1.1 	A bill for an act
1.2 	relating to financing and operation of government in
1.3 	this state; recodifying and clarifying the powers of
1.4 	the commissioner of revenue; changing income,
1.5 	corporate franchise, withholding, estate, property,
1.6 	sales and use, mortgage registry, motor fuels,
1.7 	gambling, cigarette and tobacco products, liquor,
1.8 	insurance, and other taxes and tax-related provisions;
1.9 	making technical, clarifying, collection, enforcement,
1.10 	refund, and administrative changes to certain taxes
1.11 	and tax-related provisions, tax-forfeited lands,
1.12 	revenue recapture, unfair cigarette sales, state debt
1.13 	collection, sustainable forest incentive programs,
1.14 	border city development, property tax refund, and
1.15 	metropolitan solid waste landfill fee; changing local
1.16 	government aids and credits; providing for
1.17 	determination of population for certain purposes;
1.18 	changing property tax exemptions, homesteads,
1.19 	assessment, valuation, classification, levies,
1.20 	deferral, review and equalization, appeals, notices
1.21 	and statements, allocation, and distribution
1.22 	provisions; changing provisions relating to
1.23 	manufactured home certificates of title; providing for
1.24 	compliance with streamlined sales tax agreement;
1.25 	authorizing charges for certain emergency services;
1.26 	regulating tax preparers; prohibiting purchases of
1.27 	tax-forfeited lands by certain local officials;
1.28 	providing for data classification and exchange of
1.29 	data; providing and imposing powers and duties on the
1.30 	commissioner of revenue and on certain political
1.31 	subdivisions and officials; changing town spending and
1.32 	taxing provisions; changing and imposing penalties;
1.33 	reducing certain court appropriations; transferring
1.34 	funds; recodifying a criminal penalty; appropriating
1.35 	money; amending Minnesota Statutes 2004, sections
1.36 	4A.02; 16D.08, subdivision 2; 16D.10; 115B.49,
1.37 	subdivision 4; 168A.05, subdivision 1a; 239.785,
1.38 	subdivision 4; 256.9657, subdivision 7; 256.9792,
1.39 	subdivision 8; 270.11, subdivision 2; 270.16,
1.40 	subdivision 2; 270.30, subdivisions 1, 5, 6, 8, by
1.41 	adding subdivisions; 270.65; 270.67, subdivision 4;
1.42 	270.69, subdivision 4; 270A.03, subdivision 5; 272.01,
1.43 	subdivision 2; 272.02, subdivisions 1a, 47, 53, 56, by
1.44 	adding subdivisions; 272.0211, subdivisions 1, 2;
1.45 	272.029, subdivisions 4, 6; 273.11, subdivisions 5, 8;
1.46 	273.124, subdivisions 3, 6, 8, 13, 14, 21; 273.13,
2.1 	subdivision 25; 273.1315; 273.1384, subdivision 1;
2.2 	273.19, subdivision 1a; 273.372; 274.014, subdivisions
2.3 	2, 3; 274.14; 275.07, subdivisions 1, 4; 276.112;
2.4 	276A.01, subdivision 7; 282.016; 282.08; 282.15;
2.5 	282.21; 282.224; 282.301; 287.04; 287.37; 289A.08,
2.6 	subdivisions 3, 16; 289A.18, subdivision 1; 289A.19,
2.7 	subdivision 4; 289A.31, subdivision 2; 289A.35;
2.8 	289A.37, subdivision 5; 289A.38, subdivisions 6, 7, by
2.9 	adding a subdivision; 289A.39, subdivision 1; 289A.40,
2.10 	subdivision 2, by adding subdivisions; 289A.42,
2.11 	subdivision 1; 289A.50, subdivision 1a; 289A.60,
2.12 	subdivisions 2a, 6, 11, 12, 13; 290.01, subdivisions
2.13 	7b, 19a, 19b, 19c; 290.06, subdivision 22; 290.0671,
2.14 	subdivision 1a; 290.0674, subdivision 1; 290.92,
2.15 	subdivisions 1, 4b; 290A.07, by adding a subdivision;
2.16 	290B.05, subdivision 3; 290C.05; 290C.10; 291.005,
2.17 	subdivision 1; 291.03, subdivision 1; 295.57,
2.18 	subdivision 1; 295.60, subdivisions 3, 7; 296A.22, by
2.19 	adding a subdivision; 297A.61, subdivisions 3, 4;
2.20 	297A.64, subdivisions 3, 4; 297A.668, subdivisions 1,
2.21 	5; 297A.67, subdivisions 2, 7, 9; 297A.68,
2.22 	subdivisions 2, 5, 28, 39; 297A.71, subdivision 12;
2.23 	297A.75, subdivision 1; 297A.87, subdivisions 2, 3;
2.24 	297A.99, subdivision 4; 297B.11; 297E.01, subdivisions
2.25 	5, 7, by adding subdivisions; 297E.06, subdivision 2;
2.26 	297E.07; 297F.08, subdivision 12, by adding a
2.27 	subdivision; 297F.09, subdivisions 1, 2; 297F.14,
2.28 	subdivision 4; 297G.09, by adding a subdivision;
2.29 	297H.10, subdivision 1; 297I.01, by adding a
2.30 	subdivision; 297I.05, subdivision 5; 297I.10, by
2.31 	adding a subdivision; 298.24, subdivision 1; 325D.33,
2.32 	subdivision 6; 365.43, subdivision 1; 365.431;
2.33 	366.011; 366.012; 373.45, subdivision 7; 469.1735,
2.34 	subdivision 3; 473.843, subdivision 5; 473F.02,
2.35 	subdivision 7; 477A.011, subdivisions 3, 34, 36, as
2.36 	amended, 38; 477A.0124, subdivisions 2, 4; 477A.03,
2.37 	subdivision 2b; Laws 1998, chapter 389, article 3,
2.38 	section 42, subdivision 2, as amended; Laws 2001 First
2.39 	Special Session chapter 5, article 3, section 8; Laws
2.40 	2003, chapter 127, article 5, sections 27; 28; Laws
2.41 	2003 First Special Session chapter 21, article 5,
2.42 	section 13; Laws 2003 First Special Session, chapter
2.43 	21, article 6, section 9; Laws 2005, chapter 43,
2.44 	section 1; proposing coding for new law in Minnesota
2.45 	Statutes, chapters 270; 290C; 473; proposing coding
2.46 	for new law as Minnesota Statutes, chapter 270C;
2.47 	repealing Minnesota Statutes 2004, sections 270.01;
2.48 	270.02; 270.021; 270.022; 270.04; 270.05; 270.052;
2.49 	270.058; 270.059; 270.06; 270.0601; 270.0602;
2.50 	270.0603; 270.0604; 270.0605; 270.061; 270.062;
2.51 	270.063; 270.064; 270.065; 270.066; 270.0665; 270.067;
2.52 	270.068; 270.0681; 270.0682; 270.069; 270.07; 270.084;
2.53 	270.09; 270.10; 270.101; 270.102; 270.11, subdivisions
2.54 	2, 3, 4, 5, 6, 7; 270.13; 270.14; 270.15; 270.16;
2.55 	270.17; 270.18; 270.19; 270.20; 270.21; 270.22;
2.56 	270.23; 270.24; 270.25; 270.26; 270.27; 270.271;
2.57 	270.272; 270.273; 270.274; 270.275; 270.276; 270.277;
2.58 	270.278; 270.30; 270.485; 270.494; 270.60; 270.65;
2.59 	270.652; 270.66; 270.67; 270.68; 270.69; 270.691;
2.60 	270.70; 270.7001; 270.7002; 270.701; 270.702; 270.703;
2.61 	270.704; 270.705; 270.706; 270.707; 270.708; 270.709;
2.62 	270.71; 270.72; 270.721; 270.73; 270.74; 270.75;
2.63 	270.76; 270.771; 270.78; 270.79; 270.85; 270.88;
2.64 	273.19, subdivision 5; 273.37, subdivision 3; 274.05;
2.65 	275.15; 275.61, subdivision 2; 283.07; 287.39;
2.66 	289A.07; 289A.13; 289A.31, subdivisions 3, 4, 6;
2.67 	289A.36; 289A.37, subdivisions 1, 3, 4, 5; 289A.38,
2.68 	subdivision 13; 289A.43; 289A.65; 290.48, subdivisions
2.69 	3, 4; 290.92, subdivisions 6b, 22, 23; 290.97;
2.70 	296A.20; 296A.201; 296A.25; 297A.86; 297A.93; 297D.14;
2.71 	297E.08; 297E.09; 297E.12, subdivision 10; 297E.15;
3.1 	297F.15, subdivisions 1, 2, 3, 4, 5, 6, 7, 8; 297F.16;
3.2 	297F.22; 297G.14, subdivisions 1, 2, 3, 4, 5, 6, 7, 8;
3.3 	297G.15; 297G.21; 297I.45; 297I.50; 297I.55; 297I.95;
3.4 	Laws 1975, chapter 287, section 5; Laws 1998, chapter
3.5 	389, article 3, section 41; Laws 2003, chapter 127,
3.6 	article 9, section 9, subdivision 4; Minnesota Rules,
3.7 	parts 8093.2000; 8093.3000; 8130.0110, subpart 4;
3.8 	8130.0200, subparts 5, 6; 8130.0400, subpart 9;
3.9 	8130.1200, subparts 5, 6; 8130.2900; 8130.3100,
3.10 	subpart 1; 8130.4000, subparts 1, 2; 8130.4200,
3.11 	subpart 1; 8130.4400, subpart 3; 8130.5200; 8130.5600,
3.12 	subpart 3; 8130.5800, subpart 5; 8130.7300, subpart 5;
3.13 	8130.8800, subpart 4.
3.14 	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

3.15 	ARTICLE 1
3.16 	RECODIFICATION
3.17 	COMMISSIONER GENERAL POWERS

3.18 	Section 1. [270C.01] DEFINITIONS.
3.19 		Subdivision 1.Applicability. For purposes of this
3.20 	chapter only, the following words, terms, and phrases have the
3.21 	meanings given them in this section unless the language or
3.22 	context clearly indicates that a different meaning is intended.
3.23 		Subd. 2.Commissioner. "Commissioner" means the
3.24 	commissioner of revenue or a person to whom the commissioner has
3.25 	delegated functions.
3.26 		Subd. 3.Department. "Department" means the Department
3.27 	of Revenue.
3.28 		Subd. 4.Electronic means; electronically. "Electronic
3.29 	means" and "electronically" mean a method that is electronic, as
3.30 	defined in section 325L.02, paragraph (e), and that is
3.31 	prescribed by the commissioner.
3.32 		Subd. 5.Law administered by the commissioner. "Law
3.33 	administered by the commissioner" means a law or rule that vests
3.34 	or imposes a power, duty, responsibility, or authority in the
3.35 	commissioner, except the following laws:  (1) the property tax
3.36 	laws, and (2) Minnesota Statutes, chapter 16D.
3.37 		Subd. 6.Person. "Person" means an individual, trust,
3.38 	estate, fiduciary, partnership, company, corporation, limited
3.39 	liability company, association, governmental unit or agency,
3.40 	public or private organization of any kind, or other legal
3.41 	entity.
3.42 		Subd. 7.Property tax laws. "Property tax laws" means
4.1 	all laws and rules related to the administration of the tax on
4.2 	property referred to in section 272.01, subdivision 1, and all
4.3 	laws related to the administration of the tax on wind energy
4.4 	production imposed under section 272.029, subdivision 1.
4.5 		Subd. 8.Return. "Return" means a return, information
4.6 	return, or report, required by a law administered by the
4.7 	commissioner.
4.8 		Subd. 9.State revenue laws. "State revenue laws" means
4.9 	all laws administered by the commissioner and the property tax
4.10 	laws.
4.11 		Subd. 10.Tax. "Tax" means a tax or fee imposed by a law
4.12 	administered by the commissioner.
4.13 		Subd. 11.Taxpayer. "Taxpayer" means a person subject
4.14 	to, or liable for, a tax or fee imposed by a law administered by
4.15 	the commissioner; a person required to file a return,
4.16 	information return, or report, with respect to, or to pay, or
4.17 	withhold or collect and remit, a tax or fee imposed by a law
4.18 	administered by the commissioner; a person required to obtain a
4.19 	license or a permit under a law administered by the
4.20 	commissioner; or a person required to keep records regarding a
4.21 	tax or fee imposed by a law administered by the commissioner.
4.22 	
EFFECTIVE DATE. This section is effective August 1, 2005.

4.23 	Sec. 2. [270C.02] DEPARTMENT OF REVENUE; COMMISSIONER.
4.24 		Subdivision 1.Commissioner; supervision of department
4.25 	and appointment. The Department of Revenue is under the
4.26 	supervision and control of the commissioner.  The commissioner
4.27 	shall be appointed by the governor under the provisions of
4.28 	section 15.06.  The commissioner shall be selected on the basis
4.29 	of ability and experience in the field of tax administration and
4.30 	without regard to political affiliations.[270.01; 270.02,
4.31 	subd. 8]
4.32 		Subd. 2.Power to appoint staff. (a) The commissioner
4.33 	may organize the department as the commissioner deems necessary,
4.34 	and appoint one deputy commissioner, a department secretary,
4.35 	directors of divisions, and such other officers, employees, and
4.36 	agents, as the commissioner deems necessary to carry out the
5.1 	duties, responsibilities, and authority entrusted to the
5.2 	commissioner.  The commissioner may define the duties of such
5.3 	officers, employees, and agents, and delegate to them any of the
5.4 	commissioner's powers or duties, subject to the commissioner's
5.5 	control and under such conditions as the commissioner may
5.6 	prescribe.  Appointments to exercise delegated power to sign
5.7 	documents which require the signature of the commissioner or a
5.8 	delegate by law shall be by written order filed with the
5.9 	secretary of state.[270.02, subd. 3]
5.10 	(b) The commissioner may appoint agents as the commissioner
5.11 	considers necessary to make examinations and determinations.
5.12 	The agents have the rights and powers conferred on the
5.13 	commissioner to subpoena, examine, and copy books, records,
5.14 	papers, or memoranda, subpoena witnesses, administer oaths and
5.15 	affirmations, and take testimony.[270.06, clause (17)]
5.16 		Subd. 3.Salaries. The commissioner shall appoint and
5.17 	employ additional employees and other agents, purchase supplies
5.18 	or materials, or incur other expenditures in the administration
5.19 	and enforcement of state revenue laws as considered necessary.
5.20 	The salaries of all agents and employees provided for in this
5.21 	chapter shall be fixed by the appointing authority, subject to
5.22 	the approval of the commissioner of employee relations.
5.23 	[270.06, clause (18)]
5.24 		Subd. 4.Office and supplies furnished; expenses. The
5.25 	commissioner shall be provided with suitable and necessary
5.26 	office furniture, supplies, stationery, books, periodicals,
5.27 	newspapers, maps, and financial and commercial reports; and all
5.28 	necessary expenses therefor shall be audited and paid as other
5.29 	expenses are audited and paid.  The actual necessary expenses of
5.30 	the commissioner, the commissioner's employees and agents, and
5.31 	such experts and assistants as may be employed by the
5.32 	commissioner while traveling on the business of the department,
5.33 	shall be paid by the state.  The expenditures must be sworn to
5.34 	by the party who incurred the expense and approved by the
5.35 	commissioner.[270.04]
5.36 		Subd. 5.Filing officers. The commissioner is the filing
6.1 	officer and custodian of the books, files, and records of the
6.2 	department.  The commissioner may certify copies of the books,
6.3 	files, and records in the custody of the commissioner for all
6.4 	purposes in the same manner as other custodians of public
6.5 	records.  The commissioner may authorize other employees of the
6.6 	department to certify books, files, and records in the custody
6.7 	of the commissioner.  The authorization must be made by a
6.8 	written order stating the documents that may be certified and
6.9 	must be filed with the secretary of state.[270.022]
6.10 		Subd. 6.Department seal. The department shall have a
6.11 	seal engraved with the words, "State of Minnesota, Department of
6.12 	Revenue."  Such seal may be used to authenticate the official
6.13 	acts of the commissioner or any other employees of the
6.14 	department, but the failure to use the seal shall not invalidate
6.15 	any such acts.  Duplicate seals may be provided for the use of
6.16 	directors of divisions or other employees of the department.
6.17 	[270.02, subd. 4]
6.18 	
EFFECTIVE DATE. This section is effective August 1, 2005.

6.19 	Sec. 3. [270C.03] POWERS AND DUTIES.
6.20 		Subdivision 1.Powers and duties. The commissioner shall
6.21 	have and exercise the following powers and duties:
6.22 	(1) administer and enforce the assessment and collection of
6.23 	taxes;[270.06, clause (14)]
6.24 	(2) make determinations, corrections, and assessments with
6.25 	respect to taxes, including interest, additions to taxes, and
6.26 	assessable penalties;[289A.35, first sentence]
6.27 	(3) use statistical or other sampling techniques consistent
6.28 	with generally accepted auditing standards in examining returns
6.29 	or records and making assessments;[289A.35, last sentence]
6.30 	(4) investigate the tax laws of other states and countries,
6.31 	and formulate and submit to the legislature such legislation as
6.32 	the commissioner may deem expedient to prevent evasions of state
6.33 	revenue laws and to secure just and equal taxation and
6.34 	improvement in the system of state revenue laws;[270.06, clause
6.35 	(10)]
6.36 	(5) consult and confer with the governor upon the subject
7.1 	of taxation, the administration of the laws in regard thereto,
7.2 	and the progress of the work of the department, and furnish the
7.3 	governor, from time to time, such assistance and information as
7.4 	the governor may require relating to tax matters;[270.06,
7.5 	clause (11)]
7.6 	(6) execute and administer any agreement with the secretary
7.7 	of the treasury of the United States or a representative of
7.8 	another state regarding the exchange of information and
7.9 	administration of the state revenue laws;[270.06, clause (19)]
7.10 	(7) require town, city, county, and other public officers
7.11 	to report information as to the collection of taxes received
7.12 	from licenses and other sources, and such other information as
7.13 	may be needful in the work of the commissioner, in such form as
7.14 	the commissioner may prescribe;[270.06, clause (5)]
7.15 	(8) authorize the use of unmarked motor vehicles to conduct
7.16 	seizures or criminal investigations pursuant to the
7.17 	commissioner's authority; and [270.06, clause (20)]
7.18 	(9) exercise other powers and authority and perform other
7.19 	duties required of or imposed upon the commissioner by law.
7.20 	[270.06, clause (21)]
7.21 		Subd. 2.Mission; efficiency. It is part of the
7.22 	department's mission that within the department's resources the
7.23 	commissioner shall endeavor to:
7.24 	(1) prevent the waste or unnecessary spending of public
7.25 	money;
7.26 	(2) use innovative fiscal and human resource practices to
7.27 	manage the state's resources and operate the department as
7.28 	efficiently as possible;
7.29 	(3) coordinate the department's activities wherever
7.30 	appropriate with the activities of other governmental agencies;
7.31 	(4) use technology where appropriate to increase agency
7.32 	productivity, improve customer service, increase public access
7.33 	to information about government, and increase public
7.34 	participation in the business of government;
7.35 	(5) utilize constructive and cooperative labor-management
7.36 	practices to the extent otherwise required by chapters 43A and
8.1 	179A;
8.2 	(6) report to the legislature on the performance of agency
8.3 	operations and the accomplishment of agency goals in the
8.4 	agency's biennial budget according to section 16A.10,
8.5 	subdivision 1; and 
8.6 	(7) recommend to the legislature appropriate changes in law
8.7 	necessary to carry out the mission and improve the performance
8.8 	of the department.[270.02, subd. 3a]
8.9 	
EFFECTIVE DATE. This section is effective August 1, 2005.

8.10 	Sec. 4. [270C.04] USE OF INFORMATION.
8.11 	Notwithstanding the provisions of any other law, the
8.12 	commissioner may use any and all information in the
8.13 	commissioner's possession, or to which the commissioner has
8.14 	access, to insure equal and consistent application and
8.15 	enforcement of all state revenue laws.  This section shall not
8.16 	be construed as granting to the commissioner any power to
8.17 	release any information outside the department.[270.065]

8.18 	EFFECTIVE DATE. This section is effective August 1, 2005.

8.19 	Sec. 5. [270C.05] ACCESS TO CRIMINAL JUSTICE DATA.
8.20 	The commissioner may enter into an agreement with the
8.21 	commissioner of public safety to allow designated employees of
8.22 	the Department of Revenue to have access to the criminal justice
8.23 	data communications network provided in section 299C.46.  For
8.24 	purposes of that section, the criminal investigation unit of the
8.25 	Department of Revenue is considered a criminal justice agency.
8.26 	[270.062]

8.27 	EFFECTIVE DATE. This section is effective August 1, 2005.

8.28 	Sec. 6. [270C.055] CRIMINAL INVESTIGATIONS, REFERRAL, AND
8.29 	INFORMATION DISCLOSURE.
8.30 		Subdivision 1.Requesting assistance. If the
8.31 	commissioner has reason to believe that a criminal violation of
8.32 	the state revenue laws or chapter 349 has occurred, the
8.33 	commissioner may request the attorney general or the prosecuting
8.34 	authority of any county to assist in a criminal investigation.
8.35 	[270.064]
8.36 		Subd. 2.Referral for prosecution. If a proceeding is
9.1 	referred to a prosecuting authority, and the prosecuting
9.2 	authority fails to issue or cause to be issued an indictment or
9.3 	criminal complaint within 30 days after the referral by the
9.4 	commissioner, the attorney general may conduct the proceeding.
9.5 		Subd. 3.Authority to disclose information. The
9.6 	commissioner may disclose information to the prosecuting
9.7 	authority and attorney general pursuant to section 270B.05,
9.8 	subdivision 2, clause (1).[270.68, subd. 1, paragraph (c)]
9.9 	
EFFECTIVE DATE. This section is effective August 1, 2005.

9.10 	Sec. 7. [270C.06] RULEMAKING AUTHORITY.
9.11 	The commissioner shall, from time to time, make, publish,
9.12 	and distribute rules for the administration and enforcement of
9.13 	state revenue laws.  The rules have the force of law.[270.06,
9.14 	clause (14)]

9.15 	EFFECTIVE DATE. This section is effective August 1, 2005.

9.16 	Sec. 8. [270C.07] REVENUE NOTICES.
9.17 		Subdivision 1.Authority. The commissioner may make,
9.18 	adopt, and publish interpretive revenue notices.  A "revenue
9.19 	notice" is a policy statement that has been published pursuant
9.20 	to subdivision 5 and that provides interpretation, details, or
9.21 	supplementary information concerning the application of state
9.22 	revenue laws or rules promulgated by the commissioner.  Revenue
9.23 	notices are published for the information and guidance of
9.24 	taxpayers, local government officials, the department, and
9.25 	others concerned.
9.26 		Subd. 2.Effect. Revenue notices do not have the force
9.27 	and effect of law and have no precedential effect, but may be
9.28 	relied on by taxpayers until revoked or modified.  A notice may
9.29 	be expressly revoked or modified by the commissioner, by the
9.30 	issuance of a revenue notice, but may not be revoked or modified
9.31 	retroactively to the detriment of the taxpayers.  A change in
9.32 	the law or an interpretation of the law occurring after the
9.33 	revenue notice is issued, whether in the form of a statute,
9.34 	court decision, administrative rule, or revenue notice, results
9.35 	in revocation or modification of the notice to the extent that
9.36 	the change affects the notice.
10.1 		Subd. 3.Retroactivity. Revenue notices are generally
10.2 	interpretive of existing law and therefore are retroactive to
10.3 	the effective date of the applicable law provision unless
10.4 	otherwise stated in the notice.
10.5 		Subd. 4.Issuance. The issuance of revenue notices is at
10.6 	the discretion of the commissioner.  The commissioner shall
10.7 	establish procedures governing the issuance of revenue notices
10.8 	and tax information bulletins.  At least one week before
10.9 	publication of a revenue notice in the State Register, the
10.10 	commissioner shall provide a copy of the notice to the chairs of
10.11 	the Taxes Committee of the house of representatives and the
10.12 	Taxes and Tax Laws Committee of the senate.
10.13 		Subd. 5.Publication. The commissioner shall publish the
10.14 	revenue notices in the State Register and in any other manner
10.15 	that makes them accessible to the general public.  The
10.16 	commissioner may charge a reasonable fee for publications.
10.17 	[270.0604]
10.18 	
EFFECTIVE DATE. This section is effective August 1, 2005.

10.19 	Sec. 9. [270C.08] TAX INFORMATION BULLETINS.
10.20 	The commissioner may issue tax information bulletins.  "Tax
10.21 	information bulletins" are informational guides to enable
10.22 	taxpayers and local governmental officials to become more
10.23 	familiar with state revenue laws and their rights and
10.24 	responsibilities under these laws.  Nothing contained in the tax
10.25 	information bulletins supersedes, alters, or otherwise changes
10.26 	any provisions of the state revenue laws, administrative rules,
10.27 	court decisions, or revenue notices.[270.0605]

10.28 	EFFECTIVE DATE. This section is effective August 1, 2005.

10.29 	Sec. 10. [270C.09] OPINION OF ATTORNEY GENERAL; EFFECT.
10.30 	The commissioner may in writing request the opinion of the
10.31 	attorney general upon any matter regarding the state revenue
10.32 	laws.  Any written opinion of the attorney general upon any such
10.33 	matter rendered in response to such request shall have the force
10.34 	and effect of law unless and until overruled by a decision of
10.35 	the Tax Court or a court of competent jurisdiction.[270.09]

10.36 	EFFECTIVE DATE. This section is effective August 1, 2005.

11.1 	Sec. 11. [270C.10] EX-EMPLOYEES NOT TO REPRESENT
11.2 	TAXPAYERS; PENALTY.
11.3 	An employee of the department may not, for a period of one
11.4 	year after the employee's employment has terminated, act as
11.5 	counsel, attorney, or agent for a taxpayer in connection with a
11.6 	claim or proceeding pending in the department.  An employee of
11.7 	the department may not act as counsel, attorney, or agent for a
11.8 	taxpayer at any time after termination of employment in
11.9 	connection with a claim or proceeding of which the person has
11.10 	knowledge that was acquired during the term of employment.  A
11.11 	violation of this section is a gross misdemeanor.[270.021]

11.12 	EFFECTIVE DATE. This section is effective August 1, 2005.

11.13 	Sec. 12. [270C.105] BASIS FOR EVALUATION OF DEPARTMENT OF
11.14 	REVENUE EMPLOYEES.
11.15 	The department must not use tax enforcement results to
11.16 	impose individual revenue quotas with respect to employees or
11.17 	their immediate supervisors who are directly involved in
11.18 	assessment or collection activities.  The department may,
11.19 	however, use individual performance with regard to number of
11.20 	cases completed and, in the case of collections employees,
11.21 	dollars collected, as factors in evaluating an employee and not
11.22 	be considered as failing to comply with this section.
11.23 	[270.0602]

11.24 	EFFECTIVE DATE. This section is effective August 1, 2005.

11.25 	Sec. 13. [270C.11] TAX EXPENDITURE BUDGET.
11.26 		Subdivision 1.Statement of purpose. State governmental
11.27 	policy objectives are sought to be achieved both by direct
11.28 	expenditure of governmental funds and by the granting of special
11.29 	and selective tax relief or tax expenditures.  Both direct
11.30 	expenditures of governmental funds and tax expenditures have an
11.31 	effect on the ability of the state and local governments to
11.32 	lower tax rates or to increase expenditures.  As a result, tax
11.33 	expenditures should receive a regular and comprehensive review
11.34 	by the legislature as to (1) their total cost, (2) their
11.35 	effectiveness in achieving their objectives, (3) their effect on
11.36 	the fairness and equity of the distribution of the tax burden,
12.1 	and (4) the public and private cost of administering tax
12.2 	expenditure financed programs.  This section is intended to
12.3 	facilitate a regular review of the state and local tax
12.4 	expenditure budget by the legislature by providing for the
12.5 	preparation of a regular biennial tax expenditure budget.
12.6 		Subd. 2.Preparation; submission. The commissioner shall
12.7 	prepare a tax expenditure budget for the state. The tax
12.8 	expenditure budget report shall be submitted to the legislature
12.9 	by February 1 of each even-numbered year.
12.10 		Subd. 3.Period covered. The report shall include
12.11 	estimates of annual tax expenditures for, at a minimum, a
12.12 	three-year period including the two-year period covered in the
12.13 	governor's budget submitted in the preceding January pursuant to
12.14 	section 16A.11.
12.15 		Subd. 4.Contents. The report shall detail for each tax
12.16 	expenditure item the amount of tax revenue foregone, a citation
12.17 	of the statutory or other legal authority for the expenditure,
12.18 	and the year in which it was enacted or the tax year in which it
12.19 	became effective.  The report may contain additional information
12.20 	which the commissioner considers relevant to the legislature's
12.21 	consideration and review of individual tax expenditure items.
12.22 	This may include, but is not limited to, statements of the
12.23 	intended purpose of the tax expenditure, analysis of whether the
12.24 	expenditure is achieving that objective, and the effect of the
12.25 	expenditure device on the distribution of the tax burden and
12.26 	administration of the tax system.
12.27 		Subd. 5.Revenue estimates; legislative bills. Upon
12.28 	reasonable notice from the chair of the house or senate tax
12.29 	committee that a bill is scheduled for hearing, the commissioner
12.30 	shall prepare an estimate of the effect on the state's tax
12.31 	revenues which would result from the passage of a legislative
12.32 	bill establishing, extending, or restricting a tax expenditure.
12.33 	These revenue estimates shall contain the same information as
12.34 	provided in subdivision 4 for expenditure items contained in the
12.35 	tax expenditure budget, as appropriate.
12.36 		Subd. 6.Definitions. For purposes of this section, the
13.1 	following terms have the meanings given:
13.2 	(1) "tax expenditure" means a tax provision which provides
13.3 	a gross income definition, deduction, exemption, credit, or rate
13.4 	for certain persons, types of income, transactions, or property
13.5 	that results in reduced tax revenue; and 
13.6 	(2) "tax" means any tax of statewide application or any tax
13.7 	authorized by state law to be levied by local governments
13.8 	generally.  It does not include a special local tax levied
13.9 	pursuant to special law or to a special local tax levied
13.10 	pursuant to general authority that is no longer applicable to
13.11 	local governments generally.[270.067]
13.12 	
EFFECTIVE DATE. This section is effective August 1, 2005.

13.13 	Sec. 14. [270C.12] TAX INFORMATION SAMPLE DATA.
13.14 		Subdivision 1.Preparation of samples. The commissioner
13.15 	shall prepare microdata samples of income tax returns and other
13.16 	information useful for purposes of:
13.17 	(1) estimating state revenues;
13.18 	(2) simulating the effect of changes or proposed changes in
13.19 	state and federal tax law on the amount of state revenues; and 
13.20 	(3) analyzing the incidence of present or proposed taxes.
13.21 		Subd. 2.Coordinating committee. A coordinating
13.22 	committee is established to oversee and coordinate preparation
13.23 	of the microdata samples.  The committee consists of:
13.24 	(1) the director of the Research Division of the department
13.25 	who shall serve as chair of the committee;
13.26 	(2) the state economist;
13.27 	(3) the chair of the Committee on Taxes of the house of
13.28 	representatives or the chair's designee; and 
13.29 	(4) the chair of the Committee on Taxes and Tax Laws of the
13.30 	senate or the chair's designee.  The committee shall consider
13.31 	the analysis needs and use of the microdata samples by the
13.32 	finance and revenue departments and the legislature in designing
13.33 	and preparing the samples, including the type of data to be
13.34 	included, the structure of the samples, size of the samples, and
13.35 	other relevant factors.
13.36 		Subd. 3.Contents of samples. The samples must consist
14.1 	of information derived from a random sample of federal and
14.2 	Minnesota individual income tax returns.  The samples prepared
14.3 	in odd numbered years must be augmented by additional
14.4 	information from other sources as the coordinating committee
14.5 	determines is feasible and appropriate.  The coordinating
14.6 	committee shall consider inclusion of:
14.7 	(1) information derived from property tax refund returns;
14.8 	(2) the estimated market value of the taxpayer's home from
14.9 	the homestead declaration; and 
14.10 	(3) information from other sources, such as the surveys
14.11 	conducted by the United States Departments of Commerce and Labor.
14.12 		Subd. 4.Consultation on analysis models. The
14.13 	coordinating committee shall facilitate regular consultation
14.14 	among the Department of Revenue, the Department of Finance, and
14.15 	house and senate staffs in development and maintenance of their
14.16 	respective computer models used to analyze the microdata
14.17 	samples.  The committee shall encourage efforts to attain more
14.18 	commonality in the models, greater sharing of program
14.19 	development efforts and programming tasks, and more consistency
14.20 	in the resulting analyses.[270.0681]
14.21 	
EFFECTIVE DATE. This section is effective August 1, 2005.

14.22 	Sec. 15. [270C.13] TAX INCIDENCE REPORTS.
14.23 		Subdivision 1.Biennial report. The commissioner shall
14.24 	report to the legislature by March 1 of each odd-numbered year
14.25 	on the overall incidence of the income tax, sales and excise
14.26 	taxes, and property tax.  The report shall present information
14.27 	on the distribution of the tax burden as follows:  (1) for the
14.28 	overall income distribution, using a systemwide incidence
14.29 	measure such as the Suits index or other appropriate measures of
14.30 	equality and inequality; (2) by income classes, including at a
14.31 	minimum deciles of the income distribution; and (3) by other
14.32 	appropriate taxpayer characteristics.
14.33 		Subd. 2.Bill analyses. At the request of the chair of
14.34 	the house Tax Committee or the senate Committee on Taxes and Tax
14.35 	Laws, the commissioner shall prepare an incidence impact
14.36 	analysis of a bill or a proposal to change the tax system which
15.1 	increases, decreases, or redistributes taxes by more than
15.2 	$20,000,000.  To the extent data is available on the changes in
15.3 	the distribution of the tax burden that are affected by the bill
15.4 	or proposal, the analysis shall report on the incidence effects
15.5 	that would result if the bill were enacted.  The report may
15.6 	present information using systemwide measures, such as Suits or
15.7 	other similar indexes, by income classes, taxpayer
15.8 	characteristics, or other relevant categories.  The report may
15.9 	include analyses of the effect of the bill or proposal on
15.10 	representative taxpayers.  The analysis must include a statement
15.11 	of the incidence assumptions that were used in computing the
15.12 	burdens.
15.13 		Subd. 3.Income measure. The incidence analyses shall
15.14 	use the broadest measure of economic income for which reliable
15.15 	data is available.[270.0682]
15.16 	
EFFECTIVE DATE. This section is effective August 1, 2005.

15.17 	Sec. 16. [270C.14] AUTHORITY TO PAY LOCAL TAXES;
15.18 	APPROPRIATION.
15.19 	The commissioner may pay to any local government unit, any
15.20 	locally imposed sales taxes that may be assessed against the
15.21 	department.  There is appropriated to the commissioner from the
15.22 	general fund the amount needed to make the payments.[270.058]

15.23 	EFFECTIVE DATE. This section is effective August 1, 2005.

15.24 	Sec. 17. [270C.15] REVENUE DEPARTMENT SERVICE AND
15.25 	RECOVERY SPECIAL REVENUE FUND.
15.26 	A Revenue Department service and recovery special revenue
15.27 	fund is created for the purpose of recovering the costs of
15.28 	furnishing government data and related services or products, as
15.29 	well as recovering costs associated with collecting local taxes
15.30 	on sales.  All money collected under this section is deposited
15.31 	in the Revenue Department service and recovery special revenue
15.32 	fund.  Money in the fund is appropriated to the commissioner to
15.33 	reimburse the department for the costs incurred in administering
15.34 	the tax law or providing the data, service, or product.  Any
15.35 	money paid to the department as a criminal fine for a violation
15.36 	of state revenue law that is designated by the court to fund
16.1 	enforcement of state revenue law is appropriated to this fund.
16.2 	[270.059]

16.3 	EFFECTIVE DATE. This section is effective August 1, 2005.

16.4 	Sec. 18. [270C.16] COLLECTION OF DELINQUENT LIABILITIES;
16.5 	COSTS.
16.6 		Subdivision 1.Appropriation. For the purpose of
16.7 	collecting delinquent tax liabilities or debts as defined in
16.8 	section 16D.02, subdivision 3, there is appropriated to the
16.9 	commissioner an amount representing the cost of collection by
16.10 	contract with collection agencies, revenue departments of other
16.11 	states, or attorneys to enable the commissioner to reimburse
16.12 	these agencies, departments, or attorneys for this service.  The
16.13 	commissioner shall report quarterly on the status of this
16.14 	program to the chair of the house Tax and Appropriation
16.15 	Committees and senate Tax and Finance Committees.[270.063,
16.16 	subd. 1]
16.17 		Subd. 2.Prepayment. Notwithstanding section 16A.15,
16.18 	subdivision 3, the commissioner may authorize the prepayment of
16.19 	sheriff's fees, attorney fees, fees charged by revenue
16.20 	departments of other states, or court costs to be incurred in
16.21 	connection with the collection of delinquent tax liabilities
16.22 	owed to the commissioner.[270.063, subd. 2]
16.23 	
EFFECTIVE DATE. This section is effective August 1, 2005.

16.24 	Sec. 19. [270C.17] COMMISSIONER TO COLLECT CERTAIN LOCAL
16.25 	TAXES.
16.26 		Subdivision 1.Costs deducted; appropriation. If the
16.27 	commissioner agrees to collect a local tax, the local unit of
16.28 	government must agree that all the direct and indirect costs of
16.29 	the department for collecting the tax and any other statewide
16.30 	indirect costs will be deducted from the amounts collected and
16.31 	paid to the local unit of government.
16.32 		Subd. 2.Development costs. If the commissioner
16.33 	determines that a new computer system will be required to
16.34 	collect the local taxes, the costs of development of the system
16.35 	will be charged to the first local units of government to be
16.36 	included in the system.  Any additional local units of
17.1 	government that by agreement are added to the system will be
17.2 	charged for a share of the development costs.  The charge will
17.3 	be determined by the commissioner who shall then refund to the
17.4 	original local units of government their portion of the
17.5 	development costs recovered from the additional users.
17.6 	[270.069]
17.7 	
EFFECTIVE DATE. This section is effective August 1, 2005.

17.8 	Sec. 20. [270C.18] SETOFF OF POLITICAL SUBDIVISION
17.9 	DEBTS.
17.10 	(a) As used in this section, "political subdivision" means
17.11 	counties and home rule charter or statutory cities, and "debts"
17.12 	means a legal obligation to pay a fixed amount of money, which
17.13 	equals or exceeds $100 and which is due and payable to the
17.14 	claimant political subdivision.
17.15 	(b) If one political subdivision owes a debt to another
17.16 	political subdivision, and the debt has not been paid within six
17.17 	months of the date when payment was due, the creditor political
17.18 	subdivision may notify the commissioner of the debt, and shall
17.19 	provide the commissioner with information sufficient to verify
17.20 	the claim.  If the commissioner has reason to believe that the
17.21 	claim is valid, and the debt has not been paid, the commissioner
17.22 	shall initiate setoff procedures under this section.
17.23 	(c) Within ten days of receipt of the notification from the
17.24 	creditor political subdivision, the commissioner shall send a
17.25 	written notice to the debtor political subdivision, advising it
17.26 	of the nature and amount of the claim.  This written notice
17.27 	shall advise the debtor of the creditor political subdivision's
17.28 	intention to request setoff of the refund against the debt.
17.29 	The notice will also advise the debtor that the debt can be
17.30 	setoff against a state aid payment, and will advise the debtor
17.31 	of the right to contest the validity of the claim at a hearing.
17.32 	The debtor must assert this right by written request to the
17.33 	commissioner, which request the commissioner must receive within
17.34 	45 days of the mailing date of the notice.
17.35 	(d) If the commissioner receives written notice of a debtor
17.36 	political subdivision's intention to contest at hearing the
18.1 	claim upon which the intended setoff is based, the commissioner
18.2 	shall initiate a hearing according to contested case procedures
18.3 	established in the state Administrative Procedure Act not later
18.4 	than 30 days after receipt of the debtor's request for a
18.5 	hearing.  The costs of the hearing shall be paid equally by the
18.6 	political subdivisions that are parties to the hearing.  The
18.7 	Office of Administrative Hearings shall separately bill each
18.8 	political subdivision for one-half of the costs.
18.9 	(e) If the debtor political subdivision does not object to
18.10 	the claim, or does not prevail in an objection to the claim or
18.11 	at a hearing on the claim, the commissioner shall deduct the
18.12 	amount of the debt from the next payment scheduled to be made to
18.13 	the debtor under section 273.1398 or chapter 477A.  The
18.14 	commissioner shall remit the amount deducted to the claimant
18.15 	political subdivision.[270.66, subd. 4]

18.16 	EFFECTIVE DATE. This section is effective August 1, 2005.

18.17 	Sec. 21. [270C.19] TAXES AND FEES; REFUND AND SHARING
18.18 	AGREEMENTS WITH INDIANS.
18.19 		Subdivision 1.Taxes paid by indians. The commissioner
18.20 	is authorized to enter into a tax refund agreement with the
18.21 	governing body of any federally recognized Indian reservation in
18.22 	Minnesota.  The agreement may provide for a mutually agreed upon
18.23 	amount as a refund to the governing body of any sales or excise
18.24 	tax paid by the total resident Indian population on or adjacent
18.25 	to a reservation into the state treasury, or for an amount which
18.26 	measures the economic value of an agreement by the tribal
18.27 	government to pay the equivalent of the state sales tax on items
18.28 	included in the sales tax base but exempt on the reservation,
18.29 	notwithstanding any other law which limits the refundment of
18.30 	taxes.  The total resident Indian population on or adjacent to a
18.31 	reservation shall be defined according to the United States
18.32 	Department of the Interior, Bureau of Indian Affairs, as
18.33 	determined and stated in its Report on Service Population and
18.34 	Labor Force.
18.35 		Subd. 2.Sales, use, and excise taxes. (a) The
18.36 	commissioner is authorized to enter into a tax agreement with
19.1 	the governing body of any federally recognized Indian
19.2 	reservation in Minnesota, that provides for the state and the
19.3 	tribal government to share sales, use, and excise tax revenues
19.4 	generated from on reservation activities of non-Indians and off
19.5 	reservation activities of members of the reservation.  Every
19.6 	agreement entered into pursuant to this subdivision must require
19.7 	the commissioner to collect all state and tribal taxes covered
19.8 	by the agreement.
19.9 	(b) The commissioner is authorized to collect any tribal
19.10 	taxes imposed pursuant to any agreement entered into pursuant to
19.11 	this subdivision and to make payments authorized by the
19.12 	agreement to the tribal government from the funds collected.
19.13 	(c) The commissioner shall pay to the tribal government its
19.14 	share of the taxes collected pursuant to the agreement, as
19.15 	indicated in the agreement, and grant the taxpayer a credit for
19.16 	the taxpayer's share of the amount paid to the tribal government
19.17 	against the taxpayer's Minnesota tax.
19.18 		Subd. 3.Appropriation. There is annually appropriated
19.19 	from the general fund to the commissioner the amounts necessary
19.20 	to make the refunds provided in this section.
19.21 		Subd. 4.Payments to counties. (a) The commissioner
19.22 	shall pay to a county in which an Indian gaming casino is
19.23 	located:
19.24 	(1) ten percent of the state share of all taxes generated
19.25 	from activities on reservations and collected under a tax
19.26 	agreement under this section with the tribal government for the
19.27 	reservation located in the county; or 
19.28 	(2) five percent of excise taxes collected by the state
19.29 	that are determined by the department to have been generated
19.30 	from activities on a reservation located in the county, the
19.31 	tribal government of which does not have a tax agreement under
19.32 	this section and did not have a tax agreement on June 30, 2003.
19.33 	If the tribe has casinos located in more than one county,
19.34 	the payment must be divided equally among the counties in which
19.35 	the casinos are located.
19.36 	(b) The commissioner shall make the payments required under
20.1 	this subdivision by February 28 of the year following the year
20.2 	the taxes are collected.
20.3 	(c) An amount sufficient to make the payments authorized by
20.4 	this subdivision is annually appropriated from the general fund
20.5 	to the commissioner.
20.6 		Subd. 5.Fees; appropriation. (a) The commissioner may
20.7 	enter into an agreement with the governing body of any federally
20.8 	recognized Indian reservation in Minnesota concerning fees
20.9 	administered by the commissioner that are paid by the tribe,
20.10 	members of the tribe, or persons who conduct business with the
20.11 	tribe, or otherwise imposed on on-reservation activities.  The
20.12 	agreement may provide for the refund or sharing of the fee.  The
20.13 	commissioner may make any payments required by the agreement
20.14 	from the fees collected.
20.15 	(b) Each head of an agency, board, or other governmental
20.16 	entity that administers a program that is funded by fees
20.17 	administered by the commissioner may sign an agreement entered
20.18 	into by the commissioner under this subdivision.  An agreement
20.19 	is not valid until signed by the head of each agency, board, or
20.20 	other governmental entity that administers a program funded by
20.21 	the particular fee covered in an agreement and by the
20.22 	commissioner.
20.23 	(c) There is annually appropriated to the commissioner from
20.24 	the funds for which the fees are collected the amounts necessary
20.25 	to make payments as provided in this subdivision.[270.60]
20.26 	
EFFECTIVE DATE. This section is effective August 1, 2005.
20.27 	TAX ADMINISTRATION

20.28 	Sec. 22. [270C.25] PROHIBITION OF SUITS TO RESTRAIN
20.29 	ASSESSMENT OR COLLECTION.
20.30 		Subdivision 1.General rule. No suit to restrain
20.31 	assessment or collection of a tax, fee, penalty, or interest,
20.32 	imposed by a law administered by the commissioner, including a
20.33 	declaratory judgment action, can be maintained in any court by
20.34 	any person except pursuant to the express procedures in (1) this
20.35 	chapter, (2) chapter 271, (3) chapter 289A, and (4) any other
20.36 	law administered by the commissioner for contesting the
21.1 	assessment or collection of taxes, fees, penalties, or interest.
21.2 		Subd. 2.Facial challenge to constitutionality. An
21.3 	action, otherwise prohibited under subdivision 1, that asserts a
21.4 	facial challenge to the constitutionality of a tax or fee
21.5 	imposed by a law administered by the commissioner may be
21.6 	maintained only if it is demonstrated to the court by clear and
21.7 	convincing evidence that under no circumstances could the
21.8 	commissioner ultimately prevail and that the taxpayer or fee
21.9 	payer will suffer irreparable harm if the relief sought is not
21.10 	granted.[289A.43]
21.11 	
EFFECTIVE DATE. This section is effective August 1, 2005.

21.12 	Sec. 23. [270C.26] PENALTY FOR FILING CERTAIN DOCUMENTS
21.13 	AGAINST DEPARTMENT OF REVENUE EMPLOYEES.
21.14 		Subdivision 1.Definitions. (a) "Recording office" means
21.15 	a county recorder, registrar of titles, or secretary of state in
21.16 	this state or another state.
21.17 	(b) "Filing party" means the person or persons requesting
21.18 	or causing another person to request that the recording office
21.19 	accept documents or instruments for recording or filing.
21.20 		Subd. 2.Invalid documents naming commissioner or
21.21 	department employees. Filing a document, including a
21.22 	nonconsensual common law lien under section 514.99, that
21.23 	purports to create a claim against the commissioner or an
21.24 	employee of the department based on performance or
21.25 	nonperformance of duties by the commissioner or employee is
21.26 	invalid unless accompanied by a specific order from a court of
21.27 	competent jurisdiction authorizing the filing of the document or
21.28 	unless a specific statute authorizes the filing of the document.
21.29 		Subd. 3.Civil penalty. If a filing party causes a
21.30 	document described in subdivision 2 to be recorded in a
21.31 	recording office, the commissioner may assess a penalty against
21.32 	the filing party of $1,000 per document filed, payable to the
21.33 	general fund.  An order assessing a penalty under this section
21.34 	is reviewable administratively under section 270C.35 and is
21.35 	appealable to Tax Court under chapter 271.  The penalty is
21.36 	collected and paid in the same manner as a tax collected by the
22.1 	commissioner.  The penalty is in addition to any other remedy
22.2 	available to the commissioner or to an employee of the
22.3 	department against whom the document has been filed.[270.278]
22.4 	
EFFECTIVE DATE. This section is effective August 1, 2005.

22.5 	Sec. 24. [270C.27] CIVIL DAMAGES FOR FAILURE TO RELEASE
22.6 	LIEN.
22.7 		Subdivision 1.In general. (a) A taxpayer may bring a
22.8 	civil action for damages against the commissioner in district
22.9 	court when an employee or the department has knowingly or
22.10 	negligently:
22.11 	(1) failed to release a lien as required by section
22.12 	270C.63, subdivision 11; or 
22.13 	(2) failed to release a lien within 30 days after
22.14 	satisfaction of the liability on which the lien is based.
22.15 	(b) An action under paragraph (a), clause (2), must be
22.16 	preceded by 30 days' written notice by the taxpayer to the
22.17 	commissioner and the taxpayer's rights advocate that the lien
22.18 	has not been released.  An action under paragraph (a) must be
22.19 	commenced within two years after the date the right of action
22.20 	accrued.
22.21 		Subd. 2.Damages. On a finding of liability on the part
22.22 	of the defendant in an action brought under subdivision 1, the
22.23 	defendant is liable to the plaintiff in an amount equal to the
22.24 	sum of actual, direct economic damages sustained by the
22.25 	plaintiff due to the actions of the defendant, plus the costs of
22.26 	the action.  Damages must be paid in accordance with section
22.27 	3.736, subdivision 7.
22.28 		Subd. 3.Mitigation of damages. Damages awarded must be
22.29 	reduced by the amount of the damages that could reasonably have
22.30 	been mitigated by the plaintiff.[270.275]
22.31 	
EFFECTIVE DATE. This section is effective August 1, 2005.

