1.1                          A bill for an act 
  1.2             relating to corporate franchise taxation; modifying 
  1.3             the definition of apportionment factors; amending 
  1.4             Minnesota Statutes 1994, section 290.191, subdivisions 
  1.5             1, 5, 6, and 11; repealing Minnesota Statutes 1994, 
  1.6             section 290.191, subdivision 8. 
  1.7   BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.8      Section 1.  Minnesota Statutes 1994, section 290.191, 
  1.9   subdivision 1, is amended to read: 
  1.10     Subdivision 1.  [GENERAL RULE.] (a) Except as otherwise 
  1.11  provided in section 290.17, subdivision 5, the net income from a 
  1.12  trade or business carried on partly within and partly without 
  1.13  this state must be apportioned to this state as provided in this 
  1.14  section.  
  1.15     (b) For purposes of this section, "state" means a state of 
  1.16  the United States, the District of Columbia, the commonwealth of 
  1.17  Puerto Rico, or any territory or possession of the United States 
  1.18  or any foreign country. 
  1.19     (c) For purposes of this section, "commercial domicile" 
  1.20  means the headquarters of the trade or business, that is, the 
  1.21  place from which the trade or business is principally managed 
  1.22  and directed.  If a taxpayer is organized under the laws of a 
  1.23  foreign country, or of the Commonwealth of Puerto Rico, or any 
  1.24  territory or possession of the United States, the taxpayer's 
  1.25  commercial domicile is the state that the taxpayer has declared 
  1.26  to be its home state under the International Banking Act of 
  2.1   1978; or, if the taxpayer has not made such a declaration or is 
  2.2   not required to make such a declaration, its commercial domicile 
  2.3   for the purpose of this section is the state of the United 
  2.4   States or the District of Columbia to which the greatest number 
  2.5   of employees are regularly connected or out of which they are 
  2.6   working, irrespective of where the services of the employees are 
  2.7   performed, as of the last day of the taxable year. 
  2.8      Sec. 2.  Minnesota Statutes 1994, section 290.191, 
  2.9   subdivision 5, is amended to read: 
  2.10     Subd. 5.  [DETERMINATION OF SALES FACTOR.] For purposes of 
  2.11  this section, the following rules apply in determining the sales 
  2.12  factor.  
  2.13     (a) The sales factor includes all sales, gross earnings, or 
  2.14  receipts received in the ordinary course of the business, except 
  2.15  that the following types of income are not included in the sales 
  2.16  factor: 
  2.17     (1) interest; 
  2.18     (2) dividends; 
  2.19     (3) sales of capital assets as defined in section 1221 of 
  2.20  the Internal Revenue Code; 
  2.21     (4) sales of property used in the trade or business, except 
  2.22  sales of leased property of a type which is regularly sold as 
  2.23  well as leased; 
  2.24     (5) sales of debt instruments as defined in section 
  2.25  1275(a)(1) of the Internal Revenue Code or sales of stock; and 
  2.26     (6) royalties, fees, or other like income of a type which 
  2.27  qualify for a subtraction from federal taxable income under 
  2.28  section 290.01, subdivision 19(d)(11).  
  2.29     (b) Sales of tangible personal property are made within 
  2.30  this state if the property is received by a purchaser at a point 
  2.31  within this state, and the taxpayer is taxable in this state, 
  2.32  regardless of the f.o.b. point, other conditions of the sale, or 
  2.33  the ultimate destination of the property. 
  2.34     (c) Tangible personal property delivered to a common or 
  2.35  contract carrier or foreign vessel for delivery to a purchaser 
  2.36  in another state or nation is a sale in that state or nation, 
  3.1   regardless of f.o.b. point or other conditions of the sale.  
  3.2      (d) Notwithstanding paragraphs (b) and (c), when 
  3.3   intoxicating liquor, wine, fermented malt beverages, cigarettes, 
  3.4   or tobacco products are sold to a purchaser who is licensed by a 
  3.5   state or political subdivision to resell this property only 
  3.6   within the state of ultimate destination, the sale is made in 
  3.7   that state.  
  3.8      (e) Sales made by or through a corporation that is 
  3.9   qualified as a domestic international sales corporation under 
  3.10  section 992 of the Internal Revenue Code are not considered to 
  3.11  have been made within this state.  
  3.12     (f) Sales, rents, royalties, and other income in connection 
  3.13  with real property is attributed to the state in which the 
  3.14  property is located.  
