 9, paragraph (c), is also
117.4 increased by $50,000 in calendar year 2002 only, provided that:
117.5 (1) the city is located in the seven-county metropolitan
117.6 area;
117.7 (2) its population in 2000 is between 10,000 and 20,000;
117.8 and
117.9 (3) its commercial industrial percentage, as calculated for
117.10 city aid payable in 2001, was greater than 25 percent.
117.11 (q) The city aid base for a city is increased by $150,000
117.12 in calendar years 2002 to 2011 and the maximum amount of total
117.13 aid it may receive under section 477A.013, subdivision 9,
117.14 paragraph (c), is also increased by $150,000 in calendar year
117.15 2002 only, provided that:
117.16 (1) the city had a population of at least 3,000 but no more
117.17 than 4,000 in 1999;
117.18 (2) its home county is located within the seven-county
117.19 metropolitan area;
117.20 (3) its pre-1940 housing percentage is less than 15
117.21 percent; and
117.22 (4) its city net tax capacity per capita for taxes payable
117.23 in 2000 is less than $900 per capita.
117.24 (r) The city aid base for a city is increased by $200,000
117.25 beginning in calendar year 2003 and the maximum amount of total
117.26 aid it may receive under section 477A.013, subdivision 9,
117.27 paragraph (c), is also increased by $200,000 in calendar year
117.28 2003 only, provided that the city qualified for an increase in
117.29 homestead and agricultural credit aid under Laws 1995, chapter
117.30 264, article 8, section 18.
117.31 [EFFECTIVE DATE.] This section is effective for aid payable
117.32 in 2002 and thereafter, except that paragraph (r) is effective
117.33 beginning with aid payable in 2003.
117.34 Sec. 10. Minnesota Statutes 2001 Supplement, section
117.35 477A.0123, is amended to read:
117.36 477A.0123 [REIMBURSEMENT OF COUNTY FOR CERTAIN OUT-OF-HOME
118.1 PLACEMENT.]
118.2 Subdivision 1. [AID PAYMENTS.] (a) In calendar year 2003
118.3 2004 and thereafter, the commissioner of revenue shall reimburse
118.4 each county for a portion of the nonfederal share of the cost of
118.5 out-of-home placement provided the commissioner of human
118.6 services, in consultation with the commissioner of corrections,
118.7 certifies to the commissioner of revenue that accurate data is
118.8 available to make the aid determination under this section. The
118.9 amount of reimbursement is a percent of the county's average
118.10 nonfederal share of the cost for out-of-home placement for the
118.11 most recent three calendar years for which data is available.
118.12 The commissioner shall pay the aid under the schedule used for
118.13 local government aid payments under section 477A.015.
118.14 (b) For aids payable in calendar year 2003 2004, the
118.15 percent of reimbursement in paragraph (a) shall be equal to the
118.16 maximum percentage possible, up to 30 percent, that does not
118.17 cause the payment to any county in the seven county metropolitan
118.18 area to exceed the difference between (1) the amount of aid it
118.19 is scheduled to receive calculated for the county in calendar
118.20 year 2003 2004 under section 273.1398, prior to the offset under
118.21 section 273.1398, subdivision 4d, and any aid offset under
118.22 section 273.1398, subdivision 4a, that is scheduled to occur
118.23 after July 1, 2003 subdivision 2, including any addition
118.24 determined under section 477A.07, and (2) the amount of any aid
118.25 reductions for the state takeover of courts contained in Laws
118.26 2001, First Special Session chapter 5, article 5. For aids
118.27 payable in 2004 2005 and thereafter, the percent of
118.28 reimbursement under paragraph (a) shall be equal to the percent
118.29 of reimbursement determined for calendar year 2003 2004,
118.30 adjusted so that the total payments under this section do not
118.31 exceed the appropriation under section 477A.03, subdivision 2,
118.32 paragraph (e).
118.33 (c) For purposes of this section, "out-of-home placement"
118.34 means the placement of a child in a child caring institution or
118.35 shelter licensed under Minnesota Rules, parts 9545.0905 to
118.36 9545.1125, in a group home licensed under Minnesota Rules, parts
119.1 9545.1400 to 9545.1480, in family foster care or group family
119.2 foster care licensed under Minnesota Rules, parts 9545.0010 to
119.3 9545.0260, or a correctional facility pursuant to a court order
119.4 under which a county social services agency or a county
119.5 correctional agency has been assigned responsibility for the
119.6 placement.
119.7 Subd. 2. [DETERMINATION OF NONFEDERAL SHARE OF COSTS.] (a)
119.8 By January 1, 2002, each county shall report the following
119.9 information to the commissioners of human services and
119.10 corrections, the separate amounts paid out of its social service
119.11 agency budget and its corrections budget for out-of-home
119.12 placement in calendar years 1998, 1999, and 2000, along with the
119.13 number of case days associated with the expenditures from each
119.14 budget. By March 15, 2002, the commissioner of human services,
119.15 in consultation with the commissioner of corrections, shall
119.16 certify to the commissioner of revenue and to the legislative
119.17 committees responsible for local government aids and out-of-home
119.18 placement funding, whether the data reported under this
119.19 subdivision accurately reflects total expenditures by counties
119.20 for out-of-home placement costs.
119.21 (b) By January 1 of calendar year 2004 2003 and thereafter,
119.22 each county shall report to the commissioners of human services
119.23 and corrections the separate amounts paid out of its social
119.24 service agency budget and its corrections budget for out-of-home
119.25 placement in the calendar years year two years before the
119.26 current calendar year along with the number of case days
119.27 associated with the expenditures from each budget.
119.28 (c) Until either the commissioner of human services or
119.29 corrections develops another mechanism for collecting and
119.30 verifying data on out-of-home placements, and the legislature
119.31 authorizes the use of that data, the data collected under this
119.32 subdivision shall be used to calculate payments under
119.33 subdivision 1. The commissioner of human services shall certify
119.34 the information to the commissioner of revenue by July 1 of the
119.35 year prior to the aid payment.
119.36 Sec. 11. Minnesota Statutes 2001 Supplement, section
120.1 477A.03, subdivision 2, is amended to read:
120.2 Subd. 2. [ANNUAL APPROPRIATION.] (a) A sum sufficient to
120.3 discharge the duties imposed by sections 477A.011 to 477A.014 is
120.4 annually appropriated from the general fund to the commissioner
120.5 of revenue.
120.6 (b) Aid payments to counties under section 477A.0121 are
120.7 limited to $20,265,000 in 1996. Aid payments to counties under
120.8 section 477A.0121 are limited to $27,571,625 in 1997. For aid
120.9 payable in 1998 and thereafter, the total aids paid under
120.10 section 477A.0121 are the amounts certified to be paid in the
120.11 previous year, adjusted for inflation as provided under
120.12 subdivision 3.
120.13 (c)(i) For aids payable in 1998 and thereafter, the total
120.14 aids paid to counties under section 477A.0122 are the amounts
120.15 certified to be paid in the previous year, adjusted for
120.16 inflation as provided under subdivision 3.
120.17 (ii) Aid payments to counties under section 477A.0122 in
120.18 2000 are further increased by an additional $20,000,000 in 2000.
120.19 (d) Aid payments to cities in 2002 under section 477A.013,
120.20 subdivision 9, are limited to the amounts certified to be paid
120.21 in the previous year, adjusted for inflation as provided in
120.22 subdivision 3, and increased by $140,000,000. For aids payable
120.23 in 2003, the total aids paid under section 477A.013, subdivision
120.24 9, are the amounts certified to be paid in the previous year,
120.25 adjusted for inflation as provided under subdivision 3. For
120.26 aids payable in 2004, the total aids paid under section
120.27 477A.013, subdivision 9, are the amounts certified to be paid in
120.28 the previous year, adjusted for inflation as provided under
120.29 subdivision 3, and increased by the amount certified to be paid
120.30 in 2003 under section 477A.06. For aids payable in 2005 and
120.31 thereafter, the total aids paid under section 477A.013,
120.32 subdivision 9, are the amounts certified to be paid in the
120.33 previous year, adjusted for inflation as provided under
120.34 subdivision 3. The additional amount authorized under
120.35 subdivision 4 is not included when calculating the appropriation
120.36 limits under this paragraph.
121.1 (e) Reimbursements made to counties under section 477A.0123
121.2 in calendar year 2004 2005 and thereafter are limited to an
121.3 amount equal to the maximum allowed appropriation under this
121.4 section in the previous year, multiplied by a percent to be
121.5 established by law. If no percent is established by law, the
121.6 appropriation is limited to the total amount appropriated for
121.7 this purpose in the previous year.
121.8 [EFFECTIVE DATE.] This section is effective beginning with
121.9 aids payable in 2004.
121.10 Sec. 12. Minnesota Statutes 2001 Supplement, section
121.11 477A.07, subdivision 2, is amended to read:
121.12 Subd. 2. [COUNTY AID.] Each county's aid amount for 2003
121.13 determined under subdivision 1 must be permanently added to the
121.14 county's 2003 homestead and agricultural credit aid base
121.15 determined under section 273.1398 for aid payable, subdivision
121.16 2, and paid in 2003 as part of the county's homestead and
121.17 agricultural credit aid. It then becomes a permanent part of
121.18 the county's homestead and agricultural credit aid base for aid
121.19 payable in 2004. Each county's aid amount for 2004 determined
121.20 under subdivision 1 must be permanently added to the county's
121.21 2004 homestead and agricultural credit aid base for aid payable
121.22 determined under section 273.1398, subdivision 2, and paid in
121.23 2004 as part of the county's homestead and agricultural credit
121.24 aid. It then becomes a permanent part of the county's homestead
121.25 and agricultural credit aid base for aid payable in 2005.
121.26 [EFFECTIVE DATE.] This section is effective beginning with
121.27 aids payable in 2003.
121.28 ARTICLE 7
121.29 ECONOMIC DEVELOPMENT
121.30 Section 1. Minnesota Statutes 2000, section 272.0212,
121.31 subdivision 4, is amended to read:
121.32 Subd. 4. [DEFINITIONS.] (a) For purposes of this section,
121.33 the following terms have the meanings given.
121.34 (b) "Qualified property" means class 3 and class 1, 3, 4,
121.35 and 5 property as defined in section 273.13 that is located in a
121.36 zone and is newly constructed after the zone was designated,
122.1 including the land that contains the improvements.
122.2 (c) "Zone" means a border city development zone designated
122.3 under the provisions of section 469.1731.
122.4 [EFFECTIVE DATE.] This section is effective beginning for
122.5 assessment year 2003.
122.6 Sec. 2. Minnesota Statutes 2001 Supplement, section
122.7 469.1734, subdivision 6, is amended to read:
122.8 Subd. 6. [SALES TAX EXEMPTION; EQUIPMENT; CONSTRUCTION
122.9 MATERIALS.] (a) The gross receipts from the sale of machinery
122.10 and equipment and repair parts are exempt from taxation under
122.11 chapter 297A, if the machinery and equipment:
122.12 (1) are used in connection with a trade or business;
122.13 (2) are placed in service in a city that is authorized to
122.14 designate a zone under section 469.1731, regardless of whether
122.15 the machinery and equipment are used in a zone; and
122.16 (3) have a useful life of 12 months or more.
122.17 (b) The gross receipts from the sale of construction
122.18 materials are exempt, if they are used to construct:
122.19 (1) a facility for use in a trade or business located in a
122.20 city that is authorized to designate a zone under section
122.21 469.1731, regardless of whether the facility is located in a
122.22 zone; or
122.23 (2) housing that is located in a zone.
122.24 The exemptions under this paragraph apply regardless of whether
122.25 the purchase is made by the owner, the user, or a contractor.
122.26 (c) A purchaser may claim an exemption under this
122.27 subdivision for tax on the purchases up to, but not exceeding:
122.28 (1) the amount of the tax credit certificates received from
122.29 the city, less
122.30 (2) any tax credit certificates used under the provisions
122.31 of subdivisions 4 and 5, and section 469.1732, subdivision 2.
122.32 (d) The tax on sales of items exempted under this
122.33 subdivision shall be imposed and collected as if the applicable
122.34 rate under section 297A.62 applied. Upon application by the
122.35 purchaser, on forms prescribed by the commissioner, a refund
122.36 equal to the tax paid shall be paid to the purchaser. The
123.1 application must include sufficient information to permit the
123.2 commissioner to verify the sales tax paid and the eligibility of
123.3 the claimant to receive the credit. No more than two
123.4 applications for refunds may be filed under this subdivision in
123.5 a calendar year. The provisions of section 289A.40 apply to the
123.6 refunds payable under this subdivision. There is annually
123.7 appropriated to the commissioner of revenue the amount required
123.8 to make the refunds, which must be deducted from the amount of
123.9 the city's allocation under section 469.169, subdivision 12,
123.10 that remains available and its limitation under section 469.1735.
123.11 The amount to be refunded shall bear interest at the rate in
123.12 section 270.76 from the date the refund claim is filed with the
123.13 commissioner.
123.14 [EFFECTIVE DATE.] This section is effective for sales made
123.15 after June 30, 2002.
123.16 Sec. 3. Minnesota Statutes 2001 Supplement, section
123.17 469.1763, subdivision 6, is amended to read:
123.18 Subd. 6. [POOLING PERMITTED FOR DEFICITS.] (a) This
123.19 subdivision applies only to districts for which the request for
123.20 certification was made before August 1, 2001, and without regard
123.21 to whether the request for certification was made prior to
123.22 August 1, 1979.
123.23 (b) The municipality for the district may transfer
123.24 available increments from another tax increment financing
123.25 district located in the municipality, if the transfer is
123.26 necessary to eliminate a deficit in the district to which the
123.27 increments are transferred. A deficit in the district for
123.28 purposes of this subdivision means the lesser of the following
123.29 two amounts:
123.30 (1)(i) the amount due during the calendar year to pay
123.31 preexisting obligations of the district; minus
123.32 (ii) the total increments to be collected from properties
123.33 located within the district that are available for the calendar
123.34 year; plus
123.35 (iii) total increments from properties located in other
123.36 districts in the municipality that are available to be used to
124.1 meet the district's obligations under this section, excluding
124.2 this subdivision, or other provisions of law (but excluding a
124.3 special tax under section 469.1791 and the grant program under
124.4 Laws 1997, chapter 231, article 1, section 19, or Laws 2001,
124.5 First Special Session chapter 5); or
124.6 (2) the reduction in increments collected from properties
124.7 located in the district for the calendar year as a result of the
124.8 changes in class rates in Laws 1997, chapter 231, article 1;
124.9 Laws 1998, chapter 389, article 2; and Laws 1999, chapter 243,
124.10 and Laws 2001, First Special Session chapter 5, or the
124.11 elimination of the general education tax levy under Laws 2001,
124.12 First Special Session chapter 5.
124.13 (c) A preexisting obligation means:
124.14 (1) bonds issued and sold before August 1, 2001, or bonds
124.15 issued pursuant to a binding contract requiring the issuance of
124.16 bonds entered into before July 1, 2001, and bonds issued to
124.17 refund such bonds or to reimburse expenditures made in
124.18 conjunction with a signed contractual agreement entered into
124.19 before August 1, 2001, to the extent that the bonds are secured
124.20 by a pledge of increments from the tax increment financing
124.21 district; and
124.22 (2) binding contracts entered into before August 1, 2001,
124.23 to the extent that the contracts require payments secured by a
124.24 pledge of increments from the tax increment financing district.
124.25 (d) The municipality may require a development authority,
124.26 other than a seaway port authority, to transfer available
124.27 increments for any of its tax increment financing districts in
124.28 the municipality to make up an insufficiency in another district
124.29 in the municipality, regardless of whether the district was
124.30 established by the development authority or another development
124.31 authority. This authority applies notwithstanding any law to
124.32 the contrary, but applies only to a development authority that:
124.33 (1) was established by the municipality; or
124.34 (2) the governing body of which is appointed, in whole or
124.35 part, by the municipality or an officer of the municipality or
124.36 which consists, in whole or part, of members of the governing
125.1 body of the municipality. The municipality may use this
125.2 authority only after it has first used all available increments
125.3 of the receiving development authority to eliminate the
125.4 insufficiency and exercised any permitted action under section
125.5 469.1792, subdivision 3, for preexisting districts of the
125.6 receiving development authority to eliminate the insufficiency.
125.7 (e) The authority under this subdivision to spend tax
125.8 increments outside of the area of the district from which the
125.9 tax increments were collected:
125.10 (1) may only be exercised after obtaining approval of the
125.11 use of the increments, in writing, by the commissioner of
125.12 revenue;
125.13 (2) is an exception to the restrictions under section
125.14 469.176, subdivision 4i, and the other provisions of this
125.15 section, and the percentage restrictions under subdivision 2
125.16 must be calculated after deducting increments spent under this
125.17 subdivision from the total increments for the district; and
125.18 (3) applies notwithstanding the provisions of the Tax
125.19 Increment Financing Act in effect for districts for which the
125.20 request for certification was made before June 30, 1982, or any
125.21 other law to the contrary.
125.22 (f) If a preexisting obligation requires the development
125.23 authority to pay an amount that is limited to the increment from
125.24 the district or a specific development within the district and
125.25 if the obligation requires paying a higher amount to the extent
125.26 that increments are available, the municipality may determine
125.27 that the amount due under the preexisting obligation equals the
125.28 higher amount and may authorize the transfer of increments under
125.29 this subdivision to pay up to the higher amount. The existence
125.30 of a guarantee of obligations by the individual or entity that
125.31 would receive the payment under this paragraph is disregarded in
125.32 the determination of eligibility to pool under this
125.33 subdivision. The authority to transfer increments under this
125.34 paragraph may only be used to the extent that the payment of all
125.35 other preexisting obligations in the municipality due during the
125.36 calendar year have been satisfied.
126.1 [EFFECTIVE DATE.] This section is effective for increments
126.2 payable in 2002 and thereafter.
126.3 Sec. 4. Minnesota Statutes 2001 Supplement, section
126.4 469.1792, subdivision 1, is amended to read:
126.5 Subdivision 1. [SCOPE.] This section applies only to an
126.6 authority with a preexisting district for which:
126.7 (1)(i) the increments from the district were insufficient
126.8 to pay preexisting obligations as a result of the class rate
126.9 changes or the elimination of the state-determined general
126.10 education property tax levy under this act, or both; or
126.11 (ii) (2)(i) the development authority has a binding
126.12 contract with a person requiring the authority to pay to the
126.13 person an amount that may not exceed the increment from the
126.14 district or a specific development within the district and as a
126.15 result of the reduction in increment because of the class rate
126.16 changes or the elimination of the state-determined general
126.17 education property tax levy under this act, or both,; and
126.18 (ii) the authority is unable to pay the full amount under
126.19 the contract from the pledged increments or other increments
126.20 from the district that would have been due if the class rate
126.21 changes or elimination of the state-determined general education
126.22 property tax levy or both had not been made under Laws 2001,
126.23 First Special Session chapter 5; and
126.24 (2) the municipality exercised its full authority to pool
126.25 under section 469.1763, subdivision 6, and the transfer of
126.26 increments did not eliminate the insufficiency under clause (1),
126.27 item (i), or the inability to pay the full amount under clause
126.28 (1), item (ii).
126.29 [EFFECTIVE DATE.] This section is effective for actions
126.30 taken and resolutions approved after June 30, 2002.
126.31 Sec. 5. Minnesota Statutes 2000, section 469.1813, is
126.32 amended by adding a subdivision to read:
126.33 Subd. 6b. [EXTENDED DURATION LIMIT.] (a) Notwithstanding
126.34 the provisions of subdivision 6, a political subdivision may
126.35 grant an abatement for a period of up to 20 years, if the
126.36 abatement is for a qualified business.
127.1 (b) To be a qualified business for purposes of this
127.2 subdivision, at least 50 percent of the payroll of the
127.3 operations of the business that qualify for the abatement must
127.4 be for employees engaged in one of the following lines of
127.5 business or any combination of them:
127.6 (1) manufacturing;
127.7 (2) agricultural processing;
127.8 (3) mining;
127.9 (4) research and development;
127.10 (5) warehousing; or
127.11 (6) qualified high technology.
127.12 (c)(1) "Manufacturing" means the material staging and
127.13 production of tangible personal property by procedures commonly
127.14 regarded as manufacturing, processing, fabrication, or
127.15 assembling which changes some existing material into new shapes,
127.16 new qualities, or new combinations.
127.17 (2) "Mining" has the meaning given in section 613(c) of the
127.18 Internal Revenue Code of 1986.
127.19 (3) "Agricultural processing" means transforming,
127.20 packaging, sorting, or grading livestock or livestock products,
127.21 agricultural commodities, or plants or plant products into goods
127.22 that are used for intermediate or final consumption including
127.23 goods for nonfood use.
127.24 (4) "Research and development" means qualified research as
127.25 defined in section 41(d) of the Internal Revenue Code of 1986.
127.26 (5) "Qualified high technology" means one or more of the
127.27 following activities:
127.28 (i) advanced computing, which is any technology used in the
127.29 design and development of any of the following:
127.30 (A) computer hardware and software;
127.31 (B) data communications; and
127.32 (C) information technologies;
127.33 (ii) advanced materials, which are materials with
127.34 engineered properties created through the development of
127.35 specialized process and synthesis technology;
127.36 (iii) biotechnology, which is any technology that uses
128.1 living organisms, cells, macromolecules, microorganisms, or
128.2 substances from living organisms to make or modify a product,
128.3 improve plants or animals, or develop microorganisms for useful
128.4 purposes;
128.5 (iv) electronic device technology, which is any technology
128.6 that involves microelectronics, semiconductors, electronic
128.7 equipment, and instrumentation, radio frequency, microwave, and
128.8 millimeter electronics, and optical and optic-electrical
128.9 devices, or data and digital communications and imaging devices;
128.10 (v) engineering or laboratory testing related to the
128.11 development of a product;
128.12 (vi) technology that assists in the assessment or
128.13 prevention of threats or damage to human health or the
128.14 environment, including, but not limited to, environmental
128.15 cleanup technology, pollution prevention technology, or
128.16 development of alternative energy sources;
128.17 (vii) medical device technology, which is any technology
128.18 that involves medical equipment or products other than a
128.19 pharmaceutical product that has therapeutic or diagnostic value
128.20 and is regulated; or
128.21 (viii) advanced vehicles technology which is any technology
128.22 that involves electric vehicles, hybrid vehicles, or alternative
128.23 fuel vehicles, or components used in the construction of
128.24 electric vehicles, hybrid vehicles, or alternative fuel
128.25 vehicles. An electric vehicle is a road vehicle that draws
128.26 propulsion energy only from an on-board source of electrical
128.27 energy. A hybrid vehicle is a road vehicle that can draw
128.28 propulsion energy from both a consumable fuel and a rechargeable
128.29 energy storage system.
128.30 (d) The authority to grant new abatements under this
128.31 subdivision expires on July 1, 2004.
128.32 Sec. 6. Laws 1995, chapter 264, article 5, section 45,
128.33 subdivision 1, as amended by Laws 1996, chapter 471, article 7,
128.34 section 22, and Laws 1997, chapter 231, article 10, section 13,
128.35 is amended to read:
128.36 Subdivision 1. [CREATION OF PROJECTS.] (a) An authority
129.1 may create a housing replacement project under sections 44 to
129.2 47, as provided in this section.
129.3 (b) For the cities of Crystal, Fridley, Richfield, and
129.4 Columbia Heights, the authority may designate up to 50 parcels
129.5 in the city to be included in a housing replacement district.
129.6 No more than ten parcels may be included in year one of the
129.7 district, with up to ten additional parcels added to the
129.8 district in each of the following nine years. For the cities of
129.9 Minneapolis, St. Paul, and Duluth, each authority may designate
129.10 up to 100 not more than 200 parcels in the city to be included
129.11 in a housing replacement district over the life of the
129.12 district. The only parcels that may be included in a district
129.13 are (1) vacant sites, (2) parcels containing vacant houses, or
129.14 (3) parcels containing houses that are structurally substandard,
129.15 as defined in Minnesota Statutes, section 469.174, subdivision
129.16 10.