22.32 	Sec. 25. [270C.275] CIVIL DAMAGES FOR CERTAIN
22.33 	UNAUTHORIZED COLLECTION ACTIONS.
22.34 		Subdivision 1.In general. If in connection with the
22.35 	collection of delinquent taxes, an employee of the department
22.36 	recklessly or intentionally disregards a law administered by the
23.1 	commissioner, the taxpayer may bring a civil action for damages
23.2 	against the commissioner in district court within two years
23.3 	after the date the right of action accrues.
23.4 		Subd. 2.Damages. On a finding of liability on the part
23.5 	of the defendant in an action brought under subdivision 1, the
23.6 	defendant is liable to the plaintiff in an amount equal to the
23.7 	lesser of $200,000, or the sum of (1) actual, direct economic
23.8 	damages sustained by the plaintiff as a proximate result of the
23.9 	reckless or intentional actions of the employee and (2) the
23.10 	costs of the action.  Damages must be paid in accordance with
23.11 	section 3.736, subdivision 7.
23.12 		Subd. 3.Limitations. A judgment for damages must not be
23.13 	awarded under subdivision 2 unless the court determines that the
23.14 	plaintiff has exhausted the administrative remedies available to
23.15 	the plaintiff within the department.  Damages awarded must be
23.16 	reduced by the amount of the damages that could reasonably have
23.17 	been mitigated by the plaintiff.
23.18 		Subd. 4.Penalties for procedures instituted primarily
23.19 	for delay. When it appears to the district court that:
23.20 	(1) proceedings before it under this section have been
23.21 	instituted or maintained by the taxpayer primarily for delay;
23.22 	(2) the taxpayer's position in such proceeding is frivolous
23.23 	or groundless; or 
23.24 	(3) the taxpayer unreasonably failed to pursue available
23.25 	administrative remedies,
23.26 	the district court, in its decision, may require the taxpayer to
23.27 	pay to the department a penalty not in excess of $25,000.  The
23.28 	penalty may be collected and paid in the same manner as a tax
23.29 	collected by the commissioner.[270.276]
23.30 	
EFFECTIVE DATE. This section is effective August 1, 2005.

23.31 	Sec. 26. [270C.28] DISCLOSURE OF RIGHTS OF TAXPAYERS.
23.32 		Subdivision 1.In general. The commissioner shall
23.33 	prepare statements that set forth in simple and nontechnical
23.34 	terms:
23.35 	(1) the rights and obligations of the department and the
23.36 	taxpayer during an audit;
24.1 	(2) the procedures by which a taxpayer may appeal an
24.2 	adverse decision of the department, including administrative and
24.3 	judicial appeals;
24.4 	(3) the procedures for filing refund claims and filing of
24.5 	taxpayer complaints; and 
24.6 	(4) the procedures that the department may use in enforcing
24.7 	a law administered by the commissioner, including assessment,
24.8 	jeopardy assessment, levy and distraint, and the filing of liens.
24.9 		Subd. 2.Distribution. The appropriate statement
24.10 	prepared in accordance with subdivision 1 must be distributed by
24.11 	the commissioner to all taxpayers contacted with respect to the
24.12 	determination or collection of a tax, other than the providing
24.13 	of tax forms.  Failure to receive the statement does not
24.14 	invalidate the determination or collection action.[270.0603]
24.15 	
EFFECTIVE DATE. This section is effective August 1, 2005.

24.16 	Sec. 27. [270C.285] PROCEDURES INVOLVING IN-PERSON
24.17 	TAXPAYER INTERVIEWS.
24.18 		Subdivision 1.Recording of interviews. (a) Upon
24.19 	reasonable advance notice from the taxpayer, a taxpayer shall be
24.20 	allowed to make an audio recording, with the taxpayer's
24.21 	equipment and at the taxpayer's expense, of an interview of the
24.22 	taxpayer by the department regarding the audit or collection of
24.23 	a tax.
24.24 	(b) An employee of the department may record an interview
24.25 	described in paragraph (a) if the taxpayer is informed of the
24.26 	recording before the interview and a transcript or copy of the
24.27 	recording is made available to the taxpayer on the taxpayer's
24.28 	request, provided the department is reimbursed by the taxpayer
24.29 	for the cost of transcribing or copying the recording.
24.30 		Subd. 2.Safeguards. (a) Before or at the start of an
24.31 	initial interview, an employee of the department shall provide
24.32 	to the taxpayer in the case of an audit interview an explanation
24.33 	of the audit process and the taxpayer's rights under that
24.34 	process and, in the case of a collection interview, an
24.35 	explanation of the collection process and the taxpayer's rights
24.36 	under that process.
25.1 	(b) If a taxpayer requests to consult with an attorney,
25.2 	accountant, agent, preparer, or any other person permitted to
25.3 	represent the taxpayer before the department at any time during
25.4 	an interview, except an interview initiated by an administrative
25.5 	subpoena, the interview must be suspended for no more than 30
25.6 	days.
25.7 		Subd. 3.Representatives holding power of attorney. An
25.8 	attorney, accountant, agent, preparer, or any other person
25.9 	permitted to represent the taxpayer before the department who
25.10 	has a written power of attorney executed by the taxpayer may
25.11 	represent the taxpayer in an interview described in subdivision
25.12 	1.  The taxpayer may be required to accompany the representative
25.13 	only if a subpoena is issued.  In this instance, with the
25.14 	consent of an immediate supervisor and after ten days' notice to
25.15 	the representative, the department employee may notify the
25.16 	taxpayer directly that the employee believes the representative
25.17 	is unreasonably delaying the examination or investigation
25.18 	process.
25.19 		Subd. 4.Not to apply to certain investigations. This
25.20 	section does not apply to criminal investigations or
25.21 	investigations relating to the conduct of an employee of the
25.22 	department.[270.272]
25.23 	
EFFECTIVE DATE. This section is effective August 1, 2005.

25.24 	Sec. 28. [270C.29] NOTICES TO HOLDERS OF POWERS OF
25.25 	ATTORNEY.
25.26 	If a taxpayer has executed a written power of attorney, in
25.27 	a form prescribed by the commissioner, the commissioner shall
25.28 	allow the taxpayer to elect, in writing, that all notices and
25.29 	correspondence between the department and the taxpayer will be
25.30 	sent to the holder of the power of attorney.[270.277]

25.31 	EFFECTIVE DATE. This section is effective August 1, 2005.

25.32 	Sec. 29. [270C.30] RETURNS; FORMAT; FURNISHING.
25.33 	The commissioner shall prescribe the content and format of
25.34 	all returns, and may furnish them subject to charge on
25.35 	application.[270.07, subd. 1, paragraph (a); 270.06, clause
25.36 	(15)]

26.1 	EFFECTIVE DATE. This section is effective August 1, 2005.

26.2 	Sec. 30. [270C.302] RETURNS, OTHER FORMS; WHERE FILED.
26.3 	Returns and other forms required to be filed under a law
26.4 	administered by the commissioner must be filed at the
26.5 	commissioner's office in St. Paul, or such other place as the
26.6 	commissioner may designate.[289A.13]

26.7 	EFFECTIVE DATE. This section is effective August 1, 2005.

26.8 	Sec. 31. [270C.304] ELECTRONICALLY FILED RETURNS;
26.9 	SIGNATURES.
26.10 	For purposes of a law administered by the commissioner, the
26.11 	name of the taxpayer, the name of the taxpayer's authorized
26.12 	agent, or the taxpayer's identification number, will constitute
26.13 	a signature when transmitted as part of the return information
26.14 	on returns filed by electronic means by the taxpayer or at the
26.15 	taxpayer's direction.  "Electronic means" includes, but is not
26.16 	limited to, the use of a touch-tone telephone to transmit return
26.17 	information in a manner prescribed by the commissioner.
26.18 	[289A.07]

26.19 	EFFECTIVE DATE. This section is effective for returns
26.20 	filed on or after August 1, 2005.

26.21 	Sec. 32. [270C.306] COMMISSIONER MAY REQUIRE SOCIAL
26.22 	SECURITY OR IDENTIFYING NUMBERS ON FORMS.
26.23 	Notwithstanding the provisions of any other law, the
26.24 	commissioner may require that a form required to be filed with
26.25 	the commissioner include the Social Security number, federal
26.26 	employer identification number, or Minnesota taxpayer
26.27 	identification number of the taxpayer or applicant.[270.066]

26.28 	EFFECTIVE DATE. This section is effective August 1, 2005.

26.29 	Sec. 33. [270C.308] PROHIBITION OF DISPLAY OF SOCIAL
26.30 	SECURITY NUMBERS.
26.31 	No label, envelope, or other material printed by the
26.32 	department may include the Social Security number of the
26.33 	taxpayer in a place that will be visible to a third party when
26.34 	delivered or mailed to the taxpayer.[270.0665]

26.35 	EFFECTIVE DATE. This section is effective August 1, 2005.

26.36 	Sec. 34. [270C.31] EXAMINATIONS AND INVESTIGATIONS.
27.1 		Subdivision 1.Scope. To determine the accuracy of a
27.2 	return, to fix liability under state revenue law, to administer
27.3 	state revenue law, when conducting an investigation or an audit
27.4 	of a taxpayer, for the purpose of collection, and in any matter
27.5 	which the commissioner has the power to investigate or
27.6 	determine, the commissioner has authority to take the actions
27.7 	allowed in this section.[270.06, clauses (6) and (9); 289A.36,
27.8 	subd. 1]
27.9 		Subd. 2.Reasonable examinations or investigations of
27.10 	taxpayer. The commissioner may make reasonable examinations or
27.11 	investigations of a taxpayer's place of business, tangible
27.12 	personal property, equipment, computer systems, and facilities.
27.13 	The commissioner may inspect and copy the taxpayer's relevant
27.14 	books, records, papers, documents, and other data, in whatever
27.15 	form.[289A.36, subds. 1 and 3, clause (1), regarding
27.16 	taxpayers]
27.17 		Subd. 3.Access to records. The commissioner may
27.18 	examine, except where privileged by law, the relevant records
27.19 	and files of any person, business, institution, financial
27.20 	institution, state agency, agency of the United States
27.21 	government, or agency of any other state where permitted by
27.22 	statute, agreement, or reciprocity.[289A.36, subd. 2]
27.23 		Subd. 4.Examinations under oath. The commissioner may
27.24 	administer oaths and affirmations and examine taxpayers and
27.25 	other persons under oath or affirmation.[270.15; 289A.36,
27.26 	subd. 3, clauses (1) and (2)]
27.27 		Subd. 5.Depositions. The commissioner may depose
27.28 	witnesses who reside inside or outside the state, or who are
27.29 	absent from the state.  Depositions are to be taken, upon notice
27.30 	to the interested party, if any, in the same manner that
27.31 	depositions of witnesses are taken in civil actions in the
27.32 	district court.[270.06, clause (9)]
27.33 		Subd. 6.Witness fees. The fees of witnesses required by
27.34 	the commissioner to appear are equal to those allowed to
27.35 	witnesses appearing before courts of this state.  The fees must
27.36 	be paid in the manner provided for the payment of other expenses
28.1 	incident to the administration of state revenue law.[289A.36,
28.2 	subd. 3, clause (2)]
28.3 		Subd. 7.Limitation of authority. The authority granted
28.4 	in this section to the commissioner does not apply to a matter
28.5 	that has been appealed to Tax Court.[270.0601]
28.6 	
EFFECTIVE DATE. This section is effective August 1, 2005.

28.7 	Sec. 35. [270C.32] SUBPOENAS.
28.8 		Subdivision 1.Authority to issue subpoenas. In addition
28.9 	to the authority to examine and investigate granted under
28.10 	section 270C.31, and to carry out that authority, the
28.11 	commissioner may issue subpoenas to compel a person, at a time
28.12 	and place reasonable under the circumstances, to appear and give
28.13 	testimony, and to produce relevant books, records, papers,
28.14 	documents, and other data, in whatever form, for inspection and
28.15 	copying.[289A.36, subds. 2 and 3, clause (1); 270.06, clause
28.16 	(7)]
28.17 		Subd. 2.Request by taxpayer for subpoena. When the
28.18 	commissioner has the authority to issue a subpoena, the
28.19 	commissioner shall honor a reasonable request by a taxpayer to
28.20 	issue a subpoena.[289A.36, subd. 6]
28.21 	Subd. 3.[THIRD-PARTY SUBPOENA WHERE TAXPAYER'S IDENTITY
28.22 	IS KNOWN.] (a) An examination or investigation may extend to a
28.23 	person that the commissioner determines has access to
28.24 	information that may be relevant to the examination or
28.25 	investigation.  When a subpoena requiring the production of
28.26 	records as described in subdivision 1 is served on a third-party
28.27 	record keeper, written notice of the subpoena must be mailed to
28.28 	the taxpayer and to any other person who is identified in the
28.29 	subpoena.  The notices must be given within three days of the
28.30 	day on which the subpoena is served.  The notice required by
28.31 	this subdivision is sufficient if it is mailed to the last known
28.32 	address of the addressee.
28.33 	(b) The provisions of this subdivision regarding notice to
28.34 	the taxpayer or other parties identified in the subpoena do not
28.35 	apply if there is reasonable cause to believe that the giving of
28.36 	notice may lead to attempts to conceal, destroy, or alter
29.1 	records or assets relevant to the examination, to prevent the
29.2 	communication of information from other persons through
29.3 	intimidation, bribery, or collusion, or to flee to avoid
29.4 	prosecution, testifying, or production of records.[289A.36,
29.5 	subd. 4]
29.6 	Subd. 4.[THIRD-PARTY SUBPOENA WHERE TAXPAYER'S IDENTITY
29.7 	IS NOT KNOWN.] (a) The commissioner may issue a subpoena that
29.8 	does not identify the person or persons with respect to whose
29.9 	liability the subpoena is issued, but only if:
29.10 	(1) the subpoena relates to the investigation of a
29.11 	particular person or ascertainable group or class of persons;
29.12 	(2) there is a reasonable basis to believe that the person
29.13 	or group or class of persons may fail or may have failed to
29.14 	comply with a state revenue law;
29.15 	(3) the information sought to be obtained from the
29.16 	examination of the records, and the identity of the person or
29.17 	persons with respect to whose liability the subpoena is issued,
29.18 	is not readily available from other sources;
29.19 	(4) the subpoena is clear and specific as to the
29.20 	information sought to be obtained; and 
29.21 	(5) the information sought to be obtained is limited solely
29.22 	to the scope of the investigation.
29.23 	(b) The party served with a subpoena that does not identify
29.24 	the person or persons with respect to whose tax liability the
29.25 	subpoena is issued shall, within 20 days after service of the
29.26 	subpoena, petition the district court for the judicial district
29.27 	of the county in which that party is located for a determination
29.28 	as to whether the commissioner has complied with all the
29.29 	requirements in paragraph (a), clauses (1) to (5), and thus,
29.30 	whether the subpoena is enforceable.  If no petition is made by
29.31 	the party served within the time prescribed, the subpoena shall
29.32 	have the force and effect of a court order.[270.06, clause
29.33 	(8); 289A.36, subd. 5]
29.34 		Subd. 5.Access to records in connection with examination
29.35 	of businesses located outside the state. (a) In order to
29.36 	determine whether a business located outside the state of
30.1 	Minnesota is required to file a return under a law administered
30.2 	by the commissioner, the commissioner may examine the relevant
30.3 	records and files of the business.  To the full extent permitted
30.4 	by the Minnesota and United States Constitutions, the
30.5 	commissioner may compel production of those relevant records and
30.6 	files by subpoena.  The subpoena may be served on the secretary
30.7 	of state along with the address to which service of the subpoena
30.8 	is to be sent and a fee of $50.  The secretary of state shall
30.9 	forward a copy of the subpoena to the business using the
30.10 	procedures for service of process in section 5.25, subdivision 6.
30.11 	(b) The commissioner shall pay the reasonable cost of
30.12 	producing records subject to subpoena under this subdivision if:
30.13 	(1) the subpoenaed party cannot produce the records without
30.14 	undue burden; and 
30.15 	(2) the examination made pursuant to paragraph (a) shows
30.16 	that the subpoenaed party is not required to file a return under
30.17 	a law administered by the commissioner.[289A.36, subd.9]
30.18 	Subd. 6.[DEMAND FOR COURT ADMINISTRATOR'S SUBPOENA.] In
30.19 	addition to administrative subpoenas of the commissioner, upon
30.20 	demand of the commissioner or an agent of the commissioner, the
30.21 	court administrator of any district court shall issue a subpoena
30.22 	for a witness to appear before the agent, or for the production
30.23 	of relevant books, records, papers, documents, and other data,
30.24 	in whatever form, to the agent for inspection and copying.
30.25 	[270.06, clause (17)]
30.26 		Subd. 7.Enforcement of subpoenas. Failure to comply
30.27 	with a subpoena shall be punished in the same manner as contempt
30.28 	of the district court in the following venues:
30.29 	(1) the district court of the district in which a court
30.30 	administrator's subpoena is issued under subdivision 6;[270.06,
30.31 	clause (17)]
30.32 	(2) the district court of the district in which the party
30.33 	served with a subpoena is located, when the subpoena is issued
30.34 	by the commissioner or the commissioner's agent; and [270.06,
30.35 	clause (17); 289A.36, subd. 7, paragraph (a)]
30.36 	(3) the District Court for Ramsey County, when a subpoena
31.1 	is issued under subdivision 5.  In addition to contempt
31.2 	remedies, the court may issue any order it deems reasonable to
31.3 	enforce compliance with a subpoena issued under subdivision 5.
31.4 	[289A.36, subd. 7, paragraph (b)]
31.5 		Subd. 8.Penalty for violating court order to comply with
31.6 	subpoena. In addition to sanctions imposed under subdivision 7,
31.7 	a penalty of $250 per day is imposed on any business that is in
31.8 	violation of a court order to comply with a subpoena that is
31.9 	seeking information necessary for the commissioner to be able to
31.10 	determine whether the business is required to file a return or
31.11 	pay a tax.  The maximum penalty is $25,000.  Upon the request of
31.12 	the commissioner, the court shall determine the amount of the
31.13 	penalty and enter it as a judgment in favor of the
31.14 	commissioner.  The penalty is not payable until the judgment is
31.15 	entered.[289A.36, subd. 10]
31.16 		Subd. 9.Cost of production of records. The cost of
31.17 	producing records of a third party required by a subpoena must
31.18 	be paid by the taxpayer, if the taxpayer requests the subpoena
31.19 	to be issued, or if the taxpayer has the records available but
31.20 	has refused to provide them to the commissioner.  In other cases
31.21 	where the taxpayer cannot produce records and the commissioner
31.22 	then issues a subpoena for third-party records, the commissioner
31.23 	shall pay the reasonable cost of producing the records.  The
31.24 	commissioner may later assess the reasonable costs against the
31.25 	taxpayer if the records contribute to the determination of an
31.26 	assessment of tax against the taxpayer.[289A.36, subd. 8]
31.27 		Subd. 10.Limitation of authority. The authority granted
31.28 	in this section to the commissioner and the commissioner's
31.29 	agents does not apply to a matter that has been appealed to Tax
31.30 	Court.[270.0601]
31.31 	
EFFECTIVE DATE. This section is effective August 1, 2005.

31.32 	Sec. 36. [270C.33] COMMISSIONER ASSESSMENT PROCEDURES.
31.33 		Subdivision 1.Orders and decisions. All orders and
31.34 	decisions of the commissioner, or any subordinates, respecting
31.35 	any tax, assessment, or other obligation, must be in writing and
31.36 	entered into the records of the commissioner.[270.10, subd. 1]
32.1 		Subd. 2.Notices. (a) At the same time that notice of an
32.2 	assessment, determination, or order, of the commissioner is
32.3 	given to a taxpayer, the taxpayer must be given a written notice
32.4 	that:
32.5 	(1) describes the taxpayer's appeal rights;
32.6 	(2) lists the amounts of tax, interest, additions to tax,
32.7 	and penalties due; and 
32.8 	(3) explains the basis for the assessment.
32.9 	(b) Failure to provide all the required information does
32.10 	not invalidate the assessment, determination, or order for
32.11 	purposes of satisfying statutory notice requirements if the
32.12 	assessment, determination, or order contains sufficient
32.13 	information to advise the taxpayer that an assessment has been
32.14 	made.[270.10, subd. 1a; 289A.37, subd. 1, paragraph (a)]
32.15 		Subd. 3.Commissioner filed returns. If a taxpayer fails
32.16 	to file a return, the commissioner, from information in the
32.17 	commissioner's possession or obtainable by the commissioner, may
32.18 	make and file a return for the taxpayer, or may issue an order
32.19 	of assessment under subdivision 4.[289A.35]
32.20 		Subd. 4.Orders of assessment. (a) The commissioner may
32.21 	issue an order of assessment in any of the following
32.22 	circumstances:
32.23 	(1) the commissioner determines that the correct amount of
32.24 	tax is different than that assessed on a return filed with the
32.25 	commissioner;[289A.37, subd. 1]
32.26 	(2) no return has been filed and the commissioner
32.27 	determines the amount of tax that should have been assessed;
32.28 	[289A.37, subd. 1]
32.29 	(3) the commissioner determines that the correct amount of
32.30 	a refundable credit is different than the amount claimed by a
32.31 	taxpayer.  For purposes of this subdivision, "refundable credit"
32.32 	means a refund benefit or credit due a person that is unrelated
32.33 	to the person's liability for a tax.  "Refundable credit" does
32.34 	not include estimated tax payments or withholding taxes.  An
32.35 	assessment for an overpayment of a refundable credit may be
32.36 	collected in the same manner as a tax collected by the
33.1 	commissioner; and 
33.2 	(4) the commissioner determines the correct amount of a tax
33.3 	that the taxpayer is not required to assess by a return filed
33.4 	with the commissioner.
33.5 	(b) An order of assessment must be in writing.[270.10,
33.6 	subd. 1]
33.7 	(c) An order of assessment must be signed by the
33.8 	commissioner or a delegate, or have their facsimile signature,
33.9 	if the change in tax, excluding penalties and interest, exceeds
33.10 	$1,000.[270.10, subd. 1]
33.11 	(d) An order of assessment is final when made but, as
33.12 	applicable, is reviewable administratively under section
33.13 	270C.35, or appealable to Tax Court under chapter 271.[289A.37,
33.14 	subd. 1, paragraph (a)]
33.15 		Subd. 5.Prohibition against collection during appeal
33.16 	period of an order. No collection action can be taken on an
33.17 	order of assessment, including the filing of liens under section
33.18 	270C.63, and no late payment penalties may be imposed when a
33.19 	return has been filed for the tax type and period upon which the
33.20 	order is based, during the appeal period of an order.  The
33.21 	appeal period of an order ends:  (1) 60 days after the order has
33.22 	been mailed to the taxpayer by the commissioner; (2) if an
33.23 	administrative appeal is filed under section 270C.35, 60 days
33.24 	after determination of the administrative appeal; (3) if an
33.25 	appeal to Tax Court is filed under chapter 271, when the
33.26 	decision of the Tax Court is made; or (4) if an appeal to Tax
33.27 	Court is filed and the appeal is based upon a constitutional
33.28 	challenge to the tax, 60 days after final determination of the
33.29 	appeal.  This subdivision does not apply to a jeopardy
33.30 	assessment under section 270C.36, or a jeopardy collection under
33.31 	section 270C.36.[289A.37, subd. 1, paragraph (b); 270.10,
33.32 	subd. 5]
33.33 		Subd. 6.Assessment presumed valid. A return or
33.34 	assessment of tax made by the commissioner is prima facie
33.35 	correct and valid.  The taxpayer has the burden of establishing
33.36 	its incorrectness or invalidity in any related action or
34.1 	proceeding.[289A.37, subd. 3]
34.2 		Subd. 7.Aggregate refund or assessment. The
34.3 	commissioner, on examining returns for more than one year or
34.4 	period, may issue one order covering the period under
34.5 	examination that reflects the aggregate refund or additional tax
34.6 	due.[289A.37, subd. 4]
34.7 		Subd. 8.Sufficiency of notice. An assessment of tax
34.8 	made by the commissioner, sent postage prepaid by United States
34.9 	mail to the taxpayer at the taxpayer's last known address, is
34.10 	sufficient even if the taxpayer is deceased or is under a legal
34.11 	disability, or, in the case of a corporation, has terminated its
34.12 	existence, unless the commissioner has been provided with a new
34.13 	address by a party authorized to receive notices of assessment.
34.14 	[289A.37, subd. 5]
34.15 		Subd. 9.Consent agreement. A taxpayer shall have the
34.16 	right at any time, whether or not an order has been issued, to
34.17 	sign and deliver to the commissioner a written consent to a
34.18 	change in tax liability that waives the requirement of any
34.19 	additional notice and all rights to an administrative appeal and
34.20 	appeal to Tax Court concerning the assessment and collection of
34.21 	any part or all of the tax liability.[270.67, subd. 3]
34.22 	
EFFECTIVE DATE. This section is effective for assessments
34.23 	made on or after August 1, 2005.

34.24 	Sec. 37. [270C.34] ABATEMENT OF PENALTY, INTEREST, AND
34.25 	ADDITIONAL TAX CHARGE.
34.26 		Subdivision 1.Authority. (a) The commissioner may
34.27 	abate, reduce, or refund any penalty or interest that is imposed
34.28 	by a law administered by the commissioner as a result of the
34.29 	late payment of tax or late filing of a return, if the failure
34.30 	to timely pay the tax or failure to timely file the return is
34.31 	due to reasonable cause, or if the taxpayer is located in a
34.32 	presidentially declared disaster area.[270.07, subd. 1,
34.33 	paragraph (e)]
34.34 	(b) The commissioner shall abate any part of a penalty or
34.35 	additional tax charge under section 289A.25, subdivision 2, or
34.36 	289A.26, subdivision 4, attributable to erroneous advice given
35.1 	to the taxpayer in writing by an employee of the department
35.2 	acting in an official capacity, if the advice:
35.3 	(1) was reasonably relied on and was in response to a
35.4 	specific written request of the taxpayer; and 
35.5 	(2) was not the result of failure by the taxpayer to
35.6 	provide adequate or accurate information.[270.07, subd. 6,
35.7 	paragraph (c)]
35.8 		Subd. 2.Procedure. (a) A request for abatement of
35.9 	penalty under subdivision 1 or section 289A.60, subdivision 4,
35.10 	must be filed with the commissioner within 60 days of the date
35.11 	the notice was mailed to the taxpayer's last known address,
35.12 	stating that a penalty has been imposed.
35.13 	(b) If the commissioner issues an order denying a request
35.14 	for abatement of penalty, the taxpayer may file an
35.15 	administrative appeal as provided in section 270C.35 or appeal
35.16 	to Tax Court as provided in section 271.06.
35.17 	(c) If the commissioner does not issue an order on the
35.18 	abatement request within 60 days from the date the request is
35.19 	received, the taxpayer may appeal to Tax Court as provided in
35.20 	section 271.06.[270.07, subd. 6, paragraphs (a) and (b)]
35.21 	
EFFECTIVE DATE. This section is effective August 1, 2005.

35.22 	Sec. 38. [270C.345] DETERMINATION OF MINIMUMS AND
35.23 	CANCELLATION; ADDITIONAL TAX, COLLECTION, REFUNDS.
35.24 	Notwithstanding any other provision of law, the
35.25 	commissioner may:
35.26 	(1) based upon the administrative costs of processing,
35.27 	determine minimum standards for the determination of additional
35.28 	tax for which an order shall be issued;
35.29 	(2) based upon collection costs as compared to the amount
35.30 	of tax involved, determine minimum standards of collection;
35.31 	(3) based upon the administrative costs of processing,
35.32 	determine the minimum amount of a refund to be made where no
35.33 	claim has been filed; and 
35.34 	(4) cancel any amounts below these minimum standards
35.35 	determined under clauses (1) and (2).[270.07, subd. 3]

35.36 	EFFECTIVE DATE. This section is effective August 1, 2005.

36.1 	Sec. 39. [270C.346] ERRONEOUS REMITTANCES.
36.2 	If a remittance is erroneously made payable to the
36.3 	commissioner and the commissioner had knowledge that the proper
36.4 	payee is a state or local official of this state, the
36.5 	commissioner may endorse such remittance to the proper state or
36.6 	local official.  The commissioner is also authorized to return a
36.7 	remittance if the records indicate that it has been erroneously
36.8 	submitted.[270.07, subd. 4]

36.9 	EFFECTIVE DATE. This section is effective August 1, 2005.

36.10 	Sec. 40. [270C.347] REBATE CHECKS AND WARRANTS; AUTHORITY
36.11 	TO REISSUE; APPROPRIATION.
36.12 		Subdivision 1.Checks and warrants, authority to
36.13 	reissue. Notwithstanding any other provision of law, the
36.14 	commissioner may, based on a showing of reasonable cause,
36.15 	reissue an uncashed rebate or property tax refund warrant or
36.16 	check that has lapsed under any provision of law relating to
36.17 	rebates or under section 290A.18, subdivision 2.  The authority
36.18 	to reissue warrants or checks under this paragraph is limited to
36.19 	five years after the date of issuance of the original warrant or
36.20 	check.[270.07, subd. 3, paragraph (f)]
36.21 		Subd. 2.Appropriation. An amount sufficient for the
36.22 	reissuance of rebate warrants authorized under subdivision 1 is
36.23 	appropriated to the commissioner from the general fund.
36.24 	[270.07, subd. 3a]
36.25 	
EFFECTIVE DATE. This section is effective August 1, 2005.

36.26 	Sec. 41. [270C.35] ADMINISTRATIVE REVIEW.
36.27 		Subdivision 1.Taxpayer right to reconsideration. A
36.28 	taxpayer may obtain reconsideration by the commissioner of an
36.29 	order assessing tax, a denial of a request for abatement of
36.30 	penalty or interest imposed by a law administered by the
36.31 	commissioner, or a denial of a claim for refund by filing an
36.32 	administrative appeal under subdivision 4.  A taxpayer cannot
36.33 	obtain reconsideration under this section if the action taken by
36.34 	the commissioner is the outcome of an administrative appeal.
36.35 		Subd. 2.Appeal by taxpayer. A taxpayer who wishes to
36.36 	seek administrative review must follow the procedures in
37.1 	subdivision 4.
37.2 		Subd. 3.Notice date. For purposes of this section, the
37.3 	term "notice date" means the date of the order adjusting the tax
37.4 	or order denying a request for abatement, or, in the case of a
37.5 	denied refund, the date of the notice of denial.
37.6 		Subd. 4.Time and content for administrative appeal.
 37.7 	Within 60 days after the notice date, the taxpayer must file a
37.8 	written appeal with the commissioner.  The appeal need not be in
37.9 	any particular form but must contain the following information:
37.10 	(1) name and address of the taxpayer;
37.11 	(2) if a corporation, the state of incorporation of the
37.12 	taxpayer, and the principal place of business of the
37.13 	corporation;
37.14 	(3) the Minnesota identification number or Social Security
37.15 	number of the taxpayer;
37.16 	(4) the type of tax involved;
37.17 	(5) the date;
37.18 	(6) the tax years or periods involved and the amount of tax
37.19 	involved for each year or period;
37.20 	(7) the findings in the notice that the taxpayer disputes;
37.21 	(8) a summary statement that the taxpayer relies on for
37.22 	each exception; and 
37.23 	(9) the taxpayer's signature or signature of the taxpayer's
37.24 	duly authorized agent.
37.25 		Subd. 5.Extensions. When requested in writing and
37.26 	within the time allowed for filing an administrative appeal, the
37.27 	commissioner may extend the time for filing an appeal for a
37.28 	period not more than 30 days from the expiration of the 60 days
37.29 	from the notice date.
37.30 		Subd. 6.Determination of appeal. On the basis of
37.31 	applicable law and available information, the commissioner shall
37.32 	determine the validity, if any, in whole or part of the appeal
37.33 	and notify the taxpayer of the decision.  This notice must be in
37.34 	writing and contain the basis for the determination.
37.35 		Subd. 7.Agreement determining tax liability. When it
37.36 	appears to be in the best interests of the state, the
38.1 	commissioner may settle any taxes, penalties, or interest that
38.2 	the commissioner has under consideration by virtue of an appeal
38.3 	filed under this section.  An agreement must be in writing and
38.4 	signed by the commissioner and the taxpayer, or the taxpayer's
38.5 	representative authorized by the taxpayer to enter into an
38.6 	agreement.  The agreement shall be final and conclusive and,
38.7 	except upon a showing of fraud or malfeasance, or
38.8 	misrepresentation of a material fact, the case shall not be
38.9 	reopened as to the matters agreed upon.
38.10 		Subd. 8.Order and appeal of an administrative
38.11 	determination. Following the determination of an appeal and
38.12 	notwithstanding any period of limitations for making assessments
38.13 	or other determinations to the contrary, the commissioner must
38.14 	issue an order reflecting that disposition.  If the statute of
38.15 	limitations for making assessments or other determinations would
38.16 	have expired before the issuance of this order, except for this
38.17 	section, the order is limited to issues or matters contained in
38.18 	the appealed determination.  The order is appealable to the
38.19 	Minnesota Tax Court under section 271.06.
38.20 		Subd. 9.Appeal where no determination. If the
38.21 	commissioner does not make a determination within six months of
38.22 	the filing of an administrative appeal, the taxpayer may elect
38.23 	to appeal to Tax Court.
38.24 		Subd. 10.Exemption from administrative procedure act.
 38.25 	This section is not subject to chapter 14.[289A.65]
38.26 	
EFFECTIVE DATE. This section is effective August 1, 2005.

38.27 	Sec. 42. [270C.36] JEOPARDY ASSESSMENT AND COLLECTION.
38.28 		Subdivision 1.Assessment. If the commissioner has
38.29 	reasonable grounds to believe that a taxpayer is about to leave,
38.30 	or take property from, this state with the purpose of evading a
38.31 	tax, or that the collection of the tax will be jeopardized by
38.32 	delays incident to other methods of collection, the commissioner
38.33 	may immediately declare the taxpayer's reporting period to be at
38.34 	an end and assess the tax due by issuing an order under section
38.35 	270C.33, subdivision 4.  The commissioner may make the
38.36 	assessment on the basis of knowledge or information available to
39.1 	the commissioner, and notwithstanding the prohibition against
39.2 	collection under section 270C.33, subdivision 5, demand
39.3 	immediate payment of the amount due shown in the assessment.
39.4 	[290.48, subd. 4; 290.92, subd. 6b; 297A.93, paragraph (a)]
39.5 		Subd. 2.Collection. Notwithstanding the prohibition
39.6 	against collection in section 270C.33, subdivision 5, and the
39.7 	notice provisions in section 270C.67, subdivision 3, if the
39.8 	commissioner has reason to believe that collection of a tax is
39.9 	in jeopardy, notice and demand for immediate payment of the tax
39.10 	may be made.  If the tax is not paid, the commissioner may
39.11 	proceed to collect by levy or by filing a lien under section
39.12 	270C.63.  For this purpose, "tax" includes any penalty,
39.13 	interest, and costs, properly payable.[270.70, subds. 1 and 2,
39.14 	paragraph (b)]
39.15 		Subd. 3.Administrative review. Within five days after a
39.16 	jeopardy assessment or jeopardy collection is made to assess or
39.17 	collect a tax, the commissioner shall provide the taxpayer with
39.18 	a written statement of the information relied on in making the
39.19 	assessment or levy.  Within 30 days after the written statement
39.20 	is provided or, if not provided, within 35 days after the
39.21 	assessment or levy, the taxpayer may request the commissioner to
39.22 	review the action taken.  After a request for review, the
39.23 	commissioner shall determine whether the assessment or levy is
39.24 	reasonable and whether the amount assessed or demanded as a
39.25 	result of the action is appropriate under the circumstances.
39.26 		Subd. 4.Judicial review. A determination by the
39.27 	commissioner under subdivision 3 is appealable to the Tax Court
39.28 	in the manner provided by law, and the appeal must be
39.29 	expeditiously heard by the court.  If the court determines that
39.30 	the making of the assessment or levy is unreasonable, or that
39.31 	the amount assessed or demanded is inappropriate, the court may
39.32 	order the commissioner to release the levy, abate the
39.33 	assessment, redetermine in whole or in part the amount assessed
39.34 	or demanded, or take other action.  A determination by the court
39.35 	under this subdivision is final and may not be appealed by
39.36 	either party.
40.1 		Subd. 5.Burden of proof. In a proceeding under
40.2 	subdivision 4, the burden of proving that the assessment or
40.3 	collection of the tax was jeopardized by delay is on the
40.4 	commissioner.  Regarding the issue of whether the amount
40.5 	assessed or demanded as a result of the action is appropriate,
40.6 	the commissioner shall provide a written statement explaining
40.7 	the basis for determining the amount, and the burden is on the
40.8 	taxpayer to show that the statement is incorrect or invalid.
40.9 	[270.274]
40.10 		Subd. 6.Defenses. It is not a defense to an assessment
40.11 	or demand made under this section that the tax period has not
40.12 	terminated, that the time otherwise allowed by law to file a
40.13 	return has not expired, that the notices otherwise required by
40.14 	law for making an assessment or demand have not been given, or
40.15 	that the time otherwise allowed by law to appeal or pay the tax
40.16 	has not expired.[297A.93, paragraph (b)]
40.17 	
EFFECTIVE DATE. This section is effective for assessments
40.18 	made and collection action taken on or after August 1, 2005.

40.19 	Sec. 43. [270C.37] TAXPAYER ASSISTANCE ORDERS; TAXPAYER'S
40.20 	RIGHTS ADVOCATE.
40.21 		Subdivision 1.Authority to issue. On application filed
40.22 	by a taxpayer with the Department of Revenue taxpayer's rights
40.23 	advocate, in the form, manner, and in the time prescribed by the
40.24 	commissioner, and after thorough investigation, the taxpayer's
40.25 	rights advocate may issue a taxpayer assistance order if, in the
40.26 	determination of the taxpayer's rights advocate, the manner in
40.27 	which a law administered by the commissioner is being carried
40.28 	out is creating or will create an unjust and inequitable result
40.29 	for the taxpayer.
40.30 		Subd. 2.Terms of a taxpayer assistance order. A
40.31 	taxpayer assistance order may require the department within a
40.32 	specified time period to release property of the taxpayer levied
40.33 	on, cease any action, take any action as permitted by law, or
40.34 	refrain from taking any action to enforce a law administered by
40.35 	the commissioner against the taxpayer, until the issue or issues
40.36 	giving rise to the order have been resolved.
41.1 		Subd. 3.Authority to modify or rescind. A taxpayer
41.2 	assistance order issued by the taxpayer's rights advocate under
41.3 	this section may be modified or rescinded by the commissioner.
41.4 		Subd. 4.Suspension of running of period of limitation.
 41.5 	The running of the period of limitation with respect to an
41.6 	action described in subdivision 2 is suspended from the date of
41.7 	the taxpayer assistance order until the expiration date of the
41.8 	order or, if modified, the expiration date of the modified order
41.9 	or, if rescinded, the date of the rescission.
41.10 	Subd. 5.[INDEPENDENT ACTION OF TAXPAYER'S RIGHTS
41.11 	ADVOCATE.] This section does not prevent the taxpayer's rights
41.12 	advocate from taking action in the absence of an application
41.13 	under subdivision 1.
41.14 	Subd. 6.[TAXPAYER'S RIGHTS ADVOCATE.] For purposes of
41.15 	this section, the term "taxpayer's rights advocate" includes a
41.16 	designee of the taxpayer's rights advocate.  The taxpayer's
41.17 	rights advocate shall represent the interests of taxpayers who
41.18 	have grievances against the department in connection with an
41.19 	audit or collection activity, and shall report directly to the
41.20 	commissioner.  A determination of the taxpayer's rights advocate
41.21 	under this section to issue or to not issue a taxpayer
41.22 	assistance order is final and cannot be appealed to the Tax
41.23 	Court or any other court.[270.273]
41.24 	
EFFECTIVE DATE. This section is effective August 1, 2005.

41.25 	Sec. 44. [270C.38] NOTICE OF DETERMINATION OR ACTION OF
41.26 	THE COMMISSIONER.
41.27 		Subdivision 1.Sufficient notice. If no method of
41.28 	notification of a written determination or action of the
41.29 	commissioner is otherwise specifically provided for by law,
41.30 	notice of the determination or action sent postage prepaid by
41.31 	United States mail to the taxpayer or other person affected by
41.32 	the determination or action at the taxpayer's or person's last
41.33 	known address, is sufficient.  If the taxpayer or person being
41.34 	notified is deceased or is under a legal disability, or, in the
41.35 	case of a corporation being notified that has terminated its
41.36 	existence, notice to the last known address of the taxpayer,
42.1 	person, or corporation is sufficient, unless the department has
42.2 	been provided with a new address by a party authorized to
42.3 	receive notices from the commissioner.
42.4 		Subd. 2.Service of notice by mail. Notwithstanding any
42.5 	other law to the contrary, the commissioner, if required to
42.6 	serve notices by registered or certified mail, may choose to
42.7 	make such service by regular mail, retaining a record of
42.8 	adequate proof of such service.[270.061]
42.9 	
EFFECTIVE DATE. This section is effective for notices
42.10 	issued on or after August 1, 2005.

42.11 	Sec. 45. [270C.39] DUE DATE ON SATURDAY, SUNDAY, OR
42.12 	HOLIDAY.
42.13 	When the last day prescribed by law for the payment of any
42.14 	tax to or the filing of any return, statement, or document with
42.15 	the commissioner or the department falls on Saturday, Sunday, or
42.16 	a legal holiday, the performance of such act shall be considered
42.17 	timely if it is performed on the next succeeding day which is
42.18 	not a Saturday, Sunday, or legal holiday.  For purposes of this
42.19 	section, the last day for the performance of the prescribed act
42.20 	shall be determined by including any authorized extension of
42.21 	time; the term "legal holiday" shall mean any day made a holiday
42.22 	in Minnesota by section 645.44, subdivision 5, or by the laws of
42.23 	the United States.[270.27]

42.24 	EFFECTIVE DATE. This section is effective August 1, 2005.

42.25 	Sec. 46. [270C.395] TIMELY MAILING TREATED AS TIMELY
42.26 	FILING AND PAYING.
42.27 		Subdivision 1.Date of delivery. When a document,
42.28 	including a return, claim, or statement, is required to be
42.29 	filed, or a payment is required to be made to the commissioner
42.30 	within a prescribed period, or on or before a prescribed date,
42.31 	and if the document or payment is delivered by electronic means
42.32 	or by United States mail after the period or the date to the
42.33 	place prescribed for filing or payment, then the date of
42.34 	delivery or of payment is the date of the confirmation
42.35 	time-and-date stamp of the transaction, if delivered by
42.36 	electronic means, or the date of the United States postmark
43.1 	stamped on the cover in which the document or payment is mailed,
43.2 	if delivered by United States mail, as the case may be.
43.3 		Subd. 2.Mailing requirements. Subdivision 1 applies
43.4 	only if:
43.5 	(1) the postmark date falls within the prescribed period or
43.6 	on or before the prescribed date,
43.7 	(i) for filing (including any extension granted for the
43.8 	filing) of the document, or 
43.9 	(ii) for making the payment (including any extension
43.10 	granted for making the payment); and 
43.11 	(2) the document or payment was within the time prescribed
43.12 	in clause (1), deposited in the mail in the United States in an
43.13 	envelope or other appropriate wrapper, postage prepaid, properly
43.14 	addressed to the office of the Department of Revenue with which
43.15 	the document is required to be filed or to which payment is
43.16 	required to be made.
43.17 		Subd. 3.Confirmation of electronic filing and payment
43.18 	and united states postal service postmark. The confirmation
43.19 	numbers and confirmation time-and-date stamps received by the
43.20 	taxpayer following electronic payment or filing are proof of the
43.21 	payment authorization and filing dates.  Only the postmark of
43.22 	the United States Postal Service, rather than those of private
43.23 	postage meters, qualifies as proof of timely mailing under this
43.24 	section.  If the document or payment is sent by United States
43.25 	registered mail, the date of registration shall be treated as
43.26 	the postmark date.  If the document or payment is sent by United
43.27 	States certified mail and the sender's receipt is postmarked by
43.28 	the postal employee to whom the envelope containing such
43.29 	document or payment is presented, the date of the United States
43.30 	postmark on the receipt shall be treated as the postmark date of
43.31 	the document or payment.
43.32 		Subd. 4.Receipt date otherwise governs. In any case in
43.33 	which the document or payment is not treated as timely filed or
43.34 	paid under this section, the date of receipt by the
43.35 	commissioner, and not the postmark date, shall govern for
43.36 	purposes of determining the amount of any penalties for late
44.1 	filing or payment.
44.2 		Subd. 5.Private delivery services. A reference in this
44.3 	section to the United States mail shall be treated as including
44.4 	a reference to any designated delivery service, and any
44.5 	reference in this section to a postmark by the United States
44.6 	Postal Service shall be treated as including a reference to any
44.7 	date recorded or marked by any designated delivery service in
44.8 	accordance with section 7502(f) of the Internal Revenue Code.
44.9 	[270.271]
44.10 	
EFFECTIVE DATE. This section is effective August 1, 2005.

44.11 	Sec. 47. [270C.40] INTEREST PAYABLE TO COMMISSIONER.
44.12 		Subdivision 1.Interest; rate. If any tax payable to the
44.13 	commissioner or to the department is not paid within the time
44.14 	specified by law for payment, the unpaid tax shall bear interest
44.15 	at the rate for each year determined in subdivision 5 from the
44.16 	date such tax should have been paid until the date that the tax
44.17 	was paid, unless otherwise provided by law.
44.18 		Subd. 2.Extension of time. When an extension of time
44.19 	has been granted by the commissioner, interest shall be paid at
44.20 	the rate for each year determined in subdivision 5 from the date
44.21 	such payment should have been made, if no extension had been
44.22 	granted, until the date of payment of such tax.
44.23 		Subd. 3.Penalty. If any penalty payable to the
44.24 	commissioner shall by law bear interest, such penalty shall bear
44.25 	interest at the rate for each year determined in subdivision 5
44.26 	from the date the penalty was assessable until the date that
44.27 	such penalty was paid, unless a different rate of interest is
44.28 	otherwise provided by law.
44.29 		Subd. 4.Underpayment of estimated tax. There shall be
44.30 	added to the amount of any underpayment of estimated tax,
44.31 	computed pursuant to chapter 289A, an amount in lieu of
44.32 	interest.  The amount in lieu of interest for that taxable year
44.33 	shall be the amount determined in subdivision 5 for January 1 on
44.34 	which begins the taxable year or precedes the beginning of the
44.35 	taxable year.  The amount in lieu of interest does not bear
44.36 	interest after the due date of the return for that taxable year.
45.1 		Subd. 5.Annual interest rate. The rate of interest or
45.2 	amount in lieu of interest contained in subdivisions 1 to 4
45.3 	shall be determined by the commissioner not later than October
45.4 	15 of each year and shall be equal to the prime rate charged by
45.5 	banks during the six-month period ending on September 30 of that
45.6 	year, rounded to the nearest full percent.  The rate of interest
45.7 	or amount in lieu of interest becomes effective on January 1 of
45.8 	the immediately succeeding year except as provided in
45.9 	subdivision 4.  For purposes of this subdivision, the term
45.10 	"prime rate charged by banks" means the average predominant
45.11 	prime rate quoted by commercial banks to large businesses, as
45.12 	determined by the Board of Governors of the Federal Reserve
45.13 	System.  The determination of the commissioner pursuant to this
45.14 	subdivision shall not be considered a "rule" and shall not be
45.15 	subject to the Administrative Procedure Act contained in chapter
45.16 	14.
45.17 		Subd. 6.Unpaid judgment. Notwithstanding section
45.18 	549.09, if judgment is entered upon any tax payable to the
45.19 	commissioner which has not been paid within the time specified
45.20 	by law for payment, the unpaid judgment shall bear interest at
45.21 	the rate specified in this section from the date judgment is
45.22 	entered until the date of payment.[270.75]
45.23 	
EFFECTIVE DATE. This section is effective August 1, 2005.

45.24 	Sec. 48. [270C.405] INTEREST ON REFUNDS.
45.25 	When any tax payable to the commissioner or to the
45.26 	department is overpaid and an amount is due the taxpayer as a
45.27 	refund of the overpayment, the overpayment shall bear interest
45.28 	from the date of payment of the tax until the date the refund is
45.29 	paid or credit is made, unless another period for computing
45.30 	interest is provided by law.  The interest rate per annum on
45.31 	overpayments shall be the interest rate contained in section
45.32 	270C.40, subdivision 5; the rate shall be adjusted annually and
45.33 	become effective as provided in section 270C.40, subdivision 5.
45.34 	The determination of the commissioner pursuant to this
45.35 	subdivision is not a "rule" and is not subject to the
45.36 	Administrative Procedure Act contained in chapter 14.[270.76]

46.1 	EFFECTIVE DATE. This section is effective August 1, 2005.

46.2 	Sec. 49. [270C.41] AGREEMENT WITH INTERNAL REVENUE
46.3 	SERVICE.
46.4 	Pursuant to section 270B.12, the commissioner may enter
46.5 	into an agreement with the Internal Revenue Service to identify
46.6 	taxpayers who have refunds due from the department and
46.7 	liabilities owing to the Internal Revenue Service.  In
46.8 	accordance with the procedures established in the agreement, the
46.9 	Internal Revenue Service may levy against the refunds to be paid
46.10 	by the department.  For each refund levied upon, the
46.11 	commissioner shall first deduct from the refund a fee of $20,
46.12 	and then remit the refund or the amount of the levy, whichever
46.13 	is less, to the Internal Revenue Service.  The proceeds of fees
46.14 	shall be deposited into the Department of Revenue recapture
46.15 	revolving fund under section 270A.07, subdivision 1.[270.052]

46.16 	EFFECTIVE DATE. This section is effective August 1, 2005.

46.17 	Sec. 50. [270C.42] ELECTRONIC PAYMENTS; PENALTY.
46.18 		Subdivision 1.Payments required to be made
46.19 	electronically. (a) If a taxpayer is required to make payment
46.20 	of a tax to the commissioner by electronic means, the taxpayer
46.21 	shall make all payments of all taxes and fees paid to the
46.22 	commissioner by electronic means.
46.23 	(b) Paragraph (a) does not apply to payments required to be
46.24 	made for individual income taxes under section 289A.20,
46.25 	subdivision 1, paragraph (a), or 289A.25.[270.771]
46.26 		Subd. 2.Penalty for failure to pay electronically. In
46.27 	addition to other applicable penalties imposed by law, after
46.28 	notification from the commissioner to the taxpayer that payments
46.29 	for a tax payable to the commissioner are required to be made by
46.30 	electronic means, and the payments are remitted by some other
46.31 	means, there is a penalty in the amount of five percent of each
46.32 	payment that should have been remitted electronically.  After
46.33 	the commissioner's initial notification to the taxpayer that
46.34 	payments are required to be made by electronic means, the
46.35 	commissioner is not required to notify the taxpayer in
46.36 	subsequent periods if the initial notification specified the
47.1 	amount of tax liability at which a taxpayer is required to remit
47.2 	payments by electronic means.  The penalty can be abated under
47.3 	the abatement procedures prescribed in section 270C.34 if the
47.4 	failure to remit the payment electronically is due to reasonable
47.5 	cause.  The penalty bears interest at the rate specified in
47.6 	section 270C.40 from the due date of the payment of the tax to
47.7 	the date of payment of the penalty.[270.78]
47.8 	
EFFECTIVE DATE. This section is effective August 1, 2005.