  3.15     (g) Receipts from the lease or rental of tangible personal 
  3.16  property, including finance leases and true leases, must be 
  3.17  attributed to this state if the property is located in this 
  3.18  state and to other states if the property is not located in this 
  3.19  state.  Receipts from the lease or rental of moving property 
  3.20  including, but not limited to, motor vehicles, rolling stock, 
  3.21  aircraft, vessels, or mobile equipment is located in this state 
  3.22  if are included in the numerator of the receipts factor to the 
  3.23  extent that the property is used in this state.  The extent of 
  3.24  the use of moving property is determined as follows: 
  3.25     (1) the operation of the property is entirely within this 
  3.26  state; or A motor vehicle is used wholly in the state in which 
  3.27  it is registered. 
  3.28     (2) the operation of the property is in two or more states 
  3.29  and the principal base of operations from which the property is 
  3.30  sent out is in this state The extent that rolling stock is used 
  3.31  in this state is determined by multiplying the receipts from the 
  3.32  lease or rental of the rolling stock by a fraction, the 
  3.33  numerator of which is the miles traveled within this state by 
  3.34  the leased or rented rolling stock and the denominator of which 
  3.35  is the total miles traveled by the leased or rented rolling 
  3.36  stock. 
  4.1      (3) The extent that an aircraft is used in this state is 
  4.2   determined by multiplying the receipts from the lease or rental 
  4.3   of the aircraft by a fraction, the numerator of which is the 
  4.4   number of landings of the aircraft in this state and the 
  4.5   denominator of which is the total number of landings of the 
  4.6   aircraft. 
  4.7      (4) The extent that a vessel, mobile equipment, or other 
  4.8   mobile property is used in the state is determined by 
  4.9   multiplying the receipts from the lease or rental of the 
  4.10  property by a fraction, the numerator of which is the number of 
  4.11  days during the taxable year the property was in this state and 
  4.12  the denominator of which is the total days in the taxable year.  
  4.13     (h) Royalties and other income not described in paragraph 
  4.14  (a), clause (6), received for the use of or for the privilege of 
  4.15  using intangible property, including patents, know-how, 
  4.16  formulas, designs, processes, patterns, copyrights, trade names, 
  4.17  service names, franchises, licenses, contracts, customer lists, 
  4.18  or similar items, must be attributed to the state in which the 
  4.19  property is used by the purchaser.  If the property is used in 
  4.20  more than one state, the royalties or other income must be 
  4.21  apportioned to this state pro rata according to the portion of 
  4.22  use in this state.  If the portion of use in this state cannot 
  4.23  be determined, the royalties or other income must be excluded 
  4.24  from both the numerator and the denominator.  Intangible 
  4.25  property is used in this state if the purchaser uses the 
  4.26  intangible property or the rights therein in the regular course 
  4.27  of its business operations in this state, regardless of the 
  4.28  location of the purchaser's customers. 
  4.29     (i) Sales of intangible property are made within the state 
  4.30  in which the property is used by the purchaser.  If the property 
  4.31  is used in more than one state, the sales must be apportioned to 
  4.32  this state pro rata according to the portion of use in this 
  4.33  state.  If the portion of use in this state cannot be 
  4.34  determined, the sale must be excluded from both the numerator 
  4.35  and the denominator of the sales factor.  Intangible property is 
  4.36  used in this state if the purchaser used the intangible property 
  5.1   in the regular course of its business operations in this state. 
  5.2      (j) Receipts from the performance of services must be 
  5.3   attributed to the state in which the benefits of where the 
  5.4   services are consumed received.  If the benefits are consumed in 
  5.5   more than one state, the receipts from those benefits must be 
  5.6   apportioned to this state pro rata according to the portion of 
  5.7   the benefits consumed in this state.  For the purposes of this 
  5.8   section, services provided to a corporation, partnership, or 
  5.9   trust may only be attributed to a state where it has a fixed 
  5.10  place of doing business.  If the extent to which the benefits of 
  5.11  services are consumed in this state in which the services are 
  5.12  received is not readily determinable, the benefits of the 
  5.13  services shall be are deemed to be consumed received at the 
  5.14  location of the office of the customer from which the services 
  5.15  were ordered in the regular course of the customer's trade or 
  5.16  business.  If the ordering office cannot be determined, the 
  5.17  benefits of the services shall be are deemed to be consumed 
  5.18  received at the office of the customer to which the services are 
  5.19  billed.  
