1.1                          A bill for an act 
  1.2             relating to taxation; providing a property tax 
  1.3             exemption for private aircraft storage hangars on 
  1.4             leased land; amending Minnesota Statutes 1998, 
  1.5             sections 272.01, subdivision 2; and 273.19, 
  1.6             subdivision 1. 
  1.7   BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.8      Section 1.  Minnesota Statutes 1998, section 272.01, 
  1.9   subdivision 2, is amended to read: 
  1.10     Subd. 2.  (a) When any real or personal property which is 
  1.11  exempt from ad valorem taxes, and taxes in lieu thereof, is 
  1.12  leased, loaned, or otherwise made available and used by a 
  1.13  private individual, association, or corporation in connection 
  1.14  with a business conducted for profit, there shall be imposed a 
  1.15  tax, for the privilege of so using or possessing such real or 
  1.16  personal property, in the same amount and to the same extent as 
  1.17  though the lessee or user was the owner of such property. 
  1.18     (b) The tax imposed by this subdivision shall not apply to: 
  1.19     (1) property leased or used as a concession in or relative 
  1.20  to the use in whole or part of a public park, market, 
  1.21  fairgrounds, port authority, economic development authority 
  1.22  established under chapter 469, municipal auditorium, municipal 
  1.23  parking facility, municipal museum, or municipal stadium; 
  1.24     (2) property of an airport owned by a city, town, county, 
  1.25  or group thereof which is:  
  1.26     (i) leased to or used by any person or entity including a 
  2.1   fixed base operator; and 
  2.2      (ii) used as a hangar for the storage or repair of aircraft 
  2.3   or to provide aviation goods, services, or facilities to the 
  2.4   airport or general public; 
  2.5      (3) the exception from taxation provided in this clause (2) 
  2.6   does not apply to: 
  2.7      (i) property located at an airport owned or operated by the 
  2.8   metropolitan airports commission or by a city of over 50,000 
  2.9   population according to the most recent federal census or such a 
  2.10  city's airport authority; 
  2.11     (ii) hangars leased by a private individual, association, 
  2.12  or corporation in connection with a business conducted for 
  2.13  profit other than an aviation-related business; or 
  2.14     (iii) facilities leased by a private individual, 
  2.15  association, or corporation in connection with a business for 
  2.16  profit, that consists of a major jet engine repair facility 
  2.17  financed, in whole or part, with the proceeds of state bonds and 
  2.18  located in a tax increment financing district; 
  2.19     (4) a leased or privately owned noncommercial aircraft 
  2.20  storage hangar located on a metropolitan airport owned by a 
  2.21  city, town, county, metropolitan airports commission, or group 
  2.22  thereof, together with the leased land on which it is located, 
  2.23  if no commercial activities are performed at the hangar, and if 
  2.24  the owner or lessee of the storage hangar pays an in-lieu fee 
  2.25  for the cost of public services actually provided to the owner 
  2.26  or lessee of the hangar; 
  2.27     (3) (5) property constituting or used as a public 
  2.28  pedestrian ramp or concourse in connection with a public 
  2.29  airport; or 
  2.30     (4) (6) property constituting or used as a passenger 
  2.31  check-in area or ticket sale counter, boarding area, or luggage 
  2.32  claim area in connection with a public airport but not the 
  2.33  airports owned or operated by the metropolitan airports 
  2.34  commission or cities of over 50,000 population or an airport 
  2.35  authority therein.  Real estate owned by a municipality in 
  2.36  connection with the operation of a public airport and leased or 
  3.1   used for agricultural purposes is not exempt. 
  3.2      (c) Taxes imposed by this subdivision are payable as in the 
  3.3   case of personal property taxes and shall be assessed to the 
  3.4   lessees or users of real or personal property in the same manner 
  3.5   as taxes assessed to owners of real or personal property, except 
  3.6   that such taxes shall not become a lien against the property.  
  3.7   When due, the taxes shall constitute a debt due from the lessee 
  3.8   or user to the state, township, city, county, and school 
  3.9   district for which the taxes were assessed and shall be 
  3.10  collected in the same manner as personal property taxes.  If 
  3.11  property subject to the tax imposed by this subdivision is 
  3.12  leased or used jointly by two or more persons, each lessee or 
  3.13  user shall be jointly and severally liable for payment of the 
  3.14  tax. 
  3.15     (d) The tax on real property of the state or any of its 
  3.16  political subdivisions that is leased by a private individual, 
  3.17  association, or corporation and becomes taxable under this 
  3.18  subdivision or other provision of law must be assessed and 
  3.19  collected as a personal property assessment.  The taxes do not 
  3.20  become a lien against the real property. 
  3.21     Sec. 2.  Minnesota Statutes 1998, section 273.19, 
  3.22  subdivision 1, is amended to read: 
  3.23     Subdivision 1.  Except as provided in subdivision 3 or 4, 
  3.24  tax-exempt property held under a lease for a term of at least 
  3.25  one year, and not taxable under section 272.01, subdivision 2, 
  3.26  or under a contract for the purchase thereof, shall be 
  3.27  considered, for all purposes of taxation, as the property of the 
  3.28  person holding it.  In this subdivision, "tax-exempt property" 
  3.29  means property owned by the United States, the state, a school, 
  3.30  or any religious, scientific, or benevolent society or 
  3.31  institution, incorporated or unincorporated, or any corporation 
  3.32  whose property is not taxed in the same manner as other 
  3.33  property.  This subdivision does not apply to property exempt 
  3.34  from taxation under section 272.01, subdivision 2, paragraph 
  3.35  (b), clauses (2), (3), and (4), (5), and (6). 
  3.36     Sec. 3.  [EFFECTIVE DATE.] 
  4.1      Sections 1 and 2 are effective retroactively for taxes 
  4.2   levied in 1999, payable in 2000, and thereafter.