1.1                          A bill for an act 
  1.2             relating to job opportunity building zones; 
  1.3             authorizing designation of additional zones for health 
  1.4             care facilities; amending Minnesota Statutes 2003 
  1.5             Supplement, section 295.53, subdivision 1; proposing 
  1.6             coding for new law in Minnesota Statutes, chapter 469. 
  1.7   BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.8      Section 1.  Minnesota Statutes 2003 Supplement, section 
  1.9   295.53, subdivision 1, is amended to read: 
  1.10     Subdivision 1.  [EXEMPTIONS.] (a) The following payments 
  1.11  are excluded from the gross revenues subject to the hospital, 
  1.12  surgical center, or health care provider taxes under sections 
  1.13  295.50 to 295.59: 
  1.14     (1) payments received for services provided under the 
  1.15  Medicare program, including payments received from the 
  1.16  government, and organizations governed by sections 1833 and 1876 
  1.17  of title XVIII of the federal Social Security Act, United States 
  1.18  Code, title 42, section 1395, and enrollee deductibles, 
  1.19  coinsurance, and co-payments, whether paid by the Medicare 
  1.20  enrollee or by a Medicare supplemental coverage as defined in 
  1.21  section 62A.011, subdivision 3, clause (10).  Payments for 
  1.22  services not covered by Medicare are taxable; 
  1.23     (2) payments received for home health care services; 
  1.24     (3) payments received from hospitals or surgical centers 
  1.25  for goods and services on which liability for tax is imposed 
  1.26  under section 295.52 or the source of funds for the payment is 
  2.1   exempt under clause (1), (7), (10), or (14); 
  2.2      (4) payments received from health care providers for goods 
  2.3   and services on which liability for tax is imposed under this 
  2.4   chapter or the source of funds for the payment is exempt under 
  2.5   clause (1), (7), (10), or (14); 
  2.6      (5) amounts paid for legend drugs, other than nutritional 
  2.7   products, to a wholesale drug distributor who is subject to tax 
  2.8   under section 295.52, subdivision 3, reduced by reimbursements 
  2.9   received for legend drugs otherwise exempt under this chapter; 
  2.10     (6) payments received by a health care provider or the 
  2.11  wholly owned subsidiary of a health care provider for care 
  2.12  provided outside Minnesota; 
  2.13     (7) payments received from the chemical dependency fund 
  2.14  under chapter 254B; 
  2.15     (8) payments received in the nature of charitable donations 
  2.16  that are not designated for providing patient services to a 
  2.17  specific individual or group; 
  2.18     (9) payments received for providing patient services 
  2.19  incurred through a formal program of health care research 
  2.20  conducted in conformity with federal regulations governing 
  2.21  research on human subjects.  Payments received from patients or 
  2.22  from other persons paying on behalf of the patients are subject 
  2.23  to tax; 
  2.24     (10) payments received from any governmental agency for 
  2.25  services benefiting the public, not including payments made by 
  2.26  the government in its capacity as an employer or insurer or 
  2.27  payments made by the government for services provided under 
  2.28  medical assistance, general assistance medical care, or the 
  2.29  MinnesotaCare program; 
  2.30     (11) government payments received by a regional treatment 
  2.31  center; 
  2.32     (12) payments received by a health care provider for 
  2.33  hearing aids and related equipment or prescription eyewear 
  2.34  delivered outside of Minnesota; 
  2.35     (13) payments received by an educational institution from 
  2.36  student tuition, student activity fees, health care service 
  3.1   fees, government appropriations, donations, or grants.  Fee for 
  3.2   service payments and payments for extended coverage are taxable; 
  3.3   ~~and~~ 
  3.4      (14) payments received under the federal Employees Health 
  3.5   Benefits Act, United States Code, title 5, section 8909(f), as 
  3.6   amended by the Omnibus Reconciliation Act of 1990; and 
  3.7      (15) payments received by a provider for services performed 
  3.8   in a health care facilities zone, designated under section 
  3.9   469.3141. 
  3.10     (b) Payments received by wholesale drug distributors for 
  3.11  legend drugs sold directly to veterinarians or veterinary bulk 
  3.12  purchasing organizations are excluded from the gross revenues 
  3.13  subject to the wholesale drug distributor tax under sections 
  3.14  295.50 to 295.59. 
  3.15     <b>[EFFECTIVE DATE.]</b> This section is effective the day 
  3.16  following final enactment.  
  3.17     Sec. 2.  [469.3141] [HEALTH CARE FACILITY ZONES.] 
  3.18     Subdivision 1.  [AUTHORITY TO DESIGNATE.] In addition to 
  3.19  the designations authorized under section 469.314, the 
  3.20  commissioner, in consultation with the commissioner of revenue, 
  3.21  may designate not more than ten job opportunity building zones 
  3.22  for health care facility projects.  In making the designations, 
  3.23  the commissioner shall consider the need for the health care 
  3.24  facilities in the applicant community.  The commissioner may 
  3.25  designate a zone at any time upon application for a qualifying 
  3.26  health care facility project. 
  3.27     Subd. 2.  [QUALIFYING PROJECTS.] A qualifying health care 
  3.28  facility project must: 
  3.29     (1) consist of a qualified business that, at the zone 
  3.30  location, is primarily engaged in operating a clinic providing 
  3.31  medical or dental care directly to patients and is enrolled as a 
  3.32  provider under the medical assistance program under chapter 
  3.33  256B, the general assistance medical care program under section 
  3.34  256D.03, subdivision 4, and the MinnesotaCare program under 
  3.35  chapter 256L; 
  3.36     (2) be located in a city or town with a population of 2,500 
  4.1   or less, as determined under section 477A.011, subdivision 3; 
  4.2   and 
  4.3      (3) provide services that are not available from other 
  4.4   providers of equivalent or substantially similar services 
  4.5   located within a radius of 25 miles of the zone. 
  4.6      Subd. 3.  [APPLICATION OF JOBZ RULES.] Except as otherwise 
  4.7   specifically provided in this section, sections 469.310 to 
  4.8   469.320 apply to zones designated under this section for health 
  4.9   care facility projects. 
  4.10     Subd. 4.  [PROVIDER TAX EXEMPTION.] In addition to the tax 
  4.11  incentives available in other job opportunity building zones 
  4.12  under section 469.315, a qualified business located in the zone 
  4.13  is exempt from the provider tax under section 295.52. 
  4.14     <b>[EFFECTIVE DATE.]</b> This section is effective the day 
  4.15  following final enactment.