  5.20     Sec. 3.  Minnesota Statutes 1994, section 290.191, 
  5.21  subdivision 6, is amended to read: 
  5.22     Subd. 6.  [DETERMINATION OF RECEIPTS FACTOR FOR FINANCIAL 
  5.23  INSTITUTIONS.] (a) For purposes of this section, the rules in 
  5.24  this subdivision and subdivisions 7 and 8 apply in determining 
  5.25  the receipts factor for financial institutions.  
  5.26     (b) "Receipts" for this purpose means gross income, 
  5.27  including net taxable gain on disposition of assets, including 
  5.28  securities and money market instruments, when derived from 
  5.29  transactions and activities in the regular course of the 
  5.30  taxpayer's trade or business.  
  5.31     (c) "Money market instruments" means federal funds sold and 
  5.32  securities purchased under agreements to resell, commercial 
  5.33  paper, banker's acceptances, and purchased certificates of 
  5.34  deposit and similar instruments to the extent that the 
  5.35  instruments are reflected as assets under generally accepted 
  5.36  accounting principles.  
  6.1      (d) "Securities" means United States Treasury securities, 
  6.2   obligations of United States government agencies and 
  6.3   corporations, obligations of state and political subdivisions, 
  6.4   corporate stock and other securities, participations in 
  6.5   securities backed by mortgages held by United States or state 
  6.6   government agencies, loan-backed securities and similar 
  6.7   investments to the extent the investments are reflected as 
  6.8   assets under generally accepted accounting principles.  
  6.9      (e) Receipts from the lease or rental of real or tangible 
  6.10  personal property, including both finance leases and true 
  6.11  leases, must be attributed to this state if the property is 
  6.12  located in this state.  Receipts from the lease or rental of 
  6.13  tangible personal property that is characteristically moving 
  6.14  property, such as including, but not limited to, motor vehicles, 
  6.15  rolling stock, aircraft, vessels, or mobile equipment, and the 
  6.16  like, is considered to be located in a state if are included in 
  6.17  the numerator of the receipts factor to the extent that the 
  6.18  property is used in this state.  The extent of the use of moving 
  6.19  property is determined as follows:  
  6.20     (1) the operation of the property is entirely within the 
  6.21  state; or A motor vehicle is used wholly in the state in which 
  6.22  it is registered. 
  6.23     (2) the operation of the property is in two or more states, 
  6.24  but the principal base of operations from which the property is 
  6.25  sent out is in the state The extent that rolling stock is used 
  6.26  in this state is determined by multiplying the receipts from the 
  6.27  lease or rental of the rolling stock by a fraction, the 
  6.28  numerator of which is the miles traveled within this state by 
  6.29  the leased or rented rolling stock and the denominator of which 
  6.30  is the total miles traveled by the leased or rented rolling 
  6.31  stock. 
  6.32     (3) The extent that an aircraft is used in this state is 
  6.33  determined by multiplying the receipts from the lease or rental 
  6.34  of the aircraft by a fraction, the numerator of which is the 
  6.35  number of landings of the aircraft in this state and the 
  6.36  denominator of which is the total number of landings of the 
  7.1   aircraft. 
  7.2      (4) The extent that a vessel, mobile equipment, or other 
  7.3   mobile property is used in the state is determined by 
  7.4   multiplying the receipts from the lease or rental of property by 
  7.5   a fraction, the numerator of which is the number of days during 
  7.6   the taxable year the property was in this state and the 
  7.7   denominator of which is the total days in the taxable year. 
  7.8      (f) Interest income and other receipts from assets in the 
  7.9   nature of loans that are secured primarily by real estate or 
  7.10  tangible personal property must be attributed to this state if 
  7.11  the security property is located in this state under the 
  7.12  principles stated in paragraph (e).  
  7.13     (g) Interest income and other receipts from consumer loans 
  7.14  not secured by real or tangible personal property that are made 
  7.15  to residents of this state, whether at a place of business, by 
  7.16  traveling loan officer, by mail, by telephone or other 
  7.17  electronic means, must be attributed to this state.  
  7.18     (h) Interest income and other receipts from commercial 
  7.19  loans and installment obligations that are unsecured by real or 
  7.20  tangible personal property or secured by intangible property 
  7.21  must be attributed to this state if the proceeds of the loan are 
  7.22  to be applied in this state.  If it cannot be determined where 
  7.23  the funds are to be applied, the income and receipts are 
  7.24  attributed to the state in which the office of the borrower from 
  7.25  which the application would be made in the regular course of 
  7.26  business is located.  If this cannot be determined, the 
  7.27  transaction is disregarded in the apportionment 
  7.28  formula borrower's commercial domicile is located in this state. 