129.17 (c) The city in which the authority is located must pay at
129.18 least 25 percent of the housing replacement project costs from
129.19 its general fund, a property tax levy, or other unrestricted
129.20 money, not including tax increments.
129.21 (d) The housing replacement district plan must have as its
129.22 sole object the acquisition of parcels for the purpose of
129.23 preparing the site to be sold for market rate housing. As used
129.24 in this section, "market rate housing" means housing that has a
129.25 market value that does not exceed 150 percent of the average
129.26 market value of single-family housing in that municipality.
129.27 Sec. 7. [CITY OF ALBERT LEA; TAX INCREMENT FINANCING
129.28 DISTRICT.]
129.29 Subdivision 1. [AUTHORIZATION.] The governing body of the
129.30 city of Albert Lea may create a redevelopment tax increment
129.31 financing district as provided in this section. The city or its
129.32 port authority may be the "authority" for the purposes of
129.33 Minnesota Statutes, sections 469.174 to 469.179.
129.34 Subd. 2. [DEFINITIONS.] (a) For the purposes of this
129.35 section, the terms defined in this subdivision have the meanings
129.36 given them.
130.1 (b) "Redevelopment parcel" means the property in the city
130.2 of Albert Lea bounded by Main Street, Garfield Avenue, Front
130.3 Street, the Union Pacific railway line, and Albert Lea lake.
130.4 (c) "Reconstruction parcel" means the property in the city
130.5 of Albert Lea described as lot 1, block 5, Habben First Addition.
130.6 Subd. 3. [SPECIAL RULES.] (a) The district established
130.7 under this section is subject to the provisions of Minnesota
130.8 Statutes, sections 469.174 to 469.179, except as provided in
130.9 this subdivision.
130.10 (b) The district may consist of the redevelopment parcel
130.11 and the reconstruction parcel.
130.12 (c) Minnesota Statutes, section 469.174, subdivision 10,
130.13 paragraph (f), does not apply to the district, and if the city
130.14 finds that the redevelopment parcel meets the criteria described
130.15 in Minnesota Statutes, section 469.174, subdivision 10,
130.16 paragraph (a), clause (1), then both the redevelopment parcel
130.17 and the reconstruction parcel and the district as a whole are
130.18 considered to meet those criteria.
130.19 (d) Expenditures for activities, as defined in Minnesota
130.20 Statutes, section 469.1763, subdivision 1, paragraph (b),
130.21 anywhere within the district are considered costs of correcting
130.22 conditions that allow designation of redevelopment districts
130.23 within the meaning of Minnesota Statutes, section 469.176,
130.24 subdivision 4j.
130.25 (e) For the purposes of Minnesota Statutes, section
130.26 469.1763, subdivision 3, expenditures on the redevelopment
130.27 parcel are considered to have been expended on an activity
130.28 within the district if a qualifying action occurs within ten
130.29 years after certification of the district.
130.30 [EFFECTIVE DATE.] This section is effective upon local
130.31 approval in compliance with the requirements of Minnesota
130.32 Statutes, section 645.021.
130.33 Sec. 8. [RUSHFORD TAX INCREMENT FINANCING EXTENSION.]
130.34 The governing body of the city of Rushford may elect to
130.35 extend the duration of its downtown redevelopment tax increment
130.36 financing district by up to two additional years.
131.1 [EFFECTIVE DATE.] This section is effective upon compliance
131.2 with the requirements of Minnesota Statutes, sections 469.1782,
131.3 subdivision 2; and 645.021.
131.4 Sec. 9. [CITY OF MINNEAPOLIS TAX INCREMENT DISTRICT;
131.5 DURATION EXTENSION.]
131.6 (a) Upon approval of the city council of the city of
131.7 Minneapolis, the Minneapolis community development agency may,
131.8 notwithstanding Minnesota Statutes, section 469.176, subdivision
131.9 1b, extend the duration of the east Hennepin and University tax
131.10 increment district for a period of up to seven years, or until
131.11 all amounts payable to the developers and to the agency to
131.12 reimburse the agency's provision of $1,100,000 of city of
131.13 Minneapolis HOME funds to assist low-income housing are repaid,
131.14 whichever is shorter.
131.15 (b) The amount of additional increment which may be paid to
131.16 the district as a result of this section may not exceed:
131.17 (1) the increment that would have been collected if the
131.18 class rate changes and elimination of the state-determined
131.19 general education property tax levy had not been made under Laws
131.20 2001, First Special Session chapter 5, for the term of the
131.21 district under general law and if the provisions of section 4
131.22 did not apply, less
131.23 (2) the actual increments collected for the term of the
131.24 district under general law.
131.25 (c) Notwithstanding any law to the contrary, effective upon
131.26 approval of this section, no increments may be spent on
131.27 activities located outside of the area of the district, other
131.28 than to pay administrative expenses.
131.29 (d) This section is effective upon compliance with the
131.30 requirements of Minnesota Statutes, sections 469.1782,
131.31 subdivision 2, and 645.021.
131.32 Sec. 10. [CITY OF MINNEAPOLIS TAX INCREMENT DISTRICT;
131.33 DURATION EXTENSION.]
131.34 (a) Upon approval of the city council of the city of
131.35 Minneapolis, the Minneapolis community development agency may,
131.36 with respect to the southeast Minneapolis industrial area
132.1 redevelopment area phase 4 tax increment financing district,
132.2 notwithstanding Minnesota Statutes, section 469.176, subdivision
132.3 1b, extend the duration of the district for a period of up to
132.4 six years.
132.5 (b) The amount of additional increment which may be paid to
132.6 the district as a result of this section may not exceed:
132.7 (1) the increment that would have been collected if the
132.8 class rate changes and elimination of the state-determined
132.9 general education property tax levy had not been made under Laws
132.10 2001, First Special Session chapter 5, for the term of the
132.11 district under general law and if the provisions of section 4
132.12 did not apply, less
132.13 (2) the actual increments collected for the term of the
132.14 district under general law.
132.15 (c) Notwithstanding any law to the contrary, effective upon
132.16 approval of this section, no increments may be spent on
132.17 activities located outside of the area of the district, other
132.18 than to pay administrative expenses.
132.19 (d) Upon payment in full of the Minneapolis community
132.20 development agency amended and restated tax increment revenue
132.21 note, in the original face amount of $1,000,000, issued December
132.22 4, 1997, the district terminates and the authority granted under
132.23 this section terminates.
132.24 (e) This section is effective upon compliance with the
132.25 requirements of Minnesota Statutes, sections 469.1782,
132.26 subdivision 2, and 645.021.
132.27 Sec. 11. [GRANT TO WASHBURN-CROSBY PROJECT.]
132.28 Notwithstanding the requirements of Minnesota Statutes,
132.29 section 469.1794, the commissioner of revenue shall pay a
132.30 one-time grant of $2,600,000 to the Minneapolis community
132.31 development agency for the Washburn-Crosby Mill City Museum
132.32 project of the historical society as described in Laws 2001,
132.33 First Special Session chapter 5, article 15, section 39. The
132.34 grant must be disbursed on July 1, 2002. $2,600,000 is
132.35 appropriated from the general fund to the commissioner of
132.36 revenue to make the grant under this section.
133.1 Sec. 12. [DAKOTA COUNTY TAX INCREMENT DISTRICT EXTENSION.]
133.2 (a) The governing body of Dakota county may elect to extend
133.3 the duration of its C.D.A. South Robert Street redevelopment tax
133.4 increment financing district number 4 by up to five additional
133.5 years.
133.6 (b) The amount of additional increment which may be paid to
133.7 the district as a result of this section may not exceed:
133.8 (1) the increment that would have been collected if the
133.9 class rate changes and elimination of the state-determined
133.10 general education property tax levy had not been made under Laws
133.11 2001, First Special Session chapter 5, for the term of the
133.12 district under general law and if the provisions of section 4
133.13 did not apply, less
133.14 (2) the actual increments collected for the term of the
133.15 district under general law.
133.16 [EFFECTIVE DATE.] This section is effective upon compliance
133.17 with Minnesota Statutes, sections 469.1782, subdivision 2, and
133.18 645.021.
133.19 Sec. 13. [REPEALER.]
133.20 Minnesota Statutes 2001 Supplement, section 469.176,
133.21 subdivision 1h, is repealed.
133.22 [EFFECTIVE DATE.] This section is effective retroactive to
133.23 July 1, 2001, and any early decertification of a tax increment
133.24 financing district made after July 1, 2001, is ratified.
133.25 ARTICLE 8
133.26 MINERALS TAXES
133.27 Section 1. Minnesota Statutes 2001 Supplement, section
133.28 126C.21, subdivision 4, is amended to read:
133.29 Subd. 4. [TACONITE DEDUCTIONS.] (1) Notwithstanding any
133.30 provisions of any other law to the contrary, the adjusted net
133.31 tax capacity used in calculating general education aid may
133.32 include only that property that is currently taxable in the
133.33 district.
133.34 (2) For districts that received payments under sections
133.35 298.018; 298.225; 298.28; 298.34 to 298.39; 298.391 to 298.396;
133.36 and 298.405, or any law imposing a tax upon severed mineral
134.1 values; or recognized revenue under section 477A.15; the general
134.2 education aid must be reduced in the final adjustment payment by
134.3 the difference between the dollar amount of the payments
134.4 received pursuant to those sections, or revenue recognized under
134.5 section 477A.15 in the fiscal year to which the final adjustment
134.6 is attributable and the amount that was calculated, pursuant to
134.7 section 126C.48, subdivision 8, as a reduction of the levy
134.8 attributable to the fiscal year to which the final adjustment is
134.9 attributable. If the final adjustment of a district's general
134.10 education aid for a fiscal year is a negative amount because of
134.11 this clause, the next fiscal year's general education aid to
134.12 that district must be reduced by this negative amount in the
134.13 following manner: there must be withheld from each scheduled
134.14 general education aid payment due the district in such fiscal
134.15 year, 15 percent of the total negative amount, until the total
134.16 negative amount has been withheld. The amount reduced from
134.17 general education aid pursuant to this clause must be recognized
134.18 as revenue in the fiscal year to which the final adjustment
134.19 payment is attributable.
134.20 Sec. 2. Minnesota Statutes 2001 Supplement, section
134.21 126C.48, subdivision 8, is amended to read:
134.22 Subd. 8. [TACONITE PAYMENT AND OTHER REDUCTIONS.] (1)
134.23 Reductions in levies pursuant to sections 126C.48, subdivision
134.24 1, and 273.138, must be made prior to the reductions in clause
134.25 (2).
134.26 (2) Notwithstanding any other law to the contrary,
134.27 districts which received payments pursuant to sections 298.018;
134.28 298.225; 298.28, except an amount distributed under section
134.29 298.28, subdivision 4, paragraph (c), clause (ii); 298.34 to
134.30 298.39; 298.391 to 298.396; 298.405; and any law imposing a tax
134.31 upon severed mineral values; or recognized revenue under section
134.32 477A.15 must not include a portion of these aids in their
134.33 permissible levies pursuant to those sections, but instead must
134.34 reduce the permissible levies authorized by this chapter and
134.35 chapters 120B, 122A, 123A, 123B, 124A, 124D, 125A, and 127A by
134.36 the greater of the following:
135.1 (a) an amount equal to 50 percent of the total dollar
135.2 amount of the payments received pursuant to those sections or
135.3 revenue recognized under section 477A.15 in the previous fiscal
135.4 year; or
135.5 (b) an amount equal to the total dollar amount of the
135.6 payments received pursuant to those sections or revenue
135.7 recognized under section 477A.15 in the previous fiscal year
135.8 less the product of the same dollar amount of payments or
135.9 revenue times five percent.
135.10 For levy year 2002 only, 77 percent of the amounts
135.11 distributed under section 298.225 and 298.28, and 100 percent of
135.12 the amounts distributed under sections 298.018; 298.34 to
135.13 298.39; 298.391 to 298.396; 298.405; and any law imposing a tax
135.14 upon severed mineral values, or recognized revenue under section
135.15 477A.15, shall be used for purposes of the calculations under
135.16 this paragraph. For levy year 2003 only, the levy reductions
135.17 under this subdivision must be calculated as if section 298.28,
135.18 subdivision 4, paragraph (f), did not apply for the 2003
135.19 distribution.
135.20 (3) The amount of any increased levy authorized by
135.21 referendum pursuant to section 126C.17, subdivision 9, voter
135.22 approved referendum, facilities down payment, and debt levies
135.23 shall not be reduced pursuant to by more than 50 percent under
135.24 this subdivision. The amount of any levy authorized by section
135.25 126C.43, to make payments for bonds issued and for interest
135.26 thereon, shall not be reduced pursuant to this subdivision. In
135.27 administering this paragraph, the commissioner shall first
135.28 reduce the nonvoter approved levies of a district; then, if any
135.29 payments, severed mineral value tax revenue or recognized
135.30 revenue under paragraph (2) remains, the commissioner shall
135.31 reduce any voter approved referendum levies authorized under
135.32 section 126C.17; then, if any payments, severed mineral value
135.33 tax revenue or recognized revenue under paragraph (2) remains,
135.34 the commissioner shall reduce any voter approved facilities down
135.35 payment levies authorized under section 123B.63 and then, if any
135.36 payments, severed mineral value tax revenue or recognized
136.1 revenue under paragraph (2) remains, the commissioner shall
136.2 reduce any voter approved debt levies.
136.3 (4) Before computing the reduction pursuant to this
136.4 subdivision of the health and safety levy authorized by sections
136.5 123B.57 and 126C.40, subdivision 5, the commissioner shall
136.6 ascertain from each affected school district the amount it
136.7 proposes to levy under each section or subdivision. The
136.8 reduction shall be computed on the basis of the amount so
136.9 ascertained.
136.10 (5) Notwithstanding any law to the contrary, any amounts
136.11 received by districts in any fiscal year pursuant to sections
136.12 298.018; 298.34 to 298.39; 298.391 to 298.396; 298.405; or any
136.13 law imposing a tax on severed mineral values; and not deducted
136.14 from general education aid pursuant to section 126C.21,
136.15 subdivision 4, clause (2), and not applied to reduce levies
136.16 pursuant to this subdivision shall be paid by the district to
136.17 the St. Louis county auditor in the following amount by March 15
136.18 of each year, the amount required to be subtracted from the
136.19 previous fiscal year's general education aid pursuant to section
136.20 126C.21, subdivision 4, which is in excess of the general
136.21 education aid earned for that fiscal year. The county auditor
136.22 shall deposit any amounts received pursuant to this clause in
136.23 the St. Louis county treasury for purposes of paying the
136.24 taconite homestead credit as provided in section 273.135. To the
136.25 extent the levy reduction calculated under paragraph (2) exceeds
136.26 the limitation in paragraph (3), an amount equal to the excess
136.27 must be distributed from the school district's distribution
136.28 under sections 298.225, 298.28, and 477A.15 in the following
136.29 year to the cities and townships within the school district in
136.30 the proportion that their taxable net tax capacity within the
136.31 school district bears to the taxable net tax capacity of the
136.32 school district for property taxes payable in the year prior to
136.33 distribution. No city or township shall receive a distribution
136.34 greater than its levy for taxes payable in the year prior to
136.35 distribution. The commissioner of revenue shall certify the
136.36 distributions of cities and towns under this paragraph to the
137.1 county auditor by September 30 of the year preceding
137.2 distribution. The county auditor shall reduce the proposed and
137.3 final levies of cities and towns receiving distributions by the
137.4 amount of their distribution. Distributions to the cities and
137.5 towns shall be made at the times provided under section 298.27.
137.6 Sec. 3. Minnesota Statutes 2001 Supplement, section
137.7 298.01, subdivision 3b, is amended to read:
137.8 Subd. 3b. [DEDUCTIONS.] (a) For purposes of determining
137.9 taxable income under subdivision 3, the deductions from gross
137.10 income include only those expenses necessary to convert raw ores
137.11 to marketable quality. Such expenses include costs associated
137.12 with refinement but do not include expenses such as
137.13 transportation, stockpiling, marketing, or marine insurance that
137.14 are incurred after marketable ores are produced, unless the
137.15 expenses are included in gross income.
137.16 (b) The provisions of section 290.01, subdivisions 19c,
137.17 clauses (6) and (10) (9), and 19d, clauses (7) and (11), are not
137.18 used to determine taxable income.
137.19 [EFFECTIVE DATE.] This section is effective the day
137.20 following final enactment.
137.21 Sec. 4. Minnesota Statutes 2001 Supplement, section
137.22 298.01, subdivision 4c, is amended to read:
137.23 Subd. 4c. [SPECIAL DEDUCTIONS; NET OPERATING LOSS.] (a)
137.24 For purposes of determining taxable income under subdivision
137.25 4, the following modifications are allowed:
137.26 (1) the provisions of section 290.01, subdivisions 19c,
137.27 clauses (6) and (10) (9), and 19d, clauses (7) and (11), are not
137.28 used to determine taxable income; and.
137.29 (2) for assets placed in service before January 1, 1990,
137.30 the deduction for depreciation will be the same amount allowed
137.31 under chapter 290, except that after an asset has been fully
137.32 depreciated for federal income tax purposes any remaining
137.33 depreciable basis is allowed as a deduction using the
137.34 straight-line method over the following number of years:
137.35 (i) three-year property, one year;
137.36 (ii) five- and seven-year property, two years;
138.1 (iii) ten-year property, five years; and
138.2 (iv) all other property, seven years.
138.3 No deduction is allowed if an asset is fully depreciated
138.4 for occupation tax purposes before January 1990.
138.5 (b) For purposes of determining the deduction allowed under
138.6 paragraph (a), clause (2), the remaining depreciable basis of
138.7 property placed in service before January 1, 1990, is calculated
138.8 as follows:
138.9 (1) the adjusted basis of the property on December 31,
138.10 1989, which was used to calculate the hypothetical corporate
138.11 franchise tax under Minnesota Statutes 1988, section 298.40,
138.12 including salvage value; less
138.13 (2) deductions for depreciation allowed under section
138.14 290.01, subdivision 19e.
138.15 (c) The basis for determining gain or loss on sale or
138.16 disposition of assets placed in service before January 1, 1990,
138.17 is the basis determined under paragraph (b), less the deductions
138.18 allowed under paragraph (a), clause (2).
138.19 (d) (b) The amount of net operating loss incurred in a
138.20 taxable year beginning before January 1, 1990, that may be
138.21 carried over to a taxable year beginning after December 31,
138.22 1989, is the amount of net operating loss carryover determined
138.23 in the calculation of the hypothetical corporate franchise tax
138.24 under Minnesota Statutes 1988, sections 298.40 and 298.402.
138.25 [EFFECTIVE DATE.] This section is effective for taxes
138.26 payable May 1, 2002, and thereafter.
138.27 Sec. 5. Minnesota Statutes 2001 Supplement, section
138.28 298.225, subdivision 1, is amended to read:
138.29 Subdivision 1. (a) The distribution of the taconite
138.30 production tax as provided in section 298.28, subdivisions 3 to
138.31 5, 6, paragraph (b), 7, and 8, shall equal the lesser of the
138.32 following amounts:
138.33 (1) the amount distributed pursuant to this section and
138.34 section 298.28, with respect to 1983 production if the
138.35 production for the year prior to the distribution year is no
138.36 less than 42,000,000 taxable tons. If the production is less
139.1 than 42,000,000 taxable tons, the amount of the distributions
139.2 shall be reduced proportionately at the rate of two percent for
139.3 each 1,000,000 tons, or part of 1,000,000 tons by which the
139.4 production is less than 42,000,000 tons; or
139.5 (2)(i) for the distributions made pursuant to section
139.6 298.28, subdivisions 4, paragraphs (b) and (c), and 6, paragraph
139.7 (c), 40.5 31.2 percent of the amount distributed pursuant to
139.8 this section and section 298.28, with respect to 1983
139.9 production;
139.10 (ii) for the distributions made pursuant to section 298.28,
139.11 subdivision 5, paragraphs (b) and (d), 75 percent of the amount
139.12 distributed pursuant to this section and section 298.28, with
139.13 respect to 1983 production.
139.14 (b) The distribution of the taconite production tax as
139.15 provided in section 298.28, subdivision 2, shall equal the
139.16 following amount:
139.17 (1) if the production for the year prior to the
139.18 distribution year is at least 42,000,000 taxable tons, the
139.19 amount distributed pursuant to this section and section 298.28
139.20 with respect to 1999 production; or
139.21 (2) if the production for the year prior to the
139.22 distribution year is less than 42,000,000 taxable tons, the
139.23 amount distributed pursuant to this section and section 298.28
139.24 with respect to 1999 production, reduced proportionately at the
139.25 rate of two percent for each 1,000,000 tons or part of 1,000,000
139.26 tons by which the production is less than 42,000,000 tons.
139.27 Sec. 6. Minnesota Statutes 2000, section 298.27, is
139.28 amended to read:
139.29 298.27 [COLLECTION AND PAYMENT OF TAX.]
139.30 The taxes provided by section 298.24 shall be paid directly
139.31 to each eligible county and the iron range resources and
139.32 rehabilitation board. The commissioner of revenue shall notify
139.33 each producer of the amount to be paid each recipient prior to
139.34 February 15. Every person subject to taxes imposed by section
139.35 298.24 shall file a correct report covering the preceding year.
139.36 The report must contain the information required by the
140.1 commissioner. The report shall be filed by each producer on or
140.2 before February 1. A remittance equal to 50 percent of the
140.3 total tax required to be paid hereunder in 2003 and 100 percent
140.4 of the total tax required to be paid hereunder in 2004 and
140.5 thereafter shall be paid on or before February 24. A remittance
140.6 equal to the remaining total tax required to be paid hereunder
140.7 in 2003 shall be paid on or before August 24. On or before
140.8 February 25, and in 2003, August 25, the county auditor shall
140.9 make distribution of the payment payments previously received by
140.10 the county in the manner provided by section 298.28. Reports
140.11 shall be made and hearings held upon the determination of the
140.12 tax in accordance with procedures established by the
140.13 commissioner of revenue. The commissioner of revenue shall have
140.14 authority to make reasonable rules as to the form and manner of
140.15 filing reports necessary for the determination of the tax
140.16 hereunder, and by such rules may require the production of such
140.17 information as may be reasonably necessary or convenient for the
140.18 determination and apportionment of the tax. All the provisions
140.19 of the occupation tax law with reference to the assessment and
140.20 determination of the occupation tax, including all provisions
140.21 for appeals from or review of the orders of the commissioner of
140.22 revenue relative thereto, but not including provisions for
140.23 refunds, are applicable to the taxes imposed by section 298.24
140.24 except in so far as inconsistent herewith. If any person
140.25 subject to section 298.24 shall fail to make the report provided
140.26 for in this section at the time and in the manner herein
140.27 provided, the commissioner of revenue shall in such case, upon
140.28 information possessed or obtained, ascertain the kind and amount
140.29 of ore mined or produced and thereon find and determine the
140.30 amount of the tax due from such person. There shall be added to
140.31 the amount of tax due a penalty for failure to report on or
140.32 before February 1, which penalty shall equal ten percent of the
140.33 tax imposed and be treated as a part thereof.
140.34 If any person responsible for making a tax payment at the
140.35 time and in the manner herein provided fails to do so, there
140.36 shall be imposed a penalty equal to ten percent of the amount so
141.1 due, which penalty shall be treated as part of the tax due.
141.2 In the case of any underpayment of the tax payment required
141.3 herein, there may be added and be treated as part of the tax due
141.4 a penalty equal to ten percent of the amount so underpaid.
141.5 A person having a liability of $120,000 or more during a
141.6 calendar year must remit all liabilities by means of a funds
141.7 transfer as defined in section 336.4A-104, paragraph (a). The
141.8 funds transfer payment date, as defined in section 336.4A-401,
141.9 must be on or before the date the tax is due. If the date the
141.10 tax is due is not a funds transfer business day, as defined in
141.11 section 336.4A-105, paragraph (a), clause (4), the payment date
141.12 must be on or before the funds transfer business day next
141.13 following the date the tax is due.