47.9 	Sec. 51. [270C.425] FINANCIAL TRANSACTION CARDS; PAYMENT
47.10 	OF TAXES; APPROPRIATION.
47.11 	(a) The commissioner may allow taxpayers to use financial
47.12 	transaction cards, as defined in section 325G.02, subdivision 2,
47.13 	to pay any of the following which are payable to the
47.14 	commissioner:
47.15 	(1) taxes;
47.16 	(2) estimated tax deposits;
47.17 	(3) penalties;
47.18 	(4) interest;
47.19 	(5) additions to taxes; and 
47.20 	(6) fees.
47.21 	(b) The commissioner may impose a fee on each transaction
47.22 	under paragraph (a).  The fee is equal to the fee the
47.23 	commissioner is required to pay for the taxpayer's use of the
47.24 	financial transaction card.  This fee must be deposited in the
47.25 	general fund and is appropriated to the commissioner for the
47.26 	purpose of paying the transaction card fee.
47.27 	(c) The types of financial transaction cards that will be
47.28 	accepted shall be determined solely by the commissioner.  The
47.29 	selection of transaction card vendors shall be made through a
47.30 	request for proposals process.  Before issuing a request for
47.31 	proposals, the commissioner shall review the request for
47.32 	proposals and any specifications with the commissioner of
47.33 	finance.  The commissioner shall select the transaction card
47.34 	vendors from among those which meet the operational and cost
47.35 	requirements of the department.  The commissioner may limit the
47.36 	number of different types of financial transaction cards that
48.1 	will be accepted.
48.2 	(d) If the commissioner allows taxpayers to pay taxes with
48.3 	financial transaction cards, the commissioner shall report
48.4 	quarterly on the status of this program to the chairs of the
48.5 	house tax and appropriations committees and the chairs of the
48.6 	senate tax and finance committees.[270.74]

48.7 	EFFECTIVE DATE. This section is effective August 1, 2005.

48.8 	Sec. 52. [270C.43] REFUNDS PAYABLE IN INSTALLMENTS.
48.9 		Subdivision 1.Law held unconstitutional. Where there is
48.10 	(1) a final judicial determination that a law administered by
48.11 	the commissioner is unconstitutional, is in violation of state
48.12 	or federal law, or that a regulation or statute has been
48.13 	misinterpreted by the department; and (2) the determination is
48.14 	not limited to prospective application, the procedures in this
48.15 	section relating to refunds attributable to that determination
48.16 	apply.
48.17 		Subd. 2.Estimate of cumulative refunds. The
48.18 	commissioner shall estimate the cumulative refunds due resulting
48.19 	from the judicial determination.
48.20 		Subd. 3.General refund provisions. If the commissioner
48.21 	determines that the cumulative refunds due all affected
48.22 	taxpayers will not exceed $50,000,000, the general provisions
48.23 	for refunding for the particular tax type apply.
48.24 		Subd. 4.Refund procedures. (a) If the commissioner
48.25 	determines that the cumulative refunds due all affected
48.26 	taxpayers will exceed $50,000,000, the refund procedures in this
48.27 	subdivision apply.
48.28 	(b) The refunds due shall be paid in five installments.
48.29 	The first installment will be paid during the calendar year
48.30 	following the later of the filing of the refund claim or the
48.31 	final judicial determination and subsequent installments will be
48.32 	paid at any time during each of the four succeeding calendar
48.33 	years.
48.34 	(c) The commissioner shall compute the annual refund
48.35 	installment due under this subdivision, and notify the taxpayer
48.36 	of the total amount of the claim for refund which has been
49.1 	allowed.
49.2 	(d) The installment paid each year equals 20 percent of the
49.3 	refund allowed unless the commissioner determines that the
49.4 	cumulative refunds due for a particular year under this section
49.5 	will exceed $150,000,000.  If the refunds payable will exceed
49.6 	that amount, they will be reduced pro rata with any balance
49.7 	remaining due payable with the final refund installment.
49.8 	(e) Unless contrary to the provisions in this section, the
49.9 	provisions for refunds in the various tax types, including
49.10 	provisions related to the payment of interest, apply to the
49.11 	refunds subject to these provisions.
49.12 	(f) The commissioner may establish a de minimis individual
49.13 	refund amount below which the installment provisions do not
49.14 	apply.  The amount established under this paragraph is not
49.15 	subject to the provisions of chapter 14.
49.16 	(g) If the commissioner of finance determines that it is in
49.17 	the best interest of the state, refunds payable under this
49.18 	section may be paid in fewer than five installments.[270.79]
49.19 	
EFFECTIVE DATE. This section is effective for refunds
49.20 	payable on or after August 1, 2005.

49.21 	Sec. 53. [270C.44] PRACTICE BEFORE THE COMMISSIONER.
49.22 	The commissioner shall prescribe rules governing the
49.23 	qualification and practice of agents, attorneys, or other
49.24 	persons representing taxpayers before the commissioner.  The
49.25 	rules may require that those persons, agents, and attorneys show
49.26 	that they are of good character and in good repute, have the
49.27 	necessary qualifications to give taxpayers valuable services,
49.28 	and are otherwise competent to advise and assist taxpayers in
49.29 	the presentation of their case before being recognized as
49.30 	representatives of taxpayers.  After due notice and opportunity
49.31 	for hearing, the commissioner may suspend and bar from further
49.32 	practice before the commissioner any person, agent, or attorney
49.33 	who is shown to be incompetent or disreputable, who refuses to
49.34 	comply with the rules, or who with intent to defraud, willfully
49.35 	or knowingly deceives, misleads, or threatens a taxpayer or
49.36 	prospective taxpayer, by words, circular, letter, or by
50.1 	advertisement.  This section does not curtail the rights of
50.2 	individuals to appear in their own behalf or partners or
50.3 	corporations' officers to appear in behalf of their respective
50.4 	partnerships or corporations.[270.06, clause (16)]

50.5 	EFFECTIVE DATE. This section is effective August 1, 2005.

50.6 	Sec. 54. [270C.445] TAX PREPARATION SERVICES.
50.7 		Subdivision 1.Scope. (a) This section applies to a
50.8 	person who offers, provides, or facilitates the provision of
50.9 	refund anticipation loans, as part of or in connection with the
50.10 	provision of tax preparation services.
50.11 	(b) This section does not apply to:
50.12 	(1) a tax preparer who provides tax preparation services
50.13 	for fewer than six clients in a calendar year;
50.14 	(2) the provision by a person of tax preparation services
50.15 	to a spouse, parent, grandparent, child, or sibling; and 
50.16 	(3) the provision of services by an employee for an
50.17 	employer.
50.18 		Subd. 2.Definitions. (a) For purposes of this section,
50.19 	the following terms have the meanings given.
50.20 	(b) "Client" means an individual for whom a tax preparer
50.21 	performs or agrees to perform tax preparation services.
50.22 	(c) "Person" means an individual, corporation, partnership,
50.23 	limited liability company, association, trustee, or other legal
50.24 	entity.
50.25 	(d) "Refund anticipation loan" means a loan, whether
50.26 	provided by the tax preparer or another entity such as a
50.27 	financial institution, in anticipation of, and whose payment is
50.28 	secured by, a client's federal or state income tax refund or
50.29 	both.
50.30 	(e) "Tax preparation services" means services provided for
50.31 	a fee or other consideration to a client to:
50.32 	(1) assist with preparing or filing state or federal
50.33 	individual income tax returns;
50.34 	(2) assume final responsibility for completed work on an
50.35 	individual income tax return on which preliminary work has been
50.36 	done by another; or 
51.1 	(3) offer or facilitate the provision of refund
51.2 	anticipation loans.
51.3 	(f) "Tax preparer" or "preparer" means a person providing
51.4 	tax preparation services subject to this section.
51.5 		Subd. 3.Standards of conduct. No tax preparer shall:
51.6 	(1) without good cause fail to promptly, diligently, and
51.7 	without unreasonable delay complete a client's tax return;
51.8 	(2) obtain the signature of a client to a tax return or
51.9 	authorizing document that contains blank spaces to be filled in
51.10 	after it has been signed;
51.11 	(3) fail to sign a client's tax return when payment for
51.12 	services rendered has been made;
51.13 	(4) fail or refuse to give a client a copy of any document
51.14 	requiring the client's signature within a reasonable time after
51.15 	the client signs the document;
51.16 	(5) fail to retain for at least four years a copy of
51.17 	individual income tax returns;
51.18 	(6) fail to maintain a confidential relationship between
51.19 	themselves and their clients or former clients;
51.20 	(7) fail to take commercially reasonable measures to
51.21 	safeguard a client's nonpublic personal information;
51.22 	(8) make, authorize, publish, disseminate, circulate, or
51.23 	cause to make, either directly or indirectly, any false,
51.24 	deceptive, or misleading statement or representation relating to
51.25 	or in connection with the offering or provision of tax
51.26 	preparation services;
51.27 	(9) require a client to enter into a loan arrangement in
51.28 	order to complete a tax return;
51.29 	(10) claim credits or deductions on a client's tax return
51.30 	for which the tax preparer knows or reasonably should know the
51.31 	taxpayer does not qualify;
51.32 	(11) charge, offer to accept, or accept a fee based upon a
51.33 	percentage of an anticipated refund for tax preparation
51.34 	services;
51.35 	(12) under any circumstances, withhold or fail to return to
51.36 	a client a document provided by the client for use in preparing
52.1 	the client's tax return.
52.2 		Subd. 4.Required disclosures; refund anticipation
52.3 	loans. (a) If a tax preparer offers to make or facilitate a
52.4 	refund anticipation loan to the client, the preparer must make
52.5 	the disclosures in this subdivision.  The disclosures must be
52.6 	made before or at the same time the preparer offers the refund
52.7 	anticipation loan to the client.
52.8 	(b) The tax preparer must provide to a client a written
52.9 	notice on a single sheet of paper, separate from any other
52.10 	document or writing, containing:
52.11 	(1) a legend, centered at the top on the single sheet of
52.12 	paper, in bold, capital letters, and in 28-point type stating
52.13 	"NOTICE";
52.14 	(2) the following verbatim statements:
52.15 	(i) "This is a loan.  The annual percentage rate (APR),
52.16 	based on the estimated payment period, is (fill in the estimated
52.17 	APR)." 
52.18 	(ii) "Your refund will be used to repay the loan.  As a
52.19 	result, the amount of your refund will be reduced by (fill in
52.20 	appropriate dollar amount) for fees, interest, and other
52.21 	charges." 
52.22 	(iii) "You can get your refund in about two weeks if you
52.23 	file your return electronically and have the Internal Revenue
52.24 	Service send your refund to your own bank account." and 
52.25 	(3) if the client is subject to additional interest when a
52.26 	refund is delayed, the following verbatim statement must also be
52.27 	included in the notice:  "If you choose to take this loan and
52.28 	your refund is delayed, you may have to pay additional interest." 
52.29 	(c) All required statements must be in capital and small
52.30 	font type fonts, in a minimum of 14-point type, with at least a
52.31 	double space between each line in the statement and four spaces
52.32 	between each statement.
52.33 	(d) The notice must be signed and dated by the tax preparer
52.34 	and the client.
52.35 		Subd. 5.Itemized bill required. A tax preparer must
52.36 	provide an itemized statement of the charges for services, at
53.1 	least separately stating the charges for:
53.2 	(1) return preparation;
53.3 	(2) electronic filing; and 
53.4 	(3) providing or facilitating a refund anticipation loan.
53.5 		Subd. 6.Enforcement; penalties. The commissioner may
53.6 	impose an administrative penalty of not more than $1,000 per
53.7 	violation of subdivision 3, 4, or 5.  The commissioner may
53.8 	terminate a tax preparer's authority to transmit returns
53.9 	electronically to the state, if the commissioner determines the
53.10 	tax preparer engaged in a pattern and practice of violating this
53.11 	section.  Imposition of a penalty under this subdivision is
53.12 	subject to the contested case procedure under chapter 14.  The
53.13 	commissioner shall collect the penalty in the same manner as a
53.14 	tax collected by the commissioner.
53.15 		Subd. 7.Enforcement; civil actions. (a) Any violation
53.16 	of this section is an unfair, deceptive, and unlawful trade
53.17 	practice within the meaning of section 8.31.
53.18 	(b) A client may bring a civil action seeking redress for a
53.19 	violation of this section in the conciliation or the district
53.20 	court of the county in which unlawful action is alleged to have
53.21 	been committed or where the respondent resides or has a
53.22 	principal place of business.
53.23 	(c) A district court finding for the plaintiff must award
53.24 	actual damages, including incidental and consequential damages,
53.25 	reasonable attorney fees, court costs, and any other equitable
53.26 	relief as the court considers appropriate.
53.27 		Subd. 8.Exemptions; enforcement provisions. The
53.28 	provisions of subdivisions 6 and 7 do not apply to:
53.29 	(1) an attorney admitted to practice under section 481.01;
53.30 	(2) a certified public accountant holding a certificate
53.31 	under section 326A.04 or a person issued a permit to practice
53.32 	under section 326A.05;
53.33 	(3) a person designated as a registered accounting
53.34 	practitioner under Minnesota Rules, part 1105.6600, or a
53.35 	registered accounting practitioner firm issued a permit under
53.36 	Minnesota Rules, part 1105.7100;
54.1 	(4) an enrolled agent who has passed the special enrollment
54.2 	examination administered by the Internal Revenue Service; and 
54.3 	(5) any fiduciary, or the regular employees of a fiduciary,
54.4 	while acting on behalf of the fiduciary estate, the testator,
54.5 	trustor, grantor, or beneficiaries of them.[270.30]
54.6 	
EFFECTIVE DATE. This section is effective August 1, 2005.

54.7 	Sec. 55. [270C.447] LEGAL ACTION TO ENJOIN TAX RETURN
54.8 	PREPARER.
54.9 		Subdivision 1.Commencement of action. A civil action in
54.10 	the name of the state of Minnesota may be commenced to enjoin
54.11 	any person who is a tax return preparer doing business in this
54.12 	state from further engaging in any conduct described in
54.13 	subdivision 2.  An action under this subdivision must be brought
54.14 	by the attorney general in the district court for the judicial
54.15 	district of the tax return preparer's residence or principal
54.16 	place of business, or in which the taxpayer with respect to
54.17 	whose tax return the action is brought resides.  The court may
54.18 	exercise its jurisdiction over the action separate and apart
54.19 	from any other action brought by the state of Minnesota against
54.20 	the tax return preparer or any taxpayer.
54.21 		Subd. 2.Injunction prohibiting specific conduct. In an
54.22 	action under subdivision 1, if the court finds that a tax return
54.23 	preparer has:
54.24 	(1) engaged in any conduct subject to a civil penalty under
54.25 	section 289A.60 or a criminal penalty under section 289A.63;
54.26 	(2) misrepresented the preparer's eligibility to practice
54.27 	before the Department of Revenue, or otherwise misrepresented
54.28 	the preparer's experience or education as a tax return preparer;
54.29 	(3) guaranteed the payment of any tax refund or the
54.30 	allowance of any tax credit; or 
54.31 	(4) engaged in any other fraudulent or deceptive conduct
54.32 	that substantially interferes with the proper administration of
54.33 	a law administered by the commissioner, and injunctive relief is
54.34 	appropriate to prevent the recurrence of that conduct,
54.35 	the court may enjoin the person from further engaging in that
54.36 	conduct.
55.1 		Subd. 3.Injunction prohibiting all business activities.
 55.2 	If the court finds that a tax return preparer has continually or
55.3 	repeatedly engaged in conduct described in subdivision 2, and
55.4 	that an injunction prohibiting that conduct would not be
55.5 	sufficient to prevent the person's interference with the proper
55.6 	administration of a law administered by the commissioner, the
55.7 	court may enjoin the person from acting as a tax return
55.8 	preparer.  The court may not enjoin the employer of a tax return
55.9 	preparer for conduct described in subdivision 2 engaged in by
55.10 	one or more of the employer's employees unless the employer was
55.11 	also actively involved in that conduct.[289A.60, subd. 13,
55.12 	paragraphs (b), (c), and (d)]
55.13 		Subd. 4.Tax return preparer. For purposes of this
55.14 	section, the term "tax return preparer" means an individual who
55.15 	prepares for compensation, or who employs one or more
55.16 	individuals to prepare for compensation, a return of tax or a
55.17 	claim for refund of tax.  The preparation of a substantial part
55.18 	of a return or claim for refund is treated as if it were the
55.19 	preparation of the entire return or claim for refund.  An
55.20 	individual is not considered a tax return preparer merely
55.21 	because the individual:
55.22 	(1) gives typing, reproducing, or other mechanical
55.23 	assistance;
55.24 	(2) prepares a return or claim for refund of the employer,
55.25 	or an officer or employee of the employer, by whom the
55.26 	individual is regularly and continuously employed;
55.27 	(3) prepares a return or claim for refund of any person as
55.28 	a fiduciary for that person; or 
55.29 	(4) prepares a claim for refund for a taxpayer in response
55.30 	to a tax order issued to the taxpayer.
55.31 	
EFFECTIVE DATE. This section is effective August 1, 2005.
55.32 	COLLECTION

55.33 	Sec. 56. [270C.50] USE OF COLLECTION REMEDIES.
55.34 	In addition to the remedies provided in the state revenue
55.35 	laws, the commissioner may use any remedy available to
55.36 	nongovernmental creditors to collect taxes.[270.06, clause
56.1 	(14)]

56.2 	EFFECTIVE DATE. This section is effective August 1, 2005.

56.3 	Sec. 57. [270C.51] ALLOCATION OF PAYMENT.
56.4 	In the discretion of the commissioner, payments received
56.5 	for taxes may be credited first to the oldest liability not
56.6 	secured by a judgment or lien.  For liabilities to which
56.7 	payments are applied, the commissioner may credit payments first
56.8 	to penalties, next to interest, and then to the tax due.
56.9 	[270.652; 297E.12, subd. 10]

56.10 	EFFECTIVE DATE. This section is effective August 1, 2005.

56.11 	Sec. 58. [270C.52] SETTLEMENT AGREEMENTS, PAYMENT
56.12 	AGREEMENTS, AND OFFERS IN COMPROMISE.
56.13 		Subdivision 1.Liability agreements. The commissioner,
56.14 	or any employee of the department authorized in writing by the
56.15 	commissioner, is authorized to enter into an agreement in
56.16 	writing with any taxpayer, or duly authorized agent or
56.17 	representative of the taxpayer, relating to the liability of the
56.18 	taxpayer in respect of any tax for any tax period ending prior
56.19 	to the date of the agreement.  The agreement shall be final and
56.20 	conclusive and, except upon a showing of fraud or malfeasance,
56.21 	or misrepresentation of a material fact, the case shall not be
56.22 	reopened as to the matters agreed upon, or the agreement
56.23 	modified, by any employee or agent of the state; and, in any
56.24 	suit, action, or proceeding, the agreement, or any
56.25 	determination, assessment, collection, payment, abatement,
56.26 	refund, or credit, made in accordance with the agreement, shall
56.27 	not be annulled, modified, set aside, or disregarded.[270.67,
56.28 	subd. 1]
56.29 		Subd. 2.Payment agreements. (a) When any portion of any
56.30 	tax payable to the commissioner together with interest and
56.31 	penalty thereon, if any, has not been paid, the commissioner may
56.32 	extend the time for payment for a further period.  When the
56.33 	authority of this section is invoked, the extension shall be
56.34 	evidenced by written agreement signed by the taxpayer and the
56.35 	commissioner, stating the amount of the tax with penalty and
56.36 	interest, if any, and providing for the payment of the amount in
57.1 	installments.
57.2 	(b) The agreement may contain a confession of judgment for
57.3 	the amount and for any unpaid portion thereof.  If the agreement
57.4 	contains a confession of judgment, the confession of judgment
57.5 	must provide that the commissioner may enter judgment against
57.6 	the taxpayer in the district court of the county of residence as
57.7 	shown upon the taxpayer's tax return for the unpaid portion of
57.8 	the amount specified in the extension agreement.
57.9 	(c) The agreement shall provide that it can be terminated,
57.10 	after notice by the commissioner, if information provided by the
57.11 	taxpayer prior to the agreement was inaccurate or incomplete,
57.12 	collection of the tax covered by the agreement is in jeopardy,
57.13 	there is a subsequent change in the taxpayer's financial
57.14 	condition, the taxpayer has failed to make a payment due under
57.15 	the agreement, or the taxpayer has failed to pay any other tax
57.16 	or file a tax return coming due after the agreement.
57.17 	(d) The notice must be given at least 14 calendar days
57.18 	prior to termination, and shall advise the taxpayer of the right
57.19 	to request a reconsideration from the commissioner of whether
57.20 	termination is reasonable and appropriate under the
57.21 	circumstances.  A request for reconsideration does not stay
57.22 	collection action beyond the 14-day notice period.  If the
57.23 	commissioner has reason to believe that collection of the tax
57.24 	covered by the agreement is in jeopardy, the commissioner may
57.25 	proceed under section 270C.36 and terminate the agreement
57.26 	without regard to the 14-day period.
57.27 	(e) The commissioner may accept other collateral the
57.28 	commissioner considers appropriate to secure satisfaction of the
57.29 	tax liability.  The principal sum specified in the agreement
57.30 	shall bear interest at the rate specified in section 270C.40 on
57.31 	all unpaid portions thereof until the same has been fully paid
57.32 	or the unpaid portion thereof has been entered as a judgment.
57.33 	The judgment shall bear interest at the rate specified in
57.34 	section 270C.40.
57.35 	(f) If it appears to the commissioner that the tax reported
57.36 	by the taxpayer is in excess of the amount actually owing by the
58.1 	taxpayer, the extension agreement or the judgment entered
58.2 	pursuant thereto shall be corrected.  If after making the
58.3 	extension agreement or entering judgment with respect thereto,
58.4 	the commissioner determines that the tax as reported by the
58.5 	taxpayer is less than the amount actually due, the commissioner
58.6 	shall assess a further tax in accordance with the provisions of
58.7 	law applicable to the tax.
58.8 	(g) The authority granted to the commissioner by this
58.9 	section is in addition to any other authority granted to the
58.10 	commissioner by law to extend the time of payment or the time
58.11 	for filing a return and shall not be construed in limitation
58.12 	thereof.[270.67, subd. 2]
58.13 		Subd. 3.Offer-in-compromise and installment payment
58.14 	program. (a) In implementing the authority provided in
58.15 	subdivision 2 or in sections 8.30 and 16D.15 to accept offers of
58.16 	installment payments or offers-in-compromise of tax liabilities,
58.17 	the commissioner shall prescribe guidelines for employees of the
58.18 	department to determine whether an offer-in-compromise or an
58.19 	offer to make installment payments is adequate and should be
58.20 	accepted to resolve a dispute.  In prescribing the guidelines,
58.21 	the commissioner shall develop and publish schedules of national
58.22 	and local allowances designed to provide that taxpayers entering
58.23 	into a compromise or payment agreement have an adequate means to
58.24 	provide for basic living expenses.  The guidelines must provide
58.25 	that the taxpayer's ownership interest in a motor vehicle, to
58.26 	the extent of the value allowed in section 550.37, will not be
58.27 	considered as an asset; in the case of an offer related to a
58.28 	joint tax liability of spouses, that value of two motor vehicles
58.29 	must be excluded.  The guidelines must provide that employees of
58.30 	the department shall determine, on the basis of the facts and
58.31 	circumstances of each taxpayer, whether the use of the schedules
58.32 	is appropriate and that employees must not use the schedules to
58.33 	the extent the use would result in the taxpayer not having
58.34 	adequate means to provide for basic living expenses.  The
58.35 	guidelines must provide that:
58.36 	(1) an employee of the department shall not reject an
59.1 	offer-in-compromise or an offer to make installment payments
59.2 	from a low-income taxpayer solely on the basis of the amount of
59.3 	the offer; and 
59.4 	(2) in the case of an offer-in-compromise which relates
59.5 	only to issues of liability of the taxpayer:
59.6 	(i) the offer must not be rejected solely because the
59.7 	commissioner is unable to locate the taxpayer's return or return
59.8 	information for verification of the liability; and 
59.9 	(ii) the taxpayer shall not be required to provide an
59.10 	audited, reviewed, or compiled financial statement.
59.11 	(b) The commissioner shall establish procedures:
59.12 	(1) that require presentation of a counteroffer or a
59.13 	written rejection of the offer by the commissioner if the amount
59.14 	offered by the taxpayer in an offer-in-compromise or an offer to
59.15 	make installment payments is not accepted by the commissioner;
59.16 	(2) for an administrative review of any written rejection
59.17 	of a proposed offer-in-compromise or installment agreement made
59.18 	by a taxpayer under this section before the rejection is
59.19 	communicated to the taxpayer;
59.20 	(3) that allow a taxpayer to request reconsideration of any
59.21 	written rejection of the offer or agreement to the commissioner
59.22 	to determine whether the rejection is reasonable and appropriate
59.23 	under the circumstances; and 
59.24 	(4) that provide for notification to the taxpayer when an
59.25 	offer-in-compromise has been accepted, and issuance of
59.26 	certificates of release of any liens imposed under section
59.27 	270C.63 related to the liability which is the subject of the
59.28 	compromise.[270.67, subd. 4]
59.29 	
EFFECTIVE DATE. This section is effective August 1, 2005.

59.30 	Sec. 59. [270C.53] COLLECTION; TAXPAYER INABILITY TO
59.31 	PAY.
59.32 	Notwithstanding any other provision of law, the
59.33 	commissioner may, based upon the inability of a taxpayer to pay
59.34 	a delinquent tax liability, abate the liability if the taxpayer
59.35 	agrees to perform uncompensated public service work for a state
59.36 	agency, a political subdivision or public corporation of this
60.1 	state, or a nonprofit educational, medical, or social service
60.2 	agency.  The Department of Corrections shall administer the work
60.3 	program.  No benefits under chapter 176 or 268 shall be
60.4 	available, but a claim authorized under section 3.739 may be
60.5 	made by the taxpayer.  The state may not enter into any
60.6 	agreement that has the purpose of or results in the displacement
60.7 	of public employees by a delinquent taxpayer under this
60.8 	section.  The state must certify to the appropriate bargaining
60.9 	agent or employees, as applicable, that the work performed by a
60.10 	delinquent taxpayer will not result in the displacement of
60.11 	currently employed workers or layoff from a substantially
60.12 	equivalent position, including partial displacement such as
60.13 	reduction in hours of nonovertime work, wages, or other
60.14 	employment benefits.[270.07, subd. 3, clause (e)]

60.15 	EFFECTIVE DATE. This section is effective August 1, 2005.

60.16 	Sec. 60. [270C.54] COLLECTION OF FINANCIAL INSTITUTION
60.17 	FEES.
60.18 	The commissioner shall collect from a taxpayer any
60.19 	collection fees or costs charged by financial institutions and
60.20 	incurred by the commissioner.[270.063, subd. 3]

60.21 	EFFECTIVE DATE. This section is effective August 1, 2005.

60.22 	Sec. 61. [270C.545] FEDERAL TAX REFUND OFFSET FEES; TIME
60.23 	LIMIT FOR SUBMITTING CLAIMS FOR OFFSET.
60.24 	For fees charged by the Department of the Treasury of the
60.25 	United States for the offset of federal tax refunds that are
60.26 	deducted from the refund amounts remitted to the commissioner,
60.27 	the unpaid debts of the taxpayers whose refunds are being offset
60.28 	to satisfy the debts are reduced only by the actual amount of
60.29 	the refund payments received by the commissioner.
60.30 	Notwithstanding any other provision of law to the contrary, a
60.31 	claim for the offset of a federal tax refund must be submitted
60.32 	to the Department of the Treasury of the United States within
60.33 	ten years after the date of the assessment of the tax owed by
60.34 	the taxpayer whose refund is to be offset to satisfy the debt.
60.35 	[270.063, subd. 4]

60.36 	EFFECTIVE DATE. This section is effective August 1, 2005.

61.1 	Sec. 62. [270C.56] PERSONAL LIABILITY.
61.2 		Subdivision 1.Liability imposed. A person who, either
61.3 	singly or jointly with others, has the control of, supervision
61.4 	of, or responsibility for filing returns or reports, paying
61.5 	taxes, or collecting or withholding and remitting taxes and who
61.6 	fails to do so, or a person who is liable under any other law,
61.7 	is liable for the payment of taxes, penalties, and interest
61.8 	arising under chapters 295, 296A, 297F, 297A, and 297G, or
61.9 	sections 290.92 and 297E.02.
61.10 		Subd. 2.Person defined. The term "person" includes, but
61.11 	is not limited to, a corporation, estate, trust, organization,
61.12 	or association, whether organized for profit or not, an officer
61.13 	or director of a corporation, a member of a partnership, an
61.14 	employee, a third party (including, but not limited to, a
61.15 	financial institution, lender, or surety), and any other
61.16 	individual or entity.  "Person" does not include an unpaid,
61.17 	volunteer member of a board of trustees or directors of an
61.18 	organization exempt from taxation under section 290.05, if the
61.19 	member is solely serving in an honorary capacity, does not
61.20 	participate in the day-to-day or financial operations of the
61.21 	organization, and has no actual knowledge of the failure to file
61.22 	returns or remit taxes.
61.23 		Subd. 3.Procedure for assessment. The commissioner may
61.24 	assess liability for the taxes described in subdivision 1
61.25 	against a person liable under this section.  The assessment may
61.26 	be based upon information available to the commissioner.  It
61.27 	must be made within the prescribed period of limitations for
61.28 	assessing the underlying tax, or within one year after the date
61.29 	of an order assessing underlying tax, whichever period expires
61.30 	later.  An order assessing personal liability under this section
61.31 	is reviewable under section 270C.35 and is appealable to Tax
61.32 	Court.
61.33 	If a person has been assessed under this section for an
61.34 	amount for a given period and the time for appeal has expired or
61.35 	there has been a final determination that the person is liable,
61.36 	collection action is not stayed pursuant to section 270C.33,
62.1 	subdivision 5, for subsequent assessments of additional amounts
62.2 	for the same person for the same period and tax type.
62.3 		Subd. 4.Right of contribution. A person who has paid
62.4 	all or part of a liability assessed under this section has a
62.5 	cause of action against other liable persons to recover the
62.6 	amount paid in excess of that person's share of the liability.
62.7 	A claim for recovery of contribution may be made only in a
62.8 	proceeding which is separate from, and cannot be joined or
62.9 	consolidated with, an administrative or judicial proceeding or
62.10 	investigation involving the commissioner's administration or
62.11 	enforcement of this section.  An order assessing liability under
62.12 	this section against the person from whom contribution is being
62.13 	sought is not a prerequisite for bringing an action for recovery
62.14 	of contribution, nor is the issuance of an order binding on the
62.15 	court in which the proceeding is brought.  The court can
62.16 	determine whether each person would be liable under this section
62.17 	and the share of liability.  The commissioner cannot be made a
62.18 	party to any proceeding for recovery of contribution, nor is a
62.19 	determination in such a proceeding binding on the commissioner
62.20 	for the purpose of administering or enforcing this section.  An
62.21 	action for contribution arises when the liability under this
62.22 	section is paid in full, or the liability of the person seeking
62.23 	contribution has been determined by agreement between the
62.24 	commissioner and such person and paid, and must be brought
62.25 	within the time period prescribed in section 541.05.[270.101]
62.26 	
EFFECTIVE DATE. This section is effective August 1, 2005.

62.27 	Sec. 63. [270C.57] SUCCESSOR LIABILITY OF BUSINESSES.
62.28 		Subdivision 1.Definitions. (a) The following terms used
62.29 	in this section have the following meanings.
62.30 	(b) "Successor" means a person who directly or indirectly
62.31 	purchases, acquires, is gifted, or succeeds to the business or
62.32 	stock of goods of any person quitting, selling, or otherwise
62.33 	disposing of a business or stock of goods.  Successor does not
62.34 	include a personal representative or beneficiary of an estate, a
62.35 	trustee in bankruptcy, a debtor in possession, a receiver, a
62.36 	secured party, a mortgagee, an assignee of rents, or any other
63.1 	lienholder.
63.2 	(c) "Person" means an individual, partnership, corporation,
63.3 	sole proprietorship, joint venture, limited liability company,
63.4 	or any other type of business entity or association.
63.5 	(d) "Withhold" means setting aside money or dealing with
63.6 	the payment of consideration in a manner that denies a
63.7 	transferring business the benefit of the transfer in an amount
63.8 	equal to the sales and withholding tax liability of the
63.9 	transferring business.
63.10 	(e) "Purchase price" means the consideration paid or to be
63.11 	paid for the transfer by the successor to the transferring
63.12 	business, and includes amounts paid for tangible property or
63.13 	intangibles such as leases, licenses, or goodwill.  Purchase
63.14 	price also includes debts assumed or forgiven by the successor,
63.15 	or real or personal property conveyed or to be conveyed by the
63.16 	successor to the transferring business.
63.17 	(f) "Arm's-length transaction" means a transfer for
63.18 	adequate consideration between independent parties both acting
63.19 	in their own best interests.  If the parties are related to each
63.20 	other, a rebuttable presumption arises that the transaction is
63.21 	not at arm's length.
63.22 	(g) "Transfer" means every mode, direct or indirect,
63.23 	absolute or conditional, voluntary or involuntary, of disposing
63.24 	of or parting with a business or an interest in a business, or a
63.25 	stock of goods, whether by gift or for consideration.  Transfer
63.26 	includes a change in the type of business entity or the name of
63.27 	the business, where one business is discontinued and a new one
63.28 	started.  Transfer also includes the acquisition by a new
63.29 	corporation of the assets of a prior business in exchange for
63.30 	the stock of the new corporation.  Transfer does not include an
63.31 	assignment for the benefit of creditors, foreclosure or
63.32 	enforcement of a mortgage, assignment of rents, security
63.33 	interest or lien, sale or disposition in a bankruptcy
63.34 	proceeding, or sale or disposition by a receiver.
63.35 	(h) "Transfer in bulk" means a transfer, other than in the
63.36 	ordinary course of the transferor's trade or business, of more
64.1 	than one-half of all the property of a business at all locations
64.2 	combined, as measured by the value of the property at the time
64.3 	of the transfer.
64.4 		Subd. 2.Bulk transfers; liability of successor; lien.
 64.5 	(a) Whenever a business transfers in bulk to a successor the
64.6 	business assets, and an enforceable lien for unpaid sales and
64.7 	withholding taxes has been filed against the business by the
64.8 	commissioner under section 270C.63, at least 20 days before
64.9 	taking possession of the assets or paying the purchase price,
64.10 	the successor shall notify the commissioner of the transfer and
64.11 	the terms and conditions related to it.  The notice must include
64.12 	the tax identification number of the transferring business.  If
64.13 	an agreement to transfer has been entered into, this notice
64.14 	requirement only applies:  (1) if a lien described under this
64.15 	paragraph has been filed prior to the date of the agreement; or
64.16 	(2) if the date of the transfer is more than 30 days after the
64.17 	date of the agreement, and a lien described under this paragraph
64.18 	is filed at least 30 days prior to the date of transfer.
64.19 	(b) If the successor fails to give the notice required in
64.20 	paragraph (a), the successor is liable for any unpaid sales and
64.21 	withholding taxes, interest, and penalties due from the
64.22 	transferring business to the extent of the purchase price.  If
64.23 	the successor provides the notice required in paragraph (a) and,
64.24 	within 20 days after receipt of the notice, the commissioner
64.25 	notifies the successor that tax liabilities exist in addition to
64.26 	those included on the lien or there are sales and withholding
64.27 	tax returns due but not filed, the successor is, in addition to
64.28 	being liable for the amounts included on the lien, liable for
64.29 	all other uncontested sales and withholding taxes, interest, and
64.30 	penalties as stated in the commissioner's notice from the
64.31 	transferring business to the extent of the purchase price if the
64.32 	successor pays the purchase price or takes possession of the
64.33 	assets without withholding and remitting the liability to the
64.34 	commissioner.  The successor is liable whether the purchase
64.35 	price is paid or the assets are transferred prior to or after
64.36 	notification from the commissioner.  The commissioner may also
65.1 	notify the successor that there are no sales or withholding tax
65.2 	liabilities or returns due from the transferring business other
65.3 	than the liabilities included on the lien, and of the current
65.4 	balance due to satisfy the lien.
65.5 	(c) If, based upon the information available, the
65.6 	commissioner determines that a transfer was not at arm's length
65.7 	or was a gift, the successor's liability under this section
65.8 	equals the value of the assets transferred.  For purposes of
65.9 	imposing the liability, the value of the property transferred is
65.10 	presumed, subject to rebuttal, to equal the unpaid sales and
65.11 	withholding taxes, interest, and penalties of the transferring
65.12 	business.
65.13 	(d) In the case of a gift resulting in successor liability
65.14 	under this section, return of the gifted property by the donee
65.15 	to the donor releases the donee's successor liability.
65.16 	(e) A successor who complies with the requirements of
65.17 	paragraphs (a) and (b) is not liable for any assessments of
65.18 	sales and withholding taxes of the transferring business made
65.19 	after the commissioner provides notice to the successor under
65.20 	paragraph (b), except for taxes assessed on returns filed to
65.21 	comply with the notice.  If the commissioner fails to provide
65.22 	the notice and the 20-day period expires, the successor is not
65.23 	liable for any sales and withholding taxes of the transferring
65.24 	business other than those included on the lien.
65.25 		Subd. 3.Assessment abatement; review. The commissioner
65.26 	may assess liability under this section within the time
65.27 	prescribed for collecting the underlying sales and withholding
65.28 	taxes, interest, and penalties.  The assessment is presumed to
65.29 	be valid, and the burden is upon the successor to show it is
65.30 	incorrect or invalid.  An order assessing successor liability is
65.31 	reviewable administratively under section 270C.35 and is
65.32 	appealable to Tax Court under chapter 271.  The commissioner may
65.33 	abate an assessment if the successor's failure to give the
65.34 	notice required under this section is due to reasonable cause.
65.35 	The procedural and appeal provisions under section 270C.34 apply
65.36 	to abatement requests under this subdivision.  Collection
66.1 	remedies available against the transferring business are
66.2 	available against the successor from the date of assessment of
66.3 	successor liability.
66.4 		Subd. 4.Disclosure. Notification by the commissioner to
66.5 	the successor under subdivision 2, paragraph (b), that the
66.6 	transferring business owes sales and withholding taxes,
66.7 	interest, and penalties or has returns that are due, or that
66.8 	there are no outstanding liabilities or returns other than the
66.9 	liabilities included on the lien, or of the current balance due
66.10 	to satisfy the lien, is not a disclosure violation under chapter
66.11 	270B.[270.102]
66.12 	
EFFECTIVE DATE. This section is effective August 1, 2005.

66.13 	Sec. 64. [270C.58] LIABILITY OF TRANSFEREES AND
66.14 	FIDUCIARIES.
66.15 		Subdivision 1.Transferees and fiduciaries. The amounts
66.16 	of the following liabilities are, except as otherwise provided
66.17 	in subdivision 3, assessed, collected, and paid in the same
66.18 	manner and subject to the same provisions and limitations as a
66.19 	deficiency in a tax imposed by chapter 290, including any
66.20 	provisions of law for the collection of taxes:
66.21 	(1) the liability, at law or in equity, of a transferee of
66.22 	property of a taxpayer for tax or overpayment of a refund,
66.23 	including interest, additional amounts, and additions to the tax
66.24 	or overpayment provided by law, imposed upon the taxpayer by
66.25 	chapter 290 or provided for in chapter 290A; and 
66.26 	(2) the liability of a fiduciary under subdivision 2, for
66.27 	the payment of tax from the estate of the taxpayer.  The
66.28 	liability may reflect the amount of tax shown on the return or
66.29 	any deficiency in tax.[289A.31, subd. 3]
66.30 		Subd. 2.Tax as a personal debt of a fiduciary. A tax
66.31 	imposed by chapter 290 and an overpayment of a refund provided
66.32 	for in chapter 290A, and interest and penalties, is a personal
66.33 	debt of the taxpayer from the time the liability arises,
66.34 	regardless of when the time for discharging the liability by
66.35 	payment occurs.  The debt is, in the case of the personal
66.36 	representative of the estate of a decedent and in the case of
67.1 	any fiduciary, that of the individual in the individual's
67.2 	official or fiduciary capacity only, unless the individual has
67.3 	voluntarily distributed the assets held in that capacity without
67.4 	reserving sufficient assets to pay the tax, interest, and
67.5 	penalties, in which event the individual is personally liable
67.6 	for the deficiency.[289A.31, subd. 4]
67.7 		Subd. 3.Time limit for assessment and collection for
67.8 	transferee or fiduciary. The period of limitation for
67.9 	assessment and collection of any liability of a transferee or
67.10 	fiduciary is as follows:
67.11 	(1) In the case of the liability of an initial transferee
67.12 	of the property of the taxpayer, the tax may be assessed within
67.13 	one year after the expiration of the period of limitation of
67.14 	assessment against the taxpayer.  The tax may be collected by
67.15 	action brought within one year after the expiration of the
67.16 	period of limitation for the starting of an action against the
67.17 	taxpayer.
67.18 	(2) In the case of the liability of the transferee of a
67.19 	transferee of the property of the taxpayer, the tax may be
67.20 	assessed within one year after the expiration of the period of
67.21 	limitation for assessment against the preceding transferee, but
67.22 	only if within 3-1/2 years after the expiration of the period of
67.23 	limitation for assessment against the taxpayer.  The tax may be
67.24 	collected by action brought within one year after the expiration
67.25 	of the period of limitation for the starting of an action
67.26 	against the preceding transferee, but only if within four years
67.27 	after the expiration of the period of limitation for bringing an
67.28 	action against the taxpayer; except that if before the
67.29 	expiration of the period of limitation for the assessment of the
67.30 	liability of the transferee a court proceeding for the
67.31 	collection of the tax or liability has been begun against the
67.32 	taxpayer or last preceding transferee, liability of the
67.33 	transferee expires one year after the return of execution in the
67.34 	court proceeding and the period of limitation for collection by
67.35 	action will expire one year after the liability is assessed.
67.36 	(3) In the case of the liability of a fiduciary, the tax
68.1 	may be assessed up to one year after the liability arises or not
68.2 	later than the expiration of the period for collection of the
68.3 	tax for which the liability arises, whichever is later, and may
68.4 	be collected by action brought within one year after assessment.
68.5 	(4) For the purposes of this subdivision, if the taxpayer
68.6 	is deceased, or in the case of a corporation, has ended its
68.7 	existence, the period of limitation for assessment against the
68.8 	taxpayer will be the period that would be in effect had death or
68.9 	termination of existence not occurred.
68.10 	As used in this subdivision, the term "transferee" includes
68.11 	heir, legatee, devisee, and distributee.[289A.38, subd. 13]
68.12 	
EFFECTIVE DATE. This section is effective August 1, 2005.

68.13 	Sec. 65. [270C.585] TRANSFEREE LIABILITY FOR ESTATE TAX.
68.14 	The personal representative and person to whom property
68.15 	that is subject to taxation under chapter 291 is transferred,
68.16 	other than a bona fide purchaser, mortgagee, or lessee, is
68.17 	personally liable for that tax, until its payment, to the extent
68.18 	of the value of the property at the time of the transfer.
68.19 	Personal liability also does not extend to subsequent
68.20 	transferees from bona fide purchasers, mortgagees, and lessees.
68.21 	[289A.31, subd. 6]

68.22 	EFFECTIVE DATE. This section is effective August 1, 2005.

68.23 	Sec. 66. [270C.59] LIABILITY OF THIRD PARTIES PAYING OR
68.24 	PROVIDING FOR WAGES.
68.25 	(a) For purposes of section 290.92, if a lender, surety, or
68.26 	other person, who is not an employer with respect to an employee
68.27 	or group of employees, pays wages directly to such an employee
68.28 	or group of employees, employed by one or more employers, or to
68.29 	an agent on behalf of such employee or employees, such lender,
68.30 	surety, or other person shall be liable to the commissioner in a
68.31 	sum equal to the taxes required to be deducted and withheld from
68.32 	such wages by such employer.
68.33 	(b) If a lender, surety, or other person supplies funds to
68.34 	or for the account of an employer for the specific purpose of
68.35 	paying wages of the employees of such employer, with actual
68.36 	notice or knowledge that such employer does not intend to or
69.1 	will not be able to make timely payment or deposit of the
69.2 	amounts of tax required by section 290.92 to be deducted and
69.3 	withheld by such employer from such wages, such lender, surety,
69.4 	or other person shall be liable personally to the commissioner
69.5 	in a sum equal to the taxes which are not paid over to the
69.6 	commissioner by such employer with respect to such wages.
69.7 	(c) For purposes of this section, a person shall be deemed
69.8 	for purposes of a particular transaction to have actual notice
69.9 	or knowledge of any fact from the time such fact is brought to
69.10 	the attention of the individual conducting such transaction, and
69.11 	in any event from the time such fact would have been brought to
69.12 	such individual's attention if the person had exercised due
69.13 	diligence.  A person exercises due diligence by maintaining
69.14 	reasonable routines for communicating significant information to
69.15 	the person conducting the transaction and there is reasonable
69.16 	compliance with the routines.  Due diligence does not require an
69.17 	individual acting for the person to communicate information
69.18 	unless such communication is part of the individual's regular
69.19 	duties or unless the individual has reason to know of the
69.20 	transaction and that the transaction would be materially
69.21 	affected by the information.
69.22 	(d) Any amounts paid to the commissioner pursuant to this
69.23 	section shall be credited to the liability of the employer.
69.24 	[290.92, subd. 22]

69.25 	EFFECTIVE DATE. This section is effective August 1, 2005.

69.26 	Sec. 67. [270C.61] LEGAL ACTION; CONFESSION OF JUDGMENT.
69.27 		Subdivision 1.Legal action. (a) In addition to all
69.28 	other methods authorized by law for the collection of tax, if
69.29 	any tax payable to the commissioner or to the department,
69.30 	including penalties and interest thereon, is not paid within 60
69.31 	days after it is required by law to be paid, the commissioner
69.32 	may proceed under this subdivision.  Within five years after the
69.33 	date of assessment of the tax or at any time a lien filed under
69.34 	section 270C.63 is enforceable, or, if the action is to renew or
69.35 	enforce a judgment, at any time before the judgment's
69.36 	expiration, the commissioner may bring an action in court
70.1 	against the person liable for the payment or collection of the
70.2 	tax, in the name of the state, for the recovery of the tax and
70.3 	interest and penalties due in respect thereof.  The action may
70.4 	be commenced by the commissioner in the same manner as any other
70.5 	civil action.
70.6 	(b) The commissioner may also serve the summons and
70.7 	complaint by mailing a copy to the taxpayer's last known address
70.8 	by certified mail.  Service by certified mail is complete when
70.9 	mailed in acceptable form with the United States Postal Service
70.10 	or with the central mail system of the state of Minnesota.
70.11 	[270.68, subd. 1]
70.12 		Subd. 2.Court-ordered returns. In addition to other
70.13 	remedies that may be available, the commissioner may bring an
70.14 	action in equity by the state against a taxpayer for an
70.15 	injunction ordering the taxpayer to file a complete and proper
70.16 	return or amended return.  The district courts of this state
70.17 	have jurisdiction over the action and disobedience of an
70.18 	injunction issued under this subdivision will be punished as a
70.19 	contempt of district court.  The action may be commenced by the
70.20 	commissioner in the same manner as any other civil action.
70.21 	[289A.36, subd. 3, clause (3)]
70.22 		Subd. 3.Prosecuting authority. The commissioner may
70.23 	request the county attorney or the attorney general to conduct
70.24 	the proceedings on behalf of the state.[270.68, subd. 1,
70.25 	paragraph (c)]
70.26 		Subd. 4.Appeals. Either party to an action or a
70.27 	judgment for the recovery of any taxes, interest, or penalties
70.28 	under subdivision 1 may appeal the judgment as in other civil
70.29 	cases.[270.68, subd. 2]
70.30 		Subd. 5.Tax presumed valid. The tax, as assessed by the
70.31 	commissioner, with any penalties included therein, shall be
70.32 	presumed to be valid and correctly determined and assessed, and
70.33 	the burden shall be upon the taxpayer to show its incorrectness
70.34 	or invalidity.  A statement filed by the commissioner showing
70.35 	the amount of the tax and penalties as determined or assessed by
70.36 	the commissioner, is admissible in evidence and shall establish
71.1 	prima facie the facts set forth therein.[270.68, subd. 3]
71.2 		Subd. 6.Confession of judgment. (a) The commissioner
71.3 	may, within 3-1/2 years after any return is filed,
71.4 	notwithstanding section 541.09, enter judgment on any confession
71.5 	of judgment contained in the return after ten days' notice
71.6 	served upon the taxpayer by mail at the address shown in the
71.7 	return.  The judgment shall be entered by the court
71.8 	administrator of district court upon the filing of a photocopy
71.9 	or similar reproduction of that part of the return containing
71.10 	the confession of judgment along with a statement of the
71.11 	commissioner or an agent that the tax has not been paid.  The
71.12 	commissioner may prescribe the words for the confession of
71.13 	judgment statement contained on the return.
71.14 	(b) Notwithstanding any other provision of the law to the
71.15 	contrary, the commissioner may, within five years after a
71.16 	written agreement is signed by the taxpayer and the commissioner
71.17 	under the provisions of section 270C.52, subdivision 2, enter
71.18 	judgment on the confession of judgment contained within the
71.19 	agreement after ten days' notice served upon the taxpayer at the
71.20 	address shown in the agreement.  Such judgment shall be entered
71.21 	by the court administrator of district court upon the filing of
71.22 	the agreement or a certified copy thereof along with a statement
71.23 	of the commissioner or an agent that the tax has not been paid.
71.24 	[270.68, subd. 4]
71.25 	
EFFECTIVE DATE. This section is effective August 1, 2005.