  7.29     (i) Interest income and other receipts from a participating 
  7.30  financial institution's portion of participation and syndication 
  7.31  loans must be attributed under paragraphs (e) to (h).  A 
  7.32  participation loan is an arrangement in which a lender makes a 
  7.33  loan to a borrower and then sells, assigns, or otherwise 
  7.34  transfers all or a part of the loan to a purchasing financial 
  7.35  institution.  A syndication loan is a loan transaction involving 
  7.36  multiple financial institutions in which all the lenders are 
  8.1   named as parties to the loan documentation, are known to the 
  8.2   borrower, and have privity of contract with the borrower.  
  8.3      (j) Interest income and other receipts including service 
  8.4   charges from financial institution credit card and travel and 
  8.5   entertainment credit card receivables and credit card holders' 
  8.6   fees must be attributed to the state to which the card charges 
  8.7   and fees are regularly billed.  
  8.8      (k) The receipts factor includes net gains (but not less 
  8.9   than zero) from the sale of credit card receivables, the 
  8.10  numerator of which is determined by multiplying the net gains by 
  8.11  a fraction, the numerator of which is the amount in the 
  8.12  numerator of the receipts factor under paragraph (j) and the 
  8.13  denominator of which is the taxpayer's total amount of interest 
  8.14  and fees or penalties in the nature of interest from credit card 
  8.15  receivables and fees charged to cardholders. 
  8.16     (1) The receipts factor includes all credit card issuer's 
  8.17  reimbursement fees, the numerator of which is determined by 
  8.18  multiplying the reimbursement fees by a fraction, the numerator 
  8.19  of which is the amount included in the numerator of the receipts 
  8.20  factor under paragraph (j) and the denominator of which is the 
  8.21  total amount of interest and fees or penalties in the nature of 
  8.22  interest from credit card receivables and fees charged to 
  8.23  cardholders. 
  8.24     (m) Merchant discount income derived from financial 
  8.25  institution credit card holder transactions with a merchant must 
  8.26  be attributed to the state in which the merchant is located.  In 
  8.27  the case of merchants located within and outside the state, only 
  8.28  receipts from merchant discounts attributable to sales made from 
  8.29  locations within the state are attributed to this state.  It is 
  8.30  presumed, subject to rebuttal, that the location of a merchant 
  8.31  is the address shown on the invoice submitted by the merchant to 
  8.32  the taxpayer of the merchant's commercial domicile. 
  8.33     (n) The receipts from the servicing of loans are included 
  8.34  in the receipts factor and are attributed to this state as 
  8.35  follows: 
  8.36     (1) The numerator of the receipts factor includes loan 
  9.1   servicing fees derived from loans secured by real estate or 
  9.2   tangible personal property multiplied by a fraction, the 
  9.3   numerator of which is the amount included in the numerator of 
  9.4   the receipts factor under paragraph (f) and the denominator of 
  9.5   which is the total amount of interest and fees or penalties in 
  9.6   the nature of interest from loans secured by real estate and 
  9.7   tangible personal property. 
  9.8      (2) The numerator of the receipts factor includes loan 
  9.9   servicing fees derived from consumer loans not secured by real 
  9.10  estate or tangible personal property multiplied by a fraction, 
  9.11  the numerator of which is the amount included in the numerator 
  9.12  of the receipts factor under paragraph (g) and the denominator 
  9.13  of which is the total amount of interest and fees or penalties 
  9.14  in the nature of interest from loans not secured by real estate 
  9.15  and tangible personal property. 
  9.16     (3) The numerator of the receipts factor includes loan 
  9.17  servicing fees derived from commercial loans and installment 
  9.18  obligations that are unsecured by real or tangible personal 
  9.19  property or secured by intangible property multiplied by a 
  9.20  fraction, the numerator of which is the amount included in the 
  9.21  numerator of the receipts factor under paragraph (h) and the 
  9.22  denominator of which is the total amount of interest and fees or 
  9.23  penalties in the nature of interest from commercial loans and 
  9.24  installment obligations that are unsecured by real or tangible 
  9.25  personal property or secured by intangible property. 