141.14 [EFFECTIVE DATE.] Except as otherwise provided, this
141.15 section is effective for years beginning after December 31, 2001.
141.16 Sec. 7. Minnesota Statutes 2001 Supplement, section
141.17 298.28, subdivision 4, is amended to read:
141.18 Subd. 4. [SCHOOL DISTRICTS.] (a) 22.28 17.15 cents per
141.19 taxable ton plus the increase provided in paragraph (d) must be
141.20 allocated to qualifying school districts to be distributed,
141.21 based upon the certification of the commissioner of revenue,
141.22 under paragraphs (b) and (c), except as otherwise provided in
141.23 paragraph (f).
141.24 (b) 4.46 3.43 cents per taxable ton must be distributed to
141.25 the school districts in which the lands from which taconite was
141.26 mined or quarried were located or within which the concentrate
141.27 was produced. The distribution must be based on the
141.28 apportionment formula prescribed in subdivision 2.
141.29 (c)(i) 17.82 13.72 cents per taxable ton, less any amount
141.30 distributed under paragraph (e), shall be distributed to a group
141.31 of school districts comprised of those school districts in which
141.32 the taconite was mined or quarried or the concentrate produced
141.33 or in which there is a qualifying municipality as defined by
141.34 section 273.134, paragraph (b), in direct proportion to school
141.35 district indexes as follows: for each school district, its
141.36 pupil units determined under section 126C.05 for the prior
142.1 school year shall be multiplied by the ratio of the average
142.2 adjusted net tax capacity per pupil unit for school districts
142.3 receiving aid under this clause as calculated pursuant to
142.4 chapters 122A, 126C, and 127A for the school year ending prior
142.5 to distribution to the adjusted net tax capacity per pupil unit
142.6 of the district. Each district shall receive that portion of
142.7 the distribution which its index bears to the sum of the indices
142.8 for all school districts that receive the distributions.
142.9 (ii) Notwithstanding clause (i), each school district that
142.10 receives a distribution under sections 298.018; 298.23 to
142.11 298.28, exclusive of any amount received under this clause;
142.12 298.34 to 298.39; 298.391 to 298.396; 298.405; or any law
142.13 imposing a tax on severed mineral values after reduction for any
142.14 portion distributed to cities and towns under section 126C.48,
142.15 subdivision 8, paragraph (5), that is less than the amount of
142.16 its levy reduction under section 126C.48, subdivision 8, for the
142.17 second year prior to the year of the distribution shall receive
142.18 a distribution equal to the difference; the amount necessary to
142.19 make this payment shall be derived from proportionate reductions
142.20 in the initial distribution to other school districts under
142.21 clause (i).
142.22 (d) Any school district described in paragraph (c) where a
142.23 levy increase pursuant to section 126C.17, subdivision 9, was
142.24 authorized by referendum for taxes payable in 2001, shall
142.25 receive a distribution from a fund that receives a distribution
142.26 in 1998 of 21.3 cents per ton. On July 15 of 1999, and each
142.27 year thereafter, the increase over the amount established for
142.28 the prior year shall be determined according to the increase in
142.29 the implicit price deflator as provided in section 298.24,
142.30 subdivision 1. Each district shall receive $175 times the pupil
142.31 units identified in section 126C.05, subdivision 1, enrolled in
142.32 the second previous year or the 1983-1984 school year, whichever
142.33 is greater, less the product of 1.8 percent times the district's
142.34 taxable net tax capacity in the second previous year.
142.35 If the total amount provided by paragraph (d) is
142.36 insufficient to make the payments herein required then the
143.1 entitlement of $175 per pupil unit shall be reduced uniformly so
143.2 as not to exceed the funds available. Any amounts received by a
143.3 qualifying school district in any fiscal year pursuant to
143.4 paragraph (d) shall not be applied to reduce general education
143.5 aid which the district receives pursuant to section 126C.13 or
143.6 the permissible levies of the district. Any amount remaining
143.7 after the payments provided in this paragraph shall be paid to
143.8 the commissioner of iron range resources and rehabilitation who
143.9 shall deposit the same in the taconite environmental protection
143.10 fund and the northeast Minnesota economic protection trust fund
143.11 as provided in subdivision 11.
143.12 Each district receiving money according to this paragraph
143.13 shall reserve $25 times the number of pupil units in the
143.14 district. It may use the money for early childhood programs or
143.15 for outcome-based learning programs that enhance the academic
143.16 quality of the district's curriculum. The outcome-based
143.17 learning programs must be approved by the commissioner of
143.18 children, families, and learning.
143.19 (e) There shall be distributed to any school district the
143.20 amount which the school district was entitled to receive under
143.21 section 298.32 in 1975.
143.22 (f) Effective with for the distribution in 2003 and
143.23 thereafter only, five percent of the distributions to school
143.24 districts under paragraphs (b), (c), and (e); subdivision 6,
143.25 paragraph (c); subdivision 11; and section 477A.15 298.225,
143.26 shall be distributed to the general fund. The remainder less
143.27 any portion distributed to cities and towns under section
143.28 126C.48, subdivision 8, paragraph (5), shall be distributed to
143.29 the cities and townships within each school district in the
143.30 proportion that their taxable net tax capacity within the school
143.31 district bears to the taxable net tax capacity of the school
143.32 district for property taxes payable in the year prior to
143.33 distribution. No city or township shall receive a distribution
143.34 greater than its levy for taxes payable in the year prior to
143.35 distribution northeast Minnesota economic protection trust fund
143.36 created in section 298.292. Fifty percent of the amount
144.1 distributed to the northeast Minnesota economic protection trust
144.2 fund shall be made available for expenditure under section
144.3 298.293 as governed by section 298.296. Effective in 2003 only,
144.4 100 percent of the distributions to school districts under
144.5 section 477A.15 less any portion distributed to cities and towns
144.6 under section 126C.48, subdivision 8, paragraph (5), shall be
144.7 distributed to the general fund.
144.8 Sec. 8. Minnesota Statutes 2000, section 298.28,
144.9 subdivision 5, is amended to read:
144.10 Subd. 5. [COUNTIES.] (a) 16.5 26.05 cents per taxable ton
144.11 is allocated to counties to be distributed, based upon
144.12 certification by the commissioner of revenue, under paragraphs
144.13 (b) to (d).
144.14 (b) 13 20.525 cents per taxable ton shall be distributed to
144.15 the county in which the taconite is mined or quarried or in
144.16 which the concentrate is produced, less any amount which is to
144.17 be distributed pursuant to paragraph (c). The apportionment
144.18 formula prescribed in subdivision 2 is the basis for the
144.19 distribution.
144.20 (c) If an electric power plant owned by and providing the
144.21 primary source of power for a taxpayer mining and concentrating
144.22 taconite is located in a county other than the county in which
144.23 the mining and the concentrating processes are conducted, one
144.24 cent per taxable ton of the tax distributed to the counties
144.25 pursuant to paragraph (b) and imposed on and collected from such
144.26 taxpayer shall be paid to the county in which the power plant is
144.27 located.
144.28 (d) 3.5 5.525 cents per taxable ton shall be paid to the
144.29 county from which the taconite was mined, quarried or
144.30 concentrated to be deposited in the county road and bridge
144.31 fund. If the mining, quarrying and concentrating, or separate
144.32 steps in any of those processes are carried on in more than one
144.33 county, the commissioner shall follow the apportionment formula
144.34 prescribed in subdivision 2.
144.35 [EFFECTIVE DATE.] This section is effective the day
144.36 following final enactment.
145.1 Sec. 9. Minnesota Statutes 2001 Supplement, section
145.2 298.28, subdivision 6, is amended to read:
145.3 Subd. 6. [PROPERTY TAX RELIEF.] (a) In 2002 and
145.4 thereafter, 35.9 33.9 cents per taxable ton, less any amount
145.5 required to be distributed under paragraphs (b) and (c), and
145.6 less any amount required to be deducted under paragraph (d),
145.7 must be allocated to St. Louis county acting as the counties'
145.8 fiscal agent, to be distributed as provided in sections 273.134
145.9 to 273.136.
145.10 (b) If an electric power plant owned by and providing the
145.11 primary source of power for a taxpayer mining and concentrating
145.12 taconite is located in a county other than the county in which
145.13 the mining and the concentrating processes are conducted, .1875
145.14 cent per taxable ton of the tax imposed and collected from such
145.15 taxpayer shall be paid to the county.
145.16 (c) If an electric power plant owned by and providing the
145.17 primary source of power for a taxpayer mining and concentrating
145.18 taconite is located in a school district other than a school
145.19 district in which the mining and concentrating processes are
145.20 conducted, .7282 .4541 cent per taxable ton of the tax imposed
145.21 and collected from the taxpayer shall be paid to the school
145.22 district.
145.23 (d) Two cents per taxable ton must be deducted from the
145.24 amount allocated to the St. Louis county auditor under paragraph
145.25 (a).
145.26 [EFFECTIVE DATE.] This section is effective the day
145.27 following final enactment.
145.28 Sec. 10. Minnesota Statutes 2001 Supplement, section
145.29 298.28, subdivision 9a, is amended to read:
145.30 Subd. 9a. [TACONITE ECONOMIC DEVELOPMENT FUND.] (a) 30.1
145.31 cents per ton for distributions in 2002 and thereafter must be
145.32 paid to the taconite economic development fund. No distribution
145.33 shall be made under this paragraph in 2004 or any subsequent
145.34 year in which total industry production falls below 30 million
145.35 tons. Distribution shall only be made to a taconite producer's
145.36 fund under section 298.227 if the producer timely pays its tax
146.1 under section 298.24 by the dates provided under section 298.27,
146.2 or pursuant to the due dates provided by an administrative
146.3 agreement with the commissioner.
146.4 (b) An amount equal to 50 percent of the tax under section
146.5 298.24 for concentrate sold in the form of pellet chips and
146.6 fines not exceeding 5/16 inch in size and not including crushed
146.7 pellets shall be paid to the taconite economic development
146.8 fund. The amount paid shall not exceed $700,000 annually for
146.9 all companies. If the initial amount to be paid to the fund
146.10 exceeds this amount, each company's payment shall be prorated so
146.11 the total does not exceed $700,000.
146.12 Sec. 11. Minnesota Statutes 2000, section 298.28,
146.13 subdivision 9b, is amended to read:
146.14 Subd. 9b. [TACONITE ENVIRONMENTAL FUND.] Five cents per
146.15 ton for distributions in 1999, 2000, 2001, and 2002, and 2003
146.16 must be paid to the taconite environmental fund for use under
146.17 section 298.2961. No distribution may be made under this
146.18 paragraph in any year in which total industry production falls
146.19 below 30,000,000 tons.
146.20 Sec. 12. Minnesota Statutes 2001 Supplement, section
146.21 298.28, subdivision 10, is amended to read:
146.22 Subd. 10. [INCREASE.] Beginning with distributions in
146.23 2000, the amount determined under subdivision 9 shall be
146.24 increased in the same proportion as the increase in the implicit
146.25 price deflator as provided in section 298.24, subdivision 1.
146.26 Beginning with distributions in 2003, the amount determined
146.27 under subdivision 6, paragraph (a), shall be increased in the
146.28 same proportion as the increase in the implicit price deflator
146.29 as provided in section 298.24, subdivision 1.
146.30 The distributions per ton determined under subdivisions 5,
146.31 paragraphs (b) and (d), and 6, paragraph (b), for distribution
146.32 in 1988 and subsequent years shall be the distribution per ton
146.33 determined for distribution in 1987. The distribution per ton
146.34 under subdivision 6, paragraph (c), for distribution in 2000 and
146.35 subsequent years shall be 81 percent of the distribution per ton
146.36 determined for distribution in 1987.
147.1 [EFFECTIVE DATE.] This section is effective the day
147.2 following final enactment.
147.3 Sec. 13. Minnesota Statutes 2000, section 298.28,
147.4 subdivision 11, is amended to read:
147.5 Subd. 11. [REMAINDER.] (a) The proceeds of the tax imposed
147.6 by section 298.24 which remain after the distributions and
147.7 payments in subdivisions 2 to 10a, as certified by the
147.8 commissioner of revenue, and paragraphs (b), (c), and (d), and
147.9 (e) have been made, together with interest earned on all money
147.10 distributed under this section prior to distribution, shall be
147.11 divided between the taconite environmental protection fund
147.12 created in section 298.223 and the northeast Minnesota economic
147.13 protection trust fund created in section 298.292 as follows:
147.14 Two-thirds to the taconite environmental protection fund and
147.15 one-third to the northeast Minnesota economic protection trust
147.16 fund. The proceeds shall be placed in the respective special
147.17 accounts.
147.18 (b) There shall be distributed to each city, town, and
147.19 county the amount that it received under section 294.26 in
147.20 calendar year 1977; provided, however, that the amount
147.21 distributed in 1981 to the unorganized territory number 2 of
147.22 Lake county and the town of Beaver Bay based on the
147.23 between-terminal trackage of Erie Mining Company will be
147.24 distributed in 1982 and subsequent years to the unorganized
147.25 territory number 2 of Lake county and the towns of Beaver Bay
147.26 and Stony River based on the miles of track of Erie Mining
147.27 Company in each taxing district.
147.28 (c) There shall be distributed to the iron range resources
147.29 and rehabilitation board the amounts it received in 1977 under
147.30 section 298.22. The amount distributed under this paragraph
147.31 shall be expended within or for the benefit of the tax relief
147.32 area defined in section 273.134.
147.33 (d) There shall be distributed to each school district 81
147.34 62 percent of the amount that it received under section 294.26
147.35 in calendar year 1977.
147.36 (e) In 2003 only, $100,000 must be distributed to a
148.1 township located in a taconite tax relief area as defined in
148.2 section 273.134, paragraph (a), that received $119,259 of
148.3 homestead and agricultural credit aid and $182,014 in local
148.4 government aid in 2001.
148.5 Sec. 14. Minnesota Statutes 2000, section 298.291, is
148.6 amended to read:
148.7 298.291 [CITATION.]
148.8 Sections 298.291 to 298.294 shall be known as the
148.9 "Northeast Minnesota Douglas J. Johnson Economic Protection
148.10 Trust Fund Act.
148.11 Sec. 15. Minnesota Statutes 2001 Supplement, section
148.12 298.296, subdivision 2, is amended to read:
148.13 Subd. 2. [EXPENDITURE OF FUNDS.] (a) Before January 1,
148.14 2003 2028, funds may be expended on projects and for
148.15 administration of the trust fund only from the net interest,
148.16 earnings, and dividends arising from the investment of the trust
148.17 at any time, including net interest, earnings, and dividends
148.18 that have arisen prior to July 13, 1982, plus $10,000,000 made
148.19 available for use in fiscal year 1983, except that any amount
148.20 required to be paid out of the trust fund to provide the
148.21 property tax relief specified in Laws 1977, chapter 423, article
148.22 X, section 4, and to make school bond payments and payments to
148.23 recipients of taconite production tax proceeds pursuant to
148.24 section 298.225, may be taken from the corpus of the trust.
148.25 (b) Additionally, upon recommendation by the board, up to
148.26 $13,000,000 from the corpus of the trust may be made available
148.27 for use as provided in subdivision 4, and up to $10,000,000 from
148.28 the corpus of the trust may be made available for use as
148.29 provided in section 298.2961.
148.30 (c) On and after January 1, 2003, Funds may be expended on
148.31 projects and for administration from any assets of the
148.32 trust. Additionally, an amount equal to 20 percent of the value
148.33 of the corpus of the trust on the date of enactment of this act,
148.34 not including the funds authorized in paragraph (b), plus the
148.35 amounts made available under sections 7 and 17, may be expended
148.36 on projects. Funds may be expended for projects under this
149.1 paragraph only if the project:
149.2 (1) is for the purposes established under section 298.292,
149.3 subdivision 1, clause (1) or (2); and
149.4 (2) is approved by the board upon an affirmative vote of at
149.5 least ten of its members.
149.6 No money made available under this paragraph or paragraph (d)
149.7 can be used for administrative or operating expenses of the iron
149.8 range resources and rehabilitation board or expenses relating to
149.9 any facilities owned or operated by the board on the effective
149.10 date of this act.
149.11 (d) Upon recommendation by a unanimous vote of all members
149.12 of the board, amounts in addition to those authorized under
149.13 paragraphs (a), (b), and (c) may be expended on projects
149.14 described in section 298.292, subdivision 1.
149.15 (e) Annual administrative costs, not including detailed
149.16 engineering expenses for the projects, shall not exceed five
149.17 percent of the net interest, dividends, and earnings arising
149.18 from the trust in the preceding fiscal year.
149.19 (f) Principal and interest received in repayment of loans
149.20 made pursuant to this section, and earnings on other investments
149.21 made under section 298.292, subdivision 2, clause (4), shall be
149.22 deposited in the state treasury and credited to the trust.
149.23 These receipts are appropriated to the board for the purposes of
149.24 sections 298.291 to 298.298.
149.25 [EFFECTIVE DATE.] This section is effective January 1, 2003.
149.26 Sec. 16. Minnesota Statutes 2000, section 477A.15, is
149.27 amended to read:
149.28 477A.15 [TACONITE AID REIMBURSEMENT.]
149.29 Any school district in which is located property which had
149.30 been entitled to a reduction of tax pursuant to Minnesota
149.31 Statutes 1978, section 273.135, subdivision 2, clause (c), shall
149.32 receive in 1981 and subsequent years an amount equal to the
149.33 amount it received in 1980 pursuant to Minnesota Statutes 1978,
149.34 section 298.28, subdivision 1, clause (3)(b). Payments shall be
149.35 made pursuant to this section and section 126C.48, subdivision
149.36 8, paragraph (5), by the commissioner of revenue to the taxing
150.1 jurisdictions on the date in each calendar year when the first
150.2 installment is paid under section 477A.015.
150.3 [EFFECTIVE DATE.] This section is effective for payments in
150.4 2003 and subsequent years.
150.5 Sec. 17. [ADDITIONAL DISTRIBUTION.]
150.6 The difference between the distribution to school districts
150.7 under Minnesota Statutes, sections 298.225 and 298.28, as
150.8 amended by this act, and the amount the districts would have
150.9 received under Minnesota Statutes 2000, sections 298.225 and
150.10 298.28 for distributions in 2004 only, shall be added to the
150.11 sums available for expenditure under Minnesota Statutes, section
150.12 298.293, as governed by Minnesota Statutes, section 298.296.
150.13 Sec. 18. [INSTRUCTION TO THE REVISOR.]
150.14 In the next edition of Minnesota Statutes, the revisor of
150.15 statutes shall change the phrase "Northeast Minnesota Economic
150.16 Protection Trust Fund Act" to "Douglas J. Johnson Economic
150.17 Protection Trust Fund Act" wherever it appears in Minnesota
150.18 Statutes.
150.19 ARTICLE 9
150.20 DEPARTMENT OF REVENUE POLICY PROVISIONS
150.21 Section 1. Minnesota Statutes 2000, section 270.063,
150.22 subdivision 4, is amended to read:
150.23 Subd. 4. [FEDERAL TAX REFUND OFFSET FEES; TIME LIMIT FOR
150.24 SUBMITTING CLAIMS FOR OFFSET.] For fees charged by the
150.25 department of the treasury of the United States for the offset
150.26 of federal tax refunds that are deducted from the refund amounts
150.27 remitted to the commissioner, the unpaid debts of the taxpayers
150.28 whose refunds are being offset to satisfy the debts are reduced
150.29 only by the actual amount of the refund payments received by the
150.30 commissioner. Notwithstanding any other provision of law to the
150.31 contrary, a claim for the offset of a federal tax refund must be
150.32 submitted to the department of the treasury of the United States
150.33 within ten years after the date of the assessment of the tax
150.34 owed by the taxpayer whose refund is to be offset to satisfy the
150.35 debt.
150.36 [EFFECTIVE DATE.] This section is effective for claims for
151.1 offset that were submitted before and are pending on the date of
151.2 final enactment, and for claims submitted on or after the day
151.3 following final enactment.
151.4 Sec. 2. Minnesota Statutes 2001 Supplement, section
151.5 270.691, subdivision 8, is amended to read:
151.6 Subd. 8. [EXPIRATION DATE.] The program authorized under
151.7 this section terminates on June 30, 2002 2003.
151.8 [EFFECTIVE DATE.] This section is effective the day
151.9 following final enactment.
151.10 Sec. 3. Minnesota Statutes 2000, section 273.125,
151.11 subdivision 4, is amended to read:
151.12 Subd. 4. [PETITIONS OF GRIEVANCE.] A person who claims
151.13 that the person's manufactured home has been unfairly or
151.14 unequally assessed, or that the property has been assessed at a
151.15 valuation greater than its real or actual value, or that the tax
151.16 levied against it is illegal, in whole or in part, or has been
151.17 paid, or that the property is exempt from the tax so levied, may
151.18 have the validity of the claim, defense, or objection determined
151.19 in court. The determination must be made by the district court
151.20 of the county in which the tax is levied or by the tax court. A
151.21 person can request the determination by filing a petition for it
151.22 in the office of the court administrator of the district court
151.23 on or before September October 1 of the year in which the tax
151.24 becomes payable. A petition for determination under this
151.25 section may be transferred by the district court to the tax
151.26 court.
151.27 [EFFECTIVE DATE.] This section is effective for taxes
151.28 payable in 2003 and thereafter.
151.29 Sec. 4. Minnesota Statutes 2000, section 278.01,
151.30 subdivision 1, is amended to read:
151.31 Subdivision 1. [DETERMINATION OF VALIDITY.] (a) Any person
151.32 having personal property, or any estate, right, title, or
151.33 interest in or lien upon any parcel of land, who claims that
151.34 such property has been partially, unfairly, or unequally
151.35 assessed in comparison with other property in the (1) city, or
151.36 (2) county, or (3) in the case of a county containing a city of
152.1 the first class, the portion of the county excluding the first
152.2 class city, or that the parcel has been assessed at a valuation
152.3 greater than its real or actual value, or that the tax levied
152.4 against the same is illegal, in whole or in part, or has been
152.5 paid, or that the property is exempt from the tax so levied, may
152.6 have the validity of the claim, defense, or objection determined
152.7 by the district court of the county in which the tax is levied
152.8 or by the tax court by serving one copy of a petition for such
152.9 determination upon the county auditor, one copy on the county
152.10 attorney, one copy on the county treasurer, and three copies on
152.11 the county assessor. The county assessor shall immediately
152.12 forward one copy of the petition to the appropriate governmental
152.13 authority in a home rule charter or statutory city or town in
152.14 which the property is located if that city or town employs its
152.15 own certified assessor. A copy of the petition shall also be
152.16 forwarded by the assessor to the school board of the school
152.17 district in which the property is located.
152.18 (b) In counties where the office of county treasurer has
152.19 been combined with the office of county auditor, the county may
152.20 elect to require the petitioner to serve the number of copies as
152.21 determined by the county. The county assessor shall immediately
152.22 forward one copy of the petition to the appropriate governmental
152.23 authority in a home rule charter or statutory city or town in
152.24 which the property is located if that city or town employs its
152.25 own certified assessor. A list of petitioned properties,
152.26 including the name of the petitioner, the identification number
152.27 of the property, and the estimated market value, shall be sent
152.28 on or before the first day of July by the county
152.29 auditor/treasurer to the school board of the school district in
152.30 which the property is located.
152.31 (c) For all counties, the petitioner must file the copies
152.32 with proof of service, in the office of the court administrator
152.33 of the district court on or before March 31 April 30 of the year
152.34 in which the tax becomes payable. A petition for determination
152.35 under this section may be transferred by the district court to
152.36 the tax court. An appeal may also be taken to the tax court
153.1 under chapter 271 at any time following receipt of the valuation
153.2 notice required by section 273.121 but prior to April May 1 of
153.3 the year in which the taxes are payable.