71.26 	Sec. 68. [270C.62] DATE OF ASSESSMENT; DEFINITION.
71.27 	For purposes of taxes, the term "date of assessment" means
71.28 	the date a liability reported on a return was entered into the
71.29 	records of the commissioner or the date a return should have
71.30 	been filed, whichever is later; or, in the case of taxes
71.31 	assessed by the commissioner, "date of assessment" means the
71.32 	date of the order assessing taxes or date of the return made by
71.33 	the commissioner; or, in the case of an amended return filed by
71.34 	the taxpayer, the assessment date is the date additional
71.35 	liability reported on the return, if any, was entered into the
71.36 	records of the commissioner; or, in the case of a check from a
72.1 	taxpayer that is dishonored and results in an erroneous refund
72.2 	being given to the taxpayer, remittance of the check is deemed
72.3 	to be an assessment and the "date of assessment" is the date the
72.4 	check was received by the commissioner.[270.65]

72.5 	EFFECTIVE DATE. This section is effective for assessments
72.6 	made on or after August 1, 2005.

72.7 	Sec. 69. [270C.63] LIEN FOR TAXES.
72.8 		Subdivision 1.Creation of lien. Tax, and interest and
72.9 	penalties imposed with respect thereto, including any recording
72.10 	fees, sheriff fees, or court costs that may accrue, shall become
72.11 	a lien upon all the property within this state, both real and
72.12 	personal, of the person liable for the payment or collection of
72.13 	the tax, except property exempt under subdivision 8, from and
72.14 	after the date of assessment of the tax.
72.15 		Subd. 2.Filing of liens necessary for enforceability
72.16 	against certain persons. The lien imposed by subdivision 1 is
72.17 	not enforceable against any purchaser, mortgagee, pledgee,
72.18 	holder of a Uniform Commercial Code security interest,
72.19 	mechanic's lienor, or judgment lien creditor whose interest has
72.20 	been duly perfected or is a conveyance or interest entitled to
72.21 	protection against judgments and attachments under section
72.22 	507.34 or under any other applicable provisions of state law,
72.23 	until a notice of lien has been filed by the commissioner in the
72.24 	office of the county recorder of the county in which real
72.25 	property is situated, or in the case of personal property in the
72.26 	Office of the Secretary of State.
72.27 		Subd. 3.Method of filing. Notices of liens, and lien
72.28 	releases, transcriptions, and renewals, in a form prescribed by
72.29 	the commissioner, may be filed with the county recorder or the
72.30 	secretary of state by mail, personal delivery, or by electronic
72.31 	transmission by the commissioner or an agent of the department
72.32 	into the computerized filing system of the secretary of state.
72.33 	The secretary of state shall transmit the notice electronically
72.34 	to the office of the county recorder, if that is the place of
72.35 	filing, in the county or counties shown on the computer entry.
72.36 	The filing officer, whether the county recorder or the secretary
73.1 	of state, shall endorse and index a printout of the notice in
73.2 	the same manner as if the notice had been mailed or delivered.
73.3 		Subd. 4.Entry of information into central
73.4 	database. County recorders and the secretary of state shall
73.5 	enter information relative to lien notices, transcriptions,
73.6 	renewals, and releases filed in their offices into the central
73.7 	database of the secretary of state.  For notices filed
73.8 	electronically with the county recorders, the date and time of
73.9 	receipt of the notice and county recorder's file number, and for
73.10 	notices filed electronically with the secretary of state, the
73.11 	secretary of state's recording information, must be entered by
73.12 	the filing officer into the central database before the close of
73.13 	the working day following the day of the original data entry by
73.14 	the department.
73.15 		Subd. 5.Conformity with federal lien registration
73.16 	act. The filing and indexing of all notices must be in
73.17 	accordance with the filing and indexing of notices of federal
73.18 	liens, certificates of release, and refiled notices under
73.19 	section 272.483.
73.20 		Subd. 6.Payment of recording fees. Notwithstanding any
73.21 	other law to the contrary, the department is exempt from payment
73.22 	of fees when a lien, lien renewal, or lien transcription is
73.23 	offered for recording.  The recording fees must be paid along
73.24 	with the release fee at the end of the month in which the
73.25 	release of lien is recorded, after receipt of a monthly
73.26 	statement from a county recorder or the secretary of state.  The
73.27 	department shall add the recording fees to the delinquent tax
73.28 	liability of the taxpayer.  Notwithstanding any other law to the
73.29 	contrary, the fee for filing or recording a notice of lien, or
73.30 	lien release, transcription, or renewal is $15.
73.31 		Subd. 7.Appropriation. There is appropriated to the
73.32 	commissioner an amount representing the cost of payment of
73.33 	recording fees to the county recorders and the secretary of
73.34 	state.  The commissioner shall keep a separate accounting of the
73.35 	costs and of payments for recording fees remitted by taxpayers,
73.36 	and make the records available to the legislature upon request.
74.1 		Subd. 8.Exempt property. The lien imposed on personal
74.2 	property by this section, even though properly filed, is not
74.3 	enforceable:  (1) against a purchaser with respect to tangible
74.4 	personal property purchased at retail in the ordinary course of
74.5 	the seller's trade or business, unless at the time of purchase
74.6 	the purchaser intends the purchase to or knows the purchase will
74.7 	hinder, evade, or defeat the collection of a tax; or (2) against
74.8 	the personal property listed as exempt in sections 550.37,
74.9 	550.38, and 550.39.
74.10 		Subd. 9.Period of limitations. The lien imposed by this
74.11 	section shall, notwithstanding any other provision of law to the
74.12 	contrary, be enforceable from the time the lien arises and for
74.13 	ten years from the date of filing the notice of lien, which must
74.14 	be filed by the commissioner within five years after the date of
74.15 	assessment of the tax or final administrative or judicial
74.16 	determination of the assessment.  A notice of lien filed in one
74.17 	county may be transcribed to any other county within ten years
74.18 	after the date of its filing, but the transcription shall not
74.19 	extend the period during which the lien is enforceable.  A
74.20 	notice of lien may be renewed by the commissioner before the
74.21 	expiration of the ten-year period for an additional ten years.
74.22 	The taxpayer must receive written notice of the renewal.
74.23 		Subd. 10.Enforceability of lien. The lien imposed by
74.24 	this section shall be enforceable by levy as authorized in
74.25 	section 270C.67, or by judgment lien foreclosure as authorized
74.26 	in chapter 550.
74.27 		Subd. 11.Notice of mortgage foreclosure or contract
74.28 	termination. In the case of a mortgage foreclosure upon real
74.29 	property commenced under chapter 580, or a termination of
74.30 	contract of sale of real property commenced under section
74.31 	559.21, if the commissioner has filed a lien under this section
74.32 	before the foreclosure sale or date of termination, notice of
74.33 	the mortgage foreclosure or termination of contract of sale
74.34 	shall be mailed to the commissioner not less than 25 days prior
74.35 	to the foreclosure sale or date of termination.  Provided,
74.36 	notice need not be given pursuant to this subdivision if the
75.1 	lien of the commissioner has been filed within 30 days or less
75.2 	prior to the foreclosure sale or date of termination.  The
75.3 	notice must contain the following information:  (1) the name and
75.4 	address of the taxpayer; (2) a copy of the notice of mortgage
75.5 	foreclosure or contract for deed cancellation; (3) a copy of the
75.6 	lien filed by the commissioner; (4) the total unpaid balance of
75.7 	the mortgage or contract for deed; (5) a legal description of
75.8 	the property; and (6) the fair market value of the property.
75.9 		Subd. 12.Filing entitlement. Execution of notices of
75.10 	liens or of other notices affecting state tax liens by the
75.11 	original or facsimile signature of the commissioner entitles
75.12 	them to be filed, and no other attestation, certification, or
75.13 	acknowledgment is necessary.  For purposes of this subdivision,
75.14 	transmission of notices under subdivision 3 constitutes
75.15 	execution.
75.16 		Subd. 13.Lien search fees. Upon request of any person,
75.17 	the filing officer shall issue a certificate showing whether
75.18 	there is recorded in that filing office, on the date and hour
75.19 	stated in the certificate, any notice of lien or certificate or
75.20 	notice affecting any lien filed on or after ten years before the
75.21 	date of the search certificate, naming a particular person, and
75.22 	giving the date and hour of filing of each notice or certificate
75.23 	naming the person.  The fee for a certificate shall be as
75.24 	provided by section 336.9-525 or 357.18, subdivision 1, clause
75.25 	(3).  Upon request, the filing officer shall furnish a copy of
75.26 	any notice of state lien, or notice or certificate affecting a
75.27 	state lien, for a fee of 50 cents per page.
75.28 		Subd. 14.Limitation for homestead property. A lien
75.29 	imposed under this section upon property defined as homestead
75.30 	property in sections 510.01 and 510.02 may not be enforced
75.31 	against homestead property by levy under section 270C.67, or by
75.32 	judgment lien foreclosure under chapter 550, but notwithstanding
75.33 	section 510.07, is enforceable against the proceeds from the
75.34 	sale, conveyance, or transfer of the homestead.
75.35 		Subd. 15.Erroneous liens. After the filing of a notice
75.36 	of lien under this section on the property or rights to property
76.1 	of a person, the person may appeal to the commissioner, in the
76.2 	form and at the time prescribed by the commissioner, alleging an
76.3 	error in the filing of the lien and requesting its release.  If
76.4 	the commissioner determines that the filing of the notice of any
76.5 	lien was erroneous, within 14 days after the determination, the
76.6 	commissioner must issue a certificate of release of the lien.
76.7 	The certificate must include a statement that the filing of the
76.8 	lien was erroneous.  In the event that the lien is erroneous and
76.9 	is not released within the 14-day period, reasonable attorney
76.10 	fees shall be paid.  Damages must be paid in accordance with
76.11 	section 3.736, subdivision 7.  Even if a lien is not erroneous,
76.12 	the commissioner may withdraw the lien if the filing of the lien
76.13 	was premature or not in accordance with administrative
76.14 	procedures of the commissioner, or withdrawal of the lien will
76.15 	facilitate the collection of the tax liability.
76.16 		Subd. 16.Lien release fee. A fee of $25 must be paid to
76.17 	the commissioner for each duplicate of an original release of
76.18 	lien.
76.19 		Subd. 17.Forty-five day rule. A notice of tax lien
76.20 	filed under this section has priority over a security interest
76.21 	arising under article 9 of the Uniform Commercial Code that is
76.22 	perfected before the date of filing of the lien imposed by this
76.23 	section, but only if:
76.24 	(1) the perfected security interest secures property
76.25 	acquired by the taxpayer or advances made by the secured party
76.26 	after the notice of tax lien is filed; and 
76.27 	(2) the property is acquired or the advance is made after
76.28 	the 45th day following the day on which the notice of tax lien
76.29 	is filed, or after the secured party has actual notice or
76.30 	knowledge of the tax lien filing, whichever is earlier.
76.31 		Subd. 18.Registered land. When a lien is filed with a
76.32 	county recorder under subdivisions 2 to 5, the county recorder
76.33 	shall search the registered land records in that county and
76.34 	cause the lien to be memorialized on every certificate of title
76.35 	or certificate of possessory title of registered land in that
76.36 	county which can be reasonably identified as owned by the
77.1 	taxpayer who is named on the lien.  The fees for memorializing
77.2 	the lien shall be paid in the manner prescribed by subdivision
77.3 	6.  The county recorders, and their employees and agents, shall
77.4 	not be liable for any loss or damages arising from failure to
77.5 	identify a parcel of registered land owned by the taxpayer who
77.6 	is named on the lien.
77.7 		Subd. 19.Assignment of liens. The commissioner may sell
77.8 	and assign to a third party the right of redemption in specific
77.9 	real property for liens filed under this section.  The
77.10 	redemption in the hands of the assignee shall not be enforceable
77.11 	by any of the collection remedies provided to the commissioner
77.12 	by law.  The assignee is limited to the same rights of
77.13 	redemption the commissioner would have in any mortgage
77.14 	foreclosure proceeding, but in any bankruptcy proceeding does
77.15 	not obtain the priority of the commissioner as a tax claimant.
77.16 	Should the taxpayer or its assigns exercise the right of
77.17 	redemption the assignment by the commissioner is extinguished.
77.18 		Subd. 20.Attachment to proceeds of property. Any lien
77.19 	imposed under this section attaches to the proceeds of property
77.20 	with the same priority that the lien has with respect to the
77.21 	property itself.  "Proceeds of property" means proceeds from the
77.22 	sale, lease, license, exchange, or other disposition of the
77.23 	property, including insurance proceeds arising from the loss or
77.24 	destruction of the property.[270.69]
77.25 	
EFFECTIVE DATE. This section is effective August 1, 2005.

77.26 	Sec. 70. [270C.64] CREDIT OF OVERPAYMENT TO DELINQUENT
77.27 	TAX LIABILITIES.
77.28 	Notwithstanding any other provision of law to the contrary,
77.29 	in the case of an overpayment of any tax collected by the
77.30 	commissioner, the commissioner may credit the amount of such
77.31 	overpayment against any uncontested delinquent tax liability on
77.32 	the part of the taxpayer who made the overpayment.  An
77.33 	overpayment may be credited under this subdivision only if the
77.34 	uncontested delinquent liability has been assessed within ten
77.35 	years of the date on which the overpayment is credited.
77.36 	However, this limitation shall not be applicable if the
78.1 	delinquent liability has been entered into judgment or if legal
78.2 	action is pending for collection of the liability or for renewal
78.3 	of the judgment.  An amount paid as tax shall constitute an
78.4 	overpayment even if in fact there was no tax liability with
78.5 	respect to which such amount was paid.[270.07, subd. 5]

78.6 	EFFECTIVE DATE. This section is effective August 1, 2005.

78.7 	Sec. 71. [270C.65] RIGHT OF SETOFF.
78.8 		Subdivision 1.Certification by commissioner. The
78.9 	commissioner of revenue is authorized to certify to the
78.10 	commissioner of finance, or to any state agency described in
78.11 	subdivision 3 which disburses its own funds, that a taxpayer has
78.12 	an uncontested delinquent tax liability owed to the commissioner
78.13 	of revenue.  The certification must be made within ten years
78.14 	after the date of assessment of the tax.  Once certification is
78.15 	made, the commissioner of finance or the state agency shall
78.16 	apply to the delinquent tax liability funds sufficient to
78.17 	satisfy the unpaid tax liability from funds appropriated for
78.18 	payment of an obligation of the state or any of its agencies
78.19 	that are due and owing the taxpayer.  No setoff shall be made
78.20 	against any funds exempt under section 550.37 or those funds
78.21 	owed an individual taxpayer who receives assistance under the
78.22 	provisions of chapter 256.
78.23 		Subd. 2.Setoff satisfies state obligation. All funds,
78.24 	whether general or dedicated, shall be subject to setoff in the
78.25 	manner herein provided.  Transfer of funds as herein provided is
78.26 	payment of the obligation of the state or any of its agencies to
78.27 	such taxpayer and any actions for said funds, if any, shall be
78.28 	had against the Department of Revenue on the issue of such tax
78.29 	liability.  Nothing in this section shall be construed to limit
78.30 	the previously existing right of the state or any of its
78.31 	agencies to setoff.
78.32 		Subd. 3.Agencies shall maintain records.
 78.33 	Notwithstanding any provision to the contrary, every person,
78.34 	organization, or corporation doing business (hereafter called
78.35 	vendor) with the state of Minnesota or any of its departments,
78.36 	agencies, or educational institutions including the University
79.1 	of Minnesota (all hereafter called agency) shall provide that
79.2 	agency with either their Social Security number, federal
79.3 	taxpayer identification number, or Minnesota tax identification
79.4 	number.  The commissioner may verify to the agency the
79.5 	identifying information provided by a vendor.  The agency shall
79.6 	maintain records of this information, and shall make these
79.7 	records available, on request, to the commissioner for the sole
79.8 	purpose of identifying people who have not filed state tax
79.9 	returns or who have not paid uncontested tax liabilities
79.10 	(hereafter called delinquent taxpayer).  When an agency is
79.11 	notified by the commissioner that a vendor is a delinquent
79.12 	taxpayer, payments shall not be made by the agency to the vendor
79.13 	until the commissioner notifies the agency that the vendor no
79.14 	longer is a delinquent taxpayer.  Furthermore, if the vendor has
79.15 	an uncontested delinquent tax liability, the setoff provided in
79.16 	subdivision 1 may be implemented.  The commissioner shall
79.17 	determine that a vendor no longer is a delinquent taxpayer when
79.18 	the vendor has filed all delinquent returns and (1) paid all
79.19 	uncontested tax liabilities or (2) entered into an agreement
79.20 	with the commissioner which provides for the payment of these
79.21 	liabilities.[270.66]
79.22 	
EFFECTIVE DATE. This section is effective August 1, 2005.

79.23 	Sec. 72. [270C.66] CONTRACTS WITH STATE; WITHHOLDING.
79.24 	No department of the state of Minnesota, nor any political
79.25 	or governmental subdivision of the state shall make final
79.26 	settlement with any contractor under a contract requiring the
79.27 	employment of employees for wages by said contractor and by
79.28 	subcontractors until satisfactory showing is made that said
79.29 	contractor or subcontractor has complied with the provisions of
79.30 	section 290.92.  A certificate by the commissioner shall satisfy
79.31 	this requirement with respect to the contractor or
79.32 	subcontractor.  If, at the time of final settlement, there are
79.33 	any unpaid withholding taxes, penalties, or interest arising
79.34 	from the government contract, the commissioner shall issue a
79.35 	certification to the contractor or subcontractor upon payment,
79.36 	with certified funds, of any unpaid withholding taxes,
80.1 	penalties, and interest.  Payment is received by the
80.2 	commissioner upon delivery of the certified funds to the central
80.3 	office located in St. Paul, or any district or subdistrict
80.4 	office located throughout the state.[290.97]

80.5 	EFFECTIVE DATE. This section is effective August 1, 2005.

80.6 	Sec. 73. [270C.67] LEVY AND DISTRAINT.
80.7 		Subdivision 1.Authority. If any tax payable to the
80.8 	commissioner or to the department is not paid when due, such tax
80.9 	may be collected by the commissioner within five years after the
80.10 	date of assessment of the tax, or if a lien has been filed,
80.11 	during the period the lien is enforceable, or if the tax
80.12 	judgment has been filed, within the statutory period of
80.13 	enforcement of a valid tax judgment, by a levy upon all property
80.14 	and rights to property, including any property in the possession
80.15 	of law enforcement officials, of the person liable for the
80.16 	payment or collection of such tax (except that which is exempt
80.17 	from execution pursuant to section 550.37) or property on which
80.18 	there is a lien provided in section 270C.63.  For this purpose,
80.19 	"tax" includes any penalty, interest, and costs, properly
80.20 	payable.
80.21 		Subd. 2.Writ of entry. The term "levy" includes the
80.22 	power of distraint and seizure by any means; provided, no entry
80.23 	can be made upon the business premises or residence of a
80.24 	taxpayer in order to seize property without first obtaining a
80.25 	writ of entry listing the property to be seized and signed by a
80.26 	judge of the district court of the district in which the
80.27 	business premises or residence is located.
80.28 		Subd. 3.Notice and demand; collection by levy. Before a
80.29 	levy is made, notice and demand for payment of the amount due
80.30 	must be given to the person liable for the payment or collection
80.31 	of the tax at least 30 days prior to the levy.  The notice
80.32 	required under this subdivision must be sent to the taxpayer's
80.33 	last known address and must include a brief statement that sets
80.34 	forth in simple and nontechnical terms:
80.35 	(1) the administrative appeals available to the taxpayer
80.36 	with respect to the levy and sale; and 
81.1 	(2) the alternatives available to the taxpayer that can
81.2 	prevent a levy, including installment payment agreements under
81.3 	section 270C.52, subdivision 2.
81.4 		Subd. 4.Manner of execution and sale. In making the
81.5 	execution of the levy and in collecting the taxes due, the
81.6 	commissioner shall have all of the powers provided in chapter
81.7 	550 and in any other law for purposes of effecting an execution
81.8 	against property in this state.  The sale of property levied
81.9 	upon, and the time and manner of redemption therefrom, shall, to
81.10 	the extent not provided in sections 270C.7101 to 270C.7109, be
81.11 	governed by chapter 550.  The seal of the court, subscribed by
81.12 	the court administrator, as provided in section 550.04, shall
81.13 	not be required. The levy for collection of taxes may be made
81.14 	whether or not the commissioner has commenced a legal action for
81.15 	collection of such taxes.
81.16 		Subd. 5.Stay of sale. (a) Where a jeopardy assessment
81.17 	or any other assessment has been made by the commissioner, the
81.18 	property seized for collection of the tax shall not be sold
81.19 	until the time has expired for filing an appeal of the
81.20 	assessment with the Tax Court pursuant to chapter 271.  If an
81.21 	appeal has been filed, no sale shall be made unless the taxes
81.22 	remain unpaid for a period of more than 30 days after final
81.23 	determination of the appeal by the Tax Court or by the
81.24 	appropriate judicial forum.
81.25 	(b) Notwithstanding paragraph (a), seized property may be
81.26 	sold if:
81.27 	(1) the taxpayer consents in writing to the sale; or 
81.28 	(2) the commissioner determines that the property is
81.29 	perishable or may become greatly reduced in price or value by
81.30 	keeping, or that such property cannot be kept without great
81.31 	expense.
81.32 	(c) The Tax Court has jurisdiction to review a
81.33 	determination made under paragraph (b), clause (2).  Review is
81.34 	commenced by motion of the commissioner or the taxpayer.  The
81.35 	order of the court in response to the motion is reviewable in
81.36 	the same manner as any other decision of the Tax Court.
82.1 		Subd. 6.Probate proceedings. Where a levy has been made
82.2 	to collect taxes pursuant to this section and the property
82.3 	seized is properly included in a formal proceeding commenced
82.4 	under sections 524.3-401 to 524.3-505 and maintained under full
82.5 	supervision of the court, such property shall not be sold until
82.6 	the probate proceedings are completed or until the court so
82.7 	orders.
82.8 		Subd. 7.Bond or security to release seizure. The
82.9 	property seized shall be returned by the commissioner if the
82.10 	owner gives a surety bond equal to the appraised value of the
82.11 	owner's interest in the property, as determined by the
82.12 	commissioner, or deposits with the commissioner security in such
82.13 	form and amount as the commissioner deems necessary to insure
82.14 	payment of the liability, but not more than twice the liability.
82.15 		Subd. 8.Injunction. Notwithstanding any other provision
82.16 	to the contrary, if a levy or sale pursuant to this section
82.17 	would irreparably injure rights in property which the court
82.18 	determines to be superior to rights of the state in such
82.19 	property, the district court may grant an injunction to prohibit
82.20 	the enforcement of such levy or to prohibit such sale.
82.21 		Subd. 9.Optional remedy. Any action taken by the
82.22 	commissioner pursuant to this section shall not constitute an
82.23 	election by the state to pursue a remedy to the exclusion of any
82.24 	other remedy.
82.25 		Subd. 10.Equitable relief. After the commissioner has
82.26 	seized the property of any person, that person may, upon giving
82.27 	48 hours notice to the commissioner and to the court, bring a
82.28 	claim for equitable relief before the district court for the
82.29 	release of the property to the taxpayer upon such terms and
82.30 	conditions as the court may deem equitable.
82.31 		Subd. 11.Levy and sale by sheriff. If any tax payable
82.32 	to the commissioner or to the department is not paid as provided
82.33 	in subdivision 3, the commissioner may, within the time periods
82.34 	provided in subdivision 1 for collection of taxes, delegate the
82.35 	authority granted by subdivision 1, by means of issuing a
82.36 	warrant to the sheriff of any county of the state commanding the
83.1 	sheriff, as agent for the commissioner, to levy upon and sell
83.2 	the real and personal property of the person liable for the
83.3 	payment or collection of the tax and to levy upon the rights to
83.4 	property of that person within the county, or to levy upon and
83.5 	seize any property within the county on which there is a lien
83.6 	provided in section 270C.63, and to return the warrant to the
83.7 	commissioner and pay to the commissioner the money collected by
83.8 	virtue thereof by a time to be therein specified not less than
83.9 	60 days from the date of the warrant.  The sheriff shall proceed
83.10 	thereunder to levy upon and seize any property of the person and
83.11 	to levy upon the rights to property of the person within the
83.12 	county (except the person's homestead or that property which is
83.13 	exempt from execution pursuant to section 550.37), or to levy
83.14 	upon and seize any property within the county on which there is
83.15 	a lien provided in section 270C.63.  For purposes of the
83.16 	preceding sentence, "tax" includes any penalty, interest, and
83.17 	costs, properly payable.  The sheriff shall then sell so much of
83.18 	the property levied upon as is required to satisfy the taxes,
83.19 	interest, and penalties, together with the sheriff's costs; but
83.20 	the sales, and the time and manner of redemption therefrom,
83.21 	shall, to the extent not provided in sections 270C.7101 to
83.22 	270C.7109, be governed by chapter 550.  The proceeds of the
83.23 	sales, less the sheriff's costs, shall be turned over to the
83.24 	commissioner, who shall then apply the proceeds as provided in
83.25 	section 270C.7108.
83.26 		Subd. 12.Priority of levy. Notwithstanding section
83.27 	52.12, a levy by the commissioner made pursuant to the
83.28 	provisions of this section upon a taxpayer's funds on deposit in
83.29 	a financial institution located in this state, shall have
83.30 	priority over any unexercised right of setoff of the financial
83.31 	institution to apply the levied funds toward the balance of an
83.32 	outstanding loan or loans owed by the taxpayer to the financial
83.33 	institution.  A claim by the financial institution that it
83.34 	exercised its right to setoff prior to the levy by the
83.35 	commissioner must be substantiated by evidence of the date of
83.36 	the setoff, and shall be verified by the sworn statement of a
84.1 	responsible corporate officer of the financial institution.
84.2 	Furthermore, for purposes of determining the priority of any
84.3 	levy made under this section, the levy shall be treated as if it
84.4 	were an execution made pursuant to chapter 550.
84.5 		Subd. 13.Effect of honoring levy. Any person in
84.6 	possession of (or obligated with respect to) property or rights
84.7 	to property subject to levy upon which a levy has been made who,
84.8 	upon demand by the commissioner, surrenders the property or
84.9 	rights to property (or who pays a liability under section
84.10 	270C.70, subdivision 1) shall be discharged from any obligation
84.11 	or liability to the person liable for the payment or collection
84.12 	of the delinquent tax with respect to the property or rights to
84.13 	property so surrendered or paid.
84.14 		Subd. 14.Notice of levy. Notwithstanding any other
84.15 	provision of law to the contrary, the notice of any levy
84.16 	authorized by this section may be served by mail or by delivery
84.17 	by an agent of the department.
84.18 		Subd. 15.Uneconomical levy. No levy may be made on
84.19 	property if the amount of the expenses that the commissioner
84.20 	estimates would be incurred by the department with respect to
84.21 	the levy and sale of the property exceeds the fair market value
84.22 	of the property at the anticipated time of levy.
84.23 		Subd. 16.Levy on appearance date of subpoena. No levy
84.24 	may be made on the property of a person on the day on which the
84.25 	person, or an officer or employee of the person, is required to
84.26 	appear in response to a subpoena issued by the commissioner to
84.27 	collect unpaid taxes, unless the commissioner determines that
84.28 	the collection of the tax is in jeopardy.[270.70]
84.29 	
EFFECTIVE DATE. This section is effective August 1, 2005.

84.30 	Sec. 74. [270C.68] CONTINUOUS LEVY.
84.31 		Subdivision 1.Authority. The commissioner may, within
84.32 	five years after the date of assessment of the tax, or if a lien
84.33 	has been filed under section 270C.63, within the statutory
84.34 	period for enforcement of the lien, give notice to a person to
84.35 	withhold the amount of any tax, interest, or penalties, due from
84.36 	a taxpayer.  The amounts withheld shall be transmitted to the
85.1 	commissioner at the times the commissioner designates.
85.2 		Subd. 2.Levy continuous. The levy made under
85.3 	subdivision 1 is continuous from the date the notice is received
85.4 	until the amount due stated on the notice has been withheld or
85.5 	the notice has been released by the commissioner under section
85.6 	270C.7109, whichever occurs first.
85.7 		Subd. 3.Amount to be withheld. The amount required to
85.8 	be withheld under this section is the least of:
85.9 	(1) the amount stated on the notice;
85.10 	(2) if the taxpayer is not a natural person, 100 percent of
85.11 	the payment; or 
85.12 	(3) if the taxpayer is an individual, 25 percent of the
85.13 	payment.
85.14 		Subd. 4.Payments covered. For purposes of this section,
85.15 	the term "payments" does not include wages as defined in section
85.16 	290.92 or funds in a deposit account as defined in section
85.17 	336.9-102(a)(29).  The term payments does include the following:
85.18 	(1) payments due for services of independent contractors,
85.19 	dividends, rents, royalties, residuals, patent rights, and
85.20 	mineral or other natural resource rights;
85.21 	(2) payments or credits under written or oral contracts for
85.22 	services or sales whether denominated as wages, salary,
85.23 	commission, bonus, or otherwise, if the payments are not covered
85.24 	by section 270C.69; and 
85.25 	(3) any other periodic payments or credits resulting from
85.26 	an enforceable obligation to the taxpayer.
85.27 		Subd. 5.Determination of status; effect. A
85.28 	determination of a taxpayer's status as an independent
85.29 	contractor under this section does not affect the determination
85.30 	of the taxpayer's status for the purposes of any other law or
85.31 	rule.[270.7001]
85.32 	
EFFECTIVE DATE. This section is effective August 1, 2005.

85.33 	Sec. 75. [270C.69] WITHHOLDING BY EMPLOYER OF DELINQUENT
85.34 	TAXES.
85.35 		Subdivision 1.Notice and procedures. (a) The
85.36 	commissioner may, within five years after the date of assessment
86.1 	of the tax, or if a lien has been filed under section 270C.63,
86.2 	within the statutory period for enforcement of the lien, give
86.3 	notice to any employer deriving income which has a taxable situs
86.4 	in this state regardless of whether the income is exempt from
86.5 	taxation, that an employee of that employer is delinquent in a
86.6 	certain amount with respect to any taxes, including penalties,
86.7 	interest, and costs.  The commissioner can proceed under this
86.8 	section only if the tax is uncontested or if the time for appeal
86.9 	of the tax has expired.  The commissioner shall not proceed
86.10 	under this section until the expiration of 30 days after mailing
86.11 	to the taxpayer, at the taxpayer's last known address, a written
86.12 	notice of (1) the amount of taxes, interest, and penalties due
86.13 	from the taxpayer and demand for their payment, and (2) the
86.14 	commissioner's intention to require additional withholding by
86.15 	the taxpayer's employer pursuant to this section.  The effect of
86.16 	the notice shall expire one year after it has been mailed to the
86.17 	taxpayer provided that the notice may be renewed by mailing a
86.18 	new notice which is in accordance with this section.  The
86.19 	renewed notice shall have the effect of reinstating the priority
86.20 	of the original claim.  The notice to the taxpayer shall be in
86.21 	substantially the same form as that provided in section 571.72.
86.22 	The notice shall further inform the taxpayer of the wage
86.23 	exemptions contained in section 550.37, subdivision 14.  If no
86.24 	statement of exemption is received by the commissioner within 30
86.25 	days from the mailing of the notice, the commissioner may
86.26 	proceed under this section.  The notice to the taxpayer's
86.27 	employer may be served by mail or by delivery by an agent of the
86.28 	department and shall be in substantially the same form as
86.29 	provided in section 571.75.  Upon receipt of notice, the
86.30 	employer shall withhold from compensation due or to become due
86.31 	to the employee, the total amount shown by the notice, subject
86.32 	to the provisions of section 571.922.  The employer shall
86.33 	continue to withhold each pay period until the notice is
86.34 	released by the commissioner under section 270C.7109.  Upon
86.35 	receipt of notice by the employer, the claim of the state of
86.36 	Minnesota shall have priority over any subsequent garnishments
87.1 	or wage assignments.  The commissioner may arrange between the
87.2 	employer and the employee for withholding a portion of the total
87.3 	amount due the employee each pay period, until the total amount
87.4 	shown by the notice plus accrued interest has been withheld.
87.5 	(b) The "compensation due" any employee is defined in
87.6 	accordance with the provisions of section 571.921.  The maximum
87.7 	withholding allowed under this section for any one pay period
87.8 	shall be decreased by any amounts payable pursuant to a
87.9 	garnishment action with respect to which the employer was served
87.10 	prior to being served with the notice of delinquency and any
87.11 	amounts covered by any irrevocable and previously effective
87.12 	assignment of wages; the employer shall give notice to the
87.13 	commissioner of the amounts and the facts relating to such
87.14 	assignments within ten days after the service of the notice of
87.15 	delinquency on the form provided by the commissioner as noted in
87.16 	this section.
87.17 	(c) Within ten days after the expiration of such pay
87.18 	period, the employer shall remit to the commissioner, on a form
87.19 	and in the manner prescribed by the commissioner, the amount
87.20 	withheld during each pay period under this section.
87.21 		Subd. 2.Termination of employment. If the employee
87.22 	ceases to be employed by the employer before the full amount set
87.23 	forth in a notice of delinquency plus accrued interest has been
87.24 	withheld, the employer shall immediately notify the commissioner
87.25 	in writing of the termination date of the employee and the total
87.26 	amount withheld.  No employer may discharge any employee by
87.27 	reason of the fact that the commissioner has proceeded under
87.28 	subdivision 1.  If an employer discharges an employee in
87.29 	violation of this provision, the employee shall have the same
87.30 	remedy as provided in section 571.927, subdivision 2.
87.31 		Subd. 3.Application to government
87.32 	employer. Subdivisions 1 and 2 apply to cases in which the
87.33 	employer is the United States or any instrumentality thereof or
87.34 	this state or any municipality or other subordinate unit
87.35 	thereof.  The provisions imposing liability on the employer for
87.36 	failure to withhold or remit under section 270C.70 do not apply
88.1 	to such government employers.
88.2 		Subd. 4.Refund to employee. The commissioner shall
88.3 	refund to the employee excess amounts withheld from the employee
88.4 	under this section.  If any excess results from payments by the
88.5 	employer because of payments made under section 270C.70, the
88.6 	excess attributable to the employer's payment shall be refunded
88.7 	to the employer.
88.8 		Subd. 5.Additional interest, costs, charges. Employers
88.9 	required to withhold delinquent taxes, penalties, interest, and
88.10 	costs under this section shall not be required to compute any
88.11 	additional interest, costs or other charges to be withheld.
88.12 		Subd. 6.Legal effect. The collection remedy provided to
88.13 	the commissioner by this section shall have the same legal
88.14 	effect as if it were a levy made pursuant to section 270C.67.
88.15 	[290.92, subd. 23]
88.16 	
EFFECTIVE DATE. This section is effective August 1, 2005.

88.17 	Sec. 76. [270C.70] PERSONAL LIABILITY FOR FAILURE TO
88.18 	HONOR A LEVY.
88.19 		Subdivision 1.Surrender of property subject to levy. A
88.20 	person who fails or refuses to surrender property or rights to
88.21 	property subject to a levy served on the person under section
88.22 	270C.67, 270C.68, or 270C.69 is liable in an amount equal to the
88.23 	value of the property or rights not surrendered, or the amount
88.24 	of taxes, penalties, and interest for the collection of which
88.25 	the levy was made, whichever is less.  A financial institution
88.26 	need not surrender funds on deposit until ten days after service
88.27 	of the levy.
88.28 		Subd. 2.Penalty. In addition to the personal liability
88.29 	imposed by subdivision 1, if a person required to surrender
88.30 	property or rights to property fails to do so without reasonable
88.31 	cause, the person is liable for a penalty equal to 25 percent of
88.32 	the amount under subdivision 1.
88.33 		Subd. 3.Person defined. The term "person" as used in
88.34 	this section includes an officer or employee of a corporation,
88.35 	or a member or employee of a partnership, who as such officer,
88.36 	employee, or member is under a duty to surrender the property or
89.1 	rights to property or to respond to the levy.
89.2 		Subd. 4.Order assessing liability. The liability
89.3 	imposed by this section may, after demand to honor a levy has
89.4 	been made, be assessed by the commissioner within 60 days after
89.5 	service of the demand.  The assessment may be based on
89.6 	information available to the commissioner.  The assessment is
89.7 	presumed to be valid, and the burden is on the person assessed
89.8 	to show it is incorrect or invalid.  An order assessing
89.9 	liability for failure to honor a levy is reviewable
89.10 	administratively under section 270C.35, and is appealable to Tax
89.11 	Court under chapter 271.  The amount assessed, plus interest at
89.12 	the rate specified in section 270C.40, may be collected by any
89.13 	remedy available to the commissioner for the collection of
89.14 	taxes.  The proceeds collected are applied first to the
89.15 	liability of the original taxpayer to the extent of the
89.16 	liability under subdivision 1 plus interest, and then to the
89.17 	penalty under subdivision 2.[270.7002]
89.18 	
EFFECTIVE DATE. This section is effective August 1, 2005.

89.19 	Sec. 77. [270C.7101] SALE OF SEIZED PROPERTY.
89.20 		Subdivision 1.Notice of seizure. As soon as practicable
89.21 	after seizure of property, notice in writing shall be given by
89.22 	the commissioner to the owner of the property (or, in the case
89.23 	of personal property, the possessor thereof), and shall be
89.24 	served in like manner as a summons in a civil action in the
89.25 	district court.  If the owner cannot be readily located, or has
89.26 	no dwelling or place of business within this state, the notice
89.27 	may be mailed to the last known address.  The notice shall
89.28 	specify the sum demanded and shall contain, in the case of
89.29 	personal property, an account of the property seized and, in the
89.30 	case of real property, a description with reasonable certainty
89.31 	of the property seized.
89.32 		Subd. 2.Notice of sale. The commissioner shall as soon
89.33 	as practicable after the seizure of the property give notice of
89.34 	sale of the property to the owner, in the manner of service
89.35 	prescribed in subdivision 1.  In the case of personal property,
89.36 	the notice shall be served at least ten days prior to the sale.
90.1 	In the case of real property, the notice shall be served at
90.2 	least four weeks prior to the sale.  The commissioner shall also
90.3 	cause public notice of each sale to be made.  In the case of
90.4 	personal property, notice shall be posted at least ten days
90.5 	prior to the sale at the county courthouse for the county where
90.6 	the seizure is made, and in not less than two other public
90.7 	places.  For purposes of this requirement, the Internet is a
90.8 	public place for posting the information.  In the case of real
90.9 	property, six weeks' published notice shall be given prior to
90.10 	the sale, in a newspaper published or generally circulated in
90.11 	the county.  The notice of sale provided in this subdivision
90.12 	shall specify the property to be sold, and the time, place,
90.13 	manner, and conditions of the sale.  Whenever levy is made
90.14 	without regard to the 30-day period provided in section 270C.67,
90.15 	subdivision 3, public notice of sale of the property seized
90.16 	shall not be made within the 30-day period unless section
90.17 	270C.7102 (relating to sale of perishable goods) is applicable.
90.18 		Subd. 3.Sale of indivisible property. If any property
90.19 	liable to levy is not divisible, so as to enable the
90.20 	commissioner by sale of a part thereof to raise the whole amount
90.21 	of the tax and expenses, the whole of the property shall be sold.
90.22 		Subd. 4.Time and place of sale. The time of sale shall
90.23 	be after the expiration of the notice periods prescribed in
90.24 	subdivision 2.  The place of sale shall be within the county in
90.25 	which the property is seized, except by special order of the
90.26 	commissioner.
90.27 		Subd. 5.Manner and conditions of sale. (a) Before the
90.28 	sale the commissioner shall determine a minimum price for which
90.29 	the property shall be sold, and if no person offers for the
90.30 	property at the sale the amount of the minimum price, the
90.31 	property shall be declared to be purchased at the minimum price
90.32 	for the state of Minnesota; otherwise the property shall be
90.33 	declared to be sold to the highest bidder.  In determining the
90.34 	minimum price, the commissioner shall take into account the
90.35 	expense of making the levy and sale.  The announcement of the
90.36 	minimum price determined by the commissioner may be delayed
91.1 	until the receipt of the highest bid.
91.2 	(b) The sale shall not be conducted in any manner other
91.3 	than:
91.4 	(1) by public auction;
91.5 	(2) by public sale under sealed bids; or 
91.6 	(3) in the case of items which individually or in usually
91.7 	marketable units have a value of $50 or less, by public or
91.8 	private proceedings as a unit or in parcels at any time and
91.9 	place and on any terms, but every aspect of the disposition
91.10 	including the method, manner, time, place, and terms must be
91.11 	commercially reasonable.
91.12 	(c) In the case of seizure of several items of property,
91.13 	the items may be offered separately, in groups, or in the
91.14 	aggregate, and shall be sold under whichever method produces the
91.15 	highest aggregate amount, except that sales under paragraph (b),
91.16 	clause (3), must produce a reasonable amount under the
91.17 	circumstances.
91.18 	(d) Payment in full shall be required at the time of
91.19 	acceptance of a bid, except that a part of the payment may be
91.20 	deferred by the commissioner for a period not to exceed 30 days.
91.21 	(e) Other methods (including advertising) in addition to
91.22 	those prescribed in subdivision 2 may be used in giving notice
91.23 	of the sale.
91.24 	(f) The commissioner may adjourn the sale from time to time
91.25 	for a period not to exceed 30 days.
91.26 	(g) If payment in full is required at the time of
91.27 	acceptance of a bid and is not then and there paid, the
91.28 	commissioner shall forthwith proceed to again sell the property
91.29 	in the manner provided in this section.  If the conditions of
91.30 	the sale permit part of the payment to be deferred, and if the
91.31 	part is not paid within the prescribed period, suit may be
91.32 	instituted against the purchaser for the purchase price or that
91.33 	part thereof as has not been paid, together with interest at the
91.34 	rate specified in section 549.09 from the date of the sale; or,
91.35 	in the discretion of the commissioner, the sale may be declared
91.36 	by the commissioner to be null and void for failure to make full
92.1 	payment of the purchase price and the property may again be
92.2 	advertised and sold as provided in this section.  In the event
92.3 	of a readvertisement and sale, any new purchaser shall receive
92.4 	the property or rights to property free and clear of any claim
92.5 	or right of the former defaulting purchaser, of any nature
92.6 	whatsoever, and the amount paid upon the bid price by the
92.7 	defaulting purchaser shall be forfeited.
92.8 		Subd. 6.Right to request sale of seized property within
92.9 	60 days. The owner of property seized by levy may request that
92.10 	the commissioner offer to sell the property within 60 days after
92.11 	the request, or within a longer period requested by the owner.
92.12 	The request must be complied with unless the commissioner
92.13 	determines and notifies the owner within that period that
92.14 	compliance is not in the best interests of the state of
92.15 	Minnesota.  A determination by the commissioner not to comply
92.16 	with the request is appealable to the Tax Court in the manner
92.17 	provided by law.
92.18 		Subd. 7.Sale of seized securities. (a) At the time of
92.19 	levy on securities, the commissioner shall provide notice to the
92.20 	taxpayer that the securities may be sold after ten days from the
92.21 	date of seizure.
92.22 	(b) If the commissioner levies upon nonexempt publicly
92.23 	traded securities and the value of the securities is less than
92.24 	or equal to the total obligation for which the levy is done,
92.25 	after ten days the person who possesses or controls the
92.26 	securities shall liquidate the securities in a commercially
92.27 	reasonable manner.  After liquidation, the person shall transfer
92.28 	the proceeds to the commissioner, less any applicable
92.29 	commissions or fees, or both, which are charged in the normal
92.30 	course of business.
92.31 	(c) If the commissioner levies upon nonexempt publicly
92.32 	traded securities and the value of the securities exceeds the
92.33 	total amount of the levy, the owner of the securities may,
92.34 	within seven days after receipt of the commissioner's notice of
92.35 	levy given pursuant to subdivision 1, instruct the person who
92.36 	possesses or controls the securities which securities are to be
93.1 	sold to satisfy the obligation.  If the owner does not provide
93.2 	instructions for liquidation, the person who possesses or
93.3 	controls the securities shall liquidate the securities in an
93.4 	amount sufficient to pay the obligation, plus any applicable
93.5 	commissions or fees, or both, which are charged in the normal
93.6 	course of business, beginning with the nonexempt securities
93.7 	purchased most recently.  After liquidation, the person who
93.8 	possesses or controls the securities shall transfer to the
93.9 	commissioner the amount of money needed to satisfy the levy.
93.10 	[270.701]
93.11 	
EFFECTIVE DATE. This section is effective for levies made
93.12 	on or after August 1, 2005.

93.13 	Sec. 78. [270C.7102] SALE OF PERISHABLE GOODS.
93.14 	If the commissioner determines that any property seized is
93.15 	liable to perish or become greatly reduced in price or value by
93.16 	keeping, or that the property cannot be kept without great
93.17 	expense, the commissioner shall appraise the value of the
93.18 	property, and if the owner of the property can be readily found,
93.19 	the commissioner shall give the owner notice of the
93.20 	determination of the appraised value of the property.  The
93.21 	property shall be returned to the owner if, within the time
93.22 	specified in the notice, the owner (a) pays to the commissioner
93.23 	an amount equal to the appraised value, or (b) gives bond in the
93.24 	form, with the sureties, and in the amount as the commissioner
93.25 	prescribes to pay the appraised amount at the time the
93.26 	commissioner determines to be appropriate in the circumstances.
93.27 	If the owner does not pay the amount or furnish the bond in
93.28 	accordance with this section, the commissioner shall as soon as
93.29 	practicable make public sale of the property in accordance with
93.30 	section 270C.7101.[270.702]

93.31 	EFFECTIVE DATE. This section is effective for levies made
93.32 	on or after August 1, 2005.

93.33 	Sec. 79. [270C.7103] REDEMPTION OF PROPERTY.
93.34 		Subdivision 1.Before sale. Any person whose property
93.35 	has been levied upon shall have the right to pay the amount due,
93.36 	together with the expenses of the proceeding, if any, to the
94.1 	commissioner at any time prior to the sale thereof, and upon
94.2 	payment the commissioner shall restore the property to the
94.3 	person, and all further proceedings in connection with the levy
94.4 	on the property shall cease from the time of payment.
94.5 		Subd. 2.Redemption of real estate after sale. The
94.6 	owners of any real property sold as provided in this section,
94.7 	their heirs, executors, or administrators, or any person having
94.8 	any interest therein, or a lien thereon, or any person in their
94.9 	behalf, shall be permitted to redeem the property sold, or any
94.10 	particular tract of the property, at any time within six months,
94.11 	or in case the real property sold exceeds ten acres in size, at
94.12 	any time within 12 months, after the sale thereof.  The property
94.13 	or tract of property shall be permitted to be redeemed upon
94.14 	payment to the purchaser (or if not found in the county in which
94.15 	the property to be redeemed is situated, then to the
94.16 	commissioner, for the use of the purchaser, or the purchaser's
94.17 	heirs or assigns) of the amount paid by the purchaser together
94.18 	with interest at the rate of 20 percent per annum.
94.19 		Subd. 3.Record. When any lands sold are redeemed as
94.20 	provided in this section, the commissioner shall cause entry of
94.21 	the fact to be made upon the record required by section
94.22 	270C.7106 and the entry shall be evidence of the redemption.
94.23 	[270.703]
94.24 	
EFFECTIVE DATE. This section is effective for levies made
94.25 	on or after August 1, 2005.

94.26 	Sec. 80. [270C.7104] CERTIFICATE OF SALE.
94.27 	In the case of property sold as provided in section
94.28 	270C.7101, the commissioner shall give to the purchaser a
94.29 	certificate of sale upon payment in full of the purchase price.
94.30 	In the case of real property the certificate shall set forth the
94.31 	real property purchased, for whose taxes the property was sold,
94.32 	the name of the purchaser, and the price paid.  If real property
94.33 	is declared purchased by the state of Minnesota, the
94.34 	commissioner shall within ten days from the sale cause the
94.35 	certificate of sale to be duly recorded by the county recorder
94.36 	of the county in which the real property is located.[270.704]

95.1 	EFFECTIVE DATE. This section is effective for levies made
95.2 	on or after August 1, 2005.

95.3 	Sec. 81. [270C.7105] EFFECT OF CERTIFICATE OF SALE.
95.4 		Subdivision 1.Personal property. (a) In all cases of
95.5 	sale pursuant to section 270C.7101 of personal property, the
95.6 	certificate of sale given pursuant to section 270C.7104 shall be
95.7 	prima facie evidence of the right of the commissioner to make
95.8 	the sale, and conclusive evidence of the regularity of the
95.9 	proceedings in making the sale.  The certificate shall transfer
95.10 	to the purchaser all right, title, and interest of the party
95.11 	delinquent in and to the property sold.
95.12 	(b) If the property consists of stocks, the certificate of
95.13 	sale shall be notice, when received, to any corporation,
95.14 	company, or association of the transfer, and shall be authority
95.15 	to the corporation, company, or association to record the
95.16 	transfer on its books and records in the same manner as if the
95.17 	stocks were transferred or assigned by the party holding the
95.18 	same, in lieu of any original or prior certificate, which shall
95.19 	be void, whether canceled or not.
95.20 	(c) If the subject of sale is securities or other evidences
95.21 	of debt, the certificate of sale shall be a good and valid
95.22 	receipt to the person holding the same, as against any person
95.23 	holding or claiming to hold possession of the securities or
95.24 	other evidences of debt.
95.25 	(d) If the property consists of a motor vehicle, the
95.26 	certificate of sale shall be notice, when received, to the
95.27 	registrar of motor vehicles of this state of the transfer, and
95.28 	shall be authority to the registrar to record the transfer on
95.29 	the books and records in the same manner as if the certificate
95.30 	of title to the motor vehicle were transferred or assigned by
95.31 	the party holding the same, in lieu of any original or prior
95.32 	certificate, which shall be void, whether canceled or not.
95.33 		Subd. 2.Real property. In the case of the sale of real
95.34 	property pursuant to section 270C.7101, the certificate of sale
95.35 	given pursuant to section 270C.7104 shall be prima facie
95.36 	evidence of the facts therein stated, and shall be considered
96.1 	and operate as a conveyance of all the right, title, and
96.2 	interest the party delinquent had in and to the real property
96.3 	thus sold at the time the lien of the state of Minnesota
96.4 	attached thereto.
96.5 		Subd. 3.Junior encumbrances. A certificate of sale of
96.6 	personal property or real property given pursuant to section
96.7 	270C.7104 shall discharge the property from all liens,
96.8 	encumbrances, and titles over which the lien of the state of
96.9 	Minnesota with respect to which the levy was made had priority.
96.10 	[270.705]
96.11 	
EFFECTIVE DATE. This section is effective for levies made
96.12 	on or after August 1, 2005.