  9.26     (4) The numerator of the receipts factor includes loan 
  9.27  servicing fees derived from financial institution credit card 
  9.28  and travel and entertainment credit card receivables and credit 
  9.29  cardholders' fees multiplied by a fraction, the numerator of 
  9.30  which is the amount included in the numerator of the receipts 
  9.31  factor under paragraph (j) and the denominator of which is the 
  9.32  total amount of interest and fees or penalties in the nature of 
  9.33  interest from financial institution credit card and travel and 
  9.34  entertainment credit card receivables and credit cardholders' 
  9.35  fees. 
  9.36     (5) If the taxpayer receives loan servicing fees for 
 10.1   servicing either the secured or the unsecured loans of the 
 10.2   unrelated third party, the receipts are attributed under the 
 10.3   principles in paragraph (o). 
 10.4      (l) (o) Receipts from the performance of fiduciary and 
 10.5   other services must be attributed to the state in which 
 10.6   the benefits of the services are consumed received.  If the 
 10.7   benefits are consumed in more than one state, the receipts from 
 10.8   those benefits must be apportioned to this state pro rata 
 10.9   according to the portion of the benefits consumed in this 
 10.10  state.  For the purposes of this section, services provided to a 
 10.11  corporation, partnership, or trust may only be attributed to a 
 10.12  state in which it has a fixed place of doing business.  If the 
 10.13  extent to which the benefits of services are consumed in this 
 10.14  state where the services are received is not readily 
 10.15  determinable, the benefits of the services shall be are deemed 
 10.16  to be consumed received at the location of the office of the 
 10.17  customer from which the services were ordered in the regular 
 10.18  course of the customer's trade or business.  If the ordering 
 10.19  office cannot be determined, the benefits of the services shall 
 10.20  be are deemed to be consumed received at the office of the 
 10.21  customer to which the services are billed.  
 10.22     (m) (p) Receipts from the issuance of travelers checks and 
 10.23  money orders must be attributed to the state in which the checks 
 10.24  and money orders are purchased.  
 10.25     (n) (q) Receipts from investments of a financial 
 10.26  institution in securities and from money market instruments must 
 10.27  be apportioned to this state based on the ratio that total 
 10.28  deposits from this state, its residents, including any business 
 10.29  with an office or other place of business in this state, its 
 10.30  political subdivisions, agencies, and instrumentalities bear to 
 10.31  the total deposits from all states, their residents, their 
 10.32  political subdivisions, agencies, and instrumentalities.  In the 
 10.33  case of an unregulated financial institution subject to this 
 10.34  section, these receipts are apportioned to this state based on 
 10.35  the ratio that its gross business income, excluding such 
 10.36  receipts, earned from sources within this state bears to gross 
 11.1   business income, excluding such receipts, earned from sources 
 11.2   within all states.  For purposes of this subdivision, deposits 
 11.3   made by this state, its residents, its political subdivisions, 
 11.4   agencies, and instrumentalities must be attributed to this 
 11.5   state, whether or not the deposits are accepted or maintained by 
 11.6   the taxpayer at locations are attributed to this state if the 
 11.7   investments are properly assigned to a regular place of business 
 11.8   of the taxpayer within this state. 
 11.9      The taxpayer has the burden of proving that investments of 
 11.10  a financial institution in securities and from money market 
 11.11  instruments are properly assigned to a regular place of business 
 11.12  outside this state.  Where the day-to-day decisions regarding an 
 11.13  investment occur at more than one regular place of business, the 
 11.14  investment is considered to be located at the regular place of 
 11.15  business of the taxpayer where the investment or trading 
 11.16  policies and guidelines with respect to the investment are 
 11.17  established. 
 11.18     (o) (r) A financial institution's interest in property 
 11.19  described in section 290.015, subdivision 3, paragraph (b), is 
 11.20  included in the receipts factor in the same manner as assets in 
 11.21  the nature of securities or money market instruments are 
 11.22  included in paragraph (n) (q).  
 11.23     Sec. 4.  Minnesota Statutes 1994, section 290.191, 
 11.24  subdivision 11, is amended to read: 
 11.25     Subd. 11.  [FINANCIAL INSTITUTIONS; PROPERTY FACTOR.] (a) 
 11.26  For financial institutions, the property factor includes, as 
 11.27  well as tangible property, intangible property as set forth in 
 11.28  this subdivision.  
 11.29     (b) Intangible personal property must be included at its 
 11.30  tax basis for federal income tax purposes.  
 11.31     (c) Goodwill must not be included in the property factor.  
 11.32     (d) Coin and currency located in this state must be 
 11.33  attributed to this state must not be included in the property 
 11.34  factor.  