153.4 [EFFECTIVE DATE.] This section is effective for taxes
153.5 payable in 2003 and thereafter.
153.6 Sec. 5. Minnesota Statutes 2000, section 279.01,
153.7 subdivision 3, is amended to read:
153.8 Subd. 3. [AGRICULTURAL PROPERTY.] In the case of class 1b
153.9 agricultural homestead, class 2a agricultural homestead
153.10 property, and class 2b(3) agricultural nonhomestead property, no
153.11 penalties shall attach to the second one-half property tax
153.12 payment as provided in this section if paid by November 15.
153.13 Thereafter for class 1b agricultural homestead and class 2a
153.14 homestead property, on November 16 following, a penalty of six
153.15 percent shall accrue and be charged on all such unpaid taxes and
153.16 on December 1 following, an additional two percent shall be
153.17 charged on all such unpaid taxes. Thereafter for class 2b(3)
153.18 agricultural nonhomestead property, on November 16 following, a
153.19 penalty of eight percent shall accrue and be charged on all such
153.20 unpaid taxes and on December 1 following, an additional four
153.21 percent shall be charged on all such unpaid taxes.
153.22 If the owner of class 1b agricultural homestead, class 2a,
153.23 or class 2b(3) agricultural property receives a consolidated
153.24 property tax statement that shows only an aggregate of the taxes
153.25 and special assessments due on that property and on other
153.26 property not classified as class 1b agricultural homestead,
153.27 class 2a, or class 2b(3) agricultural property, the aggregate
153.28 tax and special assessments shown due on the property by the
153.29 consolidated statement will be due on November 15 provided that
153.30 at least 50 percent of the property's market value is classified
153.31 class 1b agricultural, class 2a, or class 2b(3) agricultural.
153.32 [EFFECTIVE DATE.] This section is effective for taxes
153.33 payable in 2003 and thereafter.
153.34 Sec. 6. Minnesota Statutes 2000, section 289A.19,
153.35 subdivision 1, is amended to read:
153.36 Subdivision 1. [FIDUCIARY INCOME, ENTERTAINMENT TAX, AND
154.1 INFORMATION RETURNS.] When, in the commissioner's judgment, good
154.2 cause exists, the commissioner may extend the time for filing
154.3 entertainment tax returns for not more than six months. If an
154.4 extension to file the federal fiduciary income tax return or
154.5 information return has been granted under section 6081 of the
154.6 Internal Revenue Code, the time for filing the state return is
154.7 extended for that period. The commissioner may require the
154.8 taxpayer to file a tentative return when the regularly required
154.9 return is due, and to pay a tax on the basis of the tentative
154.10 return at the times required for the payment of taxes on the
154.11 basis of the regularly required return from the taxpayer. The
154.12 commissioner shall grant an automatic extension of six months to
154.13 file a partnership, "S" corporation, or fiduciary income tax
154.14 return if all of the taxes imposed on the entity for the year by
154.15 chapter 290 and section 289A.08, subdivision 7, have been paid
154.16 by the date prescribed by section 289A.18, subdivision 1.
154.17 [EFFECTIVE DATE.] This section is effective for returns due
154.18 after December 31, 2002.
154.19 Sec. 7. Minnesota Statutes 2000, section 295.53,
154.20 subdivision 1, is amended to read:
154.21 Subdivision 1. [EXEMPTIONS.] (a) The following payments
154.22 are excluded from the gross revenues subject to the hospital,
154.23 surgical center, or health care provider taxes under sections
154.24 295.50 to 295.57:
154.25 (1) payments received for services provided under the
154.26 Medicare program, including payments received from the
154.27 government, and organizations governed by sections 1833 and 1876
154.28 of title XVIII of the federal Social Security Act, United States
154.29 Code, title 42, section 1395, and enrollee deductibles,
154.30 coinsurance, and copayments, whether paid by the Medicare
154.31 enrollee or by a Medicare supplemental coverage as defined in
154.32 section 62A.011, subdivision 3, clause (10). Payments for
154.33 services not covered by Medicare are taxable;
154.34 (2) medical assistance payments including payments received
154.35 directly from the government or from a prepaid plan;
154.36 (3) payments received for home health care services;
155.1 (4) payments received from hospitals or surgical centers
155.2 for goods and services on which liability for tax is imposed
155.3 under section 295.52 or the source of funds for the payment is
155.4 exempt under clause (1), (2), (7), (8), (10), (13), or (20);
155.5 (5) payments received from health care providers for goods
155.6 and services on which liability for tax is imposed under this
155.7 chapter or the source of funds for the payment is exempt under
155.8 clause (1), (2), (7), (8), (10), (13), or (20);
155.9 (6) amounts paid for legend drugs, other than nutritional
155.10 products, to a wholesale drug distributor who is subject to tax
155.11 under section 295.52, subdivision 3, reduced by reimbursements
155.12 received for legend drugs under clauses (1), (2), (7), and
155.13 (8) otherwise exempt under chapter 295;
155.14 (7) payments received under the general assistance medical
155.15 care program including payments received directly from the
155.16 government or from a prepaid plan;
155.17 (8) payments received for providing services under the
155.18 MinnesotaCare program including payments received directly from
155.19 the government or from a prepaid plan and enrollee deductibles,
155.20 coinsurance, and copayments. For purposes of this clause,
155.21 coinsurance means the portion of payment that the enrollee is
155.22 required to pay for the covered service;
155.23 (9) payments received by a health care provider or the
155.24 wholly owned subsidiary of a health care provider for care
155.25 provided outside Minnesota;
155.26 (10) payments received from the chemical dependency fund
155.27 under chapter 254B;
155.28 (11) payments received in the nature of charitable
155.29 donations that are not designated for providing patient services
155.30 to a specific individual or group;
155.31 (12) payments received for providing patient services
155.32 incurred through a formal program of health care research
155.33 conducted in conformity with federal regulations governing
155.34 research on human subjects. Payments received from patients or
155.35 from other persons paying on behalf of the patients are subject
155.36 to tax;
156.1 (13) payments received from any governmental agency for
156.2 services benefiting the public, not including payments made by
156.3 the government in its capacity as an employer or insurer;
156.4 (14) payments received for services provided by community
156.5 residential mental health facilities licensed under Minnesota
156.6 Rules, parts 9520.0500 to 9520.0690, community support programs
156.7 and family community support programs approved under Minnesota
156.8 Rules, parts 9535.1700 to 9535.1760, and community mental health
156.9 centers as defined in section 245.62, subdivision 2;
156.10 (15) government payments received by a regional treatment
156.11 center;
156.12 (16) payments received for hospice care services;
156.13 (17) payments received by a health care provider for
156.14 hearing aids and related equipment or prescription eyewear
156.15 delivered outside of Minnesota;
156.16 (18) payments received by an educational institution from
156.17 student tuition, student activity fees, health care service
156.18 fees, government appropriations, donations, or grants. Fee for
156.19 service payments and payments for extended coverage are taxable;
156.20 (19) payments received for services provided by: assisted
156.21 living programs and congregate housing programs; and
156.22 (20) payments received under the federal Employees Health
156.23 Benefits Act, United States Code, title 5, section 8909(f), as
156.24 amended by the Omnibus Reconciliation Act of 1990.
156.25 (b) Payments received by wholesale drug distributors for
156.26 legend drugs sold directly to veterinarians or veterinary bulk
156.27 purchasing organizations are excluded from the gross revenues
156.28 subject to the wholesale drug distributor tax under sections
156.29 295.50 to 295.59.
156.30 [EFFECTIVE DATE.] This section is effective for payments
156.31 received after December 31, 2001.
156.32 Sec. 8. Minnesota Statutes 2000, section 295.57, is
156.33 amended by adding a subdivision to read:
156.34 Subd. 5. [EXEMPTION FOR AMOUNTS PAID FOR LEGEND DRUGS.] If
156.35 a hospital or health care provider cannot determine the actual
156.36 cost or reimbursement of legend drugs under the exemption
157.1 provided in section 295.53, subdivision 1, paragraph (a), clause
157.2 (6), the following method must be used:
157.3 A hospital or health care provider must determine the
157.4 amount paid for legend drugs used during the month or quarter
157.5 and multiply that amount by a ratio, the numerator of which is
157.6 the total amount received for taxable patient services, and the
157.7 denominator of which is the total amount received for all
157.8 patient services, including amounts exempt under section 295.53,
157.9 subdivision 1. The result represents the allowable exemption
157.10 for the monthly or quarterly cost of drugs.
157.11 [EFFECTIVE DATE.] This section is effective for payments
157.12 received on or after July 1, 2002.
157.13 Sec. 9. Minnesota Statutes 2001 Supplement, section
157.14 295.60, subdivision 2, is amended to read:
157.15 Subd. 2. [DEFINITIONS.] (a) For purposes of this section,
157.16 the following terms have the meanings given.
157.17 (b) "Commissioner" means the commissioner of revenue.
157.18 (c) "Furrier" means a retailer that sells clothing made of
157.19 fur.
157.20 (d) "Clothing made of fur" means articles of clothing made
157.21 of fur on the hide or pelt, and articles of clothing of which
157.22 such fur is the component material of chief value, but only if
157.23 such value is more than three times the value of the next most
157.24 valuable material.
157.25 (e) "Retail sale" has the meaning given in section 297A.61,
157.26 subdivision 4.
157.27 (f) "Delivered outside of Minnesota" means fur clothing
157.28 which the furrier delivers to a common carrier for delivery
157.29 outside Minnesota, places in the United States mail or parcel
157.30 post directed to the purchaser outside Minnesota, or delivers to
157.31 the purchaser outside Minnesota by means of the seller's own
157.32 delivery vehicles, and which is not returned to a point within
157.33 Minnesota, except in the course of interstate commerce.
157.34 [EFFECTIVE DATE.] This section is effective January 1, 2002.
157.35 Sec. 10. Minnesota Statutes 2001 Supplement, section
157.36 295.60, is amended by adding a subdivision to read:
158.1 Subd. 2a. [EXEMPTIONS.] Payments received by a furrier for
158.2 clothing made of fur delivered outside of Minnesota are exempt
158.3 from gross revenues subject to the fur clothing tax.
158.4 [EFFECTIVE DATE.] This section is effective for payments
158.5 received on or after January 1, 2002.
158.6 Sec. 11. Minnesota Statutes 2001 Supplement, section
158.7 297A.61, subdivision 26, is amended to read:
158.8 Subd. 26. [PRIVATE COMMUNICATION SERVICE.] "Private
158.9 communication service" means a communication telecommunication
158.10 service furnished to a subscriber which that entitles the
158.11 subscriber customer to:
158.12 (1) exclusive or priority use of any a communication
158.13 channel or group of channels;
158.14 (2) the use of an intercommunication system for the
158.15 subscriber's stations, or regardless of whether the channel,
158.16 group of channels, or intercommunication system may be connected
158.17 through switching;
158.18 (3) the between or among termination points, regardless of
158.19 the manner in which the channel or channels are connected, and
158.20 includes switching capacity, extension lines and, stations,
158.21 or and any other associated services that are provided in
158.22 connection with, and are necessary or unique to the use of, the
158.23 use of the channel or channels or systems described in clause
158.24 (1); or
158.25 (4) any combination of tunneling, encryption,
158.26 authentication, and access control technologies and services
158.27 used to carry traffic over the Internet, a managed Internet
158.28 provider network or provider's backbone.
158.29 [EFFECTIVE DATE.] This section is effective retroactively
158.30 for sales and purchases occurring after July 31, 2001.
158.31 Sec. 12. Minnesota Statutes 2000, section 297A.68, is
158.32 amended by adding a subdivision to read:
158.33 Subd. 37. [DELIVERY OR DISTRIBUTION CHARGES; PRINTED
158.34 MATERIALS.] Charges for the delivery or distribution of printed
158.35 materials, including individual account information, are exempt
158.36 if (1) the charges are separately stated, (2) the delivery or
159.1 distribution is to a mass audience or to a mailing list provided
159.2 at the direction of the customer, and (3) the cost of the
159.3 materials is not billed directly to the recipients.
159.4 [EFFECTIVE DATE.] This section is effective retroactive to
159.5 delivery charges on sales and purchases made after December 31,
159.6 2001, and before January 1, 2006.
159.7 Sec. 13. Minnesota Statutes 2000, section 297G.07,
159.8 subdivision 1, is amended to read:
159.9 Subdivision 1. [EXEMPTIONS.] The following are not subject
159.10 to the excise tax:
159.11 (1) Sales by a manufacturer, brewer, or wholesaler for
159.12 shipment outside the state in interstate commerce.
159.13 (2) Alcoholic beverages sold or transferred between
159.14 Minnesota wholesalers.
159.15 (3) Sales to common carriers engaged in interstate
159.16 transportation of passengers, except as provided in this chapter.
159.17 (4) Malt beverages served by a brewery for on-premise
159.18 consumption at no charge, or distributed to brewery employees
159.19 for on-premise consumption under a labor contract.
159.20 (5) Shipments of wine to Minnesota residents under section
159.21 340A.417.
159.22 (6) Fruit juices naturally fermented or beer naturally
159.23 brewed in the home for family use.
159.24 (7) Sales of wine for sacramental purposes under section
159.25 340A.316.
159.26 (8) Alcoholic beverages sold to authorized manufacturers of
159.27 food products or pharmaceutical firms. The alcoholic beverage
159.28 must be used exclusively in the manufacture of food products or
159.29 medicines. For purposes of this clause, "manufacturer" means a
159.30 person who manufactures food products intended for sale to
159.31 wholesalers or retailers for ultimate sale to the consumer.
159.32 (9) Liqueur-filled candy.
159.33 (10) Sales to a federal agency, that the state of Minnesota
159.34 is prohibited from taxing under the constitution or laws of the
159.35 United States or under the constitution of Minnesota.
159.36 (11) Sales to Indian tribes as defined in section 297G.08.
160.1 (12) Shipments of intoxicating liquor from foreign
160.2 countries to diplomatic personnel of foreign countries assigned
160.3 to service in this state.
160.4 [EFFECTIVE DATE.] This section is effective the day
160.5 following final enactment.
160.6 Sec. 14. Minnesota Statutes 2001 Supplement, section
160.7 469.1763, subdivision 6, is amended to read:
160.8 Subd. 6. [POOLING PERMITTED FOR DEFICITS.] (a) This
160.9 subdivision applies only to districts for which the request for
160.10 certification was made before August 1, 2001, and without regard
160.11 to whether the request for certification was made prior to
160.12 August 1, 1979.
160.13 (b) The municipality for the district may transfer
160.14 available increments from another tax increment financing
160.15 district located in the municipality, if the transfer is
160.16 necessary to eliminate a deficit in the district to which the
160.17 increments are transferred. A deficit in the district for
160.18 purposes of this subdivision means the lesser of the following
160.19 two amounts:
160.20 (1)(i) the amount due during the calendar year to pay
160.21 preexisting obligations of the district; minus
160.22 (ii) the total increments collected or to be collected from
160.23 properties located within the district that are available for
160.24 the calendar year including amounts collected in prior years
160.25 that are currently available; plus
160.26 (iii) total increments from properties located in other
160.27 districts in the municipality including amounts collected in
160.28 prior years that are available to be used to meet the district's
160.29 obligations under this section, excluding this subdivision, or
160.30 other provisions of law (but excluding a special tax under
160.31 section 469.1791 and the grant program under Laws 1997, chapter
160.32 231, article 1, section 19, or Laws 2001, First Special Session
160.33 chapter 5); or
160.34 (2) the reduction in increments collected from properties
160.35 located in the district for the calendar year as a result of the
160.36 changes in class rates in Laws 1997, chapter 231, article 1;
161.1 Laws 1998, chapter 389, article 2; and Laws 1999, chapter 243,
161.2 and Laws 2001, First Special Session chapter 5, or the
161.3 elimination of the general education tax levy under Laws 2001,
161.4 First Special Session chapter 5.
161.5 (c) A preexisting obligation means:
161.6 (1) bonds issued and sold before August 1, 2001, or bonds
161.7 issued pursuant to a binding contract requiring the issuance of
161.8 bonds entered into before July 1, 2001, and bonds issued to
161.9 refund such bonds or to reimburse expenditures made in
161.10 conjunction with a signed contractual agreement entered into
161.11 before August 1, 2001, to the extent that the bonds are secured
161.12 by a pledge of increments from the tax increment financing
161.13 district; and
161.14 (2) binding contracts entered into before August 1, 2001,
161.15 to the extent that the contracts require payments secured by a
161.16 pledge of increments from the tax increment financing district.
161.17 (d) The municipality may require a development authority,
161.18 other than a seaway port authority, to transfer available
161.19 increments including amounts collected in prior years that are
161.20 currently available for any of its tax increment financing
161.21 districts in the municipality to make up an insufficiency in
161.22 another district in the municipality, regardless of whether the
161.23 district was established by the development authority or another
161.24 development authority. This authority applies notwithstanding
161.25 any law to the contrary, but applies only to a development
161.26 authority that:
161.27 (1) was established by the municipality; or
161.28 (2) the governing body of which is appointed, in whole or
161.29 part, by the municipality or an officer of the municipality or
161.30 which consists, in whole or part, of members of the governing
161.31 body of the municipality. The municipality may use this
161.32 authority only after it has first used all available increments
161.33 of the receiving development authority to eliminate the
161.34 insufficiency and exercised any permitted action under section
161.35 469.1792, subdivision 3, for preexisting districts of the
161.36 receiving development authority to eliminate the insufficiency.
162.1 (e) The authority under this subdivision to spend tax
162.2 increments outside of the area of the district from which the
162.3 tax increments were collected:
162.4 (1) may only be exercised after obtaining approval of the
162.5 use of the increments, in writing, by the commissioner of
162.6 revenue;
162.7 (2) is an exception to the restrictions under section
162.8 469.176, subdivision 4i, and the other provisions of this
162.9 section, and the percentage restrictions under subdivision 2
162.10 must be calculated after deducting increments spent under this
162.11 subdivision from the total increments for the district; and
162.12 (3) applies notwithstanding the provisions of the Tax
162.13 Increment Financing Act in effect for districts for which the
162.14 request for certification was made before June 30, 1982, or any
162.15 other law to the contrary.
162.16 (f) If a preexisting obligation requires the development
162.17 authority to pay an amount that is limited to the increment from
162.18 the district or a specific development within the district and
162.19 if the obligation requires paying a higher amount to the extent
162.20 that increments are available, the municipality may determine
162.21 that the amount due under the preexisting obligation equals the
162.22 higher amount and may authorize the transfer of increments under
162.23 this subdivision to pay up to the higher amount. The authority
162.24 to transfer increments under this paragraph may only be used to
162.25 the extent that the payment of all other preexisting obligations
162.26 in the municipality due during the calendar year have been
162.27 satisfied.
162.28 [EFFECTIVE DATE.] This section is effective retroactively
162.29 to January 2, 2002, and thereafter.
162.30 ARTICLE 10
162.31 DEPARTMENT OF REVENUE TECHNICAL PROVISIONS
162.32 Section 1. Minnesota Statutes 2001 Supplement, section
162.33 69.021, subdivision 5, is amended to read:
162.34 Subd. 5. [CALCULATION OF STATE AID.] (a) The amount of
162.35 fire state aid available for apportionment, before the addition
162.36 of the minimum fire state aid allocation amount under
163.1 subdivision 7, is equal to 107 percent of the amount of premium
163.2 taxes paid to the state upon the fire, lightning, sprinkler
163.3 leakage, and extended coverage premiums reported to the
163.4 commissioner by insurers on the Minnesota Firetown Premium
163.5 Report. This amount shall be reduced by the amount required to
163.6 pay the state auditor's costs and expenses of the audits or
163.7 exams of the firefighters relief associations.
163.8 The total amount for apportionment in respect to fire state
163.9 aid must not be less than two percent of the premiums reported
163.10 to the commissioner by insurers on the Minnesota Firetown
163.11 Premium Report after subtracting the following amounts:
163.12 (1) the amount required to pay the state auditor's costs
163.13 and expenses of the audits or exams of the firefighters relief
163.14 associations; and
163.15 (2) one percent of the premiums reported by town and
163.16 farmers' mutual insurance companies and mutual property and
163.17 casualty companies with total assets of $5,000,000 or less.
163.18 (b) The total amount for apportionment as police state aid
163.19 is equal to 104 percent of the amount of premium taxes paid to
163.20 the state on the premiums reported to the commissioner by
163.21 insurers on the Minnesota Aid to Police Premium Report, plus the
163.22 payment amounts received under section 297I.05, subdivision 8,
163.23 since the last aid apportionment, and reduced by the amount
163.24 required to pay the costs and expenses of the state auditor for
163.25 audits or exams of police relief associations. The total amount
163.26 for apportionment in respect to the police state aid program
163.27 must not be less than two percent of the amount of premiums
163.28 reported to the commissioner by insurers on the Minnesota Aid to
163.29 Police Premium Report after subtracting the amount required to
163.30 pay the state auditor's cost and expenses of the audits or exams
163.31 of the police relief associations.
163.32 (c) The commissioner shall calculate the percentage of
163.33 increase or decrease reflected in the apportionment over or
163.34 under the previous year's available state aid using the same
163.35 premiums as a basis for comparison.
163.36 (d) The amount for apportionment in respect to peace
164.1 officer state aid under paragraph (b) must be further reduced by
164.2 $1,779,000 in fiscal year 1999, $2,077,000 in fiscal year 2000,
164.3 and $2,404,000 in fiscal year 2001. These reductions in this
164.4 paragraph cancel to the general fund.
164.5 (e) In addition to the amount for apportionment of police
164.6 state aid under paragraph (b) is annually increased by an amount
164.7 equal to the revenues under the tax on automobile risk
164.8 self-insurance under Minnesota Statutes 2000, section 297I.05,
164.9 subdivision 8, that were collected in fiscal year 2001, each
164.10 year $100,000 shall be apportioned for police state aid. An
164.11 amount sufficient to pay this increase is annually appropriated
164.12 from the general fund.
164.13 [EFFECTIVE DATE.] This section is effective beginning with
164.14 fiscal year 2003.
164.15 Sec. 2. Minnesota Statutes 2001 Supplement, section
164.16 126C.17, subdivision 7a, is amended to read:
164.17 Subd. 7a. [REFERENDUM TAX BASE REPLACEMENT AID.] For each
164.18 school district that had a referendum allowance for fiscal year
164.19 2002 exceeding $415, for each separately authorized referendum
164.20 levy, the commissioner of revenue, in consultation with the
164.21 commissioner of children, families, and learning, shall certify
164.22 the amount of the referendum levy in taxes payable year 2001
164.23 attributable to the portion of the referendum allowance
164.24 exceeding $415 levied against property classified as class 2,
164.25 noncommercial 4c(1), or 4c(4), under section 273.13, excluding
164.26 the portion of the tax paid by the portion of class 2a property
164.27 consisting of the house, garage, and surrounding one acre of
164.28 land. The resulting amount must be used to reduce the
164.29 district's referendum levy amount otherwise determined, and must
164.30 be paid to the district each year that the referendum authority
164.31 remains in effect. The aid payable under this subdivision must
164.32 be subtracted from the district's referendum equalization aid
164.33 under subdivision 7. The referendum equalization aid after the
164.34 subtraction must not be less than zero.
164.35 For the purposes of this subdivision, the referendum levy
164.36 with the latest year of expiration is assumed to be at the
165.1 highest level of equalization, and the referendum levy with the
165.2 earliest year of expiration is assumed to be at the lowest level
165.3 of equalization.
165.4 [EFFECTIVE DATE.] This section is effective for taxes
165.5 payable in 2002 and thereafter.