96.13 	Sec. 82. [270C.7106] RECORDS OF SALE.
96.14 	The commissioner shall maintain a record of all sales of
96.15 	property under section 270C.7101 and of redemptions of real
96.16 	property.  The record shall set forth the tax for which the sale
96.17 	was made, the dates of seizure and sale, the name of the party
96.18 	assessed and all proceedings in making the sale, the amount of
96.19 	expenses, the names of the purchasers, and the date of the
96.20 	certificate of sale.  A copy of the record, or any part thereof,
96.21 	certified by the commissioner shall be evidence in any court of
96.22 	the truth of the facts therein stated.[270.706]

96.23 	EFFECTIVE DATE. This section is effective for levies made
96.24 	on or after August 1, 2005.

96.25 	Sec. 83. [270C.7107] EXPENSE OF LEVY AND SALE.
96.26 	The commissioner shall determine the expenses to be allowed
96.27 	in all cases of levy and sale.[270.707]

96.28 	EFFECTIVE DATE. This section is effective for levies made
96.29 	on or after August 1, 2005.

96.30 	Sec. 84. [270C.7108] APPLICATION OF PROCEEDS OF LEVY.
96.31 		Subdivision 1.Collection of liability. Any money
96.32 	realized by proceedings under this chapter, whether by seizure,
96.33 	by surrender under section 270C.67, by sale of seized property,
96.34 	by sale of property redeemed by the state of Minnesota (if the
96.35 	interest of the state of Minnesota in the property was a lien
96.36 	arising under the provisions of section 270C.63), or by
97.1 	agreement, arrangement, or any other means shall be applied as
97.2 	follows:
97.3 	(a) First, against the expenses of the proceedings; then 
97.4 	(b) If the property seized and sold is subject to a tax
97.5 	that has not been paid, the amount remaining after applying
97.6 	clause (a) shall next be applied against the tax liability (and,
97.7 	if the tax was not previously assessed, it shall then be
97.8 	assessed); and 
97.9 	(c) The amount, if any, remaining after applying clauses
97.10 	(a) and (b) shall be applied against the tax liability in
97.11 	respect of which the levy was made or the sale was conducted.
97.12 		Subd. 2.Surplus proceeds. Any surplus proceeds
97.13 	remaining after the application of subdivision 1 shall, upon
97.14 	application and satisfactory proof in support thereof, be
97.15 	credited or refunded by the commissioner to the person or
97.16 	persons legally entitled thereto.[270.708]
97.17 	
EFFECTIVE DATE. This section is effective for levies made
97.18 	on or after August 1, 2005.

97.19 	Sec. 85. [270C.7109] AUTHORITY TO RELEASE LEVY AND RETURN
97.20 	PROPERTY.
97.21 		Subdivision 1.Release of levy. The commissioner shall
97.22 	release a levy on all or part of the property or rights to
97.23 	property levied on and shall promptly notify the person on whom
97.24 	the levy was made that the levy has been released if:  (1) the
97.25 	liability for which the levy was made is satisfied or has become
97.26 	unenforceable by lapse of time; (2) release of the levy will
97.27 	facilitate collection of the liability; (3) the taxpayer has
97.28 	entered into an installment payment agreement under section
97.29 	270C.52, subdivision 2, unless the agreement provides otherwise,
97.30 	or unless release of the levy will jeopardize the status of the
97.31 	department as a secured creditor; or (4) the fair market value
97.32 	of the property exceeds the liability, and release of the levy
97.33 	on a part of the property can be made without hindering
97.34 	collection.  In the case of tangible personal property essential
97.35 	in carrying on the trade or business of the taxpayer, the
97.36 	commissioner shall provide for an expedited determination under
98.1 	this subdivision.  A release of levy under this subdivision does
98.2 	not prevent a subsequent levy on the property released.
98.3 		Subd. 2.Return of property. If the commissioner
98.4 	determines that property has been wrongfully levied upon, it
98.5 	shall be lawful for the commissioner to return:
98.6 	(a) The specific property levied upon, at any time;
98.7 	(b) An amount of money equal to the amount of money levied
98.8 	upon, at any time before the expiration of nine months from the
98.9 	date of the levy; or 
98.10 	(c) An amount of money equal to the amount of money
98.11 	received by the state of Minnesota from a sale of the property,
98.12 	at any time before the expiration of nine months from the date
98.13 	of the sale.
98.14 	For purposes of clause (c), if property is declared
98.15 	purchased by the state of Minnesota at a sale pursuant to
98.16 	section 270C.7101, subdivision 5 (relating to manner and
98.17 	conditions of sale), the state of Minnesota shall be treated as
98.18 	having received an amount of money equal to the minimum price
98.19 	determined pursuant to section 270C.7101, subdivision 5, or, if
98.20 	larger, the amount received by the state of Minnesota from the
98.21 	resale of the property.[270.709]
98.22 	
EFFECTIVE DATE. This section is effective for levies made
98.23 	on or after August 1, 2005.

98.24 	Sec. 86. [270C.711] ACQUISITION AND RESALE OF SEIZED
98.25 	PROPERTY.
98.26 	For the purpose of enabling the commissioner to purchase or
98.27 	redeem seized property in which the state of Minnesota has an
98.28 	interest arising from a lien for unpaid taxes, or to provide for
98.29 	the operating costs of collection activities of the department,
98.30 	there is appropriated to the commissioner an amount representing
98.31 	the cost of such purchases, redemptions, or collection
98.32 	activities.  Seized property acquired by the state of Minnesota
98.33 	to satisfy unpaid taxes shall be resold by the commissioner.
98.34 	The commissioner shall preserve the value of seized property
98.35 	while controlling it, including but not limited to the
98.36 	procurement of insurance.  For the purpose of refunding the
99.1 	proceeds from the sale of levied or redeemed property which are
99.2 	in excess of the actual tax liability plus costs of acquiring
99.3 	the property, there is hereby created a levied and redeemed
99.4 	property refund account in the agency fund.  All amounts
99.5 	deposited into this account are appropriated to the
99.6 	commissioner.  The commissioner shall report quarterly on the
99.7 	status of this program to the chairs of the house Taxes and Ways
99.8 	and Means Committees and senate Taxes and Tax Laws and Finance
99.9 	Committees.[270.71]

99.10 	EFFECTIVE DATE. This section is effective August 1, 2005.

99.11 	Sec. 87. [270C.72] TAX CLEARANCE; ISSUANCE OF LICENSES.
99.12 		Subdivision 1.Tax clearance required. The state or a
99.13 	political subdivision of the state may not issue, transfer, or
99.14 	renew, and must revoke, a license for the conduct of a
99.15 	profession, occupation, trade, or business, if the commissioner
99.16 	notifies the licensing authority that the applicant owes the
99.17 	state delinquent taxes payable to the commissioner, penalties,
99.18 	or interest.  The commissioner may not notify the licensing
99.19 	authority unless the applicant taxpayer owes $500 or more in
99.20 	delinquent taxes, penalties, or interest, or has not filed
99.21 	returns.  If the applicant taxpayer does not owe delinquent
99.22 	taxes, penalties, or interest, but has not filed returns, the
99.23 	commissioner may not notify the licensing authority unless the
99.24 	taxpayer has been given 90 days' written notice to file the
99.25 	returns or show that the returns are not required to be filed.
99.26 	A licensing authority that has received a notice from the
99.27 	commissioner may issue, transfer, renew, or not revoke the
99.28 	applicant's license only if (a) the commissioner issues a tax
99.29 	clearance certificate and (b) the commissioner or the applicant
99.30 	forwards a copy of the clearance to the authority.  The
99.31 	commissioner may issue a clearance certificate only if the
99.32 	applicant does not owe the state any uncontested delinquent
99.33 	taxes, penalties, or interest and has filed all required returns.
99.34 		Subd. 2.Definitions. For purposes of this section, the
99.35 	following terms have the meanings given.
99.36 	(a) "Delinquent taxes" do not include a tax liability if
100.1 	(i) an administrative or court action which contests the amount
100.2 	or validity of the liability has been filed or served, (ii) the
100.3 	appeal period to contest the tax liability has not expired, or
100.4 	(iii) the applicant has entered into a payment agreement and is
100.5 	current with the payments.
100.6 	(b) "Applicant" means an individual, if the license is
100.7 	issued to or in the name of an individual, or the corporation or
100.8 	partnership, if the license is issued to or in the name of a
100.9 	corporation or partnership.  "Applicant" also means an officer
100.10 	of a corporation, a member of a partnership, or an individual
100.11 	who is liable for delinquent taxes, either for the entity for
100.12 	which the license is at issue or for another entity for which
100.13 	the liability was incurred, or personally as a licensee.  In the
100.14 	case of a license transfer, "applicant" also means both the
100.15 	transferor and the transferee of the license.  "Applicant" also
100.16 	means any holder of a license.
100.17 	(c) "License" means any permit, registration,
100.18 	certification, or other form of approval authorized by statute
100.19 	or rule to be issued by the state or a political subdivision of
100.20 	the state as a condition of doing business or conducting a
100.21 	trade, profession, or occupation in Minnesota, specifically
100.22 	including, but not limited to, a contract for space rental at
100.23 	the Minnesota state fair and authorization to operate
100.24 	concessions or rides at county and local fairs, festivals, or
100.25 	events.
100.26 	(d) "Licensing authority" includes the Minnesota State Fair
100.27 	Board and county and local boards or governing bodies.
100.28 		Subd. 3.Notice and hearing. (a) The commissioner, on
100.29 	notifying a licensing authority pursuant to subdivision 1 not to
100.30 	issue, transfer, or renew a license, must send a copy of the
100.31 	notice to the applicant.  If the applicant requests, in writing,
100.32 	within 30 days of the date of the notice a hearing, a contested
100.33 	case hearing must be held.  The hearing must be held within 45
100.34 	days of the date the commissioner refers the case to the Office
100.35 	of Administrative Hearings.  Notwithstanding any law to the
100.36 	contrary, the applicant must be served with 20 days' notice in
101.1 	writing specifying the time and place of the hearing and the
101.2 	allegations against the applicant.  The notice may be served
101.3 	personally or by mail.
101.4 	(b) Prior to notifying a licensing authority pursuant to
101.5 	subdivision 1 to revoke a license, the commissioner must send a
101.6 	notice to the applicant of the commissioner's intent to require
101.7 	revocation of the license and of the applicant's right to a
101.8 	hearing under paragraph (a).  A license is subject to revocation
101.9 	when 30 days have passed following the date of the notice in
101.10 	this paragraph without the applicant requesting a hearing, or,
101.11 	if a hearing is timely requested, upon final determination of
101.12 	the hearing under section 14.62, subdivision 1.  A license shall
101.13 	be revoked by the licensing authority within 30 days after
101.14 	receiving notice from the commissioner to revoke.
101.15 	(c) A hearing under this subdivision is in lieu of any
101.16 	other hearing or proceeding provided by law arising from any
101.17 	action taken under subdivision 1.
101.18 		Subd. 4.Licensing authority; duties. All licensing
101.19 	authorities must require the applicant to provide the
101.20 	applicant's Social Security number and Minnesota business
101.21 	identification number on all license applications.  Upon request
101.22 	of the commissioner, the licensing authority must provide the
101.23 	commissioner with a list of all applicants, including the name,
101.24 	address, business name and address, Social Security number, and
101.25 	business identification number of each applicant.  The
101.26 	commissioner may request from a licensing authority a list of
101.27 	the applicants no more than once each calendar year.[270.72]
101.28 	
EFFECTIVE DATE. This section is effective August 1, 2005.

101.29 	Sec. 88. [270C.721] REVOCATION OF CERTIFICATES OF
101.30 	AUTHORITY TO DO BUSINESS IN THIS STATE.
101.31 	When a foreign corporation authorized to do business in
101.32 	this state under chapter 303, or a foreign limited liability
101.33 	company or partnership authorized to do business in this state
101.34 	under chapter 322B, fails to comply with a law administered by
101.35 	the commissioner that imposes a tax, the commissioner may serve
101.36 	the secretary of state with a certified copy of an order finding
102.1 	such failure to comply.  The secretary of state, upon receipt of
102.2 	the order, shall revoke the certificate of authority to do
102.3 	business in this state, and shall reinstate the certificate
102.4 	under section 303.19 or 322B.960, subdivision 6, only when the
102.5 	corporation or limited liability company or partnership has
102.6 	obtained from the commissioner an order finding that the
102.7 	corporation or limited liability company or partnership is in
102.8 	compliance with such law.  An order requiring revocation of a
102.9 	certificate shall not be issued unless the commissioner gives
102.10 	the corporation or limited liability company or partnership 30
102.11 	days' written notice of the proposed order, specifying the
102.12 	violations of law, and affording an opportunity to request a
102.13 	contested case hearing under chapter 14.[270.721]

102.14 	EFFECTIVE DATE. This section is effective August 1, 2005.

102.15 	Sec. 89. [270C.722] REVOCATION OF SALES TAX PERMITS.
102.16 		Subdivision 1.Notice of revocation; hearings. (a) If:
102.17 	(1) a person fails to comply with chapter 297A or the sales and
102.18 	use tax provisions of chapter 289A or the rules related to sales
102.19 	tax, or (2) any retailer purchases for resale from an unlicensed
102.20 	seller more than 20,000 cigarettes or $500 or more worth of
102.21 	tobacco products, without reasonable cause, the commissioner may
102.22 	give the person 30 days' notice in writing, specifying the
102.23 	violations, and stating that based on the violations the
102.24 	commissioner intends to revoke the person's permit issued under
102.25 	section 297A.84.  The notice must also advise the person of the
102.26 	right to contest the revocation under this subdivision.  It must
102.27 	also explain the general procedures for a contested case hearing
102.28 	under chapter 14.  The notice may be served personally or by
102.29 	mail in the manner prescribed for service of an order of
102.30 	assessment.
102.31 	(b) If the person does not request a hearing within 30 days
102.32 	after the date of the notice of intent, the commissioner may
102.33 	serve a notice of revocation of permit upon the person, and the
102.34 	permit is revoked.  If a hearing is timely requested, and held,
102.35 	the permit is revoked after the commissioner serves an order of
102.36 	revocation of permit under section 14.62, subdivision 1.
103.1 		Subd. 2.New permits after revocation. (a) The
103.2 	commissioner shall not issue a new permit after revocation or
103.3 	reinstate a revoked permit unless the taxpayer applies for a
103.4 	permit and provides reasonable evidence of intention to comply
103.5 	with the sales and use tax laws and rules.  The commissioner may
103.6 	require the applicant to provide security, in addition to that
103.7 	authorized by section 297A.92, in an amount reasonably necessary
103.8 	to ensure compliance with the sales and use tax laws and rules.
103.9 	If the commissioner issues or reinstates a permit not in
103.10 	conformance with the requirements of this subdivision or
103.11 	applicable rules, the commissioner may cancel the permit upon
103.12 	notice to the permit holder.  The notice must be served by first
103.13 	class and certified mail at the permit holder's last known
103.14 	address.  The cancellation shall be effective immediately,
103.15 	subject to the right of the permit holder to show that the
103.16 	permit was issued in conformance with the requirements of this
103.17 	subdivision and applicable rules.  Upon such showing, the permit
103.18 	must be reissued.
103.19 	(b) If a taxpayer has had a permit or permits revoked three
103.20 	times in a five-year period, the commissioner shall not issue a
103.21 	new permit or reinstate the revoked permit until 24 months have
103.22 	elapsed after revocation and the taxpayer has satisfied the
103.23 	conditions for reinstatement of a revoked permit or issuance of
103.24 	a new permit imposed by this section and rules adopted under
103.25 	this section.
103.26 	(c) For purposes of this subdivision, "taxpayer" means:
103.27 	(1) an individual, if a revoked permit was issued to or in
103.28 	the name of an individual, or a corporation or partnership, if a
103.29 	revoked permit was issued to or in the name of a corporation or
103.30 	partnership; and 
103.31 	(2) an officer of a corporation, a member of a partnership,
103.32 	or an individual who is liable for delinquent sales taxes,
103.33 	either for the entity for which the new or reinstated permit is
103.34 	at issue, or for another entity for which a permit was
103.35 	previously revoked, or personally as a permit holder.[297A.86]
103.36 	
EFFECTIVE DATE. This section is effective August 1, 2005.

104.1 	Sec. 90. [270C.725] POSTING OF TAX DELINQUENCY; SALE OF
104.2 	LIQUOR OR BEER.
104.3 		Subdivision 1.Posting, notice. Pursuant to the
104.4 	authority to disclose under section 270B.12, subdivision 4, the
104.5 	commissioner shall, by the 15th of each month, submit to the
104.6 	commissioner of public safety a list of all taxpayers who are
104.7 	required to pay, withhold, or collect the tax imposed by section
104.8 	290.02, 290.0922, 290.92, 290.9727, 290.9728, 290.9729, or
104.9 	297A.62, or local sales and use tax payable to the commissioner,
104.10 	or a local option tax administered and collected by the
104.11 	commissioner, and who are ten days or more delinquent in either
104.12 	filing a tax return or paying the tax.
104.13 	The commissioner is under no obligation to list a taxpayer
104.14 	whose business is inactive.  At least ten days before notifying
104.15 	the commissioner of public safety, the commissioner shall notify
104.16 	the taxpayer of the intended action.
104.17 	The commissioner of public safety shall post the list in
104.18 	the same manner as provided in section 340A.318, subdivision 3.
104.19 	The list will prominently show the date of posting.  If a
104.20 	taxpayer previously listed files all returns and pays all taxes
104.21 	specified in this subdivision then due, the commissioner shall
104.22 	notify the commissioner of public safety within two business
104.23 	days.
104.24 		Subd. 2.Sales prohibited. Beginning the third business
104.25 	day after the list is posted, no wholesaler, manufacturer, or
104.26 	brewer may sell or deliver any product to a taxpayer included on
104.27 	the posted list.
104.28 		Subd. 3.Penalty. A wholesaler, manufacturer, or brewer
104.29 	of intoxicating liquor or 3.2 percent malt liquor who violates
104.30 	subdivision 2 is subject to the penalties provided in section
104.31 	340A.304.[270.73]
104.32 	
EFFECTIVE DATE. This section is effective August 1, 2005.

104.33 	Sec. 91. [270C.728] PUBLICATION OF NAMES OF DELINQUENT
104.34 	TAXPAYERS.
104.35 		Subdivision 1.Commissioner may publish. (a)
104.36 	Notwithstanding any other law, the commissioner may publish a
105.1 	list or lists of taxpayers who owe delinquent taxes, and who
105.2 	meet the requirements of paragraph (b).
105.3 	(b) For purposes of this section, a taxpayer may be
105.4 	included on a list if:
105.5 	(1) the taxes owed remain unpaid at least 180 days after
105.6 	the dates they were due;
105.7 	(2) the taxpayer's total liability for the taxes, including
105.8 	penalties, interest, and other charges, is at least $5,000; and 
105.9 	(3) a tax lien has been filed or a judgment for the
105.10 	liability has been entered against the taxpayer before notice is
105.11 	given under subdivision 3.
105.12 	(c) In the case of listed taxpayers that are business
105.13 	entities, the commissioner may also list the names of
105.14 	responsible persons assessed pursuant to section 270C.56 for
105.15 	listed liabilities, who are not protected from publication by
105.16 	subdivision 2, and for whom the requirements of paragraph (b)
105.17 	are satisfied with regard to the personal assessment.
105.18 	(d) Before any list is published under this section, the
105.19 	commissioner must certify in writing that each of the conditions
105.20 	for publication as provided in this section has been satisfied,
105.21 	and that procedures were followed to ensure the accuracy of the
105.22 	list and notice was given to the affected taxpayers.
105.23 		Subd. 2.Required and excluded taxpayers. (a) The
105.24 	commissioner may publish lists of some or all of the taxpayers
105.25 	described in subdivision 1.  A list must include the taxpayers
105.26 	with the largest unpaid liabilities of the kind used to define
105.27 	the list, subject to the limitations of paragraphs (b) and (c).
105.28 	(b) For the purposes of this section, a tax is not
105.29 	delinquent if:
105.30 	(1) an administrative or court action contesting the amount
105.31 	or validity of the taxpayer's liability has been filed or served
105.32 	and is unresolved at the time when notice would be given under
105.33 	subdivision 3;
105.34 	(2) an appeal period to contest the liability has not
105.35 	expired; or 
105.36 	(3) the liability is subject to a payment agreement and
106.1 	there is no delinquency in the payments required under the
106.2 	agreement.
106.3 	(c) Unpaid liabilities are not subject to publication if:
106.4 	(1) the commissioner is in the process of reviewing or
106.5 	adjusting the liability;
106.6 	(2) the taxpayer is a debtor in a bankruptcy proceeding and
106.7 	the automatic stay is in effect;
106.8 	(3) the commissioner has been notified that the taxpayer is
106.9 	deceased; or 
106.10 	(4) the time period for collecting the taxes has expired.
106.11 		Subd. 3.Notice to taxpayer. (a) At least 30 days before
106.12 	publishing the name of a delinquent taxpayer, the commissioner
106.13 	shall mail a written notice to the taxpayer, detailing the
106.14 	amount and nature of each liability and the intended publication
106.15 	of the information listed in subdivision 4 related to the
106.16 	liability.  The notice must be mailed by first class and
106.17 	certified mail addressed to the last known address of the
106.18 	taxpayer.  The notice must include information regarding the
106.19 	exceptions listed in subdivision 2 and must state that the
106.20 	taxpayer's information will not be published if the taxpayer
106.21 	pays the delinquent obligation, enters into an agreement to pay,
106.22 	or provides information establishing that subdivision 2
106.23 	prohibits publication of the taxpayer's name.
106.24 	(b) After at least 30 days has elapsed since the notice was
106.25 	mailed and the delinquent tax has not been paid and the taxpayer
106.26 	has not proved to the commissioner that subdivision 2 prohibits
106.27 	publication, the commissioner may publish in a list of
106.28 	delinquent taxpayers the information about the taxpayer that is
106.29 	listed in subdivision 4.
106.30 		Subd. 4.Form of list. The list may be published by any
106.31 	medium or method.  The list must contain the name, address, type
106.32 	of tax, and period for which payment is due for each liability,
106.33 	including penalties, interest, and other charges owed by each
106.34 	listed delinquent taxpayer.
106.35 		Subd. 5.Removal from list. The commissioner shall
106.36 	remove the name of a taxpayer from the list of delinquent
107.1 	taxpayers after the commissioner receives written notice of and
107.2 	verifies any of the following facts about the liability in
107.3 	question:
107.4 	(1) the taxpayer has contacted the commissioner and
107.5 	arranged resolution of the liability;
107.6 	(2) an active bankruptcy proceeding has been initiated for
107.7 	the liability;
107.8 	(3) a bankruptcy proceeding concerning the liability has
107.9 	resulted in discharge of the liability; or 
107.10 	(4) the commissioner has written off the liability.
107.11 		Subd. 6.Names published in error. If the commissioner
107.12 	publishes a name under subdivision 1 in error, the taxpayer
107.13 	whose name was erroneously published has a right to request a
107.14 	retraction and apology.  If the taxpayer so requests, the
107.15 	commissioner shall publish a retraction and apology
107.16 	acknowledging that the taxpayer's name was published in error.
107.17 	The retraction and apology must appear in the same medium and
107.18 	the same format as the original list that contained the name
107.19 	listed in error.
107.20 		Subd. 7.Payment of damages. Actions against the
107.21 	commissioner or the state of Minnesota arising out of the
107.22 	implementation of this program must be brought under section
107.23 	270C.275.  If an action results in damages awarded to a
107.24 	taxpayer, the damages must be paid out of the department's
107.25 	operating budget rather than in accordance with section 3.736,
107.26 	subdivision 7.[270.691]
107.27 	
EFFECTIVE DATE. This section is effective August 1, 2005.
107.28 	OVERSIGHT AND ADMINISTRATION OF PROPERTY TAX SYSTEM

107.29 	Sec. 92. [270C.85] ADMINISTRATION OF PROPERTY TAX LAWS;
107.30 	POWERS AND DUTIES.
107.31 		Subdivision 1.General supervision. The commissioner
107.32 	shall have and exercise general supervision over the
107.33 	administration of the property tax laws, assessors, town,
107.34 	county, and city boards of review and equalization, and all
107.35 	other assessing officers in the performance of their duties, to
107.36 	the end that all assessments of property be made relatively just
108.1 	and equal in compliance with the laws of the state.[270.06(1)]
108.2 		Subd. 2.Powers and duties. The commissioner shall have
108.3 	and exercise the following powers and duties in administering
108.4 	the property tax laws.
108.5 	(a) Confer with, advise, and give the necessary
108.6 	instructions and directions to local assessors and local boards
108.7 	of review throughout the state as to their duties under the laws
108.8 	of the state.[270.06(2)]
108.9 	(b) Direct proceedings, actions, and prosecutions to be
108.10 	instituted to enforce the laws relating to the liability and
108.11 	punishment of public officers and officers and agents of
108.12 	corporations for failure or negligence to comply with the
108.13 	provisions of the property tax laws, and cause complaints to be
108.14 	made against local assessors, members of boards of equalization,
108.15 	members of boards of review, or any other assessing or taxing
108.16 	officer, to the proper authority, for their removal from office
108.17 	for misconduct or negligence of duty.[270.06(3)]
108.18 	(c) Require county attorneys to assist in the commencement
108.19 	of prosecutions in actions or proceedings for removal,
108.20 	forfeiture, and punishment, for violation of the property tax
108.21 	laws in their respective districts or counties.[270.06(4)]
108.22 	(d) Require town, city, county, and other public officers
108.23 	to report information as to the assessment of property, and such
108.24 	other information as may be needful in the work of the
108.25 	commissioner, in such form as the commissioner may prescribe.
108.26 	[270.06(5)]
108.27 	(e) Transmit to the governor, on or before the third Monday
108.28 	in December of each even-numbered year, and to each member of
108.29 	the legislature, on or before November 15 of each even-numbered
108.30 	year, the report of the department for the preceding years,
108.31 	showing all the taxable property subject to the property tax
108.32 	laws and the value of the same, in tabulated form.[270.06(12)]
108.33 	(f) Inquire into the methods of assessment and taxation and
108.34 	ascertain whether the assessors faithfully discharge their
108.35 	duties.[270.06(13)]
108.36 	
EFFECTIVE DATE. This section is effective August 1, 2005.

109.1 	Sec. 93. [270C.86] POWER TO ABATE; CORRECTION OF ERRORS.
109.2 		Subdivision 1.Powers of commissioner; application for
109.3 	abatement; orders. (a) Except for matters delegated to the
109.4 	various boards of county commissioners under section 375.192,
109.5 	and except as otherwise provided by law, the commissioner shall
109.6 	have power to grant such reduction or abatement of net tax
109.7 	capacities, taxes imposed by the property tax laws, or special
109.8 	assessments, and of any costs, penalties, or interest thereon as
109.9 	the commissioner may deem just and equitable, and to order the
109.10 	refundment, in whole or in part, of any taxes or special
109.11 	assessments, and costs, penalties, or interest thereon which
109.12 	have been erroneously or unjustly paid.  Application therefor
109.13 	shall be submitted with a statement of facts in the case and the
109.14 	favorable recommendation of the county board or of the board of
109.15 	abatement of any city where any such board exists, and the
109.16 	county auditor of the county wherein such tax was levied or
109.17 	paid.  No reduction, abatement, or refundment of any special
109.18 	assessments made or levied by any municipality for local
109.19 	improvements shall be made unless it is also approved by the
109.20 	board of review or similar taxing authority of such municipality.
109.21 	(b) The commissioner shall forward to the county auditor a
109.22 	copy of the order made by the commissioner in all cases in which
109.23 	the approval of the county board is required.[270.07, subd.
109.24 	1(c)]
109.25 	(c) An appeal may not be taken to the Tax Court from any
109.26 	order of the commissioner made in the exercise of the
109.27 	discretionary authority granted in paragraph (a) with respect to
109.28 	the reduction or abatement of real or personal property taxes in
109.29 	response to an application for an abatement, reduction, or
109.30 	refund of taxes, net tax capacities, costs, penalties, or
109.31 	interest.[270.07, subd. 1(f)]
109.32 		Subd. 2.Examination of application; reductions;
109.33 	appeals. (a) The commissioner shall examine all applications
109.34 	submitted by a county board pursuant to section 375.192,
109.35 	subdivision 3.  If the applicant has previously submitted a
109.36 	claim for property tax relief pursuant to chapter 290A based on
110.1 	the property taxes payable prior to receiving the abatement, the
110.2 	commissioner may approve the application in an amount reduced by
110.3 	the relief provided pursuant to chapter 290A.
110.4 	(b) An appeal may be taken to the Tax Court from an order
110.5 	of the commissioner made pursuant to this subdivision.[270.07,
110.6 	subd. 1a]
110.7 		Subd. 3.Correction of errors. On application of the
110.8 	county auditor with the approval of the county board, the
110.9 	commissioner may order the correction of any administrative and
110.10 	clerical errors in the assessment, levy, and extension of taxes
110.11 	under the property tax laws, other than valuation.[270.07,
110.12 	subd. 2]
110.13 	
EFFECTIVE DATE. This section is effective August 1, 2005.

110.14 	Sec. 94. [270C.87] REVISION OF MINNESOTA ASSESSORS'
110.15 	MANUAL.
110.16 	In accordance with the provisions of section 270C.06, the
110.17 	commissioner shall periodically revise the Minnesota assessors'
110.18 	manual.[270.068]

110.19 	EFFECTIVE DATE. This section is effective August 1, 2005.

110.20 	Sec. 95. [270C.88] ORDERS; DECISIONS.
110.21 		Subdivision 1.In writing. Any order or decision of the
110.22 	commissioner increasing or decreasing any tax, assessment, or
110.23 	other obligation by a sum exceeding $1,000 on real or personal
110.24 	property, or the net tax capacity thereof, or other obligation
110.25 	relating thereto, the result of which is to increase or decrease
110.26 	the total amount payable under the property tax laws, including
110.27 	penalties and interest, by a sum exceeding $1,000, must bear the
110.28 	written signature or facsimile signature of the commissioner or
110.29 	the commissioner's delegate.  Written approval of the
110.30 	commissioner or a delegate shall not be required with respect to
110.31 	orders reducing net tax capacity of property by reason of its
110.32 	classification as a homestead.
110.33 		Subd. 2.Only official actions of county board or other
110.34 	agency acted upon. No action requiring the recommendation or
110.35 	approval of any county board or other public agency shall be
110.36 	taken by the commissioner, or any other employees or agents of
111.1 	the department, unless such recommendation or approval shall
111.2 	have been made upon official action by such county board or
111.3 	other agency, entered upon the minutes or record of its
111.4 	proceedings as a public record, showing the names of the
111.5 	taxpayers and other persons concerned and the amounts involved,
111.6 	and so certified by the recording officer of such board or
111.7 	agency.[270.10]
111.8 	
EFFECTIVE DATE. This section is effective August 1, 2005.

111.9 	Sec. 96. [270C.89] COUNTY ASSESSOR'S REPORTS OF
111.10 	ASSESSMENT FILED WITH COMMISSIONER.
111.11 		Subdivision 1.Initial report. Each county assessor
111.12 	shall file by April 1 with the commissioner a copy of the
111.13 	abstract that will be acted upon by the local and county boards
111.14 	of review. The abstract must list the real and personal property
111.15 	in the county itemized by assessment districts.  The assessor of
111.16 	each county in the state shall file with the commissioner,
111.17 	within ten working days following final action of the local
111.18 	board of review or equalization and within five days following
111.19 	final action of the county board of equalization, any changes
111.20 	made by the local or county board.  The information must be
111.21 	filed in the manner prescribed by the commissioner.  It must be
111.22 	accompanied by a printed or typewritten copy of the proceedings
111.23 	of the appropriate board.[270.11, subd. 2]
111.24 		Subd. 2.Final report. The final abstract of assessments
111.25 	after adjustments by the State Board of Equalization and
111.26 	inclusion of any omitted property shall be submitted to the
111.27 	commissioner on or before September 1 of each calendar year.
111.28 	The final abstract must separately report the captured tax
111.29 	capacity of tax increment financing districts under section
111.30 	469.177, subdivision 2, the metropolitan revenue contribution
111.31 	value under section 473F.07, and the value subject to the power
111.32 	line credit under section 273.42.[270.11, subd. 2]
111.33 	
EFFECTIVE DATE. This section is effective August 1, 2005.

111.34 	Sec. 97. [270C.90] COUNTY AUDITOR TO CALCULATE TAX RATE.
111.35 	The county auditor shall calculate the tax rate necessary
111.36 	to raise the required amount of the various taxes on the net tax
112.1 	capacity of all property as returned by the commissioner and the
112.2 	State Board of Equalization.[270.14]

112.3 	EFFECTIVE DATE. This section is effective August 1, 2005.

112.4 	Sec. 98. [270C.91] RECORD OF PROCEEDINGS CHANGING NET TAX
112.5 	CAPACITY; DUTIES OF COUNTY AUDITOR.
112.6 	A record of all proceedings of the commissioner affecting
112.7 	any change in the net tax capacity of any property, as revised
112.8 	by the State Board of Equalization, shall be kept by the
112.9 	commissioner and a copy thereof, duly certified, shall be mailed
112.10 	each year to the auditor of each county wherein such property is
112.11 	situated, on or before June 30 or 30 days after submission of
112.12 	the abstract required by section 270C.89, whichever is later.
112.13 	This record shall specify the amounts or amount, or both, added
112.14 	to or deducted from the net tax capacity of the real property of
112.15 	each of the several towns and cities, and of the real property
112.16 	not in towns or cities, also the percent or amount of both,
112.17 	added to or deducted from the several classes of personal
112.18 	property in each of the towns and cities, and also the amount
112.19 	added to or deducted from the assessment of any person.  The
112.20 	county auditor shall add to or deduct from such tract or lot, or
112.21 	portion thereof, of any real property in the county the required
112.22 	percent or amount, or both, on the net tax capacity thereof as
112.23 	it stood after equalized by the county board, adding in each
112.24 	case a fractional sum of 50 cents or more, and deducting in each
112.25 	case any fractional sum of less than 50 cents, so that no net
112.26 	tax capacity of any separate tract or lot shall contain any
112.27 	fraction of a dollar; and add to, or deduct from, the several
112.28 	classes of personal property in the county the required percent
112.29 	or amount, or both, on the net tax capacity thereof as it stood
112.30 	after equalized by the county board, adding or deducting in
112.31 	manner aforesaid any fractional sum so that no net tax capacity
112.32 	of any separate class of personal property shall contain a
112.33 	fraction of a dollar, and add to or deduct from assessment of
112.34 	any person, as they stood after equalization by the county
112.35 	board, the required amounts to agree with the assessments as
112.36 	returned by the commissioner.[270.13]

113.1 	EFFECTIVE DATE. This section is effective August 1, 2005.

113.2 	Sec. 99. [270C.92] IMPROPER OR NEGLIGENT ADMINISTRATION
113.3 	OF PROPERTY TAX LAWS.
113.4 		Subdivision 1.Examination of complaints;
113.5 	proceedings. The commissioner shall receive complaints and
113.6 	examine all cases where it is alleged that property subject to
113.7 	taxation has not been assessed or has been fraudulently or for
113.8 	any reason improperly or unequally assessed, or the law in any
113.9 	manner evaded or violated, and cause to be instituted such
113.10 	proceedings as will remedy improper or negligent administration
113.11 	of the property tax laws.[270.11, subd. 5]
113.12 		Subd. 2.Change of market values. In administering the
113.13 	property tax laws, the commissioner shall raise or lower the
113.14 	market value of any real or personal property, including the
113.15 	power to raise or lower the market value of the real or personal
113.16 	property of any person; provided, that before any such
113.17 	assessment against the property of any person is so raised,
113.18 	notice of an intention to raise such market value and of the
113.19 	time and place at which a hearing thereon will be held shall be
113.20 	given to such person, by mail, addressed to the person at the
113.21 	place of residence listed upon the assessment book, at least
113.22 	five days before the day of such hearing.
113.23 	All relevant and material evidence concerning the market
113.24 	value of the real or personal property shall be submitted at the
113.25 	hearing, and the hearing shall not be a "contested case" within
113.26 	the meaning of section 14.02, subdivision 3.  The person
113.27 	notified of the hearing, or any other person having an interest
113.28 	in the property, may present evidence and argument bearing upon
113.29 	the market value of the property.[270.11, subd. 6]
113.30 		Subd. 3.Appearances before the commissioner. A property
113.31 	owner, other than a public utility or mining company, for which
113.32 	the original assessments are determined by the commissioner, may
113.33 	not appear before the commissioner for the purposes provided in
113.34 	subdivision 1 or 2 unless a timely appearance in person, by
113.35 	counsel, or by written communication has been made before the
113.36 	county board of equalization as provided in section 274.13, to
114.1 	appeal the assessment of the property, or that the property
114.2 	owner can establish not receiving notice of market value at
114.3 	least five days before the local board of review meeting.
114.4 	The commissioner may refuse to hear an appeal that is
114.5 	within the jurisdiction of the Small Claims Division of the Tax
114.6 	Court as stated in section 271.21, subdivision 2.  The property
114.7 	owner shall be notified by the commissioner of the right to
114.8 	appeal to the Small Claims Division whenever an appeal to the
114.9 	commissioner is denied.[270.11, subd. 7]
114.10 	
EFFECTIVE DATE. This section is effective August 1, 2005.

114.11 	Sec. 100. [270C.921] MUNICIPALITY MAY BE PARTY TO TAX
114.12 	HEARING.
114.13 	Any city, town, school district, or county (all of which
114.14 	governmental subdivisions shall be embraced in the word
114.15 	"municipality" as used in sections 270C.921 to 270C.928) may
114.16 	appear at and become a party to any proceedings before the
114.17 	commissioner under section 270C.92 held for the purpose of
114.18 	equalizing or assessing any real or personal property in the
114.19 	municipality, or reducing the net tax capacity of any such
114.20 	property.  For that purpose the municipality may employ counsel
114.21 	and disburse money for other expenses in connection with the
114.22 	proceedings, on duly itemized, verified claims, which shall be
114.23 	audited and allowed as now provided by law for the allowance of
114.24 	claims against a municipality.  It shall be the duty of the
114.25 	commissioner, at the time of a hearing, to grant the
114.26 	municipality, at its request, any further reasonable time as may
114.27 	be necessary for the municipality to prepare for further
114.28 	hearing.  Before granting any reduction in net tax capacity
114.29 	exceeding $100,000, it shall be the duty of the commissioner,
114.30 	when any taxpayer or property owner has applied to the
114.31 	commissioner after June 30, 1983, for a reduction of the net tax
114.32 	capacity of any real or personal property in an amount exceeding
114.33 	$100,000, to give written notice to the officials of the
114.34 	municipality where the property is located and to permit the
114.35 	municipality to have reasonable opportunity to be heard at any
114.36 	proceedings concerning such reduction.[270.19]

115.1 	Sec. 101. [270C.922] MUNICIPALITY MAY REQUEST TAX
115.2 	HEARING.
115.3 	Any municipality may, at any time within ten days after the
115.4 	final adjournment of the county board of equalization of the
115.5 	county in which the municipality is located or within ten days
115.6 	after the filing with the auditor of such county of any order of
115.7 	the commissioner reducing the net tax capacity of any property
115.8 	in the municipality, file a written request with the
115.9 	commissioner for a hearing under section 270C.92 upon the
115.10 	equalization or assessment of any property within the
115.11 	municipality, specifying the property and the name and address
115.12 	of the owner thereof, as they appear from the assessment books.
115.13 	The commissioner shall then order a hearing and mail a notice
115.14 	stating the time and place of the hearing to the municipality
115.15 	and to the owner of the property.  It shall be the duty of the
115.16 	commissioner, at the time of a hearing, to grant the
115.17 	municipality, at its request, such further reasonable time as
115.18 	may be necessary for the municipality to prepare for further
115.19 	hearing.[270.20]

115.20 	EFFECTIVE DATE. This section is effective August 1, 2005.

115.21 	Sec. 102. [270C.923] WITNESSES SUMMONED.
115.22 	In any hearing before the commissioner under section
115.23 	270C.92, the commissioner shall, upon the request of a
115.24 	municipality or any other party to the proceedings, issue
115.25 	subpoenas and summon witnesses to appear and give testimony, and
115.26 	to produce books, records, papers, and documents.  For the
115.27 	purpose of preparing for and participating in a hearing the
115.28 	municipality shall have access to, and use of, all the data,
115.29 	records, and files of the commissioner pertaining to the
115.30 	property in question.  Upon demand of any party a record shall
115.31 	be kept by the commissioner of all evidence offered or received
115.32 	at a hearing, the cost thereof to be paid by the party making
115.33 	such demand.[270.21]

115.34 	EFFECTIVE DATE. This section is effective August 1, 2005.

115.35 	Sec. 103. [270C.924] FINDINGS OF FACT AND ORDER;
115.36 	APPEALS.
116.1 		Subdivision 1.Findings of fact. For hearings held under
116.2 	section 270C.92, the commissioner shall determine the
116.3 	controversy upon the evidence produced at the hearing and shall
116.4 	make and file written findings of fact and an order determining
116.5 	the controversy.  In the equalization and determination of net
116.6 	tax capacities, the findings and net tax capacities as given by
116.7 	the assessor of the local assessment district shall be
116.8 	considered as prima facie correct.  Copies of the order and
116.9 	findings shall be mailed to all parties appearing at the hearing
116.10 	and to the auditor of the county in which the property is
116.11 	located.
116.12 		Subd. 2.Appeal by municipality. Any municipality which
116.13 	has appeared in the proceedings, and which is aggrieved by the
116.14 	order of the commissioner reducing the net tax capacity of any
116.15 	of the property, or failing to increase the net tax capacity,
116.16 	may have the order of the commissioner reviewed by appeal to the
116.17 	Court of Appeals, on either of the following grounds:  (1) that
116.18 	the determination of the commissioner was not in accordance with
116.19 	the property tax laws, or that the commissioner committed any
116.20 	other error of law; or (2) that the findings of fact and
116.21 	determination of net tax capacity were unwarranted by or were
116.22 	contrary to the weight of the evidence.
116.23 		Subd. 3.Appeal by property owner. Any owner of property
116.24 	who has appeared in the proceedings and who is aggrieved by the
116.25 	order of the commissioner raising the net tax capacity of the
116.26 	property, or failing to reduce the net tax capacity, may have
116.27 	the order of the commissioner reviewed on appeal to the Court of
116.28 	Appeals in like manner and upon the same grounds as provided for
116.29 	review on the appeal of any municipality.[270.22]
116.30 	
EFFECTIVE DATE. This section is effective August 1, 2005.

116.31 	Sec. 104. [270C.925] NOTICE OF APPEAL.
116.32 	To secure review of a determination made by the
116.33 	commissioner under section 270C.924, the municipality shall,
116.34 	within 30 days after mailing of notice of the determination,
116.35 	serve upon the commissioner a notice of appeal to the Court of
116.36 	Appeals from the order of the commissioner and file the
117.1 	original, with proof of service, with the clerk of the appellate
117.2 	courts, paying the filing fee provided by law for appeals in
117.3 	civil actions.  The filing of the notice of appeal shall vest
117.4 	the court with jurisdiction and the appeal shall be heard and
117.5 	disposed of as in other civil cases.
117.6 	The court shall reverse or affirm the order of the
117.7 	commissioner or remand the cause to the commissioner for a new
117.8 	hearing or further proceedings or for other disposition, with
117.9 	further directions as the court deems proper.[270.23]

117.10 	EFFECTIVE DATE. This section is effective August 1, 2005.

117.11 	Sec. 105. [270C.926] APPEAL DOES NOT STAY COLLECTION.
117.12 	The institution of any appeal under sections 270C.924 and
117.13 	270C.925 from the order of the commissioner does not stay any
117.14 	proceedings for the assessment or collection of taxes against
117.15 	the property involved therein.  Notwithstanding such appeal, the
117.16 	commissioner shall file with the auditor of the county in which
117.17 	such property is situated an order confirming, increasing,
117.18 	decreasing, or determining the net tax capacity thereof, and the
117.19 	county auditor shall extend and levy against such property, or
117.20 	the owner thereof, the taxes thereupon for such year according
117.21 	to such assessment, and all subsequent proceedings for the
117.22 	determination of the taxes and the collection thereof shall be
117.23 	taken as if no appeal from such order were pending.  When the
117.24 	matter is finally determined on review a properly authenticated
117.25 	copy of the findings, order, or judgment shall be filed with the
117.26 	auditor of the county in which the land or property referred to
117.27 	in the proceedings is situated.  If such order or judgment
117.28 	lowers the net tax capacity of the land or property referred to
117.29 	in the proceedings, the commissioner, upon petition of the
117.30 	owner, approved by the county board, shall abate so much of the
117.31 	taxes against such property as is attributable to the excessive
117.32 	net tax capacity thereof.  If such tax has been paid, the county
117.33 	auditor, upon petition of the owner, approved by the county
117.34 	board and the commissioner, shall refund so much of such payment
117.35 	as is attributable to such excess net tax capacity.  Upon such
117.36 	refund being made the county auditor shall charge the same to
118.1 	the state and the various governmental subdivisions thereof that
118.2 	participated in such excessive payment, in proportion to their
118.3 	respective shares therein, and deduct the same in the next tax
118.4 	apportionment.[270.24]

118.5 	EFFECTIVE DATE. This section is effective August 1, 2005.

118.6 	Sec. 106. [270C.927] INCREASE IN NET TAX CAPACITY;
118.7 	ADDITIONAL TAXES.
118.8 	If the final order and judgment in a hearing before the
118.9 	commissioner under section 270C.92, or any appeal thereof,
118.10 	result in raising the net tax capacity of the property affected
118.11 	by the proceedings, the county officers shall, for the next
118.12 	ensuing year, in addition to the regular taxes levied for such
118.13 	ensuing year, levy, extend, and spread against such property, if
118.14 	real property, or against the owner thereof, if personal
118.15 	property, a tax equal to the difference between the taxes
118.16 	actually levied and extended against such property, or owner,
118.17 	for the year in question and the taxes which should have been
118.18 	levied or extended against such property, or owner, at the
118.19 	increased net tax capacity as finally determined.[270.25]

118.20 	EFFECTIVE DATE. This section is effective August 1, 2005.

118.21 	Sec. 107. [270C.928] PROCEEDINGS TO DETERMINE NET TAX
118.22 	CAPACITY.
118.23 	The proceedings provided in sections 270C.92 to 270C.927
118.24 	are for determining the net tax capacity upon the basis of which
118.25 	taxes are spread against property, or its owner, in the first
118.26 	instance.  The order of the commissioner, or the final order for
118.27 	judgment of the Court of Appeals on it, shall not be a bar to
118.28 	any defense against the taxes interposed at the time of the
118.29 	proceedings for judgment on them.  All defenses which may be set
118.30 	up against the proceedings for judgment upon the taxes may be
118.31 	asserted notwithstanding the determination of the commissioner
118.32 	or the court.  If the taxes are levied or extended pending
118.33 	review of the order of the commissioner by the court, a judgment
118.34 	entered upon the taxes in the tax delinquency proceedings shall
118.35 	not be a bar to the spreading of further taxes against the
118.36 	property for that year, in the event the net tax capacity of the
119.1 	property is raised as herein provided.  In the proceedings for
119.2 	the collection of any taxes which include an additional levy
119.3 	because of the raising of the net tax capacity of any property,
119.4 	the owner may answer separately to the proceedings to obtain
119.5 	judgment for the excess levy.[270.26]

119.6 	EFFECTIVE DATE. This section is effective August 1, 2005.
119.7 	REASSESSMENT OF OMITTED OR UNDERVALUED PROPERTIES

119.8 	Sec. 108. [270C.94] PROPERTY OMITTED OR UNDERVALUED;
119.9 	REASSESSMENT; APPOINTMENT OF SPECIAL ASSESSOR.
119.10 		Subdivision 1.Property omitted or undervalued. When it
119.11 	shall be made to appear to the commissioner, by complaint or by
119.12 	the finding of a court or of the legislature, or either body of
119.13 	the legislature, or any committee of the legislature, or any
119.14 	city council or county board, that any considerable amount of
119.15 	property has been improperly omitted from the tax list or
119.16 	assessment roll of any district or county for any year, or, if
119.17 	assessed, that the same has been undervalued or overvalued, as
119.18 	compared with like property in the same county or in the state
119.19 	so that the assessment for such year in such district or county
119.20 	is grossly unfair and inequitable, whether or not the same has
119.21 	been equalized by the county board of equalization or the
119.22 	commissioner, the commissioner shall examine into the facts in
119.23 	the matter and, if satisfied that it would be for the best
119.24 	interests of the state that a reassessment of such property be
119.25 	made, the commissioner shall appoint a special assessor and such
119.26 	deputy assessors as may be necessary and cause a reassessment to
119.27 	be made of all or any of the real and personal property, or
119.28 	either, in any such district or county as the commissioner may
119.29 	deem best, to the end that all property in such district or
119.30 	county shall be assessed equitably as compared with like
119.31 	property in such district or county.[270.16, subd. 1]
119.32 		Subd. 2.Special assessors, deputies; reassessments. The
119.33 	commissioner shall appoint a special assessor and deputies and
119.34 	cause to be made, in any year, a reassessment of all or any real
119.35 	and personal property, or either, in any assessment district,
119.36 	when in the commissioner's judgment such reassessment is
120.1 	desirable or necessary, to the end that any and all property in
120.2 	such district shall be assessed equitably as compared with like
120.3 	property in the county wherein such district is situated.
120.4 	[270.11, subd. 3]
120.5 		Subd. 3.Failure to appraise. When an assessor has
120.6 	failed to properly appraise at least one-quarter of the parcels
120.7 	of property in a district or county as provided in section
120.8 	273.01, the commissioner shall appoint a special assessor and
120.9 	deputy assessor as necessary and cause a reappraisal to be made
120.10 	of the property due for reassessment in accordance with law.
120.11 	[270.16, subd. 2]
120.12 	
EFFECTIVE DATE. This section is effective August 1, 2005.