 11.35     (e) Lease financing receivables must be attributed to this 
 11.36  state if and to the extent that the property is located the 
 12.1   receivables are properly assigned to a regular place of business 
 12.2   of the taxpayer within this state.  
 12.3      (f) Assets in the nature of loans that are secured by real 
 12.4   or tangible personal property must be attributed to this state 
 12.5   if and to the extent that the security property is located the 
 12.6   loans are properly assigned to a regular place of business of 
 12.7   the taxpayer within this state.  
 12.8      (g) Assets in the nature of consumer loans and installment 
 12.9   obligations that are unsecured or secured by intangible property 
 12.10  must be attributed to this state if the loan was made to a 
 12.11  resident of this state.  
 12.12     (h) Assets in the nature of commercial loan and installment 
 12.13  obligations that are unsecured by real or tangible personal 
 12.14  property or secured by intangible property must be attributed to 
 12.15  this state if the proceeds of the loan are to be applied in this 
 12.16  state.  If it cannot be determined where the funds are to be 
 12.17  applied, the assets must be attributed to the state in which 
 12.18  there is located the office of the borrower from which the 
 12.19  application would be made in the regular course of business.  If 
 12.20  this cannot be determined, the transaction is disregarded in the 
 12.21  apportionment formula.  
 12.22     (i) A participating financial institution's portion of 
 12.23  participation and syndication loans must be attributed under 
 12.24  paragraphs (e) to (h) and (f).  
 12.25     (j) (h) Financial institution credit card and travel and 
 12.26  entertainment credit card receivables must be attributed to the 
 12.27  state to which the credit card charges and fees are regularly 
 12.28  billed if the receivables are properly assigned to a regular 
 12.29  place of business of the taxpayer within the state.  
 12.30     (k) (i) Receivables arising from merchant discount income 
 12.31  derived from financial institution credit card holder 
 12.32  transactions with a merchant are attributed to the state in 
 12.33  which the merchant is located.  In the case of merchants located 
 12.34  within and without the state, only receivables from merchant 
 12.35  discounts attributable to sales made from locations within the 
 12.36  state are attributed to this state.  It is presumed, subject to 
 13.1   rebuttal, that the location of a merchant is the address shown 
 13.2   on the invoice submitted by the merchant to the taxpayer if the 
 13.3   receivables are properly assigned to a regular place of business 
 13.4   of the taxpayer within the state. 
 13.5      (l) (j) Assets in the nature of securities and money market 
 13.6   instruments are apportioned to this state based upon the ratio 
 13.7   that total deposits from this state, its residents, its 
 13.8   political subdivisions, agencies and instrumentalities bear to 
 13.9   the total deposits from all states, their residents, their 
 13.10  political subdivisions, agencies and instrumentalities.  In the 
 13.11  case of an unregulated financial institution, the assets are 
 13.12  apportioned to this state based upon the ratio that its gross 
 13.13  business income earned from sources within this state bears to 
 13.14  gross business income earned from sources within all states.  
 13.15  For purposes of this paragraph, deposits made by this state, its 
 13.16  residents, its political subdivisions, agencies, and 
 13.17  instrumentalities are attributed to this state, whether or not 
 13.18  the deposits are accepted or maintained by the taxpayer at 
 13.19  locations within this state must not be included in the property 
 13.20  factor. 
 13.21     (m) (k) A financial institution's interest in any property 
 13.22  described in section 290.015, subdivision 3, paragraph (b), is 
 13.23  included in the property factor in the same manner as assets in 
 13.24  the nature of securities or money market instruments are 
 13.25  included under paragraph (1) must not be included in the 
 13.26  property factor. 
 13.27     (l) For the purposes of paragraphs (e) to (i), loan assets 
 13.28  and receivables are properly assigned in this state if the 
 13.29  preponderance of substantive contact occurred in this state.  In 
 13.30  determining where the preponderance of substantive contact 
 13.31  occurred, the following consideration should be given: 
 13.32     (1) solicitation; 
 13.33     (2) investigation; 
 13.34     (3) negotiation; 
 13.35     (4) approval; and 
 13.36     (5) administration.  
 14.1      Sec. 5.  [REPEALER.] 
 14.2      Minnesota Statutes 1994, section 290.191, subdivision 8, is 
 14.3   repealed. 
 14.4      Sec. 6.  [EFFECTIVE DATE.] 
 14.5      Sections 1 to 5 are effective for taxable years beginning 
 14.6   after December 31, 1994.