165.6 Sec. 3. Minnesota Statutes 2001 Supplement, section
165.7 270.69, subdivision 2, is amended to read:
165.8 Subd. 2. [FILING OF LIENS NECESSARY FOR ENFORCEABILITY
165.9 AGAINST CERTAIN PERSONS; METHODS OF FILING; FEES.] (a) The lien
165.10 imposed by subdivision 1 is not enforceable against any
165.11 purchaser, mortgagee, pledgee, holder of a Uniform Commercial
165.12 Code security interest, mechanic's lienor, or judgment lien
165.13 creditor whose interest has been duly perfected or is a
165.14 conveyance or interest entitled to protection against judgments
165.15 and attachments under section 507.34 or under any other
165.16 applicable provisions of state law, until a notice of lien has
165.17 been filed by the commissioner of revenue in the office of the
165.18 county recorder of the county in which real property is
165.19 situated, or in the case of personal property belonging to an
165.20 individual who is not a resident of this state or to a
165.21 corporation, partnership, or other organization, in the office
165.22 of the secretary of state, or in the case of personal property
165.23 belonging to a resident individual, in the office of the county
165.24 recorder of the county of residence of the individual.
165.25 (b)(1) Notices of liens, and lien releases, transcriptions,
165.26 and renewals, in a form prescribed by the commissioner of
165.27 revenue, may be filed with the county recorder or the secretary
165.28 of state by mail, personal delivery, or by electronic
165.29 transmission by the commissioner or a delegate into the
165.30 computerized filing system of the secretary of state. The
165.31 secretary of state shall transmit the notice electronically to
165.32 the office of the county recorder, if that is the place of
165.33 filing, in the county or counties shown on the computer entry.
165.34 The filing officer, whether the county recorder or the secretary
165.35 of state, shall endorse and index a printout of the notice in
165.36 the same manner as if the notice had been mailed or delivered.
166.1 (2) County recorders and the secretary of state shall enter
166.2 information relative to lien notices, transcriptions, renewals,
166.3 and releases filed in their offices into the central database of
166.4 the secretary of state. For notices filed electronically with
166.5 the county recorders, the date and time of receipt of the notice
166.6 and county recorder's file number, and for notices filed
166.7 electronically with the secretary of state, the secretary of
166.8 state's recording information, must be entered by the filing
166.9 officer into the central database before the close of the
166.10 working day following the day of the original data entry by the
166.11 department of revenue.
166.12 The filing and indexing of all notices must be in
166.13 accordance with the filing and indexing of notices of federal
166.14 liens, certificates of release, and refiled notices under
166.15 section 272.483.
166.16 (c) Notwithstanding any other law to the contrary, the
166.17 department of revenue is exempt from payment of fees when a
166.18 lien, lien renewal, or lien transcription is offered for
166.19 recording. The recording fees must be paid along with the
166.20 release fee at the end of the month in which the release of lien
166.21 is recorded, after receipt of a monthly statement from a county
166.22 recorder or the secretary of state. The department of revenue
166.23 shall add the recording fees to the delinquent tax liability of
166.24 the taxpayer. Notwithstanding any other law to the contrary,
166.25 the fee for filing or recording a notice of lien, or lien
166.26 release, transcription, or renewal is $15.
166.27 (d) There is appropriated to the commissioner of revenue an
166.28 amount representing the cost of payment of recording fees to the
166.29 county recorders and the secretary of state. The commissioner
166.30 shall keep a separate accounting of the costs and of payments
166.31 for recording fees remitted by taxpayers, and make the records
166.32 available to the legislature upon request.
166.33 [EFFECTIVE DATE.] As to the protection of interests in
166.34 property of third parties, this section is effective for liens
166.35 of record and enforceable as of the day following final
166.36 enactment, and for liens filed thereafter. As to the place of
167.1 filing of liens against personal property, this section is
167.2 effective for liens filed on or after the day following final
167.3 enactment.
167.4 Sec. 4. Minnesota Statutes 2000, section 272.02,
167.5 subdivision 15, is amended to read:
167.6 Subd. 15. [PROPERTY USED TO GENERATE HYDROELECTRIC OR
167.7 HYDROMECHANICAL POWER.] To the extent provided by section 295.44
167.8 Notwithstanding the provisions of subdivision 39, and sections
167.9 272.01, subdivision 2, and 273.19, subdivision 1, real and
167.10 personal property used or to be used primarily for the
167.11 production of hydroelectric or hydromechanical power on a site
167.12 owned by the federal government, the state, or a local
167.13 governmental unit which is and developed and operated pursuant
167.14 to the provisions of section 103G.535 is exempt from property
167.15 tax for all years during which the site is developed and
167.16 operated under the terms of a lease or agreement authorized by
167.17 section 103G.535.
167.18 [EFFECTIVE DATE.] This section is effective the day
167.19 following final enactment.
167.20 Sec. 5. Minnesota Statutes 2001 Supplement, section
167.21 273.121, is amended to read:
167.22 273.121 [VALUATION OF REAL PROPERTY, NOTICE.]
167.23 Any county assessor or city assessor having the powers of a
167.24 county assessor, valuing or classifying taxable real property
167.25 shall in each year notify those persons whose property is to be
167.26 included on the assessment roll that year if the person's
167.27 address is known to the assessor, otherwise the occupant of the
167.28 property. The notice shall be in writing and shall be sent by
167.29 ordinary mail at least ten days before the meeting of the local
167.30 board of appeal and equalization under section 274.01 or the
167.31 review process established under section 274.13, subdivision
167.32 1c. It shall contain: (1) the market value for the current and
167.33 prior assessment, (2) the limited market value under section
167.34 273.11, subdivision 1a, for the current and prior assessment, (3)
167.35 the qualifying amount of any improvements under section 273.11,
167.36 subdivision 16, for the current assessment, (4) the market value
168.1 subject to taxation after subtracting the amount of any
168.2 qualifying improvements for the current assessment, (5) the
168.3 classification of the property for the current and prior
168.4 assessment, (6) a note that if the property is homestead and at
168.5 least 35 45 years old, improvements made to the property may be
168.6 eligible for a valuation exclusion under section 273.11,
168.7 subdivision 16, (7) the assessor's office address, and (8) the
168.8 dates, places, and times set for the meetings of the local board
168.9 of appeal and equalization, the review process established under
168.10 section 274.13, subdivision 1c, and the county board of appeal
168.11 and equalization. The commissioner of revenue shall specify the
168.12 form of the notice. The assessor shall attach to the assessment
168.13 roll a statement that the notices required by this section have
168.14 been mailed. Any assessor who is not provided sufficient funds
168.15 from the assessor's governing body to provide such notices, may
168.16 make application to the commissioner of revenue to finance such
168.17 notices. The commissioner of revenue shall conduct an
168.18 investigation and, if satisfied that the assessor does not have
168.19 the necessary funds, issue a certification to the commissioner
168.20 of finance of the amount necessary to provide such notices. The
168.21 commissioner of finance shall issue a warrant for such amount
168.22 and shall deduct such amount from any state payment to such
168.23 county or municipality. The necessary funds to make such
168.24 payments are hereby appropriated. Failure to receive the notice
168.25 shall in no way affect the validity of the assessment, the
168.26 resulting tax, the procedures of any board of review or
168.27 equalization, or the enforcement of delinquent taxes by
168.28 statutory means.
168.29 [EFFECTIVE DATE.] This section is effective for notices
168.30 required to be mailed in 2002 and thereafter.
168.31 Sec. 6. Minnesota Statutes 2001 Supplement, section
168.32 273.13, subdivision 24, is amended to read:
168.33 Subd. 24. [CLASS 3.] (a) Commercial and industrial
168.34 property and utility real and personal property is class 3a.
168.35 (1) Except as otherwise provided, each parcel of
168.36 commercial, industrial, or utility real property has a class
169.1 rate of 1.5 percent of the first tier of market value, and 2.0
169.2 percent of the remaining market value. In the case of
169.3 contiguous parcels of property owned by the same person or
169.4 entity, only the value equal to the first-tier value of the
169.5 contiguous parcels qualifies for the reduced class rate, except
169.6 that contiguous parcels owned by the same person or entity shall
169.7 be eligible for the first-tier value class rate on each separate
169.8 business operated by the owner of the property, provided the
169.9 business is housed in a separate structure. For the purposes of
169.10 this subdivision, the first tier means the first $150,000 of
169.11 market value. Real property owned in fee by a utility for
169.12 transmission line right-of-way shall be classified at the class
169.13 rate for the higher tier.
169.14 For purposes of this subdivision, parcels are considered to
169.15 be contiguous even if they are separated from each other by a
169.16 road, street, waterway, or other similar intervening type of
169.17 property. Connections between parcels that consist of power
169.18 lines or pipelines do not cause the parcels to be contiguous.
169.19 Property owners who have contiguous parcels of property that
169.20 constitute separate businesses that may qualify for the
169.21 first-tier class rate shall notify the assessor by July 1, for
169.22 treatment beginning in the following taxes payable year.
169.23 (2) All railroad operating property and All personal
169.24 property that is: (i) part of an electric generation,
169.25 transmission, or distribution system; or (ii) part of a pipeline
169.26 system transporting or distributing water, gas, crude oil, or
169.27 petroleum products; and (iii) not described in clause (3), and
169.28 all railroad operating property has a class rate as provided
169.29 under clause (1) for the first tier of market value and the
169.30 remaining market value. In the case of multiple parcels in one
169.31 county that are owned by one person or entity, only one first
169.32 tier amount is eligible for the reduced rate.
169.33 (3) The entire market value of personal property that is:
169.34 (i) tools, implements, and machinery of an electric generation,
169.35 transmission, or distribution system; (ii) tools, implements,
169.36 and machinery of a pipeline system transporting or distributing
170.1 water, gas, crude oil, or petroleum products; or (iii) the mains
170.2 and pipes used in the distribution of steam or hot or chilled
170.3 water for heating or cooling buildings, has a class rate as
170.4 provided under clause (1) for the remaining market value in
170.5 excess of the first tier.
170.6 (b) Employment property defined in section 469.166, during
170.7 the period provided in section 469.170, shall constitute class
170.8 3b. The class rates for class 3b property are determined under
170.9 paragraph (a).
170.10 [EFFECTIVE DATE.] This section is effective for taxes
170.11 payable in 2002 and thereafter.
170.12 Sec. 7. Minnesota Statutes 2001 Supplement, section
170.13 273.1392, is amended to read:
170.14 273.1392 [PAYMENT; SCHOOL DISTRICTS.]
170.15 The amounts of conservation tax credits under section
170.16 273.119; disaster or emergency reimbursement under section
170.17 273.123; attached machinery aid under section 273.138; homestead
170.18 and agricultural credits under section 273.1384; aids and
170.19 credits under section 273.1398; wetlands reimbursement under
170.20 section 275.295; enterprise zone property credit payments under
170.21 section 469.171; and metropolitan agricultural preserve
170.22 reduction under section 473H.10 for school districts, shall be
170.23 certified to the department of children, families, and learning
170.24 by the department of revenue. The amounts so certified shall be
170.25 paid according to section 127A.45, subdivisions 9 and 13.
170.26 [EFFECTIVE DATE.] This section is effective for aids and
170.27 credits payable in 2002 and thereafter.
170.28 Sec. 8. Minnesota Statutes 2001 Supplement, section
170.29 273.1398, subdivision 4c, is amended to read:
170.30 Subd. 4c. [TEMPORARY AID; COURT ADMINISTRATION COSTS.] For
170.31 calendar years 2004 and 2005, each county in a judicial district
170.32 that has not been transferred to the state by January 1 of that
170.33 year shall receive additional homestead and agricultural credit
170.34 aid. This amount is in addition to the amount calculated under
170.35 subdivision 2 and must not be included in the definition of
170.36 homestead and agricultural credit base under subdivision 1,
171.1 paragraph (j). The amount of additional aid is equal to the
171.2 difference between (1) the amount budgeted for court
171.3 administration costs in 2001 as determined under subdivision 4b,
171.4 paragraph (c) (b), multiplied by the maintenance of effort
171.5 percent for the calendar year as determined under subdivision
171.6 4b, paragraph (d) (a), and (2) the amount calculated under
171.7 subdivision 4b, paragraph (a), for calendar year 2003. This
171.8 additional aid must be used only to fund court administration
171.9 expenditures as defined in section 480.183, subdivision 3. This
171.10 amount must be added to the state court's base budget in the
171.11 year when the court in that judicial district in which the
171.12 county is located is transferred to the state.
171.13 [EFFECTIVE DATE.] This section is effective retroactively
171.14 to July 1, 2001, and thereafter.
171.15 Sec. 9. Minnesota Statutes 2001 Supplement, section
171.16 275.74, subdivision 2, is amended to read:
171.17 Subd. 2. [AUTHORIZATION FOR SPECIAL LEVIES.] A local
171.18 governmental unit may request authorization to levy for
171.19 unreimbursed costs for other natural disasters under section
171.20 275.70, subdivision 5, clause (6) (7). The local governmental
171.21 unit shall submit a request to levy under section 275.70,
171.22 subdivision 5, clause (6) (7), to the commissioner of revenue by
171.23 September 30 of the levy year and the request must include
171.24 information documenting the estimated unreimbursed costs. The
171.25 commissioner of revenue may grant levy authority, up to the
171.26 amount requested based on the documentation submitted. All
171.27 decisions of the commissioner are final.
171.28 [EFFECTIVE DATE.] This section is effective for taxes
171.29 payable in 2002 and 2003.
171.30 Sec. 10. Minnesota Statutes 2001 Supplement, section
171.31 289A.60, subdivision 2, is amended to read:
171.32 Subd. 2. [PENALTY FOR FAILURE TO MAKE AND FILE RETURN.] If
171.33 a taxpayer fails to make and file a tax return within the time
171.34 prescribed, including an extension, or fails to file an
171.35 individual income tax return within six months after the due
171.36 date, a penalty of five percent of the amount of tax not paid by
172.1 the end of that period is added to the tax.
172.2 [EFFECTIVE DATE.] This section is effective the day
172.3 following final enactment.
172.4 Sec. 11. Minnesota Statutes 2000, section 290.067,
172.5 subdivision 2a, is amended to read:
172.6 Subd. 2a. [INCOME.] (a) For purposes of this section,
172.7 "income" means the sum of the following:
172.8 (1) federal adjusted gross income as defined in section 62
172.9 of the Internal Revenue Code; and
172.10 (2) the sum of the following amounts to the extent not
172.11 included in clause (1):
172.12 (i) all nontaxable income;
172.13 (ii) the amount of a passive activity loss that is not
172.14 disallowed as a result of section 469, paragraph (i) or (m) of
172.15 the Internal Revenue Code and the amount of passive activity
172.16 loss carryover allowed under section 469(b) of the Internal
172.17 Revenue Code;
172.18 (iii) an amount equal to the total of any discharge of
172.19 qualified farm indebtedness of a solvent individual excluded
172.20 from gross income under section 108(g) of the Internal Revenue
172.21 Code;
172.22 (iv) cash public assistance and relief;
172.23 (v) any pension or annuity (including railroad retirement
172.24 benefits, all payments received under the federal Social
172.25 Security Act, supplemental security income, and veterans
172.26 benefits), which was not exclusively funded by the claimant or
172.27 spouse, or which was funded exclusively by the claimant or
172.28 spouse and which funding payments were excluded from federal
172.29 adjusted gross income in the years when the payments were made;
172.30 (vi) interest received from the federal or a state
172.31 government or any instrumentality or political subdivision
172.32 thereof;
172.33 (vii) workers' compensation;
172.34 (viii) nontaxable strike benefits;
172.35 (ix) the gross amounts of payments received in the nature
172.36 of disability income or sick pay as a result of accident,
173.1 sickness, or other disability, whether funded through insurance
173.2 or otherwise;
173.3 (x) a lump sum distribution under section 402(e)(3) of the
173.4 Internal Revenue Code;
173.5 (xi) contributions made by the claimant to an individual
173.6 retirement account, including a qualified voluntary employee
173.7 contribution; simplified employee pension plan; self-employed
173.8 retirement plan; cash or deferred arrangement plan under section
173.9 401(k) of the Internal Revenue Code; or deferred compensation
173.10 plan under section 457 of the Internal Revenue Code; and
173.11 (xii) nontaxable scholarship or fellowship grants.
173.12 In the case of an individual who files an income tax return
173.13 on a fiscal year basis, the term "federal adjusted gross income"
173.14 means federal adjusted gross income reflected in the fiscal year
173.15 ending in the next calendar year. Federal adjusted gross income
173.16 may not be reduced by the amount of a net operating loss
173.17 carryback or carryforward or a capital loss carryback or
173.18 carryforward allowed for the year.
173.19 (b) "Income" does not include:
173.20 (1) amounts excluded pursuant to the Internal Revenue Code,
173.21 sections 101(a) and 102;
173.22 (2) amounts of any pension or annuity that were exclusively
173.23 funded by the claimant or spouse if the funding payments were
173.24 not excluded from federal adjusted gross income in the years
173.25 when the payments were made;
173.26 (3) surplus food or other relief in kind supplied by a
173.27 governmental agency;
173.28 (4) relief granted under chapter 290A; and
173.29 (5) child support payments received under a temporary or
173.30 final decree of dissolution or legal separation; and
173.31 (6) restitution payments received by eligible individuals
173.32 and excludable interest as defined in section 803 of the
173.33 Economic Growth and Tax Relief Reconciliation Act of 2001,
173.34 Public Law Number 107-16.
173.35 [EFFECTIVE DATE.] This section is effective for tax years
173.36 beginning after December 31, 2000.
174.1 Sec. 12. Minnesota Statutes 2001 Supplement, section
174.2 290.0675, subdivision 1, is amended to read:
174.3 Subdivision 1. [DEFINITIONS.] (a) For purposes of this
174.4 section the following terms have the meanings given.
174.5 (b) "Earned income" means the sum of the following, to the
174.6 extent included in Minnesota taxable income:
174.7 (1) earned income as defined in section 32(c)(2) of the
174.8 Internal Revenue Code;
174.9 (2) income received from a retirement pension,
174.10 profit-sharing, stock bonus, or annuity plan; and
174.11 (3) social security benefits as defined in section 86(d)(1)
174.12 of the Internal Revenue Code.
174.13 (c) "Taxable income" means net income as defined in section
174.14 290.01, subdivision 19.
174.15 (d) "Earned income of lesser-earning spouse" means the
174.16 earned income of the spouse with the lesser amount of earned
174.17 income as defined in paragraph (b) for the taxable year minus
174.18 the sum of (i) the amount for one exemption under section 151(d)
174.19 of the Internal Revenue Code and (ii) one-half the amount of the
174.20 standard deduction under section 63(c)(2)(A) and (4) of the
174.21 Internal Revenue Code.
174.22 [EFFECTIVE DATE.] This section is effective for tax years
174.23 beginning after December 31, 2000.
174.24 Sec. 13. Minnesota Statutes 2001 Supplement, section
174.25 290.0675, subdivision 3, is amended to read:
174.26 Subd. 3. [CREDIT AMOUNT.] The credit amount is the
174.27 difference between the tax on the couple's joint Minnesota
174.28 taxable income under the rates in section 290.06, subdivision
174.29 2c, paragraph (a), and the sum of the tax under the rates of
174.30 section 290.06, subdivision 2c, paragraph (b), on the earned
174.31 income of the lesser-earning spouse, and the tax under the rates
174.32 of section 290.06, subdivision 2c, paragraph (b), on the
174.33 couple's joint Minnesota taxable income, minus the earned income
174.34 of the lesser-earning spouse.
174.35 For taxable years beginning after December 31, 2001, The
174.36 commissioner of revenue shall prepare and make available to
175.1 taxpayers a comprehensive table showing the credit under this
175.2 section at brackets of earnings of the lesser-earning spouse and
175.3 joint taxable income. The brackets of earnings shall not be
175.4 more than $2,000.
175.5 For taxable years beginning after December 31, 2002, the
175.6 commissioner shall update the table as necessary to provide a
175.7 credit that reflects the relationship between the marginal tax
175.8 rates imposed under section 290.06, subdivision 2c.
175.9 [EFFECTIVE DATE.] This section is effective for tax years
175.10 beginning after December 31, 2000.
175.11 Sec. 14. Minnesota Statutes 2001 Supplement, section
175.12 290.0921, subdivision 2, is amended to read:
175.13 Subd. 2. [DEFINITIONS.] (a) For purposes of this section,
175.14 the following terms have the meanings given them.
175.15 (b) "Alternative minimum taxable net income" is alternative
175.16 minimum taxable income,
175.17 (1) less the exemption amount, and
175.18 (2) apportioned or allocated to Minnesota under section
175.19 290.17, 290.191, or 290.20.
175.20 (c) The "exemption amount" is $40,000, reduced, but not
175.21 below zero, by 25 percent of the excess of alternative minimum
175.22 taxable income over $150,000.
175.23 (d) "Minnesota alternative minimum taxable income" is
175.24 alternative minimum taxable net income, less the deductions for
175.25 alternative tax net operating loss under subdivision 4;
175.26 charitable contributions under subdivision 5; and dividends
175.27 received under subdivision 6. The sum of the deductions under
175.28 this paragraph may not exceed 90 percent of alternative minimum
175.29 taxable net income. This limitation does not apply to a
175.30 deduction for dividends paid to or received from a corporation
175.31 which is subject to tax under section 290.36 and which is a
175.32 member of an affiliated group of corporations as defined by the
175.33 Internal Revenue Code.
175.34 [EFFECTIVE DATE.] This section is effective for taxable
175.35 years beginning after December 31, 2001.
175.36 Sec. 15. Minnesota Statutes 2000, section 290.17,
176.1 subdivision 2, is amended to read:
176.2 Subd. 2. [INCOME NOT DERIVED FROM CONDUCT OF A TRADE OR
176.3 BUSINESS.] The income of a taxpayer subject to the allocation
176.4 rules that is not derived from the conduct of a trade or
176.5 business must be assigned in accordance with paragraphs (a) to
176.6 (f):
176.7 (a)(1) Subject to paragraphs (a)(2), (a)(3), and (a)(4),
176.8 income from wages as defined in section 3401(a) and (f) of the
176.9 Internal Revenue Code is assigned to this state if, and to the
176.10 extent that, the work of the employee is performed within it;
176.11 all other income from such sources is treated as income from
176.12 sources without this state.
176.13 Severance pay shall be considered income from labor or
176.14 personal or professional services.
176.15 (2) In the case of an individual who is a nonresident of
176.16 Minnesota and who is an athlete or entertainer, income from
176.17 compensation for labor or personal services performed within
176.18 this state shall be determined in the following manner:
176.19 (i) The amount of income to be assigned to Minnesota for an
176.20 individual who is a nonresident salaried athletic team employee
176.21 shall be determined by using a fraction in which the denominator
176.22 contains the total number of days in which the individual is
176.23 under a duty to perform for the employer, and the numerator is
176.24 the total number of those days spent in Minnesota. For purposes
176.25 of this paragraph, off-season training activities, unless
176.26 conducted at the team's facilities as part of a team imposed
176.27 program, are not included in the total number of duty days.
176.28 Bonuses earned as a result of play during the regular season or
176.29 for participation in championship, play-off, or all-star games
176.30 must be allocated under the formula. Signing bonuses are not
176.31 subject to allocation under the formula if they are not
176.32 conditional on playing any games for the team, are payable
176.33 separately from any other compensation, and are nonrefundable;
176.34 and
176.35 (ii) The amount of income to be assigned to Minnesota for
176.36 an individual who is a nonresident, and who is an athlete or
177.1 entertainer not listed in clause (i), for that person's athletic
177.2 or entertainment performance in Minnesota shall be determined by
177.3 assigning to this state all income from performances or athletic
177.4 contests in this state.
177.5 (3) For purposes of this section, amounts received by a
177.6 nonresident as "retirement income" as defined in section (b)(1)
177.7 of the State Income Taxation of Pension Income Act, Public Law
177.8 Number 104-95, are not considered income derived from carrying
177.9 on a trade or business or from wages or other compensation for
177.10 work an employee performed in Minnesota, and are not taxable
177.11 under this chapter.
177.12 (4) Wages, otherwise assigned to this state under clause
177.13 (1) and not qualifying under clause (3), are not taxable under
177.14 this chapter if the following conditions are met:
177.15 (i) the recipient was not a resident of this state for any
177.16 part of the taxable year in which the wages were received; and
177.17 (ii) the wages are for work performed while the recipient
177.18 was a resident of this state.