120.13 	Sec. 109. [270C.95] QUALIFICATION OF ASSESSORS;
120.14 	REASSESSMENT, HOW MADE.
120.15 	Every special assessor and deputy appointed under the
120.16 	provisions of section 270C.94 shall subscribe and file with the
120.17 	commissioner an oath to faithfully and fairly perform the duties
120.18 	of office.  Such special assessor, assisted by deputies, shall
120.19 	thereupon proceed to carefully examine and reassess the property
120.20 	so to be reassessed and prepare duplicate lists of such
120.21 	reassessment in such form as the commissioner may prescribe,
120.22 	showing the property or person so reassessed, the amount of the
120.23 	original assessment thereof made in such year, and opposite the
120.24 	same the reassessment so made by such special assessor.  The
120.25 	special assessor shall file both copies of such list with the
120.26 	commissioner; and the commissioner shall thereupon examine,
120.27 	equalize, and correct such reassessment so as to substantially
120.28 	conform with the assessment of like property throughout the
120.29 	state and transmit to the auditor of the county wherein such
120.30 	reassessment was so made one copy of such reassessment by the
120.31 	commissioner so corrected and equalized.  Such list shall for
120.32 	all purposes supersede and be in place of the original
120.33 	assessment made for such year upon such property and the county
120.34 	auditor, upon receipt thereof, shall extend and levy against
120.35 	such property so reassessed the taxes thereon for such year
120.36 	according to such reassessment in the same manner as though such
121.1 	list was the original assessment list of such property.  Any
121.2 	person feeling aggrieved by an assessment so made against the
121.3 	person, or upon any property at that time owned by the person,
121.4 	may appeal therefrom to the district court of the county in
121.5 	which such assessment is made.  To render the appeal effective
121.6 	for any purpose, the appellant shall file a notice of the appeal
121.7 	with the auditor of such county within 30 days after the making
121.8 	of the assessment, which notice shall specify the ground upon
121.9 	which the appeal was taken, and no other or different service
121.10 	shall be required to perfect it.  Upon the filing of the notice
121.11 	the county auditor shall make and file in the office of the
121.12 	court administrator of the district court a certified copy of
121.13 	the notice and of the particular assessment appealed from and
121.14 	notify the county attorney of such county of the pendency of the
121.15 	appeal.  Thereupon the district court shall be deemed to have
121.16 	acquired jurisdiction of the matter and proceed to hear and
121.17 	determine it in like manner as other tax matters are tried and
121.18 	determined in the district courts of this state.  The county
121.19 	attorney of such county shall appear for and defend the
121.20 	interests of the state in such matter.[270.17]

121.21 	EFFECTIVE DATE. This section is effective August 1, 2005.

121.22 	Sec. 110. [270C.96] REASSESSMENT; COMPENSATION;
121.23 	REIMBURSEMENT BY COUNTIES.
121.24 	The compensation of each special assessor and deputies,
121.25 	appointed under the provisions of section 270C.94 and the
121.26 	expenses as such, shall be fixed by the commissioner and paid
121.27 	out of money appropriated for operation of the department.  The
121.28 	commissioner on August 1 shall notify the auditor of each
121.29 	affected county of the amount thereof paid on behalf of such
121.30 	county since August 1 of the preceding year, whereupon the
121.31 	county auditor shall levy a tax upon the taxable property in the
121.32 	assessment district or districts wherein such reassessment was
121.33 	made sufficient to pay the same.  One-half of such tax shall be
121.34 	levied in the year in which the commissioner so notifies the
121.35 	county auditor and the remaining one-half shall be levied in the
121.36 	following year.  The respective counties shall reimburse the
122.1 	state by paying one-half of the tax so assessed on or before
122.2 	July 1 and the remaining one-half on or before December 1 in the
122.3 	year in which the tax is payable by owner, whether or not the
122.4 	tax was collected by the county.  The reimbursement shall be
122.5 	credited to the general fund.  If any county fails to reimburse
122.6 	the state within the time specified herein, the commissioner is
122.7 	empowered to order withholding of state aids or distributions to
122.8 	such county equal to the amount delinquent.[270.18]

122.9 	EFFECTIVE DATE. This section is effective August 1, 2005.

122.10 	Sec. 111. [270C.97] OMITTED PROPERTY.
122.11 	The commissioner shall require the county auditor to place
122.12 	upon the assessment rolls omitted property which may be
122.13 	discovered to have escaped assessment and taxation in previous
122.14 	years.[270.11, subd. 4]

122.15 	EFFECTIVE DATE. This section is effective August 1, 2005.

122.16 	Sec. 112. [270C.98] SENIOR ACCREDITATION.
122.17 	The legislature finds that the property tax system would be
122.18 	enhanced by requiring that every senior appraiser in the
122.19 	Property Tax Division of the department obtain senior
122.20 	accreditation from the State Board of Assessors.  Every senior
122.21 	appraiser, including the department's regional representatives,
122.22 	and every county assessor within two years of the first
122.23 	appointment under section 273.061, must obtain senior
122.24 	accreditation from the state Board of Assessors.  The board
122.25 	shall provide the necessary courses or training.  If a
122.26 	department senior appraiser or regional representative fails to
122.27 	obtain or maintain senior accreditation, the failure shall be
122.28 	grounds for dismissal, disciplinary action, or corrective
122.29 	action.  Except as provided in section 273.061, subdivision 2,
122.30 	paragraph (c), the commissioner must not approve the appointment
122.31 	of a county assessor who is not senior accredited by the State
122.32 	Board of Assessors.  No employee hired by the commissioner as a
122.33 	senior appraiser or regional representative shall attain
122.34 	permanent status until the employee obtains senior accreditation.
122.35 	[270.485]

122.36 	EFFECTIVE DATE. This section is effective August 1, 2005.

123.1 	Sec. 113. [270C.99] CERTAIN TOWNSHIPS AND CITIES OPTION
123.2 	TO ELECT TO REINSTATE THE OFFICE OF ASSESSOR.
123.3 	Notwithstanding the provisions of section 273.05,
123.4 	subdivision 1, a city or township in which the office of
123.5 	assessor has been eliminated because of failure to fill a
123.6 	vacancy in the office within 90 days pursuant to section 273.05,
123.7 	subdivision 1, may elect, with the approval of the commissioner,
123.8 	to have the office of assessor reinstated by hiring a certified
123.9 	or accredited assessor.  This section shall not apply to Ramsey
123.10 	county or to cities and townships located in counties which have
123.11 	elected a county assessment system in accordance with section
123.12 	273.055.[270.494]

123.13 	EFFECTIVE DATE. This section is effective August 1, 2005.

123.14 	Sec. 114. RULES; EFFECT OF RECODIFICATION.
 123.15 	Notwithstanding Minnesota Statutes, section 14.05,
123.16 	subdivision 1, Minnesota Rules, chapters 8001, 8002, 8007, 8009,
123.17 	8017, 8019, 8020, 8031, 8034, 8038, 8043, 8050, 8052, 8092,
123.18 	8093, 8100, 8106, 8110, 8120, 8121, 8122, 8125, 8130, 8160,
123.19 	8165, 8170, and 8175, shall continue under the authority granted
123.20 	in Minnesota Statutes, section 270C.06.  Furthermore, Minnesota
123.21 	Statutes, section 14.125, does not apply, and the Department of
123.22 	Revenue may subsequently amend or repeal these rules from time
123.23 	to time without additional legislative authorization.

123.24 	EFFECTIVE DATE. This section is effective August 1, 2005.

123.25 	Sec. 115. PURPOSE AND EFFECT.
 123.26 		Subdivision 1.Purpose. It is the intent of the
123.27 	legislature to simplify Minnesota's tax laws by consolidating
123.28 	and recodifying tax administration and compliance provisions now
123.29 	contained in Minnesota Statutes, chapter 270, and several other
123.30 	chapters of Minnesota Statutes.  The provisions of this act may
123.31 	not be used to determine the law in effect prior to the
123.32 	effective dates in this act.
123.33 		Subd. 2.Effect. Due to the complexity of the
123.34 	recodification, prior provisions are repealed on the effective
123.35 	date of the new provisions.  The repealed provisions, however,
123.36 	continue to remain in effect until superseded by the analogous
124.1 	provision in the new law.
124.2 	
EFFECTIVE DATE. This section is effective August 1, 2005.

124.3 	Sec. 116. REVISOR INSTRUCTION.
 124.4 	(a) To the extent practicable, the revisor shall publish
124.5 	the statutory derivations of the laws repealed and recodified in
124.6 	this article in Laws of Minnesota.
124.7 	(b) The revisor shall correct cross-references in Minnesota
124.8 	Statutes and Minnesota Rules to sections that are repealed and
124.9 	recodified by this article.
124.10 	(c) Notwithstanding any law to the contrary, if a provision
124.11 	of a section of Minnesota Statutes repealed by this article is
124.12 	amended or repealed during the same legislative session, the
124.13 	amendment or repealer shall supersede the provisions of this
124.14 	article, and the revisor shall codify the amendment or repealer
124.15 	consistent with the recodification of the affected section by
124.16 	this article.  In addition, the revisor shall code new sections
124.17 	or subdivisions enacted during the legislative session
124.18 	consistent with the recodification.

124.19 	EFFECTIVE DATE. This section is effective August 1, 2005.

124.20 	Sec. 117. REPEALER.
 124.21 	Minnesota Statutes 2004, sections 270.01; 270.02; 270.021;
124.22 	270.022; 270.04; 270.05; 270.052; 270.058; 270.059; 270.06;
124.23 	270.0601; 270.0602; 270.0603; 270.0604; 270.0605; 270.061;
124.24 	270.062; 270.063; 270.064; 270.065; 270.066; 270.0665; 270.067;
124.25 	270.068; 270.0681; 270.0682; 270.069; 270.07; 270.084; 270.09;
124.26 	270.10; 270.101; 270.102; 270.11, subdivisions 2, 3, 4, 5, 6,
124.27 	and 7; 270.13; 270.14; 270.15; 270.16; 270.17; 270.18; 270.19;
124.28 	270.20; 270.21; 270.22; 270.23; 270.24; 270.25; 270.26; 270.27;
124.29 	270.271; 270.272; 270.273; 270.274; 270.275; 270.276; 270.277;
124.30 	270.278; 270.30; 270.485; 270.494; 270.60; 270.65; 270.652;
124.31 	270.66; 270.67; 270.68; 270.69; 270.691; 270.70; 270.7001;
124.32 	270.7002; 270.701; 270.702; 270.703; 270.704; 270.705; 270.706;
124.33 	270.707; 270.708; 270.709; 270.71; 270.72; 270.721; 270.73;
124.34 	270.74; 270.75; 270.76; 270.771; 270.78; 270.79; 287.39;
124.35 	289A.07; 289A.13; 289A.31, subdivisions 3, 4, and 6; 289A.36;
124.36 	289A.37, subdivisions 1, 3, 4, and 5; 289A.38, subdivision 13;
125.1 	289A.43; 289A.65; 290.48, subdivisions 3 and 4; 290.92,
125.2 	subdivisions 6b, 22, and 23; 290.97; 296A.20; 296A.201; 296A.25;
125.3 	297A.86; 297A.93; 297D.14; 297E.08; 297E.09; 297E.12,
125.4 	subdivision 10; 297E.15; 297F.15, subdivisions 1, 2, 3, 4, 5, 6,
125.5 	7, and 8; 297F.16; 297F.22; 297G.14, subdivisions 1, 2, 3, 4, 5,
125.6 	6, 7, and 8; 297G.15; 297G.21; 297I.45; 297I.50; 297I.55; and
125.7 	297I.95, are repealed.

125.8 	EFFECTIVE DATE. This section is effective August 1, 2005.

125.9 	ARTICLE 2
125.10 	CONFORMING PROVISIONS

125.11 	Section 1. Minnesota Statutes 2004, section 16D.08,
125.12 	subdivision 2, is amended to read:
125.13 		Subd. 2.Powers.  (a) In addition to the collection
125.14 	remedies available to private collection agencies in this state,
125.15 	the commissioner, with legal assistance from the attorney
125.16 	general, may utilize any statutory authority granted to a
125.17 	referring agency for purposes of collecting debt owed to that
125.18 	referring agency.  The commissioner may also use the tax
125.19 	collection remedies in sections 270.06, 270.66, 270.67,
125.20 	subdivisions 2 and 4, 270.69, 270.70, 270.7001 to 270.72, and
125.21 	290.92, subdivision 23 270C.03, subdivision 1, clause (8),
125.22 	270C.31, 270C.32, 270C.52, subdivisions 2 and 3, 270C.63,
125.23 	270C.65, and 270C.67 to 270C.72.  A debtor may take advantage of
125.24 	any administrative or appeal rights contained in the listed
125.25 	sections.  For administrative and appeal rights for nontax
125.26 	debts, references to administrative appeals or to the taxpayer
125.27 	rights advocate shall be construed to be references to the case
125.28 	reviewer, references to Tax Court shall be construed to mean
125.29 	district court, and offers in compromise shall be submitted to
125.30 	the referring agency.  A debtor who qualifies for cancellation
125.31 	of collection costs under section 16D.11, subdivision 3, clause
125.32 	(1), can apply to the commissioner for reduction or release of a
125.33 	continuous wage levy, if the debtor establishes that the debtor
125.34 	needs all or a portion of the wages being levied upon to pay for
125.35 	essential living expenses, such as food, clothing, shelter,
125.36 	medical care, or expenses necessary for maintaining employment.
126.1 	The commissioner's determination not to reduce or release a
126.2 	continuous wage levy is appealable to district court.  The word
126.3 	"tax" or "taxes" when used in the tax collection statutes listed
126.4 	in this subdivision also means debts referred under this chapter.
126.5 	(b) Before using the tax collection remedies listed in this
126.6 	subdivision, notice and demand for payment of the amount due
126.7 	must be given to the person liable for the payment or collection
126.8 	of the debt at least 30 days prior to the use of the remedies.
126.9 	The notice must be sent to the person's last known address and
126.10 	must include a brief statement that sets forth in simple and
126.11 	nontechnical terms the amount and source of the debt, the nature
126.12 	of the available collection remedies, and remedies available to
126.13 	the debtor.

126.14 	Sec. 2. Minnesota Statutes 2004, section 115B.49,
126.15 	subdivision 4, is amended to read:
126.16 		Subd. 4.Registration; fees.  (a) The owner or operator
126.17 	of a dry cleaning facility shall register on or before October 1
126.18 	of each year with the commissioner of revenue in a manner
126.19 	prescribed by the commissioner of revenue and pay a registration
126.20 	fee for the facility.  The amount of the fee is:
126.21 	(1) $500, for facilities with a full-time equivalence of
126.22 	fewer than five;
126.23 	(2) $1,000, for facilities with a full-time equivalence of
126.24 	five to ten; and
126.25 	(3) $1,500, for facilities with a full-time equivalence of
126.26 	more than ten.
126.27 	(b) A person who sells dry cleaning solvents for use by dry
126.28 	cleaning facilities in the state shall collect and remit to the
126.29 	commissioner of revenue in a manner prescribed by the
126.30 	commissioner of revenue, on or before the 20th day of the month
126.31 	following the month in which the sales of dry cleaning solvents
126.32 	are made, a fee of:
126.33 	(1) $3.50 for each gallon of perchloroethylene sold for use
126.34 	by dry cleaning facilities in the state;
126.35 	(2) 70 cents for each gallon of hydrocarbon-based dry
126.36 	cleaning solvent sold for use by dry cleaning facilities in the
127.1 	state; and
127.2 	(3) 35 cents for each gallon of other nonaqueous solvents
127.3 	sold for use by dry cleaning facilities in the state.
127.4 	(c) The audit, assessment, appeal, collection, enforcement,
127.5 	and administrative provisions of chapters 270C and 289A apply to
127.6 	the fee imposed by this subdivision.To enforce this
127.7 	subdivision, the commissioner of revenue may examine documents,
127.8 	assess and collect fees, conduct investigations, issue
127.9 	subpoenas,grant extensions to file returns and pay fees, impose
127.10 	penalties and interest on the annual registration fee under
127.11 	paragraph (a) and the monthly fee under paragraph (b), and abate
127.12 	penalties and interest, and administer appeals,in the manner
127.13 	provided in chapters 270 270C and 289A.  The penalties and
127.14 	interest imposed on taxes under chapter 297A apply to the fees
127.15 	imposed under this subdivision.  Disclosure of data collected by
127.16 	the commissioner of revenue under this subdivision is governed
127.17 	by chapter 270B.
127.18 	
EFFECTIVE DATE. This section is effective August 1, 2005.

127.19 	Sec. 3. Minnesota Statutes 2004, section 239.785,
127.20 	subdivision 4, is amended to read:
127.21 		Subd. 4.commissioner's authority administration and
127.22 	enforcement.  The provisions of chapter 296A relating to the
127.23 	commissioner's authority to audit, assess, and collect the tax
127.24 	imposed by that chapter assessment, appeal, collection, and
127.25 	administrative provisions of chapters 270C and 296A, that apply
127.26 	to the taxes imposed by chapter 296A,apply to the fee imposed
127.27 	by this section.
127.28 	
EFFECTIVE DATE. This section is effective August 1, 2005.

127.29 	Sec. 4. Minnesota Statutes 2004, section 256.9657,
127.30 	subdivision 7, is amended to read:
127.31 		Subd. 7.Collection; civil penalties.  The provisions of
127.32 	sections 270C.31, except subdivisions 5 and 7; 270C.32, except
127.33 	subdivisions 6 and 10; 270C.33; 270C.61, subdivision 2; and 
127.34 	289A.35 to 289A.50 relating to the authority to audit, assess,
127.35 	collect, and pay refunds of other state taxes may be implemented
127.36 	by the commissioner of human services with respect to the tax,
128.1 	penalty, and interest imposed by this section.  The commissioner
128.2 	of human services shall impose civil penalties for violation of
128.3 	this section as provided in section 289A.60, and the tax and
128.4 	penalties are subject to interest at the rate provided in
128.5 	section 270.75 270C.40.  The commissioner of human services
128.6 	shall have the power to abate penalties and interest when
128.7 	discrepancies occur resulting from, but not limited to,
128.8 	circumstances of error and mail delivery.  The commissioner of
128.9 	human services shall bring appropriate civil actions to collect
128.10 	provider payments due under this section.
128.11 	
EFFECTIVE DATE. This section is effective August 1, 2005.

128.12 	Sec. 5. Minnesota Statutes 2004, section 256.9792,
128.13 	subdivision 8, is amended to read:
128.14 		Subd. 8.Remedies.  (a) The commissioner of revenue is
128.15 	authorized to use the tax collection remedies in sections
128.16 	270.06, clause (7), 270.69 to 270.72, and 290.92, subdivision 23
128.17 	270C.32, subdivision 1, 270C.63, 270C.67, 270C.68, 270C.69,
128.18 	270C.70 to 270C.72, and 270C.728, and tax return information to
128.19 	collect arrearages.
128.20 	(b) Liens arising under paragraph (a) shall be perfected
128.21 	under the provisions of section 270.69 270C.63.  The lien may be
128.22 	filed as long as the time period allowed by law for collecting
128.23 	the arrearages has not expired.  The lien shall attach to all
128.24 	property of the debtor within the state, both real and personal
128.25 	under the provisions of section 270.69 270C.63.  The lien shall
128.26 	be enforced under the provisions in section 270.69 270C.63 
128.27 	relating to state tax liens.
128.28 	
EFFECTIVE DATE. This section is effective August 1, 2005.

128.29 	Sec. 6. Minnesota Statutes 2004, section 273.11,
128.30 	subdivision 5, is amended to read:
128.31 		Subd. 5.Boards of review and equalization.
 128.32 	Notwithstanding any other provision of law to the contrary, the
128.33 	limitation contained in subdivisions 1 and 1a shall also apply
128.34 	to the authority of the local board of review as provided in
128.35 	section 274.01, the county board of equalization as provided in
128.36 	section 274.13, the State Board of Equalization and the
129.1 	commissioner of revenue as provided in sections
129.2 	270.11, subdivision 1,270.12, 270C.92,and 270.16 270C.94.
129.3 	
EFFECTIVE DATE. This section is effective August 1, 2005.

129.4 	Sec. 7. Minnesota Statutes 2004, section 287.37, is
129.5 	amended to read:
129.6 	287.37 INVESTIGATIONS AND ASSESSMENTS.
129.7 	The commissioner of revenue may investigate and examine
129.8 	persons and transactions that are subject to this chapter using
129.9 	the powers and authorities granted in chapters 270 270C and 289A.
129.10 	The commissioner may issue orders of assessment under chapter
129.11 	289A, and enforce collection of unpaid tax or penalty amounts,
129.12 	including interest, under the authority of chapter 270.The
129.13 	audit, assessment, appeal, collection, enforcement, and
129.14 	administrative provisions of chapters 270C and 289A apply to the
129.15 	taxes imposed by this chapter.All tax amounts collected by the
129.16 	commissioner must be apportioned under section 287.12.  The
129.17 	commissioner's expenses under this section are not expenses of
129.18 	administration under section 287.33.  All data and information
129.19 	made available to the commissioner under this section is public
129.20 	except for investigative data covered by section 270B.03,
129.21 	subdivision 6.

129.22 	EFFECTIVE DATE. This section is effective August 1, 2005.

129.23 	Sec. 8. Minnesota Statutes 2004, section 289A.35, is
129.24 	amended to read:
129.25 	289A.35 ASSESSMENTS; COMMISSIONER FILED ON RETURNS.
129.26 	The commissioner has the authority to make determinations,
129.27 	corrections, and assessments with respect to state taxes,
129.28 	including interest, additions to taxes, and assessable
129.29 	penalties.The commissioner may audit and adjust the taxpayer's
129.30 	computation of federal taxable income, items of federal tax
129.31 	preferences, or federal credit amounts to make them conform with
129.32 	the provisions of chapter 290 or section 298.01. If a taxpayer
129.33 	fails to file a required return, the commissioner, from
129.34 	information in the commissioner's possession or obtainable by
129.35 	the commissioner, may make a return for the taxpayer.  The
129.36 	return will be prima facie correct and valid.If a return has
130.1 	been filed, the commissioner shall enter the liability reported
130.2 	on the return and may make any audit or investigation that is
130.3 	considered necessary. The commissioner may use statistical or
130.4 	other sampling techniques consistent with generally accepted
130.5 	auditing standards in examining returns or records and making
130.6 	assessments.

130.7 	EFFECTIVE DATE. This section is effective August 1, 2005.

130.8 	Sec. 9. Minnesota Statutes 2004, section 289A.42,
130.9 	subdivision 1, is amended to read:
130.10 		Subdivision 1.Extension agreement.  If before the
130.11 	expiration of time prescribed in sections 270C.58, subdivision
130.12 	13,289A.38,and 289A.40 for the assessment of tax or the filing
130.13 	of a claim for refund, both the commissioner and the taxpayer
130.14 	have consented in writing to the assessment or filing of a claim
130.15 	for refund after that time, the tax may be assessed or the claim
130.16 	for refund filed at any time before the expiration of the agreed
130.17 	upon period.  The period may be extended by later agreements in
130.18 	writing before the expiration of the period previously agreed
130.19 	upon.  The taxpayer and the commissioner may also agree to
130.20 	extend the period for collection of the tax.

130.21 	Sec. 10. Minnesota Statutes 2004, section 289A.60,
130.22 	subdivision 13, is amended to read:
130.23 		Subd. 13.Penalties for tax return preparers.  (a) If an
130.24 	understatement of liability with respect to a return or claim
130.25 	for refund is due to a willful attempt in any manner to
130.26 	understate the liability for a tax by a person who is a tax
130.27 	return preparer with respect to the return or claim, the person
130.28 	shall pay to the commissioner a penalty of $500.  If a part of a
130.29 	property tax refund claim is excessive due to a willful attempt
130.30 	in any manner to overstate the claim for relief allowed under
130.31 	chapter 290A by a person who is a tax refund or return preparer,
130.32 	the person shall pay to the commissioner a penalty of $500 with
130.33 	respect to the claim.  These penalties may not be assessed
130.34 	against the employer of a tax return preparer unless the
130.35 	employer was actively involved in the willful attempt to
130.36 	understate the liability for a tax or to overstate the claim for
131.1 	refund.  These penalties are income tax liabilities and may be
131.2 	assessed at any time as provided in section 289A.38, subdivision
131.3 	5.
131.4 	(b) A civil action in the name of the state of Minnesota
131.5 	may be commenced to enjoin any person who is a tax return
131.6 	preparer doing business in this state from further engaging in
131.7 	any conduct described in paragraph (c).  An action under this
131.8 	paragraph must be brought by the attorney general in the
131.9 	district court for the judicial district of the tax return
131.10 	preparer's residence or principal place of business, or in which
131.11 	the taxpayer with respect to whose tax return the action is
131.12 	brought resides.  The court may exercise its jurisdiction over
131.13 	the action separate and apart from any other action brought by
131.14 	the state of Minnesota against the tax return preparer or any
131.15 	taxpayer as provided in section 270C.447.
131.16 	(c) In an action under paragraph (b), if the court finds
131.17 	that a tax return preparer has:
131.18 	(1) engaged in any conduct subject to a civil penalty under
131.19 	section 289A.60 or a criminal penalty under section 289A.63;
131.20 	(2) misrepresented the preparer's eligibility to practice
131.21 	before the Department of Revenue, or otherwise misrepresented
131.22 	the preparer's experience or education as a tax return preparer;
131.23 	(3) guaranteed the payment of any tax refund or the
131.24 	allowance of any tax credit; or 
131.25 	(4) engaged in any other fraudulent or deceptive conduct
131.26 	that substantially interferes with the proper administration of
131.27 	state tax law, and injunctive relief is appropriate to prevent
131.28 	the recurrence of that conduct,
131.29 	the court may enjoin the person from further engaging in that
131.30 	conduct.
131.31 	(d) If the court finds that a tax return preparer has
131.32 	continually or repeatedly engaged in conduct described in
131.33 	paragraph (c), and that an injunction prohibiting that conduct
131.34 	would not be sufficient to prevent the person's interference
131.35 	with the proper administration of state tax laws, the court may
131.36 	enjoin the person from acting as a tax return preparer.  The
132.1 	court may not enjoin the employer of a tax return preparer for
132.2 	conduct described in paragraph (c) engaged in by one or more of
132.3 	the employer's employees unless the employer was also actively
132.4 	involved in that conduct.
132.5 	(e) For purposes of this subdivision, the term
132.6 	"understatement of liability" means an understatement of the net
132.7 	amount payable with respect to a tax imposed by state tax law,
132.8 	or an overstatement of the net amount creditable or refundable
132.9 	with respect to a tax.  The determination of whether or not
132.10 	there is an understatement of liability must be made without
132.11 	regard to any administrative or judicial action involving the
132.12 	taxpayer.  For purposes of this subdivision, the amount
132.13 	determined for underpayment of estimated tax under either
132.14 	section 289A.25 or 289A.26 is not considered an understatement
132.15 	of liability.
132.16 	(f) (d) For purposes of this subdivision, the term
132.17 	"overstatement of claim" means an overstatement of the net
132.18 	amount refundable with respect to a claim for property tax
132.19 	relief provided by chapter 290A.  The determination of whether
132.20 	or not there is an overstatement of a claim must be made without
132.21 	regard to administrative or judicial action involving the
132.22 	claimant.
132.23 	(g) (e) For purposes of this section, the term "tax refund
132.24 	or return preparer" means an individual who prepares for
132.25 	compensation, or who employs one or more individuals to prepare
132.26 	for compensation, a return of tax, or a claim for refund of
132.27 	tax.  The preparation of a substantial part of a return or claim
132.28 	for refund is treated as if it were the preparation of the
132.29 	entire return or claim for refund.  An individual is not
132.30 	considered a tax return preparer merely because the individual:
132.31 	(1) gives typing, reproducing, or other mechanical
132.32 	assistance;
132.33 	(2) prepares a return or claim for refund of the employer,
132.34 	or an officer or employee of the employer, by whom the
132.35 	individual is regularly and continuously employed;
132.36 	(3) prepares a return or claim for refund of any person as
133.1 	a fiduciary for that person; or
133.2 	(4) prepares a claim for refund for a taxpayer in response
133.3 	to a tax order issued to the taxpayer.
133.4 	
EFFECTIVE DATE. This section is effective August 1, 2005.

133.5 	Sec. 11. Minnesota Statutes 2004, section 295.57,
133.6 	subdivision 1, is amended to read:
133.7 		Subdivision 1.Application of other chapters.  Unless
133.8 	specifically provided otherwise by sections 295.50 to 295.59,
133.9 	the enforcement,interest, appeal,criminal penalties, and
133.10 	refunds provisions in chapter 289A, the civil penalty provisions
133.11 	applicable to withholding and sales taxes under section 289A.60,
133.12 	and collection and rulemaking provisions under chapter 270 the
133.13 	audit, assessment, appeal, collection, enforcement, and
133.14 	administrative provisions of chapters 270C and 289A, apply to
133.15 	taxes imposed under sections 295.50 to 295.59.
133.16 	
EFFECTIVE DATE. This section is effective August 1, 2005.

133.17 	Sec. 12. Minnesota Statutes 2004, section 295.60,
133.18 	subdivision 7, is amended to read:
133.19 		Subd. 7.Application of other chapters.  Unless
133.20 	specifically provided otherwise by this section, the
133.21 	enforcement,interest, appeal,criminal penalties, and refunds
133.22 	provisions in chapter 289A, the civil penalty provisions
133.23 	applicable to withholding and sales taxes under section 289A.60,
133.24 	and collection and rulemaking provisions under chapter 270 the
133.25 	audit, assessment, appeal, collection, enforcement, and
133.26 	administrative provisions of chapters 270C and 289A, apply to
133.27 	taxes imposed under this section.
133.28 	
EFFECTIVE DATE. This section is effective August 1, 2005.

133.29 	Sec. 13. Minnesota Statutes 2004, section 297A.64,
133.30 	subdivision 3, is amended to read:
133.31 		Subd. 3.Administration.  The retailer shall report and
133.32 	pay the tax imposed in subdivision 1 to the commissioner of
133.33 	revenue with the taxes imposed in this chapter.  The tax imposed
133.34 	in subdivision 1 and the fee imposed in subdivision 2 are
133.35 	subject to the same interest, penalty, and other provisions
133.36 	provided for sales and use taxes under this chapter and chapter
134.1 	289A and this chapter. The commissioner has the same powers to
134.2 	assess and collect the tax and fee that are given the
134.3 	commissioner in chapters 270 and 289A and this chapter to assess
134.4 	and collect sales and use tax.The audit, assessment, appeal,
134.5 	collection, enforcement, and administrative provisions of this
134.6 	chapter and chapters 270C and 289A, that apply to sales and use
134.7 	taxes, apply to the tax and fee.
134.8 	
EFFECTIVE DATE. This section is effective August 1, 2005.

134.9 	Sec. 14. Minnesota Statutes 2004, section 297B.11, is
134.10 	amended to read:
134.11 	297B.11 REGISTRAR AS AGENT OF COMMISSIONER OF REVENUE;
134.12 	POWERS.
134.13 	The state commissioner of revenue is charged with the
134.14 	administration of the sales tax on motor vehicles.  The
134.15 	commissioner may prescribe all rules not inconsistent with the
134.16 	provisions of this chapter, necessary and advisable for the
134.17 	proper and efficient administration of the law.  The collection
134.18 	of this sales tax on motor vehicles shall be carried out by the
134.19 	motor vehicle registrar who shall act as the agent of the
134.20 	commissioner and who shall be subject to all rules not
134.21 	inconsistent with the provisions of this chapter, that may be
134.22 	prescribed by the commissioner.
134.23 	The provisions of chapters 270C,289A,and 297A relating to
134.24 	the commissioner's authority to audit, assess, and collect the
134.25 	tax, and to issue refunds and to hear appeals, are applicable to
134.26 	the sales tax on motor vehicles.  The commissioner may impose
134.27 	civil penalties as provided in chapters 289A and 297A, and the
134.28 	additional tax and penalties are subject to interest at the rate
134.29 	provided in section 270.75 270C.40.

134.30 	EFFECTIVE DATE. This section is effective August 1, 2005.

134.31 	Sec. 15. Minnesota Statutes 2004, section 297H.10,
134.32 	subdivision 1, is amended to read:
134.33 		Subdivision 1.Administration and enforcement.  The
134.34 	audit, assessment, appeal, collection,refund, penalty,
134.35 	interest, enforcement, collection remedies, appeal,and
134.36 	administrative provisions of chapters 270 270C and 289A that are
135.1 	applicable to taxes imposed under by chapter 297A apply to this
135.2 	chapter.
135.3 	
EFFECTIVE DATE. This section is effective August 1, 2005.

135.4 	Sec. 16. Minnesota Statutes 2004, section 297I.10, is
135.5 	amended by adding a subdivision to read:
135.6 		Subd. 4.Collection and administration. The commissioner
135.7 	shall administer the surcharge imposed by this section in the
135.8 	same manner as the taxes imposed by this chapter.
135.9 	
EFFECTIVE DATE. This section is effective August 1, 2005.

135.10 	Sec. 17. REVISOR'S INSTRUCTION.
 135.11 	In each section of Minnesota Statutes referred to in column
135.12 	A, the revisor of statutes shall delete the reference in column
135.13 	B and insert the reference in column C.
135.14 	Column A Column B Column C
135.15 	13.4961, subd 2 270.062 270C.05
135.16 	270.064270C.055, subd 1
135.17 	270.21270C.923
135.18 	16D.11, subd 2 270.06, clause (7) 270C.32
135.19 	270.66270C.65
135.20 	16D.13, subd 2 270.75 270C.40
135.21 	115C.09, subd 1 270.75 270C.40
135.22 	126C.46 270.07 270C.86
135.23 	126C.65, subd 4 270.13 270C.91
135.24 	127A.49, subd 2 270.07 270C.86
135.25 	144.1501, subd 5 270.75 270C.40
135.26 	144.1502, subd 5 270.75 270C.40
135.27 	239.785, subd 5 270.75 270C.40
135.28 	256.9657, subd 7 270.75 270C.40
135.29 	256B.064, subd 1c 270.75 270C.40
135.30 	256B.431, subd 2d 270.75 270C.40
135.31 	270.072, subd 6 270.65 270C.62
135.32 	270.69270C.63
135.33 	270.075, subd 2 270.75 270C.40
135.34 	270A.07, subd 5 270.76 270C.405
135.35 	270B.03, subd 1 270.102 (twice) 270C.57 (twice)
135.36 	289A.31, subd 3 270C.58, subd 1
136.1 	270B.08 297A.86 270C.722
136.2 	270B.085, subd 1 270.70 270C.67
136.3 	270B.085, subd 2 270.69 270C.63
136.4 	270B.07, subd 1 270.72 270C.72
136.5 	270B.09 270.66 (twice) 270C.65 (twice)
136.6 	290.97270C.66
136.7 	270B.12, subd 4 270.73 270C.725
136.8 	270B.12, subd 7 270.72 270C.72
136.9 	270B.12, subd 10 270.60 270C.19
136.10 	271.06, subd 1 270.07, subd 1,270C.86
136.11 	                      para (a)
136.12 	271.09, subd 1 270.07, subd 1 270C.86
136.13 	271.12 270.76 270C.405
136.14 	272.115, subd 1 270.066 270C.306
136.15 	273.124, subd 13 270.0681 270C.12
136.16 	273.16 270.19 to 270.26270C.921 to 270C.928
136.17 	273.372 270.11, subd 6 270C.92, subd 2
136.18 	273.41 270.75 270C.40
136.19 	274.13, subd 1a 270.11, subds 5 270C.92, subds 1
136.20 	                      and 6 and 2
136.21 	274.16 270.11, subd 2 270C.89
136.22 	275.025, subd 1 270.11, subd 2 270C.89
136.23 	275.48 270.07 270C.86
136.24 	277.20, subd 2 270.69 270C.63
136.25 	277.21, subd 3 270.7001, 270.7002,270C.68, 270C.69,
136.26 	                      and 290.92, subd 23 and 270C.70
136.27 	270.70 to 270.709270C.67 to 270C.72
136.28 	277.21, subd 13 270.701 to 270.709270C.7101 to
136.29 	                                             270C.7109
136.30 	270.708270C.7108
136.31 	279.01, subd 2 270.07 270C.86
136.32 	279.03, subd 1a 270.75 (twice) 270C.40 (twice)
136.33 	279.34 270.07 270C.86
136.34 	287.12 270.771 270C.42
136.35 	287.29, subd 1 270.771 270C.42
136.36 	287.385, subd 1 270.75 270C.40
137.1 	287.385, subd 5 270.75 270C.40
137.2 	287.385, subd 6 270.75 270C.40
137.3 	289A.08, subd 1 289A.38, subd 13 270C.58, subd 3
137.4 	289A.19, subd 2 270.75 270C.40
137.5 	289A.25, subd 2 270.75 270C.40
137.6 	289A.26, subd 4 270.75 270C.40
137.7 	289A.31, subd 1 289A.38, subd 13 270C.58, subd 3
137.8 	289A.31, subd 3 289A.38, subd 13 270C.58, subd 3
137.9 	289A.31, subd 5 270.101 270C.56
137.10 	290.92, subd 22 270C.59
137.11 	289A.31, subd. 7 270.101 270C.56
137.12 	289A.38, subd 12 289A.31, subd 4 270C.58, subd 2
137.13 	                     (twice) (twice)
137.14 	289A.40, subd 1 289A.37, subd 1 270C.33
137.15 	289A.65270C.35
137.16 	289A.35270C.33, subd 3
137.17 	289A.50, subd 1 270.10, subd 1 270C.33
137.18 	289A.50, subd 7 289A.65 270C.35
137.19 	289A.50, subd 8 270.07, subd 5 270C.64
137.20 	289A.55, subd 1 270.75 270C.40
137.21 	289A.55, subd 7 270.75 270C.40
137.22 	289A.55, subd 8 270.75 270C.40
137.23 	289A.56, subd 1 270.76 270C.405
137.24 	289A.60, subd 4 270.75 270C.40
137.25 	289A.60, subd 5a 270.07, subds 1,
137.26 	                      para (e), and 6 270C.34
137.27 	289A.60, subd 16 297A.86 270C.722
137.28 	289A.60, subd 21 270.07, subd 6 270C.34, subd 2
137.29 	289A.63, subd 3 297A.86 270C.722
137.30 	290.05, subd 8 289A.65 270C.35
137.31 	290.06, subd 23 270.76 270C.405
137.32 	290.30 289A.31, subd 3 270C.58, subd 1
137.33 	290.92, subd 4b 270.69 270C.63
137.34 	270.70270C.67
137.35 	290.92, subd 30 289A.37 (twice) 270C.33 (twice)
137.36 	289A.65 (twice) 270C.35 (twice)
138.1 	290.9201, subd 7 270.06, para (16) 270C.02, subd 2,
138.2 	                                             para (b)
138.3 	290B.04, subd 5 289A (twice) 270C (twice)
138.4 	290B.07 270.75 270C.40
138.5 	290C.08, subd 1 270.75 270C.40
138.6 	295.55, subd 2 270.75 270C.40
138.7 	295.55, subd 3 270.75 270C.40
138.8 	295.57, subd 1 270 270C
138.9 	295.60, subd 3 270.75 270C.40
138.10 	295.60, subd 7 270 270C
138.11 	296A.02, subd 2 section 270.06chapter 270C
138.12 	                     section chapter
138.13 	296A.13 270.101 270C.56
138.14 	296A.21, subd 2 270.68 270C.61
138.15 	296A.22, subd 1 270.75 270C.40
138.16 	296A.22, subd 2 270 270C
138.17 	296A.22, subd 3 270.75 270C.40
138.18 	297A.72, subd 2 289A.07 270C.304
138.19 	297A.75, subd 4 270.76 270C.405
138.20 	297A.85 297A.86 270C.722
138.21 	297A.92, subd 2 289A.37, subd 5 270C.33, subd 8
138.22 	297D.12, subd 1 270.70 270C.36
138.23 	                     270 (twice) 270C (twice)
138.24 	297E.02, subd 4 270.76 270C.405
138.25 	297E.02, subd 7 270.70 270C.36
138.26 	                     270 (twice) 270C (twice)
138.27 	297E.03, subd 7 270.70 270C.36
138.28 	                     270 (twice) 270C (twice)
138.29 	297E.03, subd 8 270.064 270C.055, subd 1
138.30 	297E.11, subd 4 270.76 270C.405
138.31 	297E.12, subd 6 270.07, subds 1,
138.32 	                      para (e), and 6 270C.34
138.33 	297E.14, subd 1 270.75 270C.40
138.34 	297E.14, subd 6 270.75 270C.40
138.35 	297F.02, subd 2 section 270.06chapter 270C
138.36 	                     section chapter
139.1 	297F.04, subd 2 270.72 270C.72
139.2 	297F.08, subd 4 270.60 270C.19
139.3 	297F.09, subd 5 270.75 270C.40
139.4 	297F.09, subd 9 270.75 270C.40
139.5 	297F.18, subd 1 270.75 270C.40
139.6 	297F.18, subd 6 270.75 270C.40
139.7 	297F.185 297A.86 270C.722
139.8 	297F.19, subd 6 270.07, subds 1,
139.9 	                      para (e), and 6 270C.34
139.10 	297G.02, subd 3 section 270.06chapter 270C
139.11 	                     section chapter
139.12 	297G.09, subd 8 270.75 270C.40
139.13 	297G.17, subd 1 270.75 270C.40
139.14 	297G.17, subd 6 270.75 270C.40
139.15 	297G.18, subd 6 270.07, subds 1,
139.16 	                      para (e), and 6 270C.34
139.17 	297I.40, subd 4 270.75 270C.40
139.18 	297I.60, subd 2 297I.95 270C.35
139.19 	297I.80, subd 1 270.75 270C.40
139.20 	297I.80, subd 2 270.76 270C.405
139.21 	297I.85, subd 7 270.07, subd 6 270C.34, subd 2
139.22 	299L.07, subd 8 270.72 270C.72
139.23 	325D.33, subd 8 270 (three times) 270C (three times)
139.24 	270.75 (three 270C.40 (three
139.25 	                      times) times)
139.26 	336.9-531 270.69, subd 2, para
139.27 	                      (b), clause (2) 270C.63, subd 4
139.28 	349.155, subd 3 270.72 270C.72
139.29 	349A.06, subd 2 270.72 270C.72
139.30 	357.18, subd 2 270.69, subd 2,
139.31 	                      para (c) 270C.63, subd 6
139.32 	559.21, subd 5 270.69, subd 7 270C.63, subd 11
139.33 	469.171, subd 10 270.76 270C.405
139.34 	469.1734, subd 6 270.76 270C.405
139.35 	469.178, subd 7 270.75 (twice) 270C.40 (twice)
139.36 	469.319, subd 4 270 270C
140.1 	270.75270C.40
140.2 	469.340, subd 4 270 270C
140.3 	270.75270C.40
140.4 	580.15 270.69, subd 7 270C.63, subd 11
140.5 	588.21 289A.36, subd 3 270C.61, subd 2 

140.6 	ARTICLE 3
140.7 	PROPERTY TAXES

140.8 	Section 1. Minnesota Statutes 2004, section 272.02,
140.9 	subdivision 47, is amended to read:
140.10 		Subd. 47.Poultry litter biomass generation facility;
140.11 	personal property.  Notwithstanding subdivision 9, clause (a),
140.12 	attached machinery and other personal property which is part of
140.13 	an electrical generating facility that meets the requirements of
140.14 	this subdivision is exempt.  At the time of construction, the
140.15 	facility must:
140.16 	(1) be designed to utilize poultry litter as a primary fuel
140.17 	source; and
140.18 	(2) be constructed for the purpose of generating power at
140.19 	the facility that will be sold pursuant to a contract approved
140.20 	by the Public Utilities Commission in accordance with the
140.21 	biomass mandate imposed under section 216B.2424.
140.22 	Construction of the facility must be commenced after
140.23 	January 1, 2003, and before December 31, 2003 2005.  Property
140.24 	eligible for this exemption does not include electric
140.25 	transmission lines and interconnections or gas pipelines and
140.26 	interconnections appurtenant to the property or the facility.
140.27 	
EFFECTIVE DATE. This section is effective for taxes
140.28 	levied in 2005, payable in 2006, and thereafter.

140.29 	Sec. 2. Minnesota Statutes 2004, section 272.02,
140.30 	subdivision 53, is amended to read:
140.31 		Subd. 53.Electric generation facility; personal
140.32 	property.  Notwithstanding subdivision 9, clause (a), attached
140.33 	machinery and other personal property which is part of a 3.2
140.34 	megawatt run-of-the-river hydroelectric generation facility and
140.35 	that meets the requirements of this subdivision is exempt.  At
140.36 	the time of construction, the facility must:
141.1 	(1) utilize two turbine generators at a dam site existing
141.2 	on March 31, 1994;
141.3 	(2) be located on publicly owned land and within 1,500 feet
141.4 	of a 13.8 kilovolt distribution substation; and
141.5 	(3) be eligible to receive a renewable energy production
141.6 	incentive payment under section 216C.41.
141.7 	Construction of the facility must be commenced after
141.8 	January 1, 2002 December 31, 2004, and before January 1, 2005 
141.9 	2007.  Property eligible for this exemption does not include
141.10 	electric transmission lines and interconnections or gas
141.11 	pipelines and interconnections appurtenant to the property or
141.12 	the facility.
141.13 	
EFFECTIVE DATE. This section is effective for taxes
141.14 	levied in 2005, payable in 2006 and thereafter.

141.15 	Sec. 3. Minnesota Statutes 2004, section 272.02,
141.16 	subdivision 56, is amended to read:
141.17 		Subd. 56.Electric generation facility; personal
141.18 	property.  (a) Notwithstanding subdivision 9, clause (a),
141.19 	attached machinery and other personal property which is part of
141.20 	a combined-cycle combustion-turbine electric generation facility
141.21 	that exceeds 550 300 megawatts of installed capacity and that
141.22 	meets the requirements of this subdivision is exempt.  At the
141.23 	time of construction, the facility must:
141.24 	(1) be designed to utilize natural gas as a primary fuel;
141.25 	(2) not be owned by a public utility as defined in section
141.26 	216B.02, subdivision 4;
141.27 	(3) be located within five miles of an existing natural gas
141.28 	pipeline and within four miles of an existing electrical
141.29 	transmission substation;
141.30 	(4) be located outside the metropolitan area as defined
141.31 	under section 473.121, subdivision 2; and
141.32 	(5) be designed to provide energy and ancillary services
141.33 	and have received a certificate of need under section 216B.243.
141.34 	(b) Construction of the facility must be commenced after
141.35 	January 1, 2004, and before January 1, 2007, except that
141.36 	property eligible for this exemption includes any expansion of
142.1 	the facility that also meets the requirements of paragraph (a),
142.2 	clauses (1) to (5), without regard to the date that construction
142.3 	of the expansion commences.  Property eligible for this
142.4 	exemption does not include electric transmission lines and
142.5 	interconnections or gas pipelines and interconnections
142.6 	appurtenant to the property or the facility.
142.7 	
EFFECTIVE DATE. This section is effective for taxes
142.8 	levied in 2005, payable in 2006, and thereafter.

142.9 	Sec. 4. Minnesota Statutes 2004, section 272.02, is
142.10 	amended by adding a subdivision to read:
142.11 		Subd. 68.Electric generation facility; personal
142.12 	property. (a) Notwithstanding subdivision 9, clause (a),
142.13 	attached machinery and other personal property which is part of
142.14 	a simple-cycle combustion-turbine electric generation facility
142.15 	that exceeds 290 megawatts of installed capacity and that meets
142.16 	the requirements of this subdivision is exempt.  At the time of
142.17 	construction, the facility must:
142.18 	(1) be designed to utilize natural gas as a primary fuel;
142.19 	(2) not be owned by a public utility as defined in section
142.20 	216B.02, subdivision 4;
142.21 	(3) be located within 15 miles of an existing natural gas
142.22 	pipeline and within five miles of an existing electrical
142.23 	transmission substation;
142.24 	(4) be located outside the metropolitan area as defined
142.25 	under section 473.121, subdivision 2;
142.26 	(5) be designed to provide peaking capacity energy and
142.27 	ancillary services and have satisfied all of the requirements
142.28 	under section 216B.243; and 
142.29 	(6) have received, by resolution, the approval from the
142.30 	governing body of the county, city, and school district in which
142.31 	the proposed facility is to be located for the exemption of
142.32 	personal property under this subdivision.
142.33 	(b) Construction of the facility must be commenced after
142.34 	January 1, 2005, and before January 1, 2009.  Property eligible
142.35 	for this exemption does not include electric transmission lines
142.36 	and interconnections or gas pipelines and interconnections
143.1 	appurtenant to the property or the facility.
143.2 	
EFFECTIVE DATE. This section is effective for assessment
143.3 	year 2006, taxes payable in 2007, and thereafter.

143.4 	Sec. 5. Minnesota Statutes 2004, section 272.02, is
143.5 	amended by adding a subdivision to read:
143.6 		Subd. 69.Electric generation facility personal
143.7 	property. (a) Notwithstanding subdivision 9, clause (a), and
143.8 	section 453.54, subdivision 20, attached machinery and other
143.9 	personal property which is part of an electric generation
143.10 	facility that exceeds 150 megawatts of installed capacity and
143.11 	meets the requirements of this subdivision is exempt.  At the
143.12 	time of construction, the facility must:
143.13 	(1) be designed to utilize natural gas as a primary fuel;
143.14 	(2) be owned and operated by a municipal power agency as
143.15 	defined in section 453.52, subdivision 8;
143.16 	(3) have received the certificate of need under section
143.17 	216B.243;
143.18 	(4) be located outside the metropolitan area as defined
143.19 	under section 473.121, subdivision 2; and 
143.20 	(5) be designed to be a combined-cycle facility, although
143.21 	initially the facility will be operated as a simple-cycle
143.22 	combustion turbine.
143.23 	(b) To qualify under this subdivision, an agreement must be
143.24 	negotiated between the municipal power agency and the host city,
143.25 	for a payment in lieu of property taxes to the host city.
143.26 	(c) Construction of the facility must be commenced after
143.27 	January 1, 2004, and before January 1, 2006.  Property eligible
143.28 	for this exemption does not include electric transmission lines
143.29 	and interconnections or gas pipelines and interconnections
143.30 	appurtenant to the property or the facility.
143.31 	
EFFECTIVE DATE. This section is effective for assessment
143.32 	year 2005, taxes payable in 2006, and thereafter.

143.33 	Sec. 6. Minnesota Statutes 2004, section 272.02, is
143.34 	amended by adding a subdivision to read:
143.35 		Subd. 70.Electric generation facility; personal
143.36 	property. Notwithstanding subdivision 9, clause (a), attached
144.1 	machinery and other personal property which is part of an
144.2 	existing simple-cycle, combustion-turbine electric generation
144.3 	facility that exceeds 300 megawatts of installed capacity and
144.4 	that meets the requirements of this subdivision is exempt.  At
144.5 	the time of the construction, the facility must:
144.6 	(1) be designed to utilize natural gas as a primary fuel;
144.7 	(2) be owned by a public utility as defined in section
144.8 	216B.02, subdivision 4, and be located at or interconnected with
144.9 	an existing generating plant of the utility;
144.10 	(3) be designed to provide peaking, emergency backup, or
144.11 	contingency services;
144.12 	(4) satisfy a resource need identified in an approved
144.13 	integrated resource plan filed under section 216B.2422; and 
144.14 	(5) have received, by resolution, the approval from the
144.15 	governing body of the county and the city for the exemption of
144.16 	personal property under this subdivision.
144.17 	Construction of the facility expansion must be commenced
144.18 	after January 1, 2004, and before January 1, 2005.  Property
144.19 	eligible for this exemption does not include electric
144.20 	transmission lines and interconnections or gas pipelines and
144.21 	interconnections appurtenant to the property or the facility.
144.22 	
EFFECTIVE DATE. This section is effective beginning with
144.23 	assessment year 2005, for taxes payable in 2006 and thereafter.