177.19 (b) Income or gains from tangible property located in this
177.20 state that is not employed in the business of the recipient of
177.21 the income or gains must be assigned to this state.
177.22 (c) Income or gains from intangible personal property not
177.23 employed in the business of the recipient of the income or gains
177.24 must be assigned to this state if the recipient of the income or
177.25 gains is a resident of this state or is a resident trust or
177.26 estate.
177.27 Gain on the sale of a partnership interest is allocable to
177.28 this state in the ratio of the original cost of partnership
177.29 tangible property in this state to the original cost of
177.30 partnership tangible property everywhere, determined at the time
177.31 of the sale. If more than 50 percent of the value of the
177.32 partnership's assets consists of intangibles, gain or loss from
177.33 the sale of the partnership interest is allocated to this state
177.34 in accordance with the sales factor of the partnership for its
177.35 first full tax period immediately preceding the tax period of
177.36 the partnership during which the partnership interest was sold.
178.1 Gain on the sale of goodwill or income from a covenant not
178.2 to compete that is connected with a business operating all or
178.3 partially in Minnesota is allocated to this state to the extent
178.4 that the income from the business in the year preceding the year
178.5 of sale was assignable to Minnesota under subdivision 3.
178.6 When an employer pays an employee for a covenant not to
178.7 compete, the income allocated to this state is in the ratio of
178.8 the employee's service in Minnesota in the calendar year
178.9 preceding leaving the employment of the employer over the total
178.10 services performed by the employee for the employer in that year.
178.11 (d) Income from winnings on Minnesota pari-mutuel betting
178.12 tickets, the Minnesota state lottery, and lawful gambling as
178.13 defined in section 349.12, subdivision 24, conducted within the
178.14 boundaries of the state of Minnesota shall be assigned to this
178.15 state a bet made by an individual while in Minnesota is assigned
178.16 to this state. In this paragraph, "bet" has the meaning given
178.17 in section 609.75, subdivision 2, as limited by section 609.75,
178.18 subdivision 3, clauses (1), (2), and (3).
178.19 (e) All items of gross income not covered in paragraphs (a)
178.20 to (d) and not part of the taxpayer's income from a trade or
178.21 business shall be assigned to the taxpayer's domicile.
178.22 (f) For the purposes of this section, working as an
178.23 employee shall not be considered to be conducting a trade or
178.24 business.
178.25 [EFFECTIVE DATE.] This section is effective for tax years
178.26 beginning after December 31, 2001.
178.27 Sec. 16. Minnesota Statutes 2000, section 290.17,
178.28 subdivision 3, is amended to read:
178.29 Subd. 3. [TRADE OR BUSINESS INCOME; GENERAL RULE.] All
178.30 income of a trade or business is subject to apportionment except
178.31 nonbusiness income. Income derived from carrying on a trade or
178.32 business must be assigned to this state if the trade or business
178.33 is conducted wholly within this state, assigned outside this
178.34 state if conducted wholly without this state and apportioned
178.35 between this state and other states and countries under this
178.36 subdivision if conducted partly within and partly without this
179.1 state. For purposes of determining whether a trade or business
179.2 is carried on exclusively within or without this state:
179.3 (a) A trade or business physically located exclusively
179.4 within this state is nevertheless carried on partly within and
179.5 partly without this state if any of the principles set forth in
179.6 section 290.191 for the allocation of sales or receipts within
179.7 or without this state when applied to the taxpayer's situation
179.8 result in the allocation of any sales or receipts without this
179.9 state.
179.10 (b) A trade or business physically located exclusively
179.11 without this state is nevertheless carried on partly within and
179.12 partly without this state if any of the principles set forth in
179.13 section 290.191 for the allocation of sales or receipts within
179.14 or without this state when applied to the taxpayer's situation
179.15 result in the allocation of any sales or receipts without within
179.16 this state. The jurisdiction to tax such a business under this
179.17 chapter must be determined in accordance with sections 290.014
179.18 and 290.015.
179.19 [EFFECTIVE DATE.] This section is effective for tax years
179.20 beginning after December 31, 2001.
179.21 Sec. 17. Minnesota Statutes 2000, section 290A.03,
179.22 subdivision 3, is amended to read:
179.23 Subd. 3. [INCOME.] (1) "Income" means the sum of the
179.24 following:
179.25 (a) federal adjusted gross income as defined in the
179.26 Internal Revenue Code; and
179.27 (b) the sum of the following amounts to the extent not
179.28 included in clause (a):
179.29 (i) all nontaxable income;
179.30 (ii) the amount of a passive activity loss that is not
179.31 disallowed as a result of section 469, paragraph (i) or (m) of
179.32 the Internal Revenue Code and the amount of passive activity
179.33 loss carryover allowed under section 469(b) of the Internal
179.34 Revenue Code;
179.35 (iii) an amount equal to the total of any discharge of
179.36 qualified farm indebtedness of a solvent individual excluded
180.1 from gross income under section 108(g) of the Internal Revenue
180.2 Code;
180.3 (iv) cash public assistance and relief;
180.4 (v) any pension or annuity (including railroad retirement
180.5 benefits, all payments received under the federal Social
180.6 Security Act, supplemental security income, and veterans
180.7 benefits), which was not exclusively funded by the claimant or
180.8 spouse, or which was funded exclusively by the claimant or
180.9 spouse and which funding payments were excluded from federal
180.10 adjusted gross income in the years when the payments were made;
180.11 (vi) interest received from the federal or a state
180.12 government or any instrumentality or political subdivision
180.13 thereof;
180.14 (vii) workers' compensation;
180.15 (viii) nontaxable strike benefits;
180.16 (ix) the gross amounts of payments received in the nature
180.17 of disability income or sick pay as a result of accident,
180.18 sickness, or other disability, whether funded through insurance
180.19 or otherwise;
180.20 (x) a lump sum distribution under section 402(e)(3) of the
180.21 Internal Revenue Code;
180.22 (xi) contributions made by the claimant to an individual
180.23 retirement account, including a qualified voluntary employee
180.24 contribution; simplified employee pension plan; self-employed
180.25 retirement plan; cash or deferred arrangement plan under section
180.26 401(k) of the Internal Revenue Code; or deferred compensation
180.27 plan under section 457 of the Internal Revenue Code; and
180.28 (xii) nontaxable scholarship or fellowship grants.
180.29 In the case of an individual who files an income tax return
180.30 on a fiscal year basis, the term "federal adjusted gross income"
180.31 shall mean federal adjusted gross income reflected in the fiscal
180.32 year ending in the calendar year. Federal adjusted gross income
180.33 shall not be reduced by the amount of a net operating loss
180.34 carryback or carryforward or a capital loss carryback or
180.35 carryforward allowed for the year.
180.36 (2) "Income" does not include:
181.1 (a) amounts excluded pursuant to the Internal Revenue Code,
181.2 sections 101(a) and 102;
181.3 (b) amounts of any pension or annuity which was exclusively
181.4 funded by the claimant or spouse and which funding payments were
181.5 not excluded from federal adjusted gross income in the years
181.6 when the payments were made;
181.7 (c) surplus food or other relief in kind supplied by a
181.8 governmental agency;
181.9 (d) relief granted under this chapter;
181.10 (e) child support payments received under a temporary or
181.11 final decree of dissolution or legal separation; or
181.12 (f) holocaust settlement payments as defined in section
181.13 290.01, subdivision 32 restitution payments received by eligible
181.14 individuals and excludable interest as defined in section 803 of
181.15 the Economic Growth and Tax Relief Reconciliation Act of 2001,
181.16 Public Law Number 107-16.
181.17 (3) The sum of the following amounts may be subtracted from
181.18 income:
181.19 (a) for the claimant's first dependent, the exemption
181.20 amount multiplied by 1.4;
181.21 (b) for the claimant's second dependent, the exemption
181.22 amount multiplied by 1.3;
181.23 (c) for the claimant's third dependent, the exemption
181.24 amount multiplied by 1.2;
181.25 (d) for the claimant's fourth dependent, the exemption
181.26 amount multiplied by 1.1;
181.27 (e) for the claimant's fifth dependent, the exemption
181.28 amount; and
181.29 (f) if the claimant or claimant's spouse was disabled or
181.30 attained the age of 65 on or before December 31 of the year for
181.31 which the taxes were levied or rent paid, the exemption amount.
181.32 For purposes of this subdivision, the "exemption amount"
181.33 means the exemption amount under section 151(d) of the Internal
181.34 Revenue Code for the taxable year for which the income is
181.35 reported.
181.36 [EFFECTIVE DATE.] This section is effective the day
182.1 following final enactment.
182.2 Sec. 18. Minnesota Statutes 2001 Supplement, section
182.3 290A.04, subdivision 2h, is amended to read:
182.4 Subd. 2h. [ADDITIONAL REFUND.] (a) Beginning with gross
182.5 property taxes payable in 2003, If the gross property taxes
182.6 payable on a homestead increase more than 12 percent over the
182.7 property taxes payable in the prior year on the same property
182.8 that is owned and occupied by the same owner on January 2 of
182.9 both years, and the amount of that increase is $100 or more, a
182.10 claimant who is a homeowner shall be allowed an additional
182.11 refund equal to 60 percent of the amount of the increase over
182.12 the greater of 12 percent of the prior year's property taxes
182.13 payable or $100. This subdivision shall not apply to any
182.14 increase in the gross property taxes payable attributable to
182.15 improvements made to the homestead after the assessment date for
182.16 the prior year's taxes. This subdivision shall not apply to any
182.17 increase in the gross property taxes payable attributable to the
182.18 termination of valuation exclusions under section 273.11,
182.19 subdivision 16.
182.20 The maximum refund allowed under this subdivision is $1,000.
182.21 (b) For purposes of this subdivision "gross property taxes
182.22 payable" means property taxes payable determined without regard
182.23 to the refund allowed under this subdivision.
182.24 (c) In addition to the other proofs required by this
182.25 chapter, each claimant under this subdivision shall file with
182.26 the property tax refund return a copy of the property tax
182.27 statement for taxes payable in the preceding year or other
182.28 documents required by the commissioner.
182.29 (d) Upon request, the appropriate county official shall
182.30 make available the names and addresses of the property taxpayers
182.31 who may be eligible for the additional property tax refund under
182.32 this section. The information shall be provided on a magnetic
182.33 computer disk. The county may recover its costs by charging the
182.34 person requesting the information the reasonable cost for
182.35 preparing the data. The information may not be used for any
182.36 purpose other than for notifying the homeowner of potential
183.1 eligibility and assisting the homeowner, without charge, in
183.2 preparing a refund claim.
183.3 [EFFECTIVE DATE.] This section is effective beginning with
183.4 refunds based on gross property taxes payable in 2002.
183.5 Sec. 19. Minnesota Statutes 2001 Supplement, section
183.6 295.60, is amended by adding a subdivision to read:
183.7 Subd. 1a. [USE TAX; CREDIT FOR TAXES PAID.] (a) A person
183.8 that receives fur clothing for use or storage in Minnesota,
183.9 other than from a furrier that paid the tax under subdivision 1,
183.10 is subject to tax at the rate imposed under subdivision 1.
183.11 Liability for the tax is incurred when the person has possession
183.12 of the fur clothing in Minnesota. The tax must be remitted to
183.13 the commissioner in the manner prescribed by subdivision 3.
183.14 (b) A person that has paid taxes to another jurisdiction on
183.15 the same transaction and is subject to tax under this section is
183.16 entitled to a credit for the tax legally due and paid to another
183.17 jurisdiction to the extent of the lesser of (1) the tax actually
183.18 paid to the other jurisdiction, or (2) the amount of tax imposed
183.19 by Minnesota on the transaction subject to tax in the other
183.20 jurisdiction.
183.21 [EFFECTIVE DATE.] This section is effective for fur
183.22 clothing purchased and brought into Minnesota on or after
183.23 January 1, 2002.
183.24 Sec. 20. Minnesota Statutes 2001 Supplement, section
183.25 295.60, is amended by adding a subdivision to read:
183.26 Subd. 1b. [TAX COLLECTION REQUIRED.] A furrier with nexus
183.27 in Minnesota, who is not subject to tax under subdivision 1, is
183.28 required to collect the tax imposed under subdivision 1a from
183.29 the purchaser of the clothing made from fur and give the
183.30 purchaser a receipt for the tax paid. The tax collected must be
183.31 remitted to the commissioner in the manner prescribed by
183.32 subdivision 3.
183.33 [EFFECTIVE DATE.] This section is effective for fur
183.34 clothing purchased and brought into Minnesota on or after
183.35 January 1, 2002.
183.36 Sec. 21. Minnesota Statutes 2001 Supplement, section
184.1 295.60, is amended by adding a subdivision to read:
184.2 Subd. 1c. [TAXES PAID TO ANOTHER JURISDICTION; CREDIT.] A
184.3 furrier that has paid taxes to another jurisdiction measured by
184.4 gross revenue and is subject to tax under this section on the
184.5 same gross revenues is entitled to a credit for the tax legally
184.6 due and paid to another jurisdiction to the extent of the lesser
184.7 of (1) the tax actually paid to the other jurisdiction, or (2)
184.8 the amount of tax imposed by Minnesota on the gross revenues
184.9 subject to tax in the other taxing jurisdictions.
184.10 [EFFECTIVE DATE.] This section is effective for gross
184.11 revenues received on or after January 1, 2002.
184.12 Sec. 22. Minnesota Statutes 2001 Supplement, section
184.13 295.60, subdivision 7, is amended to read:
184.14 Subd. 7. [APPLICATION OF OTHER CHAPTERS.] Unless
184.15 specifically provided otherwise by this section, the
184.16 enforcement, interest, and penalty provisions under chapter 294,
184.17 appeal provisions in sections 289A.43 and 289A.65, criminal
184.18 penalties in section 289A.63, and refunds provisions in section
184.19 289A.50 chapter 289A, civil penalty provisions applicable to
184.20 withholding and sales taxes under section 289A.60, and
184.21 collection and rulemaking provisions under chapter 270, apply to
184.22 a liability for the taxes imposed under this section.
184.23 [EFFECTIVE DATE.] This section is effective January 1, 2002.
184.24 Sec. 23. Minnesota Statutes 2000, section 296A.18,
184.25 subdivision 8, is amended to read:
184.26 Subd. 8. [AVIATION FUEL TAX STATE AIRPORTS FUND.] The
184.27 revenues derived from the excise taxes on aviation gasoline and
184.28 on special fuel received, sold, stored, or withdrawn from
184.29 storage as substitutes for aviation gasoline, shall be paid into
184.30 the state treasury and credited to the aviation fuel tax state
184.31 airports fund. There is hereby appropriated such sums as are
184.32 needed to carry out the provisions of this subdivision.
184.33 [EFFECTIVE DATE.] This section is effective the day
184.34 following final enactment.
184.35 Sec. 24. Minnesota Statutes 2001 Supplement, section
184.36 297A.70, subdivision 3, is amended to read:
185.1 Subd. 3. [SALES OF CERTAIN GOODS AND SERVICES TO
185.2 GOVERNMENT.] (a) The following sales to or use by the specified
185.3 governments and political subdivisions of the state are exempt:
185.4 (1) repair and replacement parts for emergency rescue
185.5 vehicles, fire trucks, and fire apparatus to a political
185.6 subdivision;
185.7 (2) machinery and equipment, except for motor vehicles,
185.8 used directly for mixed municipal solid waste management
185.9 services at a solid waste disposal facility as defined in
185.10 section 115A.03, subdivision 10;
185.11 (3) chore and homemaking services to a political
185.12 subdivision of the state to be provided to elderly or disabled
185.13 individuals;
185.14 (4) telephone services to the department of administration
185.15 that are used to provide telecommunications services through the
185.16 intertechnologies revolving fund;
185.17 (5) firefighter personal protective equipment as defined in
185.18 paragraph (b), if purchased or authorized by and for the use of
185.19 an organized fire department, fire protection district, or fire
185.20 company regularly charged with the responsibility of providing
185.21 fire protection to the state or a political subdivision;
185.22 (6) bullet-resistant body armor that provides the wearer
185.23 with ballistic and trauma protection, if purchased by a law
185.24 enforcement agency of the state or a political subdivision of
185.25 the state, or a licensed peace officer, as defined in section
185.26 626.84, subdivision 1;
185.27 (7) motor vehicles purchased or leased by political
185.28 subdivisions of the state if the vehicles are exempt from
185.29 registration under section 168.012, subdivision 1, paragraph
185.30 (b), exempt from taxation under section 473.448, or exempt from
185.31 the motor vehicle sales tax under section 297B.03, clause (12);
185.32 (8) equipment designed to process, dewater, and recycle
185.33 biosolids for wastewater treatment facilities of political
185.34 subdivisions, and materials incidental to installation of that
185.35 equipment; and materials used to construct buildings to house
185.36 the equipment, if the materials are purchased after June 30,
186.1 1998, and before July 1, 2001; and
186.2 (9) sales to a town of gravel and of machinery, equipment,
186.3 and accessories, except motor vehicles, used exclusively for
186.4 road and bridge maintenance, and leases by a town of motor
186.5 vehicles exempt from tax under section 297B.03, clause (10).
186.6 (b) For purposes of this subdivision, "firefighters
186.7 personal protective equipment" means helmets, including face
186.8 shields, chin straps, and neck liners; bunker coats and pants,
186.9 including pant suspenders; boots; gloves; head covers or hoods;
186.10 wildfire jackets; protective coveralls; goggles; self-contained
186.11 breathing apparatus; canister filter masks; personal alert
186.12 safety systems; spanner belts; optical or thermal imaging search
186.13 devices; and all safety equipment required by the Occupational
186.14 Safety and Health Administration.
186.15 [EFFECTIVE DATE.] This section is effective the day
186.16 following final enactment.
186.17 Sec. 25. Minnesota Statutes 2000, section 297I.05,
186.18 subdivision 11, is amended to read:
186.19 Subd. 11. [RETALIATORY PROVISIONS.] (a) If any other state
186.20 or country imposes any taxes, fines, deposits, penalties,
186.21 licenses, or fees upon any insurance companies of this state and
186.22 their agents doing business in another state or country that are
186.23 in addition to or in excess of those imposed by the laws of this
186.24 state upon foreign insurance companies and their agents doing
186.25 business in this state, the same taxes, fines, deposits,
186.26 penalties, licenses, and fees are imposed upon every similar
186.27 insurance company of that state or country and their agents
186.28 doing or applying to do business in this state.
186.29 (b) If any conditions precedent to the right to do business
186.30 in any other state or country are imposed by the laws of that
186.31 state or country, beyond those imposed upon foreign companies by
186.32 the laws of this state, the same conditions precedent are
186.33 imposed upon every similar insurance company of that state or
186.34 country and their agents doing or applying to do business in
186.35 that state.
186.36 (c) For purposes of this subdivision, "taxes, fines,
187.1 deposits, penalties, licenses, or fees" means an amount of money
187.2 that is deposited in the general revenue fund of the state or
187.3 other similar fund in another state or country and is not
187.4 dedicated to a special purpose or use or money deposited in the
187.5 general revenue fund of the state or other similar fund in
187.6 another state or country and appropriated to the commissioner of
187.7 commerce or insurance for the operation of the department of
187.8 commerce or other similar agency with jurisdiction over
187.9 insurance. Taxes, fines, deposits, penalties, licenses, or fees
187.10 do not include:
187.11 (1) special purpose obligations or assessments imposed in
187.12 connection with particular kinds of insurance, including but not
187.13 limited to assessments imposed in connection with residual
187.14 market mechanisms; or
187.15 (2) assessments made by the insurance guaranty association,
187.16 life and health guarantee association, or similar association.
187.17 (d) This subdivision applies to taxes imposed under
187.18 subdivisions 1, 3, 4, 6, and 12, paragraph (a), clauses (1) and
187.19 (3) (2).
187.20 (e) This subdivision does not apply to insurance companies
187.21 organized or domiciled in a state or country, the laws of which
187.22 do not impose retaliatory taxes, fines, deposits, penalties,
187.23 licenses, or fees or which grant, on a reciprocal basis,
187.24 exemptions from retaliatory taxes, fines, deposits, penalties,
187.25 licenses, or fees to insurance companies domiciled in this state.
187.26 [EFFECTIVE DATE.] This section is effective retroactively
187.27 to tax years beginning on or after January 1, 2001.
187.28 Sec. 26. Minnesota Statutes 2000, section 477A.011,
187.29 subdivision 20, is amended to read:
187.30 Subd. 20. [CITY NET TAX CAPACITY.] "City net tax capacity"
187.31 means (1) the net tax capacity computed using the net tax
187.32 capacity rates in section 273.13 for taxes payable in the year
187.33 of the aid distribution, and the market values for taxes payable
187.34 in the year prior to the aid distribution plus (2) a city's
187.35 fiscal disparities distribution tax capacity under section
187.36 276A.06, subdivision 2, paragraph (b), or 473F.08, subdivision
188.1 2, paragraph (b), for taxes payable in the year prior to that
188.2 for which aids are being calculated. The market value utilized
188.3 in computing city net tax capacity shall be reduced by the sum
188.4 of (1) a city's market value of commercial industrial property
188.5 as defined in section 276A.01, subdivision 3, or 473F.02,
188.6 subdivision 3, multiplied by the ratio determined pursuant to
188.7 section 276A.06, subdivision 2, paragraph (a), or 473F.08,
188.8 subdivision 2, paragraph (a), (2) the market value of the
188.9 captured value of tax increment financing districts as defined
188.10 in section 469.177, subdivision 2, and (3) the market value of
188.11 transmission lines deducted from a city's total net tax capacity
188.12 under section 273.425. The city net tax capacity will be
188.13 computed using equalized market values.
188.14 [EFFECTIVE DATE.] This section is effective for aid payable
188.15 in 2002 and thereafter.
188.16 Sec. 27. Minnesota Statutes 2001 Supplement, section
188.17 477A.013, subdivision 9, is amended to read:
188.18 Subd. 9. [CITY AID DISTRIBUTION.] (a) In calendar year
188.19 2002 and thereafter, each city shall receive an aid distribution
188.20 equal to the sum of (1) the city formula aid under subdivision
188.21 8, and (2) its city aid base.
188.22 (b) The percentage increase for a first class city in
188.23 calendar year 1995 and thereafter, except for 2002, shall not
188.24 exceed the percentage increase in the sum of the aid to all
188.25 cities under this section in the current calendar year compared
188.26 to the sum of the aid to all cities in the previous year. For
188.27 aids payable in 2002 only, the amount of the aid paid to a first
188.28 class city shall not exceed the sum of its aid amount for
188.29 calendar year 2001 under this section and its aid payment in
188.30 calendar year 2001 under section 273.1398, subdivision 2, by
188.31 more than 2.5 percent.
188.32 (c) For aids payable in all years except 2002, the total
188.33 aid for any city, except a first class city, shall not exceed
188.34 the sum of (1) ten percent of the city's net levy for the year
188.35 prior to the aid distribution plus (2) its total aid in the
188.36 previous year before any increases or decreases under sections
189.1 16A.711, subdivision 5, and 477A.0132. For aids payable in 2002
189.2 only, the total aid for any city, except a first class city,
189.3 shall not exceed 40 percent of the sum of (1) 40 percent of the
189.4 city's net levy for taxes payable in the year prior to the aid
189.5 distribution plus (2) 40 percent of its total aid in the
189.6 previous year under section 273.1398, subdivision 2, before any
189.7 increases or decreases under sections 16A.711, subdivision 5,
189.8 and 477A.0132 plus (3) its total aid in the previous year under
189.9 this section.
189.10 [EFFECTIVE DATE.] This section is effective for aid payable
189.11 in 2002 and thereafter.
189.12 Sec. 28. Minnesota Statutes 2001 Supplement, section
189.13 477A.07, subdivision 1, is amended to read:
189.14 Subdivision 1. [AID AMOUNT.] (a) For aid payable in 2003,
189.15 each county and city is eligible for aid equal to the amount by
189.16 which (i) 0.3 percent of the assessment year 2001 taxable market
189.17 value of class 4a property, plus 0.25 percent of the assessment
189.18 year 2001 market value of class 4b property, as defined in
189.19 section 273.13, subdivision 25, multiplied by the jurisdiction's
189.20 average tax rate for taxes payable in 2002, exceeds (ii) 0.4
189.21 percent of the jurisdiction's total taxable net tax capacity for
189.22 taxes payable in 2002, multiplied by the jurisdiction's average
189.23 tax rate for taxes payable in 2002.
189.24 (b) For aid payable in 2004, each county and city is
189.25 eligible for aid equal to the amount by which (i) 0.25 percent
189.26 of the assessment year 2002 taxable market value of class 4a
189.27 property, as defined in section 273.13, subdivision
189.28 25, multiplied by the jurisdiction's average tax rate for taxes
189.29 payable in 2003, exceeds (ii) 0.4 percent of the jurisdiction's
189.30 total taxable net tax capacity for taxes payable in 2003,
189.31 multiplied by the jurisdiction's average tax rate for taxes
189.32 payable in 2003.
189.33 [EFFECTIVE DATE.] This section is effective for aid payable
189.34 in 2003 and thereafter.
189.35 Sec. 29. Minnesota Statutes 2001 Supplement, section
189.36 477A.07, subdivision 3, is amended to read:
190.1 Subd. 3. [CITY AID.] Each city's 2003 aid amount
190.2 determined under subdivision 1 must be permanently added to its
190.3 city aid base under section 477A.011, subdivision 36, and the
190.4 maximum amount of total aid it may receive under section
190.5 477A.013, subdivision 9, paragraph (b) or (c), is increased by
190.6 the same amount for aid payable in 2003. Each city's 2004 aid
190.7 amount determined under subdivision 1 must be permanently added
190.8 to its city aid base under section 477A.011, subdivision 36, and
190.9 the maximum amount of total aid it may receive under section
190.10 477A.013, subdivision 9, paragraph (b) or _(c), is increased by
190.11 the same amount for aid payable in 2004.
190.12 [EFFECTIVE DATE.] This section is effective for aids
190.13 payable in calendar years 2003 and 2004.
190.14 Sec. 30. Laws 1993, chapter 375, article 5, section 42, is
190.15 amended to read:
190.16 Sec. 42. [REPORT TO LEGISLATURE.]
190.17 By February March 1 of each year, the commissioner of
190.18 revenue shall make a report to the legislature on the use of
190.19 limited market value under section 273.13, subdivision 1a, and
190.20 the valuation exclusion under section 273.13, subdivision 16.
190.21 For the limited market value provision, the report shall include
190.22 the total value excluded from taxation by type of property for
190.23 each city and town. For the valuation exclusion provision, the
190.24 report shall include the total market value excluded from
190.25 taxation for each city and town, as well as a breakdown of the
190.26 excluded improvement amounts by age and value of the property
190.27 being improved and the amount of the qualifying improvement.
190.28 The county assessors shall provide the information necessary for
190.29 the commissioner to compile the report in a manner prescribed by
190.30 the commissioner.
190.31 Sec. 31. Laws 2001, First Special Session chapter 5,
190.32 article 9, section 3, the effective date, is amended to read:
190.33 [EFFECTIVE DATE.] This section is effective for tax years
190.34 beginning after December 31, 2001, except that the amendment
190.35 to clause clauses (3) is and (12) are effective for tax years
190.36 beginning after December 31, 2000.
191.1 Sec. 32. [REPEALER.]
191.2 (a) Minnesota Statutes 2000, sections 272.02, subdivision
191.3 40; 290.01, subdivisions 19g and 32; and 295.44, are repealed
191.4 effective the day following final enactment.
191.5 (b) Minnesota Statutes 2000, section 290.0921, subdivision
191.6 5, is repealed effective for taxable years beginning after
191.7 December 31, 2001.
191.8 (c) Minnesota Rules, parts 8130.1400; 8130.2100; 8130.2350;
191.9 8130.2600; 8130.3000; 8130.3850; and 8130.5000, are repealed
191.10 effective the day following final enactment.
191.11 ARTICLE 11
191.12 LOCAL LAWS
191.13 Section 1. [CITY OF MOORHEAD; TAX LEVY AUTHORIZED.]
191.14 (a) Each year the city of Moorhead may impose a tax on all
191.15 class 3a and class 3b property located in the city in an amount
191.16 which the city determines is equal to the reduction in revenues
191.17 from increment from all tax increment financing districts in the
191.18 city resulting from the class rate changes and the elimination
191.19 of the state-determined general education property levy under
191.20 Laws 2001, First Special Session chapter 5. The proceeds of
191.21 this tax may only be used to pay preexisting obligations as
191.22 defined in Minnesota Statutes, section 469.1763, subdivision 6,
191.23 whether general obligations or payable wholly from tax
191.24 increments. The tax must be levied and collected in the same
191.25 manner and as part of the property tax levied by the city and is
191.26 subject to the same administrative, penalty, and enforcement
191.27 provisions. A tax imposed under this section is a special levy
191.28 and is not subject to levy limitations under Minnesota Statutes,
191.29 section 275.71.
191.30 (b) This section expires December 31, 2005.
191.31 [EFFECTIVE DATE.] This section is effective upon approval
191.32 by and compliance with Minnesota Statutes, section 645.021,
191.33 subdivision 3, by the governing body of the city of Moorhead.
191.34 Sec. 2. [ST. CLOUD AREA CITIES; TAXES AUTHORIZED.]
191.35 Subdivision 1. [SALES AND USE TAX.] (a) Notwithstanding
191.36 Minnesota Statutes, section 477A.016, or any other provision of
192.1 law, ordinance, or city charter, the following cities may, by
192.2 ordinance, impose a sales and use tax of one-half of one percent
192.3 for the purposes specified in subdivision 2:
192.4 (1) the city of St. Cloud, pursuant to the approval of the
192.5 city voters at the general election held on November 7, 2000;
192.6 (2) the city of Sartell, pursuant to the approval of the
192.7 city voters at an election held in November 1999; and
192.8 (3) each of the cities of Sauk Rapids, Waite Park, St.
192.9 Joseph, and St. Augusta, pursuant to the approval of the voters
192.10 of that city at the next general election following the date of
192.11 final enactment of this act, as provided for in subdivision 3.
192.12 (b) The provisions of Minnesota Statutes, section 297A.99,
192.13 govern the imposition, administration, collection, and
192.14 enforcement of the taxes authorized under this subdivision.
192.15 (c) The tax in Sartell must be used for the purposes listed
192.16 in subdivision 2, notwithstanding other purposes listed in the
192.17 referendum, and are not subject to the requirements of Minnesota
192.18 Statutes, section 297A.99, subdivision 3.
192.19 Subd. 2. [USE OF REVENUES.] (a) Revenues received from the
192.20 taxes authorized under subdivision 1 must be used for the cost
192.21 of collecting and administering the taxes and to pay all or part
192.22 of the capital or administrative costs of the acquisition,
192.23 construction, and improvement of the main runway improvements to
192.24 the St. Cloud Regional Airport, as provided for in the city of
192.25 St. Cloud capital improvement program 2000 to 2005, adopted by
192.26 the St. Cloud planning commission on July 14, 1999. Authorized
192.27 expenses include, but are not limited to, acquiring property,
192.28 paying construction expenses related to the development of these
192.29 facilities, and securing and paying debt service on bonds or
192.30 other obligations issued to finance construction or improvement
192.31 of the authorized facility.
192.32 (b) If revenues collected from the taxes imposed under
192.33 subdivision 1 are greater than the amount needed to meet
192.34 obligations under paragraph (a) in any year, the surplus may be
192.35 returned to the cities in a manner agreed upon by the
192.36 participating cities under this section, to be used by the
193.1 cities for projects of regional significance, limited to: the
193.2 acquisition and improvement of park land and open space; the
193.3 purchase, renovation, and construction of public buildings and
193.4 land primarily used for the arts, libraries, and community
193.5 centers; major roadway improvements; and for debt service on
193.6 bonds issued for these purposes. Authorized expenses include,
193.7 but are not limited to, acquiring property, paying construction
193.8 expenses related to the development of these facilities, and
193.9 securing and paying debt service on bonds or other obligations
193.10 issued to finance construction or improvement of the authorized
193.11 facility. The distribution of surplus revenues raised by the
193.12 tax must be determined by an applicable joint powers agreement.
193.13 The revenues returned to each city may only be used to fund
193.14 projects that have been approved by voters at the referendum
193.15 authorizing the tax.
193.16 (c) Pursuant to the approval of the St. Cloud voters at the
193.17 general election held on November 7, 2000, the surplus returned
193.18 to St. Cloud under paragraph (b) must be used for the following
193.19 projects:
193.20 (1) intersection improvements to the 25th Avenue and trunk
193.21 highway No. 23, I-94 interchange at county road 75, 10th Street
193.22 South improvements, the West Metro corridor improvements, and
193.23 other regionally significant road projects; and
193.24 (2) park and nature land purchase, trail development, and
193.25 improvements and expansions of existing regional park
193.26 facilities, as provided for in the city of St. Cloud capital
193.27 improvement program 2000 to 2005, adopted by the St. Cloud
193.28 planning commission on July 14, 1999.
193.29 (d) Pursuant to approval of the Sartell voters at the
193.30 election held in November 1999, the surplus returned to the city
193.31 of Sartell under paragraph (b) must be used to fund
193.32 construction, expansion, and improvements to a community center
193.33 and for park land acquisition and improvement.
193.34 Subd. 3. [SEPARATE REFERENDA REQUIRED.] Notwithstanding
193.35 Minnesota Statutes, section 297A.99, subdivision 3, each city
193.36 listed in subdivision 1, clause (3), shall have a separate vote
194.1 on each project that it proposes to fund with the surplus tax
194.2 revenues it receives under subdivision 2, paragraph (b). For
194.3 these cities, the cost of each project to be funded by the taxes
194.4 authorized in subdivision 1 must be listed. Revenue may be used
194.5 to repay debt for a project that the city has already funded if
194.6 the project meets one of the authorized uses listed in
194.7 subdivision 2, paragraph (b), and the referenda states the
194.8 maximum amount of debt that will be repaid from the revenue.
194.9 The referendum must state that approval of using the tax
194.10 authorized in subdivision 1 for any project shall also indicate
194.11 approval to share the revenues collected from the tax with the
194.12 other cities in the area which have also passed a sales tax.
194.13 The sharing must be done in a manner agreed upon by all affected
194.14 cities under a joint powers agreement.
194.15 Subd. 4. [IMPOSITION AND TERMINATION OF TAX.] The tax
194.16 authorized by each city under subdivision 1 shall be imposed
194.17 beginning January 1, 2003, and shall expire December 31, 2005.
194.18 [EFFECTIVE DATE.] This section is effective July 1, 2002,
194.19 with respect to any city listed in subdivision 1, upon
194.20 compliance of the governing body of that city with Minnesota
194.21 Statutes, section 645.021, subdivision 3.
194.22 ARTICLE 12
194.23 MISCELLANEOUS
194.24 Section 1. Minnesota Statutes 2000, section 16A.152, is
194.25 amended by adding a subdivision to read:
194.26 Subd. 1b. [BUDGET RESERVE INCREASE.] On June 30, 2003, the
194.27 commissioner of finance shall transfer $3,900,000 to the budget
194.28 reserve account in the general fund. On June 30, 2004, the
194.29 commissioner of finance shall transfer $12,300,000 to the budget
194.30 reserve account in the general fund. On June 30, 2005, the
194.31 commissioner of finance shall transfer $12,000,000 to the budget
194.32 reserve account in the general fund. The amounts necessary for
194.33 this purpose are appropriated from the general fund.
194.34 Sec. 2. Minnesota Statutes 2000, section 40A.151,
194.35 subdivision 1, is amended to read:
194.36 Subdivision 1. [ESTABLISHMENT.] The Minnesota conservation
195.1 fund is established as an account in the state treasury. Money
195.2 from counties under section 40A.152 must be deposited in the
195.3 state treasury and credited one-half to the Minnesota
195.4 conservation fund account and one-half to the general fund.
195.5 [EFFECTIVE DATE.] This section is effective for money from
195.6 counties deposited in the state treasury after June 30, 2002.
195.7 Sec. 3. Minnesota Statutes 2000, section 40A.152,
195.8 subdivision 1, is amended to read:
195.9 Subdivision 1. [FEE.] A county that is a metropolitan
195.10 county under section 473.121, subdivision 4, has allowed
195.11 exclusive agricultural zones to be created under this chapter,
195.12 or has elected to become an agricultural land preservation pilot
195.13 county, shall impose an additional fee of $5 per transaction on
195.14 the recording or registration of a mortgage subject to the tax
195.15 under section 287.05 and an additional $5 on the recording or
195.16 registration of a deed subject to the tax under section 287.21.
195.17 One-half of the fee must be deposited in a special conservation
195.18 account to be created in the county general revenue fund and
195.19 one-half must be transferred to the commissioner of revenue for
195.20 deposit in the state treasury and credited to the Minnesota
195.21 conservation fund pursuant to section 40A.151, subdivision 1.
195.22 [EFFECTIVE DATE.] This section is effective July 1, 2002,
195.23 and thereafter.
195.24 Sec. 4. Minnesota Statutes 2000, section 40A.152,
195.25 subdivision 3, is amended to read:
195.26 Subd. 3. [TRANSFER TO STATE FUND.] Money in the county
195.27 conservation account that is not encumbered by the county within
195.28 one year of deposit in the account must be transferred to the
195.29 commissioner of revenue for deposit in the Minnesota
195.30 conservation fund state treasury pursuant to section 40A.151,
195.31 subdivision 1.
195.32 Sec. 5. Minnesota Statutes 2000, section 270B.01,
195.33 subdivision 8, is amended to read:
195.34 Subd. 8. [MINNESOTA TAX LAWS.] For purposes of this
195.35 chapter only, unless expressly stated otherwise, "Minnesota tax
195.36 laws" means the taxes, refunds, and fees administered by or paid
196.1 to the commissioner under chapters 115B (except taxes imposed
196.2 under sections 115B.21 to 115B.24), 289A (except taxes imposed
196.3 under sections 298.01, 298.015, and 298.24), 290, 290A,
196.4 291, 295, 297A, and 297H and sections 295.50 to 295.59, or any
196.5 similar Indian tribal tax administered by the commissioner
196.6 pursuant to any tax agreement between the state and the Indian
196.7 tribal government, and includes any laws for the assessment,
196.8 collection, and enforcement of those taxes, refunds, and fees.
196.9 [EFFECTIVE DATE.] This section is effective the day
196.10 following final enactment.
196.11 Sec. 6. Minnesota Statutes 2001 Supplement, section
196.12 270B.02, subdivision 3, is amended to read:
196.13 Subd. 3. [CONFIDENTIAL DATA ON INDIVIDUALS; PROTECTED
196.14 NONPUBLIC DATA.] (a) Except as provided in paragraph (b), the
196.15 name or existence of an informer, informer letters, and other
196.16 data, in whatever form, given to the department of revenue by a
196.17 person, other than the data subject, who informs that a specific
196.18 taxpayer person is not or may not be in compliance with tax
196.19 laws, or nontax laws administered by the department of revenue,
196.20 including laws other than those relating to property taxes not
196.21 listed in section 270B.01, subdivision 8, are confidential data
196.22 on individuals or protected nonpublic data as defined in section
196.23 13.02, subdivisions 3 and 13.
196.24 (b) Data under paragraph (a) may be disclosed with the
196.25 consent of the informer or upon a written finding by a court
196.26 that the information provided by the informer was false and that
196.27 there is evidence that the information was provided in bad
196.28 faith. This subdivision does not alter disclosure
196.29 responsibilities or obligations under the rules of criminal
196.30 procedure.
196.31 [EFFECTIVE DATE.] This section is effective the day
196.32 following final enactment.
196.33 Sec. 7. Minnesota Statutes 2000, section 270B.02,
196.34 subdivision 4, is amended to read:
196.35 Subd. 4. [PUBLIC DATA.] Information required to be filed
196.36 by exempt individuals, corporations, organizations, estates, and
197.1 trusts under section 290.05, subdivisions 1 and 4, or that
197.2 relates to exempt status under section 290.05, subdivision 2, is
197.3 public data on individuals or public data not on individuals, as
197.4 defined in section 13.02, subdivisions 14 and 15. The
197.5 commissioner may publish a list of organizations exempt from
197.6 taxation under section 290.05, except that the name or address
197.7 of any contributor to any organization that is or was exempt, or
197.8 that has applied for tax exempt status, or any other information
197.9 that could not be disclosed under section 6104 of the Internal
197.10 Revenue Code of 1986, as amended through December 31, 1988, is
197.11 classified as private data on individuals or nonpublic data as
197.12 defined in section 13.02, subdivisions 9 and 12.
197.13 [EFFECTIVE DATE.] This section is effective the day
197.14 following final enactment.
197.15 Sec. 8. Minnesota Statutes 2001 Supplement, section
197.16 270B.08, subdivision 2, is amended to read:
197.17 Subd. 2. [REVOCATION.] When a taxpayer's sales tax permit
197.18 has been revoked under section 297A.86, the commissioner may
197.19 disclose data identifying the holder of the revoked permit and,
197.20 stating the basis for the revocation, and stating whether the
197.21 permit has been reinstated.
197.22 [EFFECTIVE DATE.] This section is effective the day
197.23 following final enactment.
197.24 Sec. 9. Minnesota Statutes 2000, section 270B.14,
197.25 subdivision 8, is amended to read:
197.26 Subd. 8. [EXCHANGE BETWEEN DEPARTMENTS OF LABOR AND
197.27 INDUSTRY AND REVENUE.] The departments of labor and industry and
197.28 revenue may exchange information as follows:
197.29 (1) data used in determining whether a business is an
197.30 employer or a contracting agent;
197.31 (2) taxpayer identity information relating to employers and
197.32 employees for purposes of supporting tax administration and
197.33 chapter chapters 176, 177, and 181; and
197.34 (3) data to the extent provided in and for the purpose set
197.35 out in section 176.181, subdivision 8.
197.36 [EFFECTIVE DATE.] This section is effective the day
198.1 following final enactment.
198.2 Sec. 10. Minnesota Statutes 2000, section 289A.10,
198.3 subdivision 1, is amended to read:
198.4 Subdivision 1. [RETURN REQUIRED.] In the case of a
198.5 decedent who has an interest in property with a situs in
198.6 Minnesota, the personal representative must submit a Minnesota
198.7 estate tax return to the commissioner, on a form prescribed by
198.8 the commissioner, in instances in which a federal estate tax
198.9 return is required to be filed if the federal gross estate
198.10 exceeds $700,000 for estates of decedents dying after December
198.11 31, 2001, and before January 1, 2004; $850,000 for estates of
198.12 decedents dying after December 31, 2003, and before January 1,
198.13 2005; $950,000 for estates of decedents dying after December 31,
198.14 2004, and before January 1, 2006; and $1,000,000 for estates of
198.15 decedents dying after December 31, 2005.
198.16 The return must contain a computation of the Minnesota
198.17 estate tax due. The return must be signed by the personal
198.18 representative.
198.19 [EFFECTIVE DATE.] This section is effective for estates of
198.20 decedents dying after December 31, 2001.
198.21 Sec. 11. Minnesota Statutes 2001 Supplement, section
198.22 291.005, subdivision 1, is amended to read:
198.23 Subdivision 1. Unless the context otherwise clearly
198.24 requires, the following terms used in this chapter shall have
198.25 the following meanings:
198.26 (1) "Federal gross estate" means the gross estate of a
198.27 decedent as valued and otherwise determined for federal estate
198.28 tax purposes by federal taxing authorities pursuant to the
198.29 provisions of the Internal Revenue Code.
198.30 (2) "Minnesota gross estate" means the federal gross estate
198.31 of a decedent after (a) excluding therefrom any property
198.32 included therein which has its situs outside Minnesota and
198.33 pensions exempt from tax under this chapter pursuant to section
198.34 352.15, subdivision 1; 353.15, subdivision 1; 354.10,
198.35 subdivision 1; 354B.30; or 354C.165, and (b) including therein
198.36 any property omitted from the federal gross estate which is
199.1 includable therein, has its situs in Minnesota, and was not
199.2 disclosed to federal taxing authorities.
199.3 (3) "Personal representative" means the executor,
199.4 administrator or other person appointed by the court to
199.5 administer and dispose of the property of the decedent. If
199.6 there is no executor, administrator or other person appointed,
199.7 qualified, and acting within this state, then any person in
199.8 actual or constructive possession of any property having a situs
199.9 in this state which is included in the federal gross estate of
199.10 the decedent shall be deemed to be a personal representative to
199.11 the extent of the property and the Minnesota estate tax due with
199.12 respect to the property.
199.13 (4) "Resident decedent" means an individual whose domicile
199.14 at the time of death was in Minnesota.
199.15 (5) "Nonresident decedent" means an individual whose
199.16 domicile at the time of death was not in Minnesota.
199.17 (6) "Situs of property" means, with respect to real
199.18 property, the state or country in which it is located; with
199.19 respect to tangible personal property, the state or country in
199.20 which it was normally kept or located at the time of the
199.21 decedent's death; and with respect to intangible personal
199.22 property, the state or country in which the decedent was
199.23 domiciled at death.
199.24 (7) "Commissioner" means the commissioner of revenue or any
199.25 person to whom the commissioner has delegated functions under
199.26 this chapter.
199.27 (8) "Internal Revenue Code" means the United States
199.28 Internal Revenue Code of 1986, as amended through December 31,
199.29 2000.
199.30 [EFFECTIVE DATE.] This section is effective for estates of
199.31 decedents dying after December 31, 2001.
199.32 Sec. 12. Minnesota Statutes 2000, section 291.03,
199.33 subdivision 1, is amended to read:
199.34 Subdivision 1. [TAX AMOUNT.] The tax imposed shall be an
199.35 amount equal to the proportion of the maximum credit
199.36 allowable computed under section 2011 of the Internal Revenue
200.1 Code for state death taxes as the Minnesota gross estate bears
200.2 to the value of the federal gross estate. For a resident
200.3 decedent, the tax shall be the maximum credit allowable computed
200.4 under section 2011 of the Internal Revenue Code reduced by the
200.5 amount of the death tax paid the other state and credited
200.6 against the federal estate tax if this results in a larger
200.7 amount of tax than the proportionate amount of the credit. The
200.8 tax determined under this paragraph shall not be greater than
200.9 the maximum credit allowable under section 2011 of the Internal
200.10 Revenue Code federal estate tax computed under section 2001 of
200.11 the Internal Revenue Code after the allowance of the federal
200.12 credits allowed under sections 2010, 2012, 2013, and 2015 of the
200.13 Internal Revenue Code of 1986, as amended through December 31,
200.14 2000.
200.15 [EFFECTIVE DATE.] This section is effective for estates of
200.16 decedents dying after December 31, 2001.