144.24 	Sec. 7. Minnesota Statutes 2004, section 272.02, is
144.25 	amended by adding a subdivision to read:
144.26 		Subd. 71.Electric generation facility; personal
144.27 	property. (a) Notwithstanding subdivision 9, clause (a),
144.28 	attached machinery and other personal property which is part of
144.29 	a simple-cycle combustion-turbine electric generation facility
144.30 	that exceeds 150 megawatts of installed capacity and that meets
144.31 	the requirements of this subdivision is exempt.  At the time of
144.32 	construction, the facility must:
144.33 	(1) utilize natural gas as a primary fuel;
144.34 	(2) be owned by an electric generation and transmission
144.35 	cooperative;
144.36 	(3) be located within five miles of parallel existing
145.1 	12-inch and 16-inch natural gas pipelines and a 69-kilovolt
145.2 	high-voltage electric transmission line;
145.3 	(4) be designed to provide peaking, emergency backup, or
145.4 	contingency services;
145.5 	(5) have received a certificate of need under section
145.6 	216B.243 demonstrating demand for its capacity; and 
145.7 	(6) have received by resolution the approval from the
145.8 	governing body of the county and township in which the proposed
145.9 	facility is to be located for the exemption of personal property
145.10 	under this subdivision.
145.11 	(b) Construction of the facility must be commenced after
145.12 	July 1, 2005, and before January 1, 2009.  Property eligible for
145.13 	this exemption does not include electric transmission lines and
145.14 	interconnections or gas pipelines and interconnections
145.15 	appurtenant to the property or the facility.
145.16 	
EFFECTIVE DATE. This section is effective for assessment
145.17 	year 2006 and thereafter, for taxes payable in 2007 and
145.18 	thereafter.

145.19 	Sec. 8. Minnesota Statutes 2004, section 272.02, is
145.20 	amended by adding a subdivision to read:
145.21 		Subd. 72.Electric generation facility personal
145.22 	property. (a) Notwithstanding subdivision 9, clause (a),
145.23 	attached machinery and other personal property which is part of
145.24 	either a simple-cycle, combustion-turbine electric generation
145.25 	facility, or a combined-cycle, combustion-turbine electric
145.26 	generation facility that does not exceed 325 megawatts of
145.27 	installed capacity and that meets the requirements of this
145.28 	subdivision is exempt.  At the time of construction, the
145.29 	facility must:
145.30 	(1) utilize either a simple-cycle or a combined-cycle
145.31 	combustion-turbine generator fueled by natural gas;
145.32 	(2) be connected to an existing 115-kilovolt high-voltage
145.33 	electric transmission line that is within two miles of the
145.34 	facility;
145.35 	(3) be located on an underground natural gas storage
145.36 	aquifer;
146.1 	(4) be designed as either a peaking or intermediate load
146.2 	facility; and 
146.3 	(5) have received, by resolution, the approval from the
146.4 	governing body of the county for the exemption of personal
146.5 	property under this subdivision.
146.6 	(b) Construction of the facility must be commenced after
146.7 	January 1, 2006, and before January 1, 2008.  Property eligible
146.8 	for this exemption does not include electric transmission lines
146.9 	and interconnections or gas pipelines and interconnections
146.10 	appurtenant to the property or the facility.
146.11 	
EFFECTIVE DATE. This section is effective for assessment
146.12 	year 2005, taxes payable in 2006, and thereafter.

146.13 	Sec. 9. Minnesota Statutes 2004, section 272.0211,
146.14 	subdivision 1, is amended to read:
146.15 		Subdivision 1.Efficiency determination and
146.16 	certification.  An owner or operator of a new or existing
146.17 	electric power generation facility, excluding wind energy
146.18 	conversion systems, may apply to the commissioner of revenue for
146.19 	a market value exclusion on the property as provided for in this
146.20 	section.  This exclusion shall apply only to the market value of
146.21 	the equipment of the facility, and shall not apply to the
146.22 	structures and the land upon which the facility is located.  The
146.23 	commissioner of revenue shall prescribe the forms and procedures
146.24 	for this application.  Upon receiving the application, the
146.25 	commissioner of revenue shall request the commissioner of
146.26 	commerce to make a determination of the efficiency of the
146.27 	applicant's electric power generation facility. In calculating
146.28 	the efficiency of a facility,The commissioner of commerce shall
146.29 	use a definition of calculate efficiency which calculates
146.30 	efficiency as the sum of:
146.31 	(1) the useful electrical power output; plus 
146.32 	(2) the useful thermal energy output; plus 
146.33 	(3) the fuel energy of the useful chemical products,
146.34 	all divided by the total energy input to the facility, expressed
146.35 	as a percentage as the ratio of useful energy outputs to energy
146.36 	inputs, expressed as a percentage, based on the performance of
147.1 	the facility's equipment during normal full load operation.  The
147.2 	commissioner must include in this formula the energy used in any
147.3 	on-site preparation of materials necessary to convert the
147.4 	materials into the fuel used to generate electricity, such as a
147.5 	process to gasify petroleum coke.  The commissioner shall use
147.6 	the high Higher Heating Value (HHV) for all substances in the
147.7 	commissioner's efficiency calculations, except for wood for fuel
147.8 	in a biomass-eligible project under section 216B.2424; for these
147.9 	instances, the commissioner shall adjust the heating value to
147.10 	allow for energy consumed for evaporation of the moisture in the
147.11 	wood.  The applicant shall provide the commissioner of commerce
147.12 	with whatever information the commissioner deems necessary to
147.13 	make the determination.  Within 30 days of the receipt of the
147.14 	necessary information, the commissioner of commerce shall
147.15 	certify the findings of the efficiency determination to the
147.16 	commissioner of revenue and to the applicant.  The commissioner
147.17 	of commerce shall determine the efficiency of the facility and
147.18 	certify the findings of that determination to the commissioner
147.19 	of revenue every two years thereafter from the date of the
147.20 	original certification.
147.21 	
EFFECTIVE DATE. This section is effective for assessment
147.22 	year 2005 and thereafter, for taxes payable in 2006 and
147.23 	thereafter.

147.24 	Sec. 10. Minnesota Statutes 2004, section 272.0211,
147.25 	subdivision 2, is amended to read:
147.26 		Subd. 2.Sliding scale exclusion.  Based upon the
147.27 	efficiency determination provided by the commissioner of
147.28 	commerce as described in subdivision 1, the commissioner of
147.29 	revenue shall subtract five eight percent of the taxable market
147.30 	value of the qualifying property for each percentage point that
147.31 	the efficiency of the specific facility, as determined by the
147.32 	commissioner of commerce, is above 35 40 percent.  The reduction
147.33 	in taxable market value shall be reflected in the taxable market
147.34 	value of the facility beginning with the assessment year
147.35 	immediately following the determination.  For a facility that is
147.36 	assessed by the county in which the facility is located, the
148.1 	commissioner of revenue shall certify to the assessor of that
148.2 	county the percentage of the taxable market value of the
148.3 	facility to be excluded.
148.4 	
EFFECTIVE DATE. This section is effective for assessment
148.5 	year 2005 and thereafter, for taxes payable in 2006 and
148.6 	thereafter.

148.7 	Sec. 11. Minnesota Statutes 2004, section 273.124,
148.8 	subdivision 14, is amended to read:
148.9 		Subd. 14.Agricultural homesteads; special provisions.
 148.10 	(a) Real estate of less than ten acres that is the homestead of
148.11 	its owner must be classified as class 2a under section 273.13,
148.12 	subdivision 23, paragraph (a), if:
148.13 	(1) the parcel on which the house is located is contiguous
148.14 	on at least two sides to (i) agricultural land, (ii) land owned
148.15 	or administered by the United States Fish and Wildlife Service,
148.16 	or (iii) land administered by the Department of Natural
148.17 	Resources on which in lieu taxes are paid under sections 477A.11
148.18 	to 477A.14;
148.19 	(2) its owner also owns a noncontiguous parcel of
148.20 	agricultural land that is at least 20 acres;
148.21 	(3) the noncontiguous land is located not farther than four
148.22 	townships or cities, or a combination of townships or cities
148.23 	from the homestead; and
148.24 	(4) the agricultural use value of the noncontiguous land
148.25 	and farm buildings is equal to at least 50 percent of the market
148.26 	value of the house, garage, and one acre of land.
148.27 	Homesteads initially classified as class 2a under the
148.28 	provisions of this paragraph shall remain classified as class
148.29 	2a, irrespective of subsequent changes in the use of adjoining
148.30 	properties, as long as the homestead remains under the same
148.31 	ownership, the owner owns a noncontiguous parcel of agricultural
148.32 	land that is at least 20 acres, and the agricultural use value
148.33 	qualifies under clause (4).  Homestead classification under this
148.34 	paragraph is limited to property that qualified under this
148.35 	paragraph for the 1998 assessment.
148.36 	(b)(i) Agricultural property consisting of at least 40
149.1 	acres shall be classified as the owner's homestead, to the same
149.2 	extent as other agricultural homestead property, if all of the
149.3 	following criteria are met:
149.4 	(1) the owner, the owner's spouse, or the son or daughter
149.5 	of the owner or owner's spouse, or the grandson or granddaughter
149.6 	of the owner or the owner's spouse,is actively farming the
149.7 	agricultural property, either on the person's own behalf as an
149.8 	individual or on behalf of a partnership operating a family
149.9 	farm, family farm corporation, joint family farm venture, or
149.10 	limited liability company of which the person is a partner,
149.11 	shareholder, or member;
149.12 	(2) both the owner of the agricultural property and the
149.13 	person who is actively farming the agricultural property under
149.14 	clause (1), are Minnesota residents;
149.15 	(3) neither the owner nor the spouse of the owner claims
149.16 	another agricultural homestead in Minnesota; and
149.17 	(4) neither the owner nor the person actively farming the
149.18 	property lives farther than four townships or cities, or a
149.19 	combination of four townships or cities, from the agricultural
149.20 	property, except that if the owner or the owner's spouse is
149.21 	required to live in employer-provided housing, the owner or
149.22 	owner's spouse, whichever is actively farming the agricultural
149.23 	property, may live more than four townships or cities, or
149.24 	combination of four townships or cities from the agricultural
149.25 	property.
149.26 	The relationship under this paragraph may be either by
149.27 	blood or marriage.
149.28 	(ii) Real property held by a trustee under a trust is
149.29 	eligible for agricultural homestead classification under this
149.30 	paragraph if the qualifications in clause (i) are met, except
149.31 	that "owner" means the grantor of the trust.
149.32 	(iii) Property containing the residence of an owner who
149.33 	owns qualified property under clause (i) shall be classified as
149.34 	part of the owner's agricultural homestead, if that property is
149.35 	also used for noncommercial storage or drying of agricultural
149.36 	crops.
150.1 	(c) Noncontiguous land shall be included as part of a
150.2 	homestead under section 273.13, subdivision 23, paragraph (a),
150.3 	only if the homestead is classified as class 2a and the detached
150.4 	land is located in the same township or city, or not farther
150.5 	than four townships or cities or combination thereof from the
150.6 	homestead.  Any taxpayer of these noncontiguous lands must
150.7 	notify the county assessor that the noncontiguous land is part
150.8 	of the taxpayer's homestead, and, if the homestead is located in
150.9 	another county, the taxpayer must also notify the assessor of
150.10 	the other county.
150.11 	(d) Agricultural land used for purposes of a homestead and
150.12 	actively farmed by a person holding a vested remainder interest
150.13 	in it must be classified as a homestead under section 273.13,
150.14 	subdivision 23, paragraph (a).  If agricultural land is
150.15 	classified class 2a, any other dwellings on the land used for
150.16 	purposes of a homestead by persons holding vested remainder
150.17 	interests who are actively engaged in farming the property, and
150.18 	up to one acre of the land surrounding each homestead and
150.19 	reasonably necessary for the use of the dwelling as a home, must
150.20 	also be assessed class 2a.
150.21 	(e) Agricultural land and buildings that were class 2a
150.22 	homestead property under section 273.13, subdivision 23,
150.23 	paragraph (a), for the 1997 assessment shall remain classified
150.24 	as agricultural homesteads for subsequent assessments if:
150.25 	(1) the property owner abandoned the homestead dwelling
150.26 	located on the agricultural homestead as a result of the April
150.27 	1997 floods;
150.28 	(2) the property is located in the county of Polk, Clay,
150.29 	Kittson, Marshall, Norman, or Wilkin;
150.30 	(3) the agricultural land and buildings remain under the
150.31 	same ownership for the current assessment year as existed for
150.32 	the 1997 assessment year and continue to be used for
150.33 	agricultural purposes;
150.34 	(4) the dwelling occupied by the owner is located in
150.35 	Minnesota and is within 30 miles of one of the parcels of
150.36 	agricultural land that is owned by the taxpayer; and
151.1 	(5) the owner notifies the county assessor that the
151.2 	relocation was due to the 1997 floods, and the owner furnishes
151.3 	the assessor any information deemed necessary by the assessor in
151.4 	verifying the change in dwelling.  Further notifications to the
151.5 	assessor are not required if the property continues to meet all
151.6 	the requirements in this paragraph and any dwellings on the
151.7 	agricultural land remain uninhabited.
151.8 	(f) Agricultural land and buildings that were class 2a
151.9 	homestead property under section 273.13, subdivision 23,
151.10 	paragraph (a), for the 1998 assessment shall remain classified
151.11 	agricultural homesteads for subsequent assessments if:
151.12 	(1) the property owner abandoned the homestead dwelling
151.13 	located on the agricultural homestead as a result of damage
151.14 	caused by a March 29, 1998, tornado;
151.15 	(2) the property is located in the county of Blue Earth,
151.16 	Brown, Cottonwood, LeSueur, Nicollet, Nobles, or Rice;
151.17 	(3) the agricultural land and buildings remain under the
151.18 	same ownership for the current assessment year as existed for
151.19 	the 1998 assessment year;
151.20 	(4) the dwelling occupied by the owner is located in this
151.21 	state and is within 50 miles of one of the parcels of
151.22 	agricultural land that is owned by the taxpayer; and
151.23 	(5) the owner notifies the county assessor that the
151.24 	relocation was due to a March 29, 1998, tornado, and the owner
151.25 	furnishes the assessor any information deemed necessary by the
151.26 	assessor in verifying the change in homestead dwelling.  For
151.27 	taxes payable in 1999, the owner must notify the assessor by
151.28 	December 1, 1998.  Further notifications to the assessor are not
151.29 	required if the property continues to meet all the requirements
151.30 	in this paragraph and any dwellings on the agricultural land
151.31 	remain uninhabited.
151.32 	(g) Agricultural property consisting of at least 40 acres
151.33 	of a family farm corporation, joint family farm venture, family
151.34 	farm limited liability company, or partnership operating a
151.35 	family farm as described under subdivision 8 shall be classified
151.36 	homestead, to the same extent as other agricultural homestead
152.1 	property, if all of the following criteria are met:
152.2 	(1) a shareholder, member, or partner of that entity is
152.3 	actively farming the agricultural property;
152.4 	(2) that shareholder, member, or partner who is actively
152.5 	farming the agricultural property is a Minnesota resident;
152.6 	(3) neither that shareholder, member, or partner, nor the
152.7 	spouse of that shareholder, member, or partner claims another
152.8 	agricultural homestead in Minnesota; and
152.9 	(4) that shareholder, member, or partner does not live
152.10 	farther than four townships or cities, or a combination of four
152.11 	townships or cities, from the agricultural property.
152.12 	Homestead treatment applies under this paragraph for
152.13 	property leased to a family farm corporation, joint farm
152.14 	venture, limited liability company, or partnership operating a
152.15 	family farm if legal title to the property is in the name of an
152.16 	individual who is a member, shareholder, or partner in the
152.17 	entity.
152.18 	(h) To be eligible for the special agricultural homestead
152.19 	under this subdivision, an initial full application must be
152.20 	submitted to the county assessor where the property is located.
152.21 	Owners and the persons who are actively farming the property
152.22 	shall be required to complete only a one-page abbreviated
152.23 	version of the application in each subsequent year provided that
152.24 	none of the following items have changed since the initial
152.25 	application:
152.26 	(1) the day-to-day operation, administration, and financial
152.27 	risks remain the same;
152.28 	(2) the owners and the persons actively farming the
152.29 	property continue to live within the four townships or city
152.30 	criteria and are Minnesota residents;
152.31 	(3) the same operator of the agricultural property is
152.32 	listed with the Farm Service Agency;
152.33 	(4) a Schedule F or equivalent income tax form was filed
152.34 	for the most recent year;
152.35 	(5) the property's acreage is unchanged; and
152.36 	(6) none of the property's acres have been enrolled in a
153.1 	federal or state farm program since the initial application.
153.2 	The owners and any persons who are actively farming the
153.3 	property must include the appropriate Social Security numbers,
153.4 	and sign and date the application.  If any of the specified
153.5 	information has changed since the full application was filed,
153.6 	the owner must notify the assessor, and must complete a new
153.7 	application to determine if the property continues to qualify
153.8 	for the special agricultural homestead.  The commissioner of
153.9 	revenue shall prepare a standard reapplication form for use by
153.10 	the assessors.
153.11 	
EFFECTIVE DATE. This section is effective for assessment
153.12 	year 2005 and thereafter, for taxes payable in 2006 and
153.13 	thereafter.

153.14 	Sec. 12. Minnesota Statutes 2004, section 273.13,
153.15 	subdivision 25, is amended to read:
153.16 		Subd. 25.Class 4.  (a) Class 4a is residential real
153.17 	estate containing four or more units and used or held for use by
153.18 	the owner or by the tenants or lessees of the owner as a
153.19 	residence for rental periods of 30 days or more.  Class 4a also
153.20 	includes hospitals licensed under sections 144.50 to 144.56,
153.21 	other than hospitals exempt under section 272.02, and contiguous
153.22 	property used for hospital purposes, without regard to whether
153.23 	the property has been platted or subdivided.  The market value
153.24 	of class 4a property has a class rate of 1.8 percent for taxes
153.25 	payable in 2002, 1.5 percent for taxes payable in 2003, and 1.25
153.26 	percent for taxes payable in 2004 and thereafter, except that
153.27 	class 4a property consisting of a structure for which
153.28 	construction commenced after June 30, 2001, has a class rate of
153.29 	1.25 percent of market value for taxes payable in 2003 and
153.30 	subsequent years.
153.31 	(b) Class 4b includes:
153.32 	(1) residential real estate containing less than four units
153.33 	that does not qualify as class 4bb, other than seasonal
153.34 	residential recreational property;
153.35 	(2) manufactured homes not classified under any other
153.36 	provision;
154.1 	(3) a dwelling, garage, and surrounding one acre of
154.2 	property on a nonhomestead farm classified under subdivision 23,
154.3 	paragraph (b) containing two or three units; and
154.4 	(4) unimproved property that is classified residential as
154.5 	determined under subdivision 33.
154.6 	The market value of class 4b property has a class rate of
154.7 	1.5 percent for taxes payable in 2002, and 1.25 percent for
154.8 	taxes payable in 2003 and thereafter.
154.9 	(c) Class 4bb includes:
154.10 	(1) nonhomestead residential real estate containing one
154.11 	unit, other than seasonal residential recreational property; and
154.12 	(2) a single family dwelling, garage, and surrounding one
154.13 	acre of property on a nonhomestead farm classified under
154.14 	subdivision 23, paragraph (b).
154.15 	Class 4bb property has the same class rates as class 1a
154.16 	property under subdivision 22.
154.17 	Property that has been classified as seasonal residential
154.18 	recreational property at any time during which it has been owned
154.19 	by the current owner or spouse of the current owner does not
154.20 	qualify for class 4bb.
154.21 	(d) Class 4c property includes:
154.22 	(1) except as provided in subdivision 22, paragraph (c),
154.23 	real property devoted to temporary and seasonal residential
154.24 	occupancy for recreation purposes, including real property
154.25 	devoted to temporary and seasonal residential occupancy for
154.26 	recreation purposes and not devoted to commercial purposes for
154.27 	more than 250 days in the year preceding the year of
154.28 	assessment.  For purposes of this clause, property is devoted to
154.29 	a commercial purpose on a specific day if any portion of the
154.30 	property is used for residential occupancy, and a fee is charged
154.31 	for residential occupancy.  In order for a property to be
154.32 	classified as class 4c, seasonal residential recreational for
154.33 	commercial purposes, at least 40 percent of the annual gross
154.34 	lodging receipts related to the property must be from business
154.35 	conducted during 90 consecutive days and either (i) at least 60
154.36 	percent of all paid bookings by lodging guests during the year
155.1 	must be for periods of at least two consecutive nights; or (ii)
155.2 	at least 20 percent of the annual gross receipts must be from
155.3 	charges for rental of fish houses, boats and motors,
155.4 	snowmobiles, downhill or cross-country ski equipment, or charges
155.5 	for marina services, launch services, and guide services, or the
155.6 	sale of bait and fishing tackle.  For purposes of this
155.7 	determination, a paid booking of five or more nights shall be
155.8 	counted as two bookings.  Class 4c also includes commercial use
155.9 	real property used exclusively for recreational purposes in
155.10 	conjunction with class 4c property devoted to temporary and
155.11 	seasonal residential occupancy for recreational purposes, up to
155.12 	a total of two acres, provided the property is not devoted to
155.13 	commercial recreational use for more than 250 days in the year
155.14 	preceding the year of assessment and is located within two miles
155.15 	of the class 4c property with which it is used.  Class 4c
155.16 	property classified in this clause also includes the remainder
155.17 	of class 1c resorts provided that the entire property including
155.18 	that portion of the property classified as class 1c also meets
155.19 	the requirements for class 4c under this clause; otherwise the
155.20 	entire property is classified as class 3.  Owners of real
155.21 	property devoted to temporary and seasonal residential occupancy
155.22 	for recreation purposes and all or a portion of which was
155.23 	devoted to commercial purposes for not more than 250 days in the
155.24 	year preceding the year of assessment desiring classification as
155.25 	class 1c or 4c, must submit a declaration to the assessor
155.26 	designating the cabins or units occupied for 250 days or less in
155.27 	the year preceding the year of assessment by January 15 of the
155.28 	assessment year.  Those cabins or units and a proportionate
155.29 	share of the land on which they are located will be designated
155.30 	class 1c or 4c as otherwise provided.  The remainder of the
155.31 	cabins or units and a proportionate share of the land on which
155.32 	they are located will be designated as class 3a.  The owner of
155.33 	property desiring designation as class 1c or 4c property must
155.34 	provide guest registers or other records demonstrating that the
155.35 	units for which class 1c or 4c designation is sought were not
155.36 	occupied for more than 250 days in the year preceding the
156.1 	assessment if so requested.  The portion of a property operated
156.2 	as a (1) restaurant, (2) bar, (3) gift shop, and (4) other
156.3 	nonresidential facility operated on a commercial basis not
156.4 	directly related to temporary and seasonal residential occupancy
156.5 	for recreation purposes shall not qualify for class 1c or 4c;
156.6 	(2) qualified property used as a golf course if:
156.7 	(i) it is open to the public on a daily fee basis.  It may
156.8 	charge membership fees or dues, but a membership fee may not be
156.9 	required in order to use the property for golfing, and its green
156.10 	fees for golfing must be comparable to green fees typically
156.11 	charged by municipal courses; and
156.12 	(ii) it meets the requirements of section 273.112,
156.13 	subdivision 3, paragraph (d).
156.14 	A structure used as a clubhouse, restaurant, or place of
156.15 	refreshment in conjunction with the golf course is classified as
156.16 	class 3a property;
156.17 	(3) real property up to a maximum of one acre of land owned
156.18 	by a nonprofit community service oriented organization; provided
156.19 	that the property is not used for a revenue-producing activity
156.20 	for more than six days in the calendar year preceding the year
156.21 	of assessment and the property is not used for residential
156.22 	purposes on either a temporary or permanent basis.  For purposes
156.23 	of this clause, a "nonprofit community service oriented
156.24 	organization" means any corporation, society, association,
156.25 	foundation, or institution organized and operated exclusively
156.26 	for charitable, religious, fraternal, civic, or educational
156.27 	purposes, and which is exempt from federal income taxation
156.28 	pursuant to section 501(c)(3), (10), or (19) of the Internal
156.29 	Revenue Code of 1986, as amended through December 31, 1990.  For
156.30 	purposes of this clause, "revenue-producing activities" shall
156.31 	include but not be limited to property or that portion of the
156.32 	property that is used as an on-sale intoxicating liquor or 3.2
156.33 	percent malt liquor establishment licensed under chapter 340A, a
156.34 	restaurant open to the public, bowling alley, a retail store,
156.35 	gambling conducted by organizations licensed under chapter 349,
156.36 	an insurance business, or office or other space leased or rented
157.1 	to a lessee who conducts a for-profit enterprise on the
157.2 	premises.  Any portion of the property which is used for
157.3 	revenue-producing activities for more than six days in the
157.4 	calendar year preceding the year of assessment shall be assessed
157.5 	as class 3a.  The use of the property for social events open
157.6 	exclusively to members and their guests for periods of less than
157.7 	24 hours, when an admission is not charged nor any revenues are
157.8 	received by the organization shall not be considered a
157.9 	revenue-producing activity;
157.10 	(4) postsecondary student housing of not more than one acre
157.11 	of land that is owned by a nonprofit corporation organized under
157.12 	chapter 317A and is used exclusively by a student cooperative,
157.13 	sorority, or fraternity for on-campus housing or housing located
157.14 	within two miles of the border of a college campus;
157.15 	(5) manufactured home parks as defined in section 327.14,
157.16 	subdivision 3;
157.17 	(6) real property that is actively and exclusively devoted
157.18 	to indoor fitness, health, social, recreational, and related
157.19 	uses, is owned and operated by a not-for-profit corporation, and
157.20 	is located within the metropolitan area as defined in section
157.21 	473.121, subdivision 2;
157.22 	(7) a leased or privately owned noncommercial aircraft
157.23 	storage hangar not exempt under section 272.01, subdivision 2,
157.24 	and the land on which it is located, provided that:
157.25 	(i) the land is on an airport owned or operated by a city,
157.26 	town, county, Metropolitan Airports Commission, or group
157.27 	thereof; and
157.28 	(ii) the land lease, or any ordinance or signed agreement
157.29 	restricting the use of the leased premise, prohibits commercial
157.30 	activity performed at the hangar.
157.31 	If a hangar classified under this clause is sold after June
157.32 	30, 2000, a bill of sale must be filed by the new owner with the
157.33 	assessor of the county where the property is located within 60
157.34 	days of the sale; and 
157.35 	(8) a privately owned noncommercial aircraft storage hangar
157.36 	not exempt under section 272.01, subdivision 2, and the land on
158.1 	which it is located, provided that:
158.2 	(i) the land abuts a public airport; and 
158.3 	(ii) the owner of the aircraft storage hangar provides the
158.4 	assessor with a signed agreement restricting the use of the
158.5 	premises, prohibiting commercial use or activity performed at
158.6 	the hangar; and 
158.7 	(9) residential real estate, a portion of which is used by
158.8 	the owner for homestead purposes, and that is also a place of
158.9 	lodging, if all of the following criteria are met:
158.10 	(i) rooms are provided for rent to transient guests that
158.11 	generally stay for periods of 14 or fewer days;
158.12 	(ii) meals are provided to persons who rent rooms, the cost
158.13 	of which is incorporated in the basic room rate;
158.14 	(iii) meals are not provided to the general public except
158.15 	for special events on fewer than seven days in the calendar year
158.16 	preceding the year of the assessment; and
158.17 	(iv) the owner is the operator of the property.
158.18 	The market value subject to the 4c classification under this
158.19 	clause is limited to five rental units.  Any rental units on the
158.20 	property in excess of five, must be valued and assessed as class
158.21 	3a.  The portion of the property used for purposes of a
158.22 	homestead by the owner must be classified as class 1a property
158.23 	under subdivision 22.
158.24 	Class 4c property has a class rate of 1.5 percent of market
158.25 	value, except that (i) each parcel of seasonal residential
158.26 	recreational property not used for commercial purposes has the
158.27 	same class rates as class 4bb property, (ii) manufactured home
158.28 	parks assessed under clause (5) have the same class rate as
158.29 	class 4b property, (iii) commercial-use seasonal residential
158.30 	recreational property has a class rate of one percent for the
158.31 	first $500,000 of market value, which includes any market value
158.32 	receiving the one percent rate under subdivision 22, and 1.25
158.33 	percent for the remaining market value, (iv) the market value of
158.34 	property described in clause (4) has a class rate of one
158.35 	percent, (v) the market value of property described in clauses
158.36 	(2) and (6) has a class rate of 1.25 percent, and (vi) that
159.1 	portion of the market value of property in clause (8) qualifying
159.2 	for class 4c property has a class rate of 1.25 percent.
159.3 	
EFFECTIVE DATE. This section is effective for taxes
159.4 	payable in 2006 and subsequent years.

159.5 	Sec. 13. Minnesota Statutes 2004, section 290A.07, is
159.6 	amended by adding a subdivision to read:
159.7 		Subd. 5.Early payment; e-file claims. The commissioner
159.8 	may pay a claim up to 30 days earlier than the first permitted
159.9 	date under subdivision 2a or 3 if the claim is submitted by
159.10 	electronic means.
159.11 	
EFFECTIVE DATE. This section is effective the day
159.12 	following final enactment.

159.13 	Sec. 14. Minnesota Statutes 2004, section 365.43,
159.14 	subdivision 1, is amended to read:
159.15 		Subdivision 1.levied amount is spending limit total
159.16 	revenue defined.  A town must not contract debts or spend more
159.17 	money in a year than the taxes levied for the year its total
159.18 	revenue without a favorable vote of a majority of the town's
159.19 	electors. In this section, "total revenue" means property taxes
159.20 	payable in that year as well as amounts received from all other
159.21 	sources and amounts carried forward from the last year.

159.22 	Sec. 15. Minnesota Statutes 2004, section 365.431, is
159.23 	amended to read:
159.24 	365.431 AMOUNT VOTED AT MEETING IS TAX LIMIT.
159.25 	Except as otherwise authorized by law,the tax for town
159.26 	purposes must not be more than the amount voted to be raised at
159.27 	the annual town meeting.

159.28 	Sec. 16. Minnesota Statutes 2004, section 366.011, is
159.29 	amended to read:
159.30 	366.011 CHARGES FOR EMERGENCY SERVICES; COLLECTION.
159.31 	A town may impose a reasonable service charge for emergency
159.32 	services, including fire, rescue, medical, and related services
159.33 	provided by the town or contracted for by the town.  If the
159.34 	service charge remains unpaid 30 days after a notice of
159.35 	delinquency is sent to the recipient of the service or the
159.36 	recipient's representative or estate, the town or its contractor
160.1 	on behalf of the town may use any lawful means allowed to a
160.2 	private party for the collection of an unsecured delinquent
160.3 	debt.  The town may also use the authority of section 366.012 to
160.4 	collect unpaid service charges of this kind from delinquent
160.5 	recipients of services who are owners of taxable real property
160.6 	in the town state.
160.7 	The powers conferred by this section are in addition and
160.8 	supplemental to the powers conferred by any other law for a town
160.9 	to impose a service charge or assessment for a service provided
160.10 	by the town or contracted for by the town.

160.11 	EFFECTIVE DATE. This section is effective the day
160.12 	following final enactment.

160.13 	Sec. 17. Minnesota Statutes 2004, section 366.012, is
160.14 	amended to read:
160.15 	366.012 COLLECTION OF UNPAID SERVICE CHARGES.
160.16 	If a town is authorized to impose a service charge on the
160.17 	owner, lessee, or occupant of property, or any of them,for a
160.18 	governmental service provided by the town, the town board may
160.19 	certify to the county auditor of the county in which the
160.20 	recipient of the services owns real property, on or before
160.21 	October 15 for each year, any unpaid service charges which shall
160.22 	then be collected together with property taxes levied against
160.23 	the property. The county auditor shall remit to the town all
160.24 	service charges collected by the auditor on behalf of the town.
160.25 	A charge may be certified to the auditor only if, on or before
160.26 	September 15, the town has given written notice to the property
160.27 	owner of its intention to certify the charge to the auditor.
160.28 	The service charges shall be subject to the same penalties,
160.29 	interest, and other conditions provided for the collection of
160.30 	property taxes.  This section is in addition to other law
160.31 	authorizing the collection of unpaid costs and service charges.

160.32 	EFFECTIVE DATE. This section is effective the day
160.33 	following final enactment.

160.34 	Sec. 18. Laws 1998, chapter 389, article 3, section 42,
160.35 	subdivision 2, as amended by Laws 2002, chapter 377, article 4,
160.36 	section 24, is amended to read:
161.1 		Subd. 2.Recapture. (a) Property or any portion thereof
161.2 	qualifying under section 38 is subject to additional taxes if:
161.3 	(1) ownership of the property is transferred to anyone
161.4 	other than the spouse or child of the current owner;
161.5 	(2) the current owner or the spouse or child of the current
161.6 	owner has not conveyed or entered into a contract before July 1,
161.7 	2007, to convey for ownership or public easement rights, (i) a
161.8 	portion of the property to a one or more nonprofit foundation 
161.9 	foundations or corporation operating corporations; and (ii) a
161.10 	portion of the property to one or more local governments; and
161.11 	those entities shall separately or jointly operate the property
161.12 	as an art park providing the services included in section 38,
161.13 	clauses (2) to (5), and may also use some of the property for
161.14 	other public purposes as determined by the local governments; or
161.15 	(3) the nonprofit foundation or corporation to which a
161.16 	portion of the property was transferred ceases to provide the
161.17 	services included in section 38, clauses (2) to (5), earlier
161.18 	than ten years following the effective date of the conveyance 
161.19 	conveyances or of the execution of the contract contracts to
161.20 	convey.
161.21 	(b) The additional taxes are imposed at the earlier of (1)
161.22 	the year following transfer of ownership to anyone other than
161.23 	the spouse or child of the current owner or a nonprofit
161.24 	foundation or corporation or local government operating the
161.25 	property as an art park and used for other public purposes, or
161.26 	(2) for taxes payable in 2008, or (3) in the event the nonprofit
161.27 	foundation or corporation to which a portion of the property was
161.28 	conveyed ceases to provide the required services within ten
161.29 	years after the conveyance, for taxes payable in the year
161.30 	following the year when it ceased to do so.
161.31 	The county board, with the approval of the city council,
161.32 	shall determine the amount of the additional taxes due on the
161.33 	portion of property which is no longer utilized as an art park;
161.34 	provided, however, that the additional taxes are equal to must
161.35 	not be greater than the difference between the taxes determined
161.36 	on that portion of the property utilized as an art park under
162.1 	sections 39 and 40 and the amount determined under subdivision 1
162.2 	for all years that the property qualified under section 38. The
162.3 	additional taxes must be extended against the property on the
162.4 	tax list for the current year; provided, however, that No
162.5 	interest or penalties may be levied on the additional taxes if
162.6 	timely paid amount provided that it is paid within 30 days of
162.7 	the county's notice.
162.8 	
EFFECTIVE DATE. This section is effective March 1, 2005.

162.9 	Sec. 19. Laws 2001, First Special Session chapter 5,
162.10 	article 3, section 8, the effective date, is amended to read:

162.11 	EFFECTIVE DATE. This section is effective for taxes
162.12 	levied in 2002, payable in 2003, through taxes levied in 2007 
162.13 	2009, payable in 2008 2010.

162.14 	Sec. 20. Laws 2005, chapter 43, section 1, the effective
162.15 	date, is amended to read:

162.16 	EFFECTIVE DATE. This section is effective for taxes
162.17 	levied in 2005 2004, payable in 2006 2005, and thereafter.
162.18 	EFFECTIVE DATE.This section is effective the day
162.19 	following final enactment.

162.20 	Sec. 21. SCHOOL PROPERTY; EXEMPTION 2005 ONLY.
 162.21 	Notwithstanding Minnesota Statutes, section 272.02,
162.22 	subdivision 38, paragraph (b), the following property is exempt
162.23 	from taxation for assessment year 2004, for taxes payable in
162.24 	2005, if it meets all the following criteria:
162.25 	(1) is used to provide direct educational instruction for
162.26 	grades 7 through 10;
162.27 	(2) is located in a city of the first class that has a
162.28 	population greater than 250,000 and less than 350,000;
162.29 	(3) was purchased after July 1, 2004, by a nonprofit that
162.30 	is exempt from federal income tax under section 501(c)(3) of the
162.31 	Internal Revenue Code; and 
162.32 	(4) is leased and operated by two nonprofit corporations
162.33 	organized under Minnesota Statutes, chapter 317A.

162.34 	EFFECTIVE DATE. This section is effective the day
162.35 	following final enactment.

162.36 	Sec. 22. REPEALER.
 163.1 	Laws 1998, chapter 389, article 3, section 41, is repealed.

163.2 	EFFECTIVE DATE. This section is effective the day
163.3 	following final enactment.

163.4 	ARTICLE 4
163.5 	PROPERTY TAX AIDS AND CREDITS

163.6 	Section 1. Minnesota Statutes 2004, section 4A.02, is
163.7 	amended to read:
163.8 	4A.02 STATE DEMOGRAPHER.
163.9 	(a) The director shall appoint a state demographer.  The
163.10 	demographer must be professionally competent in demography and
163.11 	must possess demonstrated ability based upon past performance.
163.12 	(b) The demographer shall:
163.13 	(1) continuously gather and develop demographic data
163.14 	relevant to the state;
163.15 	(2) design and test methods of research and data
163.16 	collection;
163.17 	(3) periodically prepare population projections for the
163.18 	state and designated regions and periodically prepare
163.19 	projections for each county or other political subdivision of
163.20 	the state as necessary to carry out the purposes of this
163.21 	section;
163.22 	(4) review, comment on, and prepare analysis of population
163.23 	estimates and projections made by state agencies, political
163.24 	subdivisions, other states, federal agencies, or nongovernmental
163.25 	persons, institutions, or commissions;
163.26 	(5) serve as the state liaison with the United States
163.27 	Bureau of the Census, coordinate state and federal demographic
163.28 	activities to the fullest extent possible, and aid the
163.29 	legislature in preparing a census data plan and form for each
163.30 	decennial census;
163.31 	(6) compile an annual study of population estimates on the
163.32 	basis of county, regional, or other political or geographical
163.33 	subdivisions as necessary to carry out the purposes of this
163.34 	section and section 4A.03;
163.35 	(7) by January 1 of each year, issue a report to the
163.36 	legislature containing an analysis of the demographic
164.1 	implications of the annual population study and population
164.2 	projections;
164.3 	(8) prepare maps for all counties in the state, all
164.4 	municipalities with a population of 10,000 or more, and other
164.5 	municipalities as needed for census purposes, according to scale
164.6 	and detail recommended by the United States Bureau of the
164.7 	Census, with the maps of cities showing precinct boundaries;
164.8 	(9) prepare an estimate of population and of the number of
164.9 	households for each governmental subdivision for which the
164.10 	Metropolitan Council does not prepare an annual estimate, and
164.11 	convey the estimates to the governing body of each political
164.12 	subdivision by May June 1 of each year;
164.13 	(10) direct, under section 414.01, subdivision 14, and
164.14 	certify population and household estimates of annexed or
164.15 	detached areas of municipalities or towns after being notified
164.16 	of the order or letter of approval by the director;
164.17 	(11) prepare, for any purpose for which a population
164.18 	estimate is required by law or needed to implement a law, a
164.19 	population estimate of a municipality or town whose population
164.20 	is affected by action under section 379.02 or 414.01,
164.21 	subdivision 14; and
164.22 	(12) prepare an estimate of average household size for each
164.23 	statutory or home rule charter city with a population of 2,500
164.24 	or more by May June 1 of each year.
164.25 	(c) A governing body may challenge an estimate made under
164.26 	paragraph (b) by filing their specific objections in writing
164.27 	with the state demographer by June 10 24.  If the challenge does
164.28 	not result in an acceptable estimate by June 24, the governing
164.29 	body may have a special census conducted by the United States
164.30 	Bureau of the Census.  The political subdivision must notify the
164.31 	state demographer by July 1 of its intent to have the special
164.32 	census conducted.  The political subdivision must bear all costs
164.33 	of the special census.  Results of the special census must be
164.34 	received by the state demographer by the next April 15 to be
164.35 	used in that year's May June 1 estimate to the political
164.36 	subdivision under paragraph (b).
165.1 	(d) The state demographer shall certify the estimates of
165.2 	population and household size to the commissioner of revenue by
165.3 	July 15 each year, including any estimates still under objection.

165.4 	EFFECTIVE DATE. This section is effective the day
165.5 	following final enactment.

165.6 	Sec. 2. Minnesota Statutes 2004, section 273.1384,
165.7 	subdivision 1, is amended to read:
165.8 		Subdivision 1.Residential homestead market value
165.9 	credit.  Each county auditor shall determine a homestead credit
165.10 	for each class 1a, 1b, 1c, and 2a homestead property within the
165.11 	county equal to 0.4 percent of the first $76,000 of market value
165.12 	of the property.  The amount of homestead credit for a homestead
165.13 	may not exceed $304 and is reduced by minus.09 percent of the
165.14 	market value in excess of $76,000. The credit amount may not be
165.15 	less than zero.In the case of an agricultural or resort
165.16 	homestead, only the market value of the house, garage, and
165.17 	immediately surrounding one acre of land is eligible in
165.18 	determining the property's homestead credit.  In the case of a
165.19 	property which is classified as part homestead and part
165.20 	nonhomestead, (i) the credit shall apply only to the homestead
165.21 	portion of the property., but (ii) if a portion of a property is
165.22 	classified as nonhomestead solely because not all the owners
165.23 	occupy the property, or solely because both spouses do not
165.24 	occupy the property, the credit amount shall be initially
165.25 	computed as if that nonhomestead portion were also in the
165.26 	homestead class and then prorated to the owner-occupant's
165.27 	percentage of ownership or prorated to one-half if both spouses
165.28 	do not occupy the property.
165.29 	
EFFECTIVE DATE. This section is effective for taxes
165.30 	payable in 2006 and thereafter.

165.31 	Sec. 3. Minnesota Statutes 2004, section 276A.01,
165.32 	subdivision 7, is amended to read:
165.33 		Subd. 7.Population.  "Population" means the most recent
165.34 	estimate of the population of a municipality made by the state
165.35 	demographer and filed with the commissioner of revenue as of
165.36 	July 1 15 of the year in which a municipality's distribution net
166.1 	tax capacity is calculated.  The state demographer shall
166.2 	annually estimate the population of each municipality and, in
166.3 	the case of a municipality which is located partly within and
166.4 	partly without the area, the proportion of the total which
166.5 	resides within the area, and shall file the estimates with the
166.6 	commissioner of revenue.
166.7 	
EFFECTIVE DATE. This section is effective the day
166.8 	following final enactment.

166.9 	Sec. 4. [473.24] POPULATION ESTIMATES.
166.10 	(a) The Metropolitan Council shall annually prepare an
166.11 	estimate of population for each county, city, and town in the
166.12 	metropolitan area and an estimate of the number of households
166.13 	and average household size for each city in the metropolitan
166.14 	area with a population of 2,500 or more, and an estimate of
166.15 	population over age 65 for each county in the metropolitan area,
166.16 	and convey the estimates to the governing body of each county,
166.17 	city, or town by June 1 each year.  In the case of a city or
166.18 	town that is located partly within and partly without the
166.19 	metropolitan area, the Metropolitan Council shall estimate the
166.20 	proportion of the total population and the average size of
166.21 	households that reside within the area.  The Metropolitan
166.22 	Council may prepare an estimate of the population and of the
166.23 	average household size for any other political subdivision
166.24 	located in the metropolitan area.
166.25 	(b) A governing body may challenge an estimate made under
166.26 	this section by filing its specific objections in writing with
166.27 	the Metropolitan Council by June 24.  If the challenge does not
166.28 	result in an acceptable estimate, the governing body may have a
166.29 	special census conducted by the United States Bureau of the
166.30 	Census.  The political subdivision must notify the Metropolitan
166.31 	Council on or before July 1 of its intent to have the special
166.32 	census conducted.  The political subdivision must bear all costs
166.33 	of the special census.  Results of the special census must be
166.34 	received by the Metropolitan Council by the next April 15 to be
166.35 	used in that year's June 1 estimate under this section.  The
166.36 	Metropolitan Council shall certify the estimates of population
167.1 	and the average household size to the state demographer and to
167.2 	the commissioner of revenue by July 15 each year, including any
167.3 	estimates still under objection.

167.4 	EFFECTIVE DATE. This section is effective the day
167.5 	following final enactment.

167.6 	Sec. 5. Minnesota Statutes 2004, section 473F.02,
167.7 	subdivision 7, is amended to read:
167.8 		Subd. 7.Population.  "Population" means the most recent
167.9 	estimate of the population of a municipality made by the
167.10 	Metropolitan Council under section 473.24and filed with the
167.11 	commissioner of revenue as of July 1 15 of the year in which a
167.12 	municipality's distribution net tax capacity is calculated. The
167.13 	council shall annually estimate the population of each
167.14 	municipality as of a date which it determines and, in the case
167.15 	of a municipality which is located partly within and partly
167.16 	without the area, the proportion of the total which resides
167.17 	within the area, and shall promptly thereafter file its
167.18 	estimates with the commissioner of revenue.
167.19 	
EFFECTIVE DATE. This section is effective the day
167.20 	following final enactment.

167.21 	Sec. 6. Minnesota Statutes 2004, section 477A.011,
167.22 	subdivision 3, is amended to read:
167.23 		Subd. 3.Population.  "Population" means the
167.24 	population estimated or established as of July 1 15 in an aid
167.25 	calculation year by the most recent federal census, by a special
167.26 	census conducted under contract with the United States Bureau of
167.27 	the Census, by a population estimate made by the Metropolitan
167.28 	Council pursuant to section 473.24, or by a population estimate
167.29 	of the state demographer made pursuant to section 4A.02,
167.30 	whichever is the most recent as to the stated date of the count
167.31 	or estimate for the preceding calendar year, and which has been
167.32 	certified to the commissioner of revenue on or before July 15 of
167.33 	the aid calculation year.  The term "per capita" refers to
167.34 	population as defined by this subdivision. A revision of an
167.35 	estimate or count is effective for these purposes only if it is
167.36 	certified to the commissioner on or before July 15 of the aid
168.1 	calculation year.  Clerical errors in the certification or use
168.2 	of the estimates and counts established as of July 15 in the aid
168.3 	calculation year are subject to correction within the time
168.4 	periods allowed under section 477A.014.
168.5 	
EFFECTIVE DATE. This section is effective the day
168.6 	following final enactment.

168.7 	Sec. 7. Minnesota Statutes 2004, section 477A.011,
168.8 	subdivision 34, is amended to read:
168.9 		Subd. 34.City revenue need.  (a) For a city with a
168.10 	population equal to or greater than 2,500, "city revenue need"
168.11 	is the sum of (1) 5.0734098 times the pre-1940 housing
168.12 	percentage; plus (2) 19.141678 times the population decline
168.13 	percentage; plus (3) 2504.06334 times the road accidents factor;
168.14 	plus (4) 355.0547; minus (5) the metropolitan area factor; minus
168.15 	(6) 49.10638 times the household size.
168.16 	(b) For a city with a population less than 2,500, "city
168.17 	revenue need" is the sum of (1) 2.387 times the pre-1940 housing
168.18 	percentage; plus (2) 2.67591 times the commercial industrial
168.19 	percentage; plus (3) 3.16042 times the population decline
168.20 	percentage; plus (4) 1.206 times the transformed population;
168.21 	minus (5) 62.772.
168.22 	(c) For a city with a population of 2,500 or more and a
168.23 	population in one of the most recently available five years that
168.24 	was less than 2,500, "city revenue need" is the sum of (1) its
168.25 	city revenue need calculated under paragraph (a) multiplied by
168.26 	its transition factor; plus (2) its city revenue need calculated
168.27 	under the formula in paragraph (b) multiplied by the difference
168.28 	between one and its transition factor.  For purposes of this
168.29 	paragraph, a city's "transition factor" is equal to 0.2
168.30 	multiplied by the number of years that the city's population
168.31 	estimate has been 2,500 or more.  This provision only applies
168.32 	for aids payable in calendar years 2006 to 2008 to cities with a
168.33 	2002 population of less than 2,500.  It applies to any city for
168.34 	aids payable in 2009 and thereafter.
168.35 	(d) The city revenue need cannot be less than zero.
168.36 	(d) (e) For calendar year 2005 and subsequent years, the
169.1 	city revenue need for a city, as determined in paragraphs (a)
169.2 	to (c) (d), is multiplied by the ratio of the annual implicit
169.3 	price deflator for government consumption expenditures and gross
169.4 	investment for state and local governments as prepared by the
169.5 	United States Department of Commerce, for the most recently
169.6 	available year to the 2003 implicit price deflator for state and
169.7 	local government purchases.
169.8 	
EFFECTIVE DATE. This section is effective beginning with
169.9 	aids payable in 2006.