200.17 Sec. 13. Minnesota Statutes 2000, section 297H.06,
200.18 subdivision 2, is amended to read:
200.19 Subd. 2. [MATERIALS.] The tax is not imposed upon charges
200.20 to generators of mixed municipal solid waste or upon the volume
200.21 of non-mixed-municipal solid waste for waste management services
200.22 to manage the following materials:
200.23 (1) mixed municipal solid waste and non-mixed-municipal
200.24 solid waste generated outside of Minnesota;
200.25 (2) recyclable materials that are separated for recycling
200.26 by the generator, collected separately from other waste, and
200.27 recycled, to the extent the price of the service for handling
200.28 recyclable material is separately itemized;
200.29 (3) recyclable non-mixed-municipal solid waste that is
200.30 separated for recycling by the generator, collected separately
200.31 from other waste, delivered to a waste facility for the purpose
200.32 of recycling, and recycled;
200.33 (4) industrial waste, when it is transported to a facility
200.34 owned and operated by the same person that generated it;
200.35 (5) mixed municipal solid waste from a recycling facility
200.36 that separates or processes recyclable materials and reduces the
201.1 volume of the waste by at least 85 percent, provided that the
201.2 exempted waste is managed separately from other waste;
201.3 (6) recyclable materials that are separated from mixed
201.4 municipal solid waste by the generator, collected and delivered
201.5 to a waste facility that recycles at least 85 percent of its
201.6 waste, and are collected with mixed municipal solid waste that
201.7 is segregated in leakproof bags, provided that the mixed
201.8 municipal solid waste does not exceed five percent of the total
201.9 weight of the materials delivered to the facility and is
201.10 ultimately delivered to a waste facility identified as a
201.11 preferred waste management facility in county solid waste plans
201.12 under section 115A.46;
201.13 (7) through December 31, 2002, source-separated compostable
201.14 waste, if the waste is delivered to a facility exempted as
201.15 described in this clause. To initially qualify for an
201.16 exemption, a facility must apply for an exemption in its
201.17 application for a new or amended solid waste permit to the
201.18 pollution control agency. The first time a facility applies to
201.19 the agency it must certify in its application that it will
201.20 comply with the criteria in items (i) to (v) and the
201.21 commissioner of the agency shall so certify to the commissioner
201.22 of revenue who must grant the exemption. For each subsequent
201.23 calendar year, by October 1 of the preceding year, the facility
201.24 must apply to the agency for certification to renew its
201.25 exemption for the following year. The application must be filed
201.26 according to the procedures of, and contain the information
201.27 required by, the agency. The commissioner of revenue shall
201.28 grant the exemption if the commissioner of the pollution control
201.29 agency finds and certifies to the commissioner of revenue that
201.30 based on an evaluation of the composition of incoming waste and
201.31 residuals and the quality and use of the product:
201.32 (i) generators separate materials at the source;
201.33 (ii) the separation is performed in a manner appropriate to
201.34 the technology specific to the facility that:
201.35 (A) maximizes the quality of the product;
201.36 (B) minimizes the toxicity and quantity of residuals; and
202.1 (C) provides an opportunity for significant improvement in
202.2 the environmental efficiency of the operation;
202.3 (iii) the operator of the facility educates generators, in
202.4 coordination with each county using the facility, about
202.5 separating the waste to maximize the quality of the waste stream
202.6 for technology specific to the facility;
202.7 (iv) process residuals do not exceed 15 percent of the
202.8 weight of the total material delivered to the facility; and
202.9 (v) the final product is accepted for use;
202.10 (8) waste and waste by-products for which the tax has been
202.11 paid; and
202.12 (9) daily cover for landfills that has been approved in
202.13 writing by the Minnesota pollution control agency.
202.14 Sec. 14. Minnesota Statutes 2001 Supplement, section
202.15 349.12, subdivision 25, is amended to read:
202.16 Subd. 25. [LAWFUL PURPOSE.] (a) "Lawful purpose" means one
202.17 or more of the following:
202.18 (1) any expenditure by or contribution to a 501(c)(3) or
202.19 festival organization, as defined in subdivision 15a, provided
202.20 that the organization and expenditure or contribution are in
202.21 conformity with standards prescribed by the board under section
202.22 349.154, which standards must apply to both types of
202.23 organizations in the same manner and to the same extent;
202.24 (2) a contribution to an individual or family suffering
202.25 from poverty, homelessness, or physical or mental disability,
202.26 which is used to relieve the effects of that poverty,
202.27 homelessness, or disability;
202.28 (3) a contribution to an individual for treatment for
202.29 delayed posttraumatic stress syndrome or a contribution to a
202.30 program recognized by the Minnesota department of human services
202.31 for the education, prevention, or treatment of compulsive
202.32 gambling;
202.33 (4) a contribution to or expenditure on a public or private
202.34 nonprofit educational institution registered with or accredited
202.35 by this state or any other state;
202.36 (5) a contribution to a scholarship fund for defraying the
203.1 cost of education to individuals where the funds are awarded
203.2 through an open and fair selection process;
203.3 (6) activities by an organization or a government entity
203.4 which recognize humanitarian or military service to the United
203.5 States, the state of Minnesota, or a community, subject to rules
203.6 of the board, provided that the rules must not include mileage
203.7 reimbursements in the computation of the per occasion
203.8 reimbursement limit and must impose no aggregate annual limit on
203.9 the amount of reasonable and necessary expenditures made to
203.10 support:
203.11 (i) members of a military marching or color guard unit for
203.12 activities conducted within the state;
203.13 (ii) members of an organization solely for services
203.14 performed by the members at funeral services; or
203.15 (iii) members of military marching, color guard, or honor
203.16 guard units may be reimbursed for participating in color guard,
203.17 honor guard, or marching unit events within the state or states
203.18 contiguous to Minnesota at a per participant rate of up to $35
203.19 per occasion;
203.20 (7) recreational, community, and athletic facilities and
203.21 activities intended primarily for persons under age 21, provided
203.22 that such facilities and activities do not discriminate on the
203.23 basis of gender and the organization complies with section
203.24 349.154;
203.25 (8) payment of local taxes authorized under this chapter,
203.26 taxes imposed by the United States on receipts from lawful
203.27 gambling, the taxes imposed by section 297E.02, subdivisions 1,
203.28 4, 5, and 6, and the tax imposed on unrelated business income by
203.29 section 290.05, subdivision 3;
203.30 (9) payment of real estate taxes and assessments on
203.31 permitted gambling premises wholly owned by the licensed
203.32 organization paying the taxes, or wholly leased by a licensed
203.33 veterans organization under a national charter organized under
203.34 section 501(c)(19) of the Internal Revenue Code, not to exceed:
203.35 (i) for premises used for bingo, the amount that an
203.36 organization may expend under board rules on rent for bingo; and
204.1 (ii) $35,000 per year for premises used for other forms of
204.2 lawful gambling;
204.3 (10) a contribution to the United States, this state or any
204.4 of its political subdivisions, or any agency or instrumentality
204.5 thereof other than a direct contribution to a law enforcement or
204.6 prosecutorial agency;
204.7 (11) a contribution to or expenditure by a nonprofit
204.8 organization which is a church or body of communicants gathered
204.9 in common membership for mutual support and edification in
204.10 piety, worship, or religious observances;
204.11 (12) payment of the reasonable costs of an audit required
204.12 in section 297E.06, subdivision 4, provided the annual audit is
204.13 filed in a timely manner with the department of revenue;
204.14 (13) a contribution to or expenditure on a wildlife
204.15 management project that benefits the public at-large, provided
204.16 that the state agency with authority over that wildlife
204.17 management project approves the project before the contribution
204.18 or expenditure is made;
204.19 (14) expenditures, approved by the commissioner of natural
204.20 resources, by an organization for grooming and maintaining
204.21 snowmobile trails and all-terrain vehicle trails that are (1)
204.22 grant-in-aid trails established under section 85.019, or (2)
204.23 other trails open to public use, including purchase or lease of
204.24 equipment for this purpose; or
204.25 (15) conducting nutritional programs, food shelves, and
204.26 congregate dining programs primarily for persons who are age 62
204.27 or older or disabled; or
204.28 (16) a contribution to a community arts organization, or an
204.29 expenditure to sponsor arts programs in the community, including
204.30 but not limited to visual, literary, performing, or musical arts.
204.31 (b) Notwithstanding paragraph (a), "lawful purpose" does
204.32 not include:
204.33 (1) any expenditure made or incurred for the purpose of
204.34 influencing the nomination or election of a candidate for public
204.35 office or for the purpose of promoting or defeating a ballot
204.36 question;
205.1 (2) any activity intended to influence an election or a
205.2 governmental decision-making process;
205.3 (3) the erection, acquisition, improvement, expansion,
205.4 repair, or maintenance of real property or capital assets owned
205.5 or leased by an organization, unless the board has first
205.6 specifically authorized the expenditures after finding that (i)
205.7 the real property or capital assets will be used exclusively for
205.8 one or more of the purposes in paragraph (a); (ii) with respect
205.9 to expenditures for repair or maintenance only, that the
205.10 property is or will be used extensively as a meeting place or
205.11 event location by other nonprofit organizations or community or
205.12 service groups and that no rental fee is charged for the use;
205.13 (iii) with respect to expenditures, including a mortgage payment
205.14 or other debt service payment, for erection or acquisition only,
205.15 that the erection or acquisition is necessary to replace with a
205.16 comparable building, a building owned by the organization and
205.17 destroyed or made uninhabitable by fire or natural disaster,
205.18 provided that the expenditure may be only for that part of the
205.19 replacement cost not reimbursed by insurance; (iv) with respect
205.20 to expenditures, including a mortgage payment or other debt
205.21 service payment, for erection or acquisition only, that the
205.22 erection or acquisition is necessary to replace with a
205.23 comparable building a building owned by the organization that
205.24 was acquired from the organization by eminent domain or sold by
205.25 the organization to a purchaser that the organization reasonably
205.26 believed would otherwise have acquired the building by eminent
205.27 domain, provided that the expenditure may be only for that part
205.28 of the replacement cost that exceeds the compensation received
205.29 by the organization for the building being replaced; or (v) with
205.30 respect to an expenditure to bring an existing building into
205.31 compliance with the Americans with Disabilities Act under item
205.32 (ii), an organization has the option to apply the amount of the
205.33 board-approved expenditure to the erection or acquisition of a
205.34 replacement building that is in compliance with the Americans
205.35 with Disabilities Act;
205.36 (4) an expenditure by an organization which is a
206.1 contribution to a parent organization, foundation, or affiliate
206.2 of the contributing organization, if the parent organization,
206.3 foundation, or affiliate has provided to the contributing
206.4 organization within one year of the contribution any money,
206.5 grants, property, or other thing of value;
206.6 (5) a contribution by a licensed organization to another
206.7 licensed organization unless the board has specifically
206.8 authorized the contribution. The board must authorize such a
206.9 contribution when requested to do so by the contributing
206.10 organization unless it makes an affirmative finding that the
206.11 contribution will not be used by the recipient organization for
206.12 one or more of the purposes in paragraph (a); or
206.13 (6) a contribution to a statutory or home rule charter
206.14 city, county, or town by a licensed organization with the
206.15 knowledge that the governmental unit intends to use the
206.16 contribution for a pension or retirement fund.
206.17 [EFFECTIVE DATE.] This section is effective the day
206.18 following final enactment.
206.19 Sec. 15. Laws 2001, First Special Session chapter 6,
206.20 article 5, section 12, is amended to read:
206.21 Sec. 12. [SCHOOL DISTRICT FORMULA ADJUSTMENTS.]
206.22 Subdivision 1. [TAX RATE ADJUSTMENT.] The commissioner of
206.23 children, families, and learning must adjust each tax rate
206.24 established under Minnesota Statutes, chapters 120A to 127A, by
206.25 multiplying the rate by the ratio of the statewide net tax
206.26 capacity as calculated using the class rates in effect for
206.27 assessment year 2000 to the statewide total net tax capacity as
206.28 calculated using the class rates in effect for assessment year
206.29 2001, in both cases using taxable market values for assessment
206.30 year 2000.
206.31 Subd. 2. [EQUALIZING FACTORS.] The commissioner of
206.32 children, families, and learning must adjust each equalizing
206.33 factor based upon adjusted net tax capacity per actual pupil
206.34 unit established under Minnesota Statutes, chapters 120A to
206.35 127A, by multiplying the equalizing factor by the ratio of the
206.36 statewide net tax capacity as calculated using the class rates
207.1 in effect for assessment year 2001 to the statewide total net
207.2 tax capacity as calculated using the class rates in effect for
207.3 assessment year 2000, in both cases using taxable market values
207.4 for assessment year 2000.
207.5 Subd. 3. [DEBT SERVICE TAX RATES AND EQUALIZING FACTORS.]
207.6 The provisions in subdivisions 1 and 2 do not apply to the
207.7 equalizing factors and tax rates of the debt service
207.8 equalization aid program under Minnesota Statutes, section
207.9 123B.53.
207.10 Subd. 4. [SCHOOL DISTRICT BONDS.] The commissioner of
207.11 children, families, and learning must adjust the net debt limit
207.12 percentage for special school district No. 1, Minneapolis, based
207.13 upon net tax capacity established under Minnesota Statutes,
207.14 section 128D.11, subdivision 8, by multiplying the net debt
207.15 limit percentage by the ratio of the district's net tax capacity
207.16 as calculated using the class rates in effect for assessment
207.17 year 2000 to the district's total net tax capacity as calculated
207.18 using the class rates in effect for assessment year 2001, in
207.19 both cases using taxable market values for assessment year 2000.
207.20 [EFFECTIVE DATE.] This section is effective retroactively
207.21 for bonds issued after July 1, 2001.
207.22 Sec. 16. [CITY OF THIEF RIVER FALLS; NONPROFIT
207.23 CORPORATION.]
207.24 Subdivision 1. [NONPROFIT CORPORATION MAY BE ESTABLISHED.]
207.25 The city of Thief River Falls may incorporate or authorize the
207.26 incorporation of a nonprofit corporation to operate a community
207.27 or regional center in the city.
207.28 Subd. 2. [BOARD OF DIRECTORS.] The corporation must be
207.29 governed by a board of five directors. The directors must be
207.30 named by the Thief River Falls city council. No more than three
207.31 of the directors may be persons currently serving on the Thief
207.32 River Falls city council. Board members must not be compensated
207.33 for their services but may be reimbursed for reasonable expenses
207.34 incurred in connection with their duties as board members.
207.35 Subd. 3. [ARTICLES AND BYLAWS.] The entity must be
207.36 incorporated under Minnesota Statutes, chapter 317A, and
208.1 otherwise must comply with Minnesota Statutes, chapter 317A,
208.2 except to the extent Minnesota Statutes, chapter 317A, is
208.3 inconsistent with this section.
208.4 Subd. 4. [EMPLOYEES.] Persons employed by the nonprofit
208.5 corporation are not public employees and must not participate in
208.6 retirement, deferred compensation, insurance, or other plans
208.7 that apply to public employees generally.
208.8 Subd. 5. [STATUTORY COMPLIANCE.] The nonprofit corporation
208.9 must comply with Minnesota Statutes, section 465.719,
208.10 subdivisions 9, 10, 11, 12, 13, and 14.
208.11 Sec. 17. [APPROPRIATION.]
208.12 (a) $585,000 in fiscal year 2002 and $7,015,000 in fiscal
208.13 year 2003 are appropriated to the commissioner of revenue from
208.14 the general fund for tax compliance activities, including
208.15 identification and collection of tax liabilities from
208.16 individuals and businesses that currently do not pay all taxes
208.17 owed, and audit and collection activity in the income tax, sales
208.18 tax, lawful gambling, insurance, and corporate areas. The base
208.19 funding for these activities in fiscal years 2004 and 2005 is
208.20 increased by $4,750,000 each year.
208.21 (b) The commissioner must include these tax compliance
208.22 activities in the report required by Laws 2001, First Special
208.23 Session chapter 10, article 1, section 16, subdivision 2,
208.24 paragraph (c).
208.25 (c) Laws 2002, chapter 220, article 10, section 38, does
208.26 not apply to the positions necessary to carry out the compliance
208.27 activities identified in this section.
208.28 (d) If the legislative auditor determines that:
208.29 (1) actual revenue collections generated from tax
208.30 compliance activities funded by Laws 2001, First Special Session
208.31 chapter 10, article 1, section 16, subdivision 2, paragraphs (a)
208.32 and (b), will not generate at least $52,000,000 in additional
208.33 general fund revenue for the biennium ending June 30, 2003; or
208.34 (2) actual revenue collections generated from new tax
208.35 compliance activities funded by the appropriation in this
208.36 section will not generate at least $7,600,000 in additional
209.1 general fund revenue for the biennium ending June 30, 2003;
209.2 then the commissioner of finance must cancel from the budget
209.3 reserve account to the general fund the difference between the
209.4 $52,000,000 or the $7,600,000 and the actual additional general
209.5 fund revenue. The legislative auditor's determination under
209.6 this paragraph must be made in the February 1, 2003, report to
209.7 the legislature required by Laws 2001, First Special Session
209.8 chapter 10, article 1, section 16.
209.9 [EFFECTIVE DATE.] This section is effective the day
209.10 following final enactment.
209.11 Sec. 18. [REPEALER.]
209.12 Minnesota Statutes 2000, section 291.03, subdivision 2, is
209.13 repealed effective for estates of decedents dying after December
209.14 31, 2001."
209.15 Delete the title and insert:
209.16 "A bill for an act
209.17 relating to financing and operation of state and local
209.18 government; modifying provisions relating to income,
209.19 franchise, sales and use, property, MinnesotaCare,
209.20 gross receipts, liquor, insurance, solid waste
209.21 management, estate, minerals, and other taxes,
209.22 property tax refunds, tax liens, and tax
209.23 administration; imposing a wind energy production tax;
209.24 modifying property tax and other state aids and
209.25 credits; changing education aids and levies; modifying
209.26 tax court jurisdiction; authorizing local units of
209.27 government to levy, impose, or abate taxes, issue
209.28 debt, and exercise other powers; extending and
209.29 authorizing certain expenditures from the northeast
209.30 Minnesota economic protection trust fund; modifying
209.31 levy limits; providing powers to and imposing duties
209.32 on the commissioner of revenue and other officials;
209.33 clarifying utility rate reduction provisions mandated
209.34 by property tax reductions; modifying tax increment
209.35 financing and other economic development provisions;
209.36 providing a time limit for offset of federal tax
209.37 refunds; changing lawful purpose for purposes of
209.38 lawful gambling; providing for data privacy and
209.39 exchange of data; modifying certain debt limits;
209.40 repealing an annexation provision; making technical
209.41 corrections; providing for the transfer of funds;
209.42 providing for a budget reserve; appropriating money;
209.43 amending Minnesota Statutes 2000, sections 16A.152, by
209.44 adding a subdivision; 40A.151, subdivision 1; 40A.152,
209.45 subdivisions 1, 3; 69.77, by adding a subdivision;
209.46 126C.44; 168A.05, by adding subdivisions; 270.063,
209.47 subdivision 4; 270.60, subdivision 4; 270B.01,
209.48 subdivision 8; 270B.02, subdivision 4; 270B.14,
209.49 subdivision 8; 272.02, subdivision 15, by adding
209.50 subdivisions; 272.0212, subdivision 4; 273.125,
209.51 subdivisions 3, 4; 273.1398, subdivisions 1a, 2, 3;
209.52 278.01, subdivision 1; 279.01, subdivision 3; 289A.10,
209.53 subdivision 1; 289A.19, subdivision 1; 290.01,
209.54 subdivision 19a; 290.067, subdivisions 1, 2a; 290.081;
209.55 290.17, subdivisions 2, 3; 290.191, subdivision 4;
210.1 290A.03, subdivision 3; 291.03, subdivision 1; 295.53,
210.2 subdivision 1; 295.57, by adding a subdivision;
210.3 296A.18, subdivision 8; 297A.66, by adding a
210.4 subdivision; 297A.67, subdivision 5, by adding a
210.5 subdivision; 297A.68, by adding a subdivision;
210.6 297A.71, by adding subdivisions; 297A.96; 297G.07,
210.7 subdivision 1; 297H.06, subdivision 2; 297I.05,
210.8 subdivision 11; 298.27; 298.28, subdivisions 5, 9b,
210.9 11; 298.291; 469.1813, by adding a subdivision;
210.10 477A.011, subdivision 20; 477A.15; Minnesota Statutes
210.11 2001 Supplement, sections 69.021, subdivision 5;
210.12 124D.86, subdivision 3; 126C.17, subdivision 7a;
210.13 126C.21, subdivision 4; 126C.40, subdivision 1;
210.14 126C.43, subdivision 3; 126C.48, subdivision 8;
210.15 216B.1646; 270.69, subdivision 2; 270.691, subdivision
210.16 8; 270B.02, subdivision 3; 270B.08, subdivision 2;
210.17 271.01, subdivision 5; 271.21, subdivision 2; 272.02,
210.18 subdivision 22; 272.028; 273.121; 273.124, subdivision
210.19 11; 273.13, subdivisions 22, 24, 25; 273.1384,
210.20 subdivisions 1, 2; 273.1392; 273.1398, subdivisions
210.21 4c, 4d; 275.065, subdivision 3; 275.70, subdivision 5;
210.22 275.71, subdivisions 2, 3, 6; 275.74, subdivision 2;
210.23 276.04, subdivision 2; 289A.02, subdivision 7;
210.24 289A.20, subdivisions 2, 4; 289A.60, subdivision 2;
210.25 290.01, subdivisions 19, 19b, 19c, 19d, 31; 290.0675,
210.26 subdivisions 1, 3; 290.091, subdivision 2; 290.0921,
210.27 subdivisions 2, 3, 6; 290.21, subdivision 4; 290A.03,
210.28 subdivision 15; 290A.04, subdivision 2h; 291.005,
210.29 subdivision 1; 295.60, subdivisions 2, 7, by adding
210.30 subdivisions; 297A.61, subdivisions 3, 26, 31;
210.31 297A.66, subdivision 1; 297A.67, subdivisions 25, 29;
210.32 297A.68, subdivision 3; 297A.70, subdivisions 3, 10;
210.33 297A.71, subdivision 23; 297A.75; 297A.995,
210.34 subdivision 4; 298.01, subdivisions 3b, 4c; 298.225,
210.35 subdivision 1; 298.28, subdivisions 4, 6, 9a, 10;
210.36 298.296, subdivision 2; 349.12, subdivision 25;
210.37 469.1734, subdivision 6; 469.1763, subdivision 6;
210.38 469.1792, subdivision 1; 477A.011, subdivision 36;
210.39 477A.0123; 477A.013, subdivision 9; 477A.03,
210.40 subdivision 2; 477A.07, subdivisions 1, 2, 3; Laws
210.41 1990, chapter 604, article 6, section 9, subdivision
210.42 1, as amended; Laws 1993, chapter 375, article 5,
210.43 section 42; Laws 1995, chapter 264, article 5, section
210.44 45, subdivision 1, as amended; Laws 1998, chapter 389,
210.45 article 3, section 42; Laws 1998, chapter 389, article
210.46 8, section 37, subdivision 2; Laws 2001, First Special
210.47 Session chapter 5, article 9, section 3; Laws 2001,
210.48 First Special Session chapter 5, article 12, sections
210.49 11, 82, 95; Laws 2001, First Special Session chapter
210.50 6, article 1, section 53; Laws 2001, First Special
210.51 Session chapter 6, article 4, sections 25, 27,
210.52 subdivision 9; Laws 2001, First Special Session
210.53 chapter 6, article 5, section 12; proposing coding for
210.54 new law in Minnesota Statutes, chapters 126C; 272;
210.55 repealing Minnesota Statutes 2000, sections 272.02,
210.56 subdivision 40; 290.01, subdivisions 19g, 32;
210.57 290.0921, subdivision 5; 291.03, subdivision 2;
210.58 295.44; 297A.68, subdivision 26; Minnesota Statutes
210.59 2001 Supplement, sections 469.176, subdivision 1h;
210.60 Laws 2001, First Special Session chapter 5, article 3,
210.61 section 88; Minnesota Rules, parts 8130.1400;
210.62 8130.2100; 8130.2350; 8130.2600; 8130.3000; 8130.3850;
210.63 8130.5000."
211.1 We request adoption of this report and repassage of the
211.2 bill.
211.5 House Conferees:
211.8 ......................... .........................
211.9 Ron Abrams Dan McElroy
211.12 ......................... .........................
211.13 Bob Milbert Roxann Daggett
211.16 .........................
211.17 Ann Lenczewski
211.22 Senate Conferees:
211.25 ......................... .........................
211.26 Lawrence J. Pogemiller Douglas J. Johnson
211.29 ......................... .........................
211.30 Linda Berglin Dick Day
211.33 .........................
211.34 Leonard R. Price