169.10 	Sec. 8. Minnesota Statutes 2004, section 477A.011,
169.11 	subdivision 36, as amended by Laws 2005, chapter 38, section 1,
169.12 	is amended to read:
169.13 		Subd. 36.City aid base. (a) Except as otherwise
169.14 	provided in this subdivision, "city aid base" is zero.
169.15 	(b) The city aid base for any city with a population less
169.16 	than 500 is increased by $40,000 for aids payable in calendar
169.17 	year 1995 and thereafter, and the maximum amount of total aid it
169.18 	may receive under section 477A.013, subdivision 9, paragraph
169.19 	(c), is also increased by $40,000 for aids payable in calendar
169.20 	year 1995 only, provided that:
169.21 	(i) the average total tax capacity rate for taxes payable
169.22 	in 1995 exceeds 200 percent;
169.23 	(ii) the city portion of the tax capacity rate exceeds 100
169.24 	percent; and
169.25 	(iii) its city aid base is less than $60 per capita.
169.26 	(c) The city aid base for a city is increased by $20,000 in
169.27 	1998 and thereafter and the maximum amount of total aid it may
169.28 	receive under section 477A.013, subdivision 9, paragraph (c), is
169.29 	also increased by $20,000 in calendar year 1998 only, provided
169.30 	that:
169.31 	(i) the city has a population in 1994 of 2,500 or more;
169.32 	(ii) the city is located in a county, outside of the
169.33 	metropolitan area, which contains a city of the first class;
169.34 	(iii) the city's net tax capacity used in calculating its
169.35 	1996 aid under section 477A.013 is less than $400 per capita;
169.36 	and
170.1 	(iv) at least four percent of the total net tax capacity,
170.2 	for taxes payable in 1996, of property located in the city is
170.3 	classified as railroad property.
170.4 	(d) The city aid base for a city is increased by $200,000
170.5 	in 1999 and thereafter and the maximum amount of total aid it
170.6 	may receive under section 477A.013, subdivision 9, paragraph
170.7 	(c), is also increased by $200,000 in calendar year 1999 only,
170.8 	provided that:
170.9 	(i) the city was incorporated as a statutory city after
170.10 	December 1, 1993;
170.11 	(ii) its city aid base does not exceed $5,600; and
170.12 	(iii) the city had a population in 1996 of 5,000 or more.
170.13 	(e) The city aid base for a city is increased by $450,000
170.14 	in 1999 to 2008 and the maximum amount of total aid it may
170.15 	receive under section 477A.013, subdivision 9, paragraph (c), is
170.16 	also increased by $450,000 in calendar year 1999 only, provided
170.17 	that:
170.18 	(i) the city had a population in 1996 of at least 50,000;
170.19 	(ii) its population had increased by at least 40 percent in
170.20 	the ten-year period ending in 1996; and
170.21 	(iii) its city's net tax capacity for aids payable in 1998
170.22 	is less than $700 per capita.
170.23 	(f) The city aid base for a city is increased by $150,000
170.24 	for aids payable in 2000 and thereafter, and the maximum amount
170.25 	of total aid it may receive under section 477A.013, subdivision
170.26 	9, paragraph (c), is also increased by $150,000 in calendar year
170.27 	2000 only, provided that:
170.28 	(1) the city has a population that is greater than 1,000
170.29 	and less than 2,500;
170.30 	(2) its commercial and industrial percentage for aids
170.31 	payable in 1999 is greater than 45 percent; and
170.32 	(3) the total market value of all commercial and industrial
170.33 	property in the city for assessment year 1999 is at least 15
170.34 	percent less than the total market value of all commercial and
170.35 	industrial property in the city for assessment year 1998.
170.36 	(g) The city aid base for a city is increased by $200,000
171.1 	in 2000 and thereafter, and the maximum amount of total aid it
171.2 	may receive under section 477A.013, subdivision 9, paragraph
171.3 	(c), is also increased by $200,000 in calendar year 2000 only,
171.4 	provided that:
171.5 	(1) the city had a population in 1997 of 2,500 or more;
171.6 	(2) the net tax capacity of the city used in calculating
171.7 	its 1999 aid under section 477A.013 is less than $650 per
171.8 	capita;
171.9 	(3) the pre-1940 housing percentage of the city used in
171.10 	calculating 1999 aid under section 477A.013 is greater than 12
171.11 	percent;
171.12 	(4) the 1999 local government aid of the city under section
171.13 	477A.013 is less than 20 percent of the amount that the formula
171.14 	aid of the city would have been if the need increase percentage
171.15 	was 100 percent; and
171.16 	(5) the city aid base of the city used in calculating aid
171.17 	under section 477A.013 is less than $7 per capita.
171.18 	(h) The city aid base for a city is increased by $102,000
171.19 	in 2000 and thereafter, and the maximum amount of total aid it
171.20 	may receive under section 477A.013, subdivision 9, paragraph
171.21 	(c), is also increased by $102,000 in calendar year 2000 only,
171.22 	provided that:
171.23 	(1) the city has a population in 1997 of 2,000 or more;
171.24 	(2) the net tax capacity of the city used in calculating
171.25 	its 1999 aid under section 477A.013 is less than $455 per
171.26 	capita;
171.27 	(3) the net levy of the city used in calculating 1999 aid
171.28 	under section 477A.013 is greater than $195 per capita; and
171.29 	(4) the 1999 local government aid of the city under section
171.30 	477A.013 is less than 38 percent of the amount that the formula
171.31 	aid of the city would have been if the need increase percentage
171.32 	was 100 percent.
171.33 	(i) The city aid base for a city is increased by $32,000 in
171.34 	2001 and thereafter, and the maximum amount of total aid it may
171.35 	receive under section 477A.013, subdivision 9, paragraph (c), is
171.36 	also increased by $32,000 in calendar year 2001 only, provided
172.1 	that:
172.2 	(1) the city has a population in 1998 that is greater than
172.3 	200 but less than 500;
172.4 	(2) the city's revenue need used in calculating aids
172.5 	payable in 2000 was greater than $200 per capita;
172.6 	(3) the city net tax capacity for the city used in
172.7 	calculating aids available in 2000 was equal to or less than
172.8 	$200 per capita;
172.9 	(4) the city aid base of the city used in calculating aid
172.10 	under section 477A.013 is less than $65 per capita; and
172.11 	(5) the city's formula aid for aids payable in 2000 was
172.12 	greater than zero.
172.13 	(j) The city aid base for a city is increased by $7,200 in
172.14 	2001 and thereafter, and the maximum amount of total aid it may
172.15 	receive under section 477A.013, subdivision 9, paragraph (c), is
172.16 	also increased by $7,200 in calendar year 2001 only, provided
172.17 	that:
172.18 	(1) the city had a population in 1998 that is greater than
172.19 	200 but less than 500;
172.20 	(2) the city's commercial industrial percentage used in
172.21 	calculating aids payable in 2000 was less than ten percent;
172.22 	(3) more than 25 percent of the city's population was 60
172.23 	years old or older according to the 1990 census;
172.24 	(4) the city aid base of the city used in calculating aid
172.25 	under section 477A.013 is less than $15 per capita; and
172.26 	(5) the city's formula aid for aids payable in 2000 was
172.27 	greater than zero.
172.28 	(k) The city aid base for a city is increased by $45,000 in
172.29 	2001 and thereafter and by an additional $50,000 in calendar
172.30 	years 2002 to 2011, and the maximum amount of total aid it may
172.31 	receive under section 477A.013, subdivision 9, paragraph (c), is
172.32 	also increased by $45,000 in calendar year 2001 only, and by
172.33 	$50,000 in calendar year 2002 only, provided that:
172.34 	(1) the net tax capacity of the city used in calculating
172.35 	its 2000 aid under section 477A.013 is less than $810 per
172.36 	capita;
173.1 	(2) the population of the city declined more than two
173.2 	percent between 1988 and 1998;
173.3 	(3) the net levy of the city used in calculating 2000 aid
173.4 	under section 477A.013 is greater than $240 per capita; and
173.5 	(4) the city received less than $36 per capita in aid under
173.6 	section 477A.013, subdivision 9, for aids payable in 2000.
173.7 	(l) The city aid base for a city with a population of
173.8 	10,000 or more which is located outside of the seven-county
173.9 	metropolitan area is increased in 2002 and thereafter, and the
173.10 	maximum amount of total aid it may receive under section
173.11 	477A.013, subdivision 9, paragraph (b) or (c), is also increased
173.12 	in calendar year 2002 only, by an amount equal to the lesser of:
173.13 	(1)(i) the total population of the city, as determined by
173.14 	the United States Bureau of the Census, in the 2000 census, (ii)
173.15 	minus 5,000, (iii) times 60; or
173.16 	(2) $2,500,000.
173.17 	(m) The city aid base is increased by $50,000 in 2002 and
173.18 	thereafter, and the maximum amount of total aid it may receive
173.19 	under section 477A.013, subdivision 9, paragraph (c), is also
173.20 	increased by $50,000 in calendar year 2002 only, provided that:
173.21 	(1) the city is located in the seven-county metropolitan
173.22 	area;
173.23 	(2) its population in 2000 is between 10,000 and 20,000;
173.24 	and
173.25 	(3) its commercial industrial percentage, as calculated for
173.26 	city aid payable in 2001, was greater than 25 percent.
173.27 	(n) The city aid base for a city is increased by $150,000
173.28 	in calendar years 2002 to 2011 and the maximum amount of total
173.29 	aid it may receive under section 477A.013, subdivision 9,
173.30 	paragraph (c), is also increased by $150,000 in calendar year
173.31 	2002 only, provided that:
173.32 	(1) the city had a population of at least 3,000 but no more
173.33 	than 4,000 in 1999;
173.34 	(2) its home county is located within the seven-county
173.35 	metropolitan area;
173.36 	(3) its pre-1940 housing percentage is less than 15
174.1 	percent; and
174.2 	(4) its city net tax capacity per capita for taxes payable
174.3 	in 2000 is less than $900 per capita.
174.4 	(o) The city aid base for a city is increased by $200,000
174.5 	beginning in calendar year 2003 and the maximum amount of total
174.6 	aid it may receive under section 477A.013, subdivision 9,
174.7 	paragraph (c), is also increased by $200,000 in calendar year
174.8 	2003 only, provided that the city qualified for an increase in
174.9 	homestead and agricultural credit aid under Laws 1995, chapter
174.10 	264, article 8, section 18.
174.11 	(p) The city aid base for a city is increased by $200,000
174.12 	in 2004 only and the maximum amount of total aid it may receive
174.13 	under section 477A.013, subdivision 9, is also increased by
174.14 	$200,000 in calendar year 2004 only, if the city is the site of
174.15 	a nuclear dry cask storage facility.
174.16 	(q) The city aid base for a city is increased by $10,000 in
174.17 	2004 and thereafter and the maximum total aid it may receive
174.18 	under section 477A.013, subdivision 9, is also increased by
174.19 	$10,000 in calendar year 2004 only, if the city was included in
174.20 	a federal major disaster designation issued on April 1, 1998,
174.21 	and its pre-1940 housing stock was decreased by more than 40
174.22 	percent between 1990 and 2000.
174.23 	(r) The city aid base for a city is increased by $25,000 in
174.24 	2006 only and the maximum total aid it may receive under section
174.25 	477A.013, subdivision 9, is also increased by $25,000 in
174.26 	calendar year 2006 only if the city had a population in 2003 of
174.27 	at least 1,000 and has a state park for which the city provides
174.28 	rescue services and which comprised at least 14 percent of the
174.29 	total geographic area included within the city boundaries in
174.30 	2000.
174.31 	
EFFECTIVE DATE. This section is effective for aids
174.32 	payable in 2006 and thereafter.

174.33 	Sec. 9. Minnesota Statutes 2004, section 477A.011,
174.34 	subdivision 38, is amended to read:
174.35 		Subd. 38.Household size.  "Household size" means the
174.36 	average number of persons per household in the jurisdiction as
175.1 	most recently estimated and reported by the state
175.2 	demographer and Metropolitan Council as of July 1 15 of the aid
175.3 	calculation year. A revision to an estimate or enumeration is
175.4 	effective for these purposes only if it is certified to the
175.5 	commissioner on or before July 15 of the aid calculation year.
175.6 	Clerical errors in the certification or use of estimates and
175.7 	counts established as of July 15 in the aid calculation year are
175.8 	subject to correction within the time periods allowed under
175.9 	section 477A.014.
175.10 	
EFFECTIVE DATE. This section is effective the day
175.11 	following final enactment.

175.12 	Sec. 10. Minnesota Statutes 2004, section 477A.0124,
175.13 	subdivision 2, is amended to read:
175.14 		Subd. 2.Definitions.  (a) For the purposes of this
175.15 	section, the following terms have the meanings given them.
175.16 	(b) "County program aid" means the sum of "county need aid,"
175.17 	"county tax base equalization aid," and "county transition aid."
175.18 	(c) "Age-adjusted population" means a county's population
175.19 	multiplied by the county age index.
175.20 	(d) "County age index" means the percentage of the
175.21 	population over age 65 within the county divided by the
175.22 	percentage of the population over age 65 within the state,
175.23 	except that the age index for any county may not be greater than
175.24 	1.8 nor less than 0.8.
175.25 	(e) "Population over age 65" means the population over age
175.26 	65 established as of July 1 15 in an aid calculation year by the
175.27 	most recent federal census, by a special census conducted under
175.28 	contract with the United States Bureau of the Census, by a
175.29 	population estimate made by the Metropolitan Council, or by a
175.30 	population estimate of the state demographer made pursuant to
175.31 	section 4A.02, whichever is the most recent as to the stated
175.32 	date of the count or estimate for the preceding calendar
175.33 	year and which has been certified to the commissioner of revenue
175.34 	on or before July 15 of the aid calculation year. A revision to
175.35 	an estimate or count is effective for these purposes only if
175.36 	certified to the commissioner on or before July 15 of the aid
176.1 	calculation year.  Clerical errors in the certification or use
176.2 	of estimates and counts established as of July 15 in the aid
176.3 	calculation year are subject to correction within the time
176.4 	periods allowed under section 477A.014.
176.5 	(f) "Part I crimes" means the three-year average annual
176.6 	number of Part I crimes reported for each county by the
176.7 	Department of Public Safety for the most recent years available.
176.8 	By July 1 of each year, the commissioner of public safety shall
176.9 	certify to the commissioner of revenue the number of Part I
176.10 	crimes reported for each county for the three most recent
176.11 	calendar years available.
176.12 	(g) "Households receiving food stamps" means the average
176.13 	monthly number of households receiving food stamps for the three
176.14 	most recent years for which data is available.  By July 1 of
176.15 	each year, the commissioner of human services must certify to
176.16 	the commissioner of revenue the average monthly number of
176.17 	households in the state and in each county that receive food
176.18 	stamps, for the three most recent calendar years available.
176.19 	(h) "County net tax capacity" means the net tax capacity of
176.20 	the county, computed analogously to city net tax capacity under
176.21 	section 477A.011, subdivision 20.
176.22 	
EFFECTIVE DATE. This section is effective the day
176.23 	following final enactment.

176.24 	Sec. 11. Minnesota Statutes 2004, section 477A.0124,
176.25 	subdivision 4, is amended to read:
176.26 		Subd. 4.County tax-base equalization aid.  (a) For
176.27 	2005 2006 and subsequent years, the money appropriated to county
176.28 	tax-base equalization aid each calendar year, after the payment
176.29 	under paragraph (f),shall be apportioned among the counties
176.30 	according to each county's tax-base equalization aid factor.
176.31 	(b) A county's tax-base equalization aid factor is equal to
176.32 	the amount by which (i) $185 times the county's population,
176.33 	exceeds (ii) 9.45 percent of the county's net tax capacity.
176.34 	(c) In the case of a county with a population less than
176.35 	10,000, the factor determined in paragraph (b) shall be
176.36 	multiplied by a factor of three.
177.1 	(d) In the case of a county with a population greater than
177.2 	or equal to 10,000, but less than 12,500, the factor determined
177.3 	in paragraph (b) shall be multiplied by a factor of two.
177.4 	(e) In the case of a county with a population greater than
177.5 	500,000, the factor determined in paragraph (b) shall be
177.6 	multiplied by a factor of 0.25.
177.7 	(f) Before the money appropriated to county base
177.8 	equalization aid is apportioned among the counties as provided
177.9 	in paragraph (a), an amount up to $73,259 is allocated annually
177.10 	to Anoka County and up to $59,664 is annually allocated to
177.11 	Washington County for the county to pay postretirement costs of
177.12 	health insurance premiums for court employees.  The allocation
177.13 	under this paragraph is in addition to the allocations under
177.14 	paragraphs (a) to (e).
177.15 	
EFFECTIVE DATE. This section is effective for aids
177.16 	payable in 2006 and thereafter.

177.17 	Sec. 12. Minnesota Statutes 2004, section 477A.03,
177.18 	subdivision 2b, is amended to read:
177.19 		Subd. 2b.Counties.  (a) For aids payable in calendar
177.20 	year 2005 and thereafter, the total aids paid to counties under
177.21 	section 477A.0124, subdivision 3, are limited to $100,500,000.
177.22 	Each calendar year, $500,000 shall be retained by the
177.23 	commissioner of revenue to make reimbursements to the
177.24 	commissioner of finance for payments made under section 611.27.
177.25 	For calendar year 2004, the amount shall be in addition to the
177.26 	payments authorized under section 477A.0124, subdivision 1.  For
177.27 	calendar year 2005 and subsequent years, the amount shall be
177.28 	deducted from the appropriation under this paragraph.  The
177.29 	reimbursements shall be to defray the additional costs
177.30 	associated with court-ordered counsel under section 611.27.  Any
177.31 	retained amounts not used for reimbursement in a year shall be
177.32 	included in the next distribution of county need aid that is
177.33 	certified to the county auditors for the purpose of property tax
177.34 	reduction for the next taxes payable year.
177.35 	(b) For aids payable in 2005 and thereafter 2006, the total
177.36 	aids under section 477A.0124, subdivision 4, are limited to
178.1 	$105,000,000. For aids payable in 2007 and thereafter, the
178.2 	total aid under section 477A.0124, subdivision 4, is limited to
178.3 	$105,132,923.The commissioner of finance shall bill the
178.4 	commissioner of revenue for the cost of preparation of local
178.5 	impact notes as required by section 3.987, not to exceed
178.6 	$207,000 in fiscal year 2004 and thereafter.  The commissioner
178.7 	of education shall bill the commissioner of revenue for the cost
178.8 	of preparation of local impact notes for school districts as
178.9 	required by section 3.987, not to exceed $7,000 in fiscal year
178.10 	2004 and thereafter.  The commissioner of revenue shall deduct
178.11 	the amounts billed under this paragraph from the appropriation
178.12 	under this paragraph.  The amounts deducted are appropriated to
178.13 	the commissioner of finance and the commissioner of education
178.14 	for the preparation of local impact notes.
178.15 	
EFFECTIVE DATE. This section is effective for aids
178.16 	payable in 2007 and thereafter.

178.17 	Sec. 13. Laws 2003, First Special Session chapter 21,
178.18 	article 5, section 13, is amended to read:
178.19 	Sec. 132004 CITY AID REDUCTIONS.
 178.20 	The commissioner of revenue shall compute an aid reduction
178.21 	amount for 2004 for each city as provided in this section.
178.22 	The initial aid reduction amount for each city is the
178.23 	amount by which the city's aid distribution under Minnesota
178.24 	Statutes, section 477A.013, and related provisions payable in
178.25 	2003 exceeds the city's 2004 distribution under those provisions.
178.26 	The minimum aid reduction amount for a city is the amount
178.27 	of its reduction in 2003 under section 12.  If a city receives
178.28 	an increase to its city aid base under Minnesota Statutes,
178.29 	section 477A.011, subdivision 36, its minimum aid reduction is
178.30 	reduced by an equal amount.
178.31 	The maximum aid reduction amount for a city is an amount
178.32 	equal to 14 percent of the city's total 2004 levy plus aid
178.33 	revenue base, except that if the city has a city net tax
178.34 	capacity for aids payable in 2004, as defined in Minnesota
178.35 	Statutes, section 477A.011, subdivision 20, of $700 per capita
178.36 	or less, the maximum aid reduction shall not exceed an amount
179.1 	equal to 13 percent of the city's total 2004 levy plus aid
179.2 	revenue base.
179.3 	If the initial aid reduction amount for a city is less than
179.4 	the minimum aid reduction amount for that city, the final aid
179.5 	reduction amount for the city is the sum of the initial aid
179.6 	reduction amount and the lesser of the amount of the city's
179.7 	payable 2004 reimbursement under Minnesota Statutes, section
179.8 	273.1384, or the difference between the minimum and initial aid
179.9 	reduction amounts for the city, and the amount of the final aid
179.10 	reduction in excess of the initial aid reduction is deducted
179.11 	from the city's reimbursements pursuant to Minnesota Statutes,
179.12 	section 273.1384.
179.13 	If the initial aid reduction amount for a city is greater
179.14 	than the maximum aid reduction amount for the city, the city
179.15 	receives an additional distribution under this section equal to
179.16 	the result of subtracting the maximum aid reduction amount from
179.17 	the initial aid reduction amount.  This distribution shall be
179.18 	paid in equal installments in 2004 on the dates specified in
179.19 	Minnesota Statutes, section 477A.015.  The amount necessary for
179.20 	these additional distributions is appropriated to the
179.21 	commissioner of revenue from the general fund in fiscal year
179.22 	2005.
179.23 	The initial aid reduction is applied to the city's
179.24 	distribution pursuant to Minnesota Statutes, section 477A.013,
179.25 	and any aid reduction in excess of the initial aid reduction is
179.26 	applied to the city's reimbursements pursuant to Minnesota
179.27 	Statutes, section 273.1384.
179.28 	To the extent that sufficient information is available on
179.29 	each payment date in 2004, the commissioner of revenue shall pay
179.30 	the reimbursements reduced under this section in equal
179.31 	installments on the payment dates provided in law.

179.32 	EFFECTIVE DATE. This section is effective for aids
179.33 	payable in 2004.

179.34 	Sec. 14. Laws 2003, First Special Session chapter 21,
179.35 	article 6, section 9, is amended to read:
179.36 	Sec. 9DEFINITIONS.
 180.1 	(a) For purposes of sections 9 to 15, the following terms
180.2 	have the meanings given them in this section.
180.3 	(b) The 2003 and 2004 "levy plus aid revenue base" for a
180.4 	county is the sum of that county's certified property tax levy
180.5 	for taxes payable in 2003, plus the sum of the amounts the
180.6 	county was certified to receive in the designated calendar year
180.7 	as:
180.8 	(1) homestead and agricultural credit aid under Minnesota
180.9 	Statutes, section 273.1398, subdivision 2, plus any additional
180.10 	aid under section 16, minus the amount calculated under section
180.11 	273.1398, subdivision 4a, paragraph (b), for counties in
180.12 	judicial districts one, three, six, and ten, and 25 percent of
180.13 	the amount calculated under section 273.1398, subdivision 4a,
180.14 	paragraph (b), for counties in judicial districts two and four;
180.15 	(2) the amount of county manufactured home homestead and
180.16 	agricultural credit aid computed for the county for payment in
180.17 	2003 under section 273.166;
180.18 	(3) criminal justice aid under Minnesota Statutes, section
180.19 	477A.0121;
180.20 	(4) family preservation aid under Minnesota Statutes,
180.21 	section 477A.0122;
180.22 	(5) taconite aids under Minnesota Statutes, sections 298.28
180.23 	and 298.282, including any aid which was required to be placed
180.24 	in a special fund for expenditure in the next succeeding year;
180.25 	and
180.26 	(6) county program aid under section 477A.0124, exclusive
180.27 	of the attached machinery aid component.

180.28 	EFFECTIVE DATE. This section is effective for aids
180.29 	payable in 2004.

180.30 	Sec. 15. COURT AID ADJUSTMENT.
 180.31 	For aids payable in 2005 only, the amount of court aid paid
180.32 	to Anoka County under Minnesota Statutes, section 273.1398,
180.33 	subdivision 4a, is increased by $36,630 for aids payable in 2005
180.34 	only and the amount paid to Washington County under Minnesota
180.35 	Statutes, section 273.1398, subdivision 4a, is increased by
180.36 	$29,832 for aids payable in 2005 only.

181.1 	EFFECTIVE DATE. This section is effective for aids
181.2 	payable in 2005 only.

181.3 	Sec. 16. DISTRICT COURTS BUDGET.
 181.4 	The district courts general fund appropriation is reduced
181.5 	by $66,462 in fiscal year 2006 and $132,923 beginning in fiscal
181.6 	year 2007 to fund the amount transferred to county tax base
181.7 	equalization aid to fund the payments under Minnesota Statutes,
181.8 	section 477A.0124, subdivision 4, paragraph (f), and section 15.

181.9 	EFFECTIVE DATE. This section is effective the day
181.10 	following final enactment.

181.11 	ARTICLE 5
181.12 	DEPARTMENT OF REVENUE PROPERTY TAXES

181.13 	Section 1. Minnesota Statutes 2004, section 168A.05,
181.14 	subdivision 1a, is amended to read:
181.15 		Subd. 1a.Manufactured home; statement of property tax
181.16 	payment.  In the case of a manufactured home as defined in
181.17 	section 327.31, subdivision 6, the department shall not issue a
181.18 	certificate of title unless the application under section
181.19 	168A.04 is accompanied with a statement from the county auditor
181.20 	or county treasurer where the manufactured home is presently
181.21 	located, stating that all manufactured home personal property
181.22 	taxes levied on the unit in the name of the current owner at the
181.23 	time of transfer have been paid. For this purpose, manufactured
181.24 	home personal property taxes are treated as levied on January 1
181.25 	of the payable year.
181.26 	
EFFECTIVE DATE. This section is effective the day
181.27 	following final enactment.

181.28 	Sec. 2. Minnesota Statutes 2004, section 270.11,
181.29 	subdivision 2, is amended to read:
181.30 		Subd. 2.County assessor's reports of assessment filed
181.31 	with commissioner.  Each county assessor shall file by April 1
181.32 	with the commissioner of revenue a copy of the abstract that
181.33 	will be acted upon by the local and county boards of review.
181.34 	The abstract must list the real and personal property in the
181.35 	county itemized by assessment districts.  The assessor of each
181.36 	county in the state shall file with the commissioner, within ten
182.1 	working days following final action of the local board of review
182.2 	or equalization and within five days following final action of
182.3 	the county board of equalization, any changes made by the local
182.4 	or county board.  The information must be filed in the manner
182.5 	prescribed by the commissioner.  It must be accompanied by a
182.6 	printed or typewritten copy of the proceedings of the
182.7 	appropriate board.
182.8 	The final abstract of assessments after adjustments by the
182.9 	State Board of Equalization and inclusion of any omitted
182.10 	property shall be submitted to the commissioner of revenue on or
182.11 	before September 1 of each calendar year.  The final abstract
182.12 	must separately report the captured tax capacity of tax
182.13 	increment financing districts under section 469.177, subdivision
182.14 	2, the metropolitan revenue areawide net tax capacity 
182.15 	contribution value values determined under section sections
182.16 	276A.05, subdivision 1, and 473F.07, subdivision 1,and the
182.17 	value subject to the power line credit under section 273.42.
182.18 	
EFFECTIVE DATE. This section is effective the day
182.19 	following final enactment.

182.20 	Sec. 3. Minnesota Statutes 2004, section 270.16,
182.21 	subdivision 2, is amended to read:
182.22 		Subd. 2.Failure to appraise.  When an assessor has
182.23 	failed to properly appraise at least one-quarter one-fifth of
182.24 	the parcels of property in a district or county as provided in
182.25 	section 273.01, the commissioner of revenue shall appoint a
182.26 	special assessor and deputy assessor as necessary and cause a
182.27 	reappraisal to be made of the property due for reassessment in
182.28 	accordance with law.
182.29 	
EFFECTIVE DATE. This section is effective the day
182.30 	following final enactment.

182.31 	Sec. 4. Minnesota Statutes 2004, section 272.01,
182.32 	subdivision 2, is amended to read:
182.33 		Subd. 2.Exempt property used by private entity for
182.34 	profit.  (a) When any real or personal property which is exempt
182.35 	from ad valorem taxes, and taxes in lieu thereof, is leased,
182.36 	loaned, or otherwise made available and used by a private
183.1 	individual, association, or corporation in connection with a
183.2 	business conducted for profit, there shall be imposed a tax, for
183.3 	the privilege of so using or possessing such real or personal
183.4 	property, in the same amount and to the same extent as though
183.5 	the lessee or user was the owner of such property.
183.6 	(b) The tax imposed by this subdivision shall not apply to:
183.7 	(1) property leased or used as a concession in or relative
183.8 	to the use in whole or part of a public park, market,
183.9 	fairgrounds, port authority, economic development authority
183.10 	established under chapter 469, municipal auditorium, municipal
183.11 	parking facility, municipal museum, or municipal stadium;
183.12 	(2) property of an airport owned by a city, town, county,
183.13 	or group thereof which is:
183.14 	(i) leased to or used by any person or entity including a
183.15 	fixed base operator; and
183.16 	(ii) used as a hangar for the storage or repair of aircraft
183.17 	or to provide aviation goods, services, or facilities to the
183.18 	airport or general public;
183.19 	the exception from taxation provided in this clause does not
183.20 	apply to:
183.21 	(i) property located at an airport owned or operated by the
183.22 	Metropolitan Airports Commission or by a city of over 50,000
183.23 	population according to the most recent federal census or such a
183.24 	city's airport authority;
183.25 	(ii) hangars leased by a private individual, association,
183.26 	or corporation in connection with a business conducted for
183.27 	profit other than an aviation-related business; or
183.28 	(iii) facilities leased by a private individual,
183.29 	association, or corporation in connection with a business for
183.30 	profit, that consists of a major jet engine repair facility
183.31 	financed, in whole or part, with the proceeds of state bonds and
183.32 	located in a tax increment financing district;
183.33 	(3) property constituting or used as a public pedestrian
183.34 	ramp or concourse in connection with a public airport; or 
183.35 	(4) property constituting or used as a passenger check-in
183.36 	area or ticket sale counter, boarding area, or luggage claim
184.1 	area in connection with a public airport but not the airports
184.2 	owned or operated by the Metropolitan Airports Commission or
184.3 	cities of over 50,000 population or an airport authority
184.4 	therein.  Real estate owned by a municipality in connection with
184.5 	the operation of a public airport and leased or used for
184.6 	agricultural purposes is not exempt;
184.7 	(5) property leased, loaned, or otherwise made available to
184.8 	a private individual, corporation, or association under a
184.9 	cooperative farming agreement made pursuant to section 97A.135;
184.10 	or 
184.11 	(6) property leased, loaned, or otherwise made available to
184.12 	a private individual, corporation, or association under section
184.13 	272.68, subdivision 4.
184.14 	(c) Taxes imposed by this subdivision are payable as in the
184.15 	case of personal property taxes and shall be assessed to the
184.16 	lessees or users of real or personal property in the same manner
184.17 	as taxes assessed to owners of real or personal property, except
184.18 	that such taxes shall not become a lien against the property.
184.19 	When due, the taxes shall constitute a debt due from the lessee
184.20 	or user to the state, township, city, county, and school
184.21 	district for which the taxes were assessed and shall be
184.22 	collected in the same manner as personal property taxes.  If
184.23 	property subject to the tax imposed by this subdivision is
184.24 	leased or used jointly by two or more persons, each lessee or
184.25 	user shall be jointly and severally liable for payment of the
184.26 	tax.
184.27 	(d) The tax on real property of the state or any of its
184.28 	political subdivisions that is leased by a private individual,
184.29 	association, or corporation and becomes taxable under this
184.30 	subdivision or other provision of law must be assessed and
184.31 	collected as a personal property assessment.  The taxes do not
184.32 	become a lien against the real property.
184.33 	
EFFECTIVE DATE. This section is effective the day
184.34 	following final enactment.

184.35 	Sec. 5. Minnesota Statutes 2004, section 272.02,
184.36 	subdivision 1a, is amended to read:
185.1 		Subd. 1a.Limitations on exemptions.  The exemptions
185.2 	granted by subdivision 1 are subject to the limits contained in
185.3 	the other subdivisions of this section, section 272.025, or
185.4 	273.13, subdivision 25, paragraph (c), clause (1) or (2), or
185.5 	paragraph (d), clause (2) and all other provisions of applicable
185.6 	law.
185.7 	
EFFECTIVE DATE. This section is effective the day
185.8 	following final enactment.

185.9 	Sec. 6. Minnesota Statutes 2004, section 272.02, is
185.10 	amended by adding a subdivision to read:
185.11 		Subd. 73.Property subject to taconite production tax or
185.12 	net proceeds tax. (a) Real and personal property described in
185.13 	section 298.25 is exempt to the extent the tax on taconite and
185.14 	iron sulphides under section 298.24 is described in section
185.15 	298.25 as being in lieu of other taxes on such property.  This
185.16 	exemption applies for taxes payable in each year that the tax
185.17 	under section 298.24 is payable with respect to such property.
185.18 	(b) Deposits of mineral, metal, or energy resources the
185.19 	mining of which is subject to taxation under section 298.015 are
185.20 	exempt.  This exemption applies for taxes payable in each year
185.21 	that the tax under section 298.015 is payable with respect to
185.22 	such property.
185.23 	
EFFECTIVE DATE. This section is effective the day
185.24 	following final enactment.

185.25 	Sec. 7. Minnesota Statutes 2004, section 272.02, is
185.26 	amended by adding a subdivision to read:
185.27 		Subd. 74.Religious corporations. Personal and real
185.28 	property that a religious corporation, formed under section
185.29 	317A.909, necessarily uses for a religious purpose is exempt to
185.30 	the extent provided in section 317A.909, subdivision 3.
185.31 	
EFFECTIVE DATE. This section is effective the day
185.32 	following final enactment.

185.33 	Sec. 8. Minnesota Statutes 2004, section 272.02, is
185.34 	amended by adding a subdivision to read:
185.35 		Subd. 75.Children's homes. Personal and real property
185.36 	owned by a corporation formed under section 317A.907 is exempt
186.1 	to the extent provided in section 317A.907, subdivision 7.
186.2 	
EFFECTIVE DATE. This section is effective the day
186.3 	following final enactment.

186.4 	Sec. 9. Minnesota Statutes 2004, section 272.02, is
186.5 	amended by adding a subdivision to read:
186.6 		Subd. 76.Housing and redevelopment authority and tribal
186.7 	housing authority property. Property owned by a housing and
186.8 	redevelopment authority described in chapter 469, or by a
186.9 	designated housing authority described in section 469.040,
186.10 	subdivision 5, is exempt to the extent provided in chapter 469.
186.11 	
EFFECTIVE DATE. This section is effective the day
186.12 	following final enactment.

186.13 	Sec. 10. Minnesota Statutes 2004, section 272.02, is
186.14 	amended by adding a subdivision to read:
186.15 		Subd. 77.Property of housing and redevelopment
186.16 	authorities. Property of projects of housing and redevelopment
186.17 	authorities are exempt to the extent permitted by sections
186.18 	469.042, subdivision 1, and 469.043, subdivisions 2 and 5.
186.19 	
EFFECTIVE DATE. This section is effective the day
186.20 	following final enactment.

186.21 	Sec. 11. Minnesota Statutes 2004, section 272.02, is
186.22 	amended by adding a subdivision to read:
186.23 		Subd. 78.Property of regional rail authority. Property
186.24 	of a regional rail authority as defined in chapter 398A is
186.25 	exempt to the extent permitted by section 398A.05.
186.26 	
EFFECTIVE DATE. This section is effective the day
186.27 	following final enactment.

186.28 	Sec. 12. Minnesota Statutes 2004, section 272.02, is
186.29 	amended by adding a subdivision to read:
186.30 		Subd. 79.Spirit mountain recreation area
186.31 	authority. Property owned by the Spirit Mountain Recreation
186.32 	Area Authority is exempt from taxation to the extent provided in
186.33 	Laws 1973, chapter 327, section 6.

186.34 	Sec. 13. Minnesota Statutes 2004, section 272.02, is
186.35 	amended by adding a subdivision to read:
186.36 		Subd. 80.Installed capacity defined. For purposes of
187.1 	this section, the term "installed capacity" means generator
187.2 	nameplate capacity.
187.3 	
EFFECTIVE DATE. This section is effective the day
187.4 	following final enactment.

187.5 	Sec. 14. Minnesota Statutes 2004, section 272.029,
187.6 	subdivision 4, is amended to read:
187.7 		Subd. 4.Reports.  (a) An owner of a wind energy
187.8 	conversion system subject to tax under subdivision 3 shall file
187.9 	a report with the commissioner of revenue annually on or before
187.10 	March February 1 detailing the amount of electricity in
187.11 	kilowatt-hours that was produced by the wind energy conversion
187.12 	system for the previous calendar year.  The commissioner shall
187.13 	prescribe the form of the report.  The report must contain the
187.14 	information required by the commissioner to determine the tax
187.15 	due to each county under this section for the current year.  If
187.16 	an owner of a wind energy conversion system subject to taxation
187.17 	under this section fails to file the report by the due date, the
187.18 	commissioner of revenue shall determine the tax based upon the
187.19 	nameplate capacity of the system multiplied by a capacity factor
187.20 	of 40 percent.
187.21 	(b) On or before March 31 February 28, the commissioner of
187.22 	revenue shall notify the owner of the wind energy conversion
187.23 	systems of the tax due to each county for the current year and
187.24 	shall certify to the county auditor of each county in which the
187.25 	systems are located the tax due from each owner for the current
187.26 	year.
187.27 	
EFFECTIVE DATE. This section is effective for reports and
187.28 	certifications due in 2006 and thereafter.

187.29 	Sec. 15. Minnesota Statutes 2004, section 272.029,
187.30 	subdivision 6, is amended to read:
187.31 		Subd. 6.Distribution of revenues.  Revenues from the
187.32 	taxes imposed under subdivision 5 must be part of the settlement
187.33 	between the county treasurer and the county auditor under
187.34 	section 276.09.  The revenue must be distributed by the county
187.35 	auditor or the county treasurer to all local taxing
187.36 	jurisdictions in which the wind energy conversion system is
188.1 	located,as follows:  beginning with distributions in 2006, 80
188.2 	percent to counties; 14 percent to cities and townships; and six
188.3 	percent to school districts; and for distributions occurring in
188.4 	2004 and 2005 in the same proportion that each of the local 
188.5 	taxing jurisdiction's current year's net tax capacity based tax
188.6 	rate is to the current year's total local net tax capacity based
188.7 	rate.
188.8 	
EFFECTIVE DATE. This section is effective the day
188.9 	following final enactment.

188.10 	Sec. 16. Minnesota Statutes 2004, section 273.11,
188.11 	subdivision 8, is amended to read:
188.12 		Subd. 8.Limited equity cooperative apartments.  For the
188.13 	purposes of this subdivision, the terms defined in this
188.14 	subdivision have the meanings given them.
188.15 	A "limited equity cooperative" is a corporation organized
188.16 	under chapter 308A or 308B, which has as its primary purpose the
188.17 	provision of housing and related services to its members which
188.18 	meets one of the following criteria with respect to the income
188.19 	of its members:  (1) a minimum of 75 percent of members must
188.20 	have incomes at or less than 90 percent of area median income,
188.21 	(2) a minimum of 40 percent of members must have incomes at or
188.22 	less than 60 percent of area median income, or (3) a minimum of
188.23 	20 percent of members must have incomes at or less than 50
188.24 	percent of area median income.  For purposes of this clause,
188.25 	"member income" shall mean the income of a member existing at
188.26 	the time the member acquires cooperative membership, and median
188.27 	income shall mean the St. Paul-Minneapolis metropolitan area
188.28 	median income as determined by the United States Department of
188.29 	Housing and Urban Development.  It must also meet the following
188.30 	requirements:
188.31 	(a) The articles of incorporation set the sale price of
188.32 	occupancy entitling cooperative shares or memberships at no more
188.33 	than a transfer value determined as provided in the articles.
188.34 	That value may not exceed the sum of the following:
188.35 	(1) the consideration paid for the membership or shares by
188.36 	the first occupant of the unit, as shown in the records of the
189.1 	corporation;
189.2 	(2) the fair market value, as shown in the records of the
189.3 	corporation, of any improvements to the real property that were
189.4 	installed at the sole expense of the member with the prior
189.5 	approval of the board of directors;
189.6 	(3) accumulated interest, or an inflation allowance not to
189.7 	exceed the greater of a ten percent annual noncompounded
189.8 	increase on the consideration paid for the membership or share
189.9 	by the first occupant of the unit, or the amount that would have
189.10 	been paid on that consideration if interest had been paid on it
189.11 	at the rate of the percentage increase in the revised Consumer
189.12 	Price Index for All Urban Consumers for the Minneapolis-St. Paul
189.13 	metropolitan area prepared by the United States Department of
189.14 	Labor, provided that the amount determined pursuant to this
189.15 	clause may not exceed $500 for each year or fraction of a year
189.16 	the membership or share was owned; plus
189.17 	(4) real property capital contributions shown in the
189.18 	records of the corporation to have been paid by the transferor
189.19 	member and previous holders of the same membership, or of
189.20 	separate memberships that had entitled occupancy to the unit of
189.21 	the member involved.  These contributions include contributions
189.22 	to a corporate reserve account the use of which is restricted to
189.23 	real property improvements or acquisitions, contributions to the
189.24 	corporation which are used for real property improvements or
189.25 	acquisitions, and the amount of principal amortized by the
189.26 	corporation on its indebtedness due to the financing of real
189.27 	property acquisition or improvement or the averaging of
189.28 	principal paid by the corporation over the term of its real
189.29 	property-related indebtedness.
189.30 	(b) The articles of incorporation require that the board of
189.31 	directors limit the purchase price of stock or membership
189.32 	interests for new member-occupants or resident shareholders to
189.33 	an amount which does not exceed the transfer value for the
189.34 	membership or stock as defined in clause (a).
189.35 	(c) The articles of incorporation require that the total
189.36 	distribution out of capital to a member shall not exceed that
190.1 	transfer value.
190.2 	(d) The articles of incorporation require that upon
190.3 	liquidation of the corporation any assets remaining after
190.4 	retirement of corporate debts and distribution to members will
190.5 	be conveyed to a charitable organization described in section
190.6 	501(c)(3) of the Internal Revenue Code of 1986, as amended
190.7 	through December 31, 1992, or a public agency.
190.8 	A "limited equity cooperative apartment" is a dwelling unit
190.9 	owned by a limited equity cooperative.
190.10 	"Occupancy entitling cooperative share or membership" is
190.11 	the ownership interest in a cooperative organization which
190.12 	entitles the holder to an exclusive right to occupy a dwelling
190.13 	unit owned or leased by the cooperative.
190.14 	For purposes of taxation, the assessor shall value a unit
190.15 	owned by a limited equity cooperative at the lesser of its
190.16 	market value or the value determined by capitalizing the net
190.17 	operating income of a comparable apartment operated on a rental
190.18 	basis at the capitalization rate used in valuing comparable
190.19 	buildings that are not limited equity cooperatives.  If a
190.20 	cooperative fails to operate in accordance with the provisions
190.21 	of clauses (a) to (d), the property shall be subject to
190.22 	additional property taxes in the amount of the difference
190.23 	between the taxes determined in accordance with this subdivision
190.24 	for the last ten years that the property had been assessed
190.25 	pursuant to this subdivision and the amount that would have been
190.26 	paid if the provisions of this subdivision had not applied to
190.27 	it.  The additional taxes, plus interest at the rate specified
190.28 	in section 549.09, shall be extended against the property on the
190.29 	tax list for the current year.
190.30 	
EFFECTIVE DATE. This section is effective for taxes
190.31 	payable in 2004 and thereafter.

190.32 	Sec. 17. Minnesota Statutes 2004, section 273.124,
190.33 	subdivision 3, is amended to read:
190.34 		Subd. 3.Cooperatives and charitable corporations;
190.35 	homestead and other property.  (a) When property is owned by a
190.36 	corporation or association organized under chapter 308A or 308B,
191.1 	and each person who owns a share or shares in the corporation or
191.2 	association is entitled to occupy a building on the property, or
191.3 	a unit within a building on the property, the corporation or
191.4 	association may claim homestead treatment for each dwelling, or
191.5 	for each unit in the case of a building containing several
191.6 	dwelling units, or for the part of the value of the building
191.7 	occupied by a shareholder.  Each building or unit must be
191.8 	designated by legal description or number.  The net tax capacity
191.9 	of each building or unit that qualifies for assessment as a
191.10 	homestead under this subdivision must include not more than
191.11 	one-half acre of land, if platted, nor more than 80 acres if
191.12 	unplatted.  The net tax capacity of the property is the sum of
191.13 	the net tax capacities of each of the respective buildings or
191.14 	units comprising the property, including the net tax capacity of
191.15 	each unit's or building's proportionate share of the land and
191.16 	any common buildings.  To qualify for the treatment provided by
191.17 	this subdivision, the corporation or association must be wholly
191.18 	owned by persons having a right to occupy a building or unit
191.19 	owned by the corporation or association.  A charitable
191.20 	corporation organized under the laws of Minnesota and not
191.21 	otherwise exempt thereunder with no outstanding stock qualifies
191.22 	for homestead treatment with respect to member residents of the
191.23 	dwelling units who have purchased and hold residential
191.24 	participation warrants entitling them to occupy the units.
191.25 	(b) To the extent provided in paragraph (a), a cooperative
191.26 	or corporation organized under chapter 308A may obtain separate
191.27 	assessment and valuation, and separate property tax statements
191.28 	for each residential homestead, residential nonhomestead, or for
191.29 	each seasonal residential recreational building or unit not used
191.30 	for commercial purposes.  The appropriate class rates under
191.31 	section 273.13 shall be applicable as if each building or unit
191.32 	were a separate tax parcel; provided, however, that the tax
191.33 	parcel which exists at the time the cooperative or corporation
191.34 	makes application under this subdivision shall be a single
191.35 	parcel for purposes of property taxes or the enforcement and
191.36 	collection thereof, other than as provided in paragraph (a) or
192.1 	this paragraph.
192.2 	(c) A member of a corporation or association may initially
192.3 	obtain the separate assessment and valuation and separate
192.4 	property tax statements, as provided in paragraph (b), by
192.5 	applying to the assessor by June 30 of the assessment year.
192.6 	(d) When a building, or dwelling units within a building,
192.7 	no longer qualify under paragraph (a) or (b), the current owner
192.8 	must notify the assessor within 30 days.  Failure to notify the
192.9 	assessor within 30 days shall result in the loss of benefits
192.10 	under paragraph (a) or (b) for taxes payable in the year that
192.11 	the failure is discovered.  For these purposes, "benefits under
192.12 	paragraph (a) or (b)" means the difference in the net tax
192.13 	capacity of the building or units which no longer qualify as
192.14 	computed under paragraph (a) or (b) and as computed under the
192.15 	otherwise applicable law, times the local tax rate applicable to
192.16 	the building for that taxes payable year.  Upon discovery of a
192.17 	failure to notify, the assessor shall inform the auditor of the
192.18 	difference in net tax capacity for the building or buildings in
192.19 	which units no longer qualify, and the auditor shall calculate
192.20 	the benefits under paragraph (a) or (b).  Such amount, plus a
192.21 	penalty equal to 100 percent of that amount, shall then be
192.22 	demanded of the building's owner.  The property owner may appeal
192.23 	the county's determination by serving copies of a petition for
192.24 	review with county officials as provided in section 278.01 and
192.25 	filing a proof of service as provided in section 278.01 with the
192.26 	Minnesota Tax Court within 60 days of the date of the notice
192.27 	from the county.  The appeal shall be governed by the Tax Court
192.28 	procedures provided in chapter 271, for cases relating to the
192.29 	tax laws as defined in section 271.01, subdivision 5;
192.30 	disregarding sections 273.125, subdivision 5, and 278.03, but
192.31 	including section 278.05, subdivision 2.  If the amount of the
192.32 	benefits under paragraph (a) or (b) and penalty are not paid
192.33 	within 60 days, and if no appeal has been filed, the county
192.34 	auditor shall certify the amount of the benefit and penalty to
192.35 	the succeeding year's tax list to be collected as part of the
192.36 	property taxes on the affected property.
193.1 	
EFFECTIVE DATE. This section is effective for taxes
193.2 	payable in 2004 and thereafter.

193.3 	Sec. 18. Minnesota Statutes 2004, section 273.124,
193.4 	subdivision 6, is amended to read:
193.5 		Subd. 6.Leasehold cooperatives.  When one or more
193.6 	dwellings or one or more buildings which each contain several
193.7 	dwelling units is owned by a nonprofit corporation subject to
193.8 	the provisions of chapter 317A and qualifying under section
193.9 	501(c)(3) or 501(c)(4) of the Internal Revenue Code of 1986, as
193.10 	amended through December 31, 1990, or a limited partnership
193.11 	which corporation or partnership operates the property in
193.12 	conjunction with a cooperative association, and has received
193.13 	public financing, homestead treatment may be claimed by the
193.14 	cooperative association on behalf of the members of the
193.15 	cooperative for each dwelling unit occupied by a member of the
193.16 	cooperative.  The cooperative association must provide the
193.17 	assessor with the Social Security numbers of those members.  To
193.18 	qualify for the treatment provided by this subdivision, the
193.19 	following conditions must be met:
193.20 	(a) the cooperative association must be organized under
193.21 	chapter 308A or 308B and all voting members of the board of
193.22 	directors must be resident tenants of the cooperative and must
193.23 	be elected by the resident tenants of the cooperative;
193.24 	(b) the cooperative association must have a lease for
193.25 	occupancy of the property for a term of at least 20 years, which
193.26 	permits the cooperative association, while not in default on the
193.27 	lease, to participate materially in the management of the
193.28 	property, including material participation in establishing
193.29 	budgets, setting rent levels, and hiring and supervising a
193.30 	management agent;
193.31 	(c) to the extent permitted under state or federal law, the
193.32 	cooperative association must have a right under a written
193.33 	agreement with the owner to purchase the property if the owner
193.34 	proposes to sell it; if the cooperative association does not
193.35 	purchase the property it is offered for sale, the owner may not
193.36 	subsequently sell the property to another purchaser at a price
194.1 	lower than the price at which it was offered for sale to the
194.2 	cooperative association unless the cooperative association
194.3 	approves the sale;
194.4 	(d) a minimum of 40 percent of the cooperative
194.5 	association's members must have incomes at or less than 60
194.6 	percent of area median gross income as determined by the United
194.7 	States Secretary of Housing and Urban Development under section
194.8 	142(d)(2)(B) of the Internal Revenue Code of 1986, as amended
194.9 	through December 31, 1991.  For purposes of this clause, "member
194.10 	income" means the income of a member existing at the time the
194.11 	member acquires cooperative membership;
194.12 	(e) if a limited partnership owns the property, it must
194.13 	include as the managing general partner a nonprofit organization
194.14 	operating under the provisions of chapter 317A and qualifying
194.15 	under section 501(c)(3) or 501(c)(4) of the Internal Revenue
194.16 	Code of 1986, as amended through December 31, 1990, and the
194.17 	limited partnership agreement must provide that the managing
194.18 	general partner have sufficient powers so that it materially
194.19 	participates in the management and control of the limited
194.20 	partnership;
194.21 	(f) prior to becoming a member of a leasehold cooperative
194.22 	described in this subdivision, a person must have received
194.23 	notice that (1) describes leasehold cooperative property in
194.24 	plain language, including but not limited to the effects of
194.25 	classification under this subdivision on rents, property taxes
194.26 	and tax credits or refunds, and operating expenses, and (2)
194.27 	states that copies of the articles of incorporation and bylaws
194.28 	of the cooperative association, the lease between the owner and
194.29 	the cooperative association, a sample sublease between the
194.30 	cooperative association and a tenant, and, if the owner is a
194.31 	partnership, a copy of the limited partnership agreement, can be
194.32 	obtained upon written request at no charge from the owner, and
194.33 	the owner must send or deliver the materials within seven days
194.34 	after receiving any request;
194.35 	(g) if a dwelling unit of a building was occupied on the
194.36 	60th day prior to the date on which the unit became leasehold
195.1 	cooperative property described in this subdivision, the notice
195.2 	described in paragraph (f) must have been sent by first class
195.3 	mail to the occupant of the unit at least 60 days prior to the
195.4 	date on which the unit became leasehold cooperative property.
195.5 	For purposes of the notice under this paragraph, the copies of
195.6 	the documents referred to in paragraph (f) may be in proposed
195.7 	version, provided that any subsequent material alteration of
195.8 	those documents made after the occupant has requested a copy
195.9 	shall be disclosed to any occupant who has requested a copy of
195.10 	the document.  Copies of the articles of incorporation and
195.11 	certificate of limited partnership shall be filed with the
195.12 	secretary of state after the expiration of the 60-day period
195.13 	unless the change to leasehold cooperative status does not
195.14 	proceed;
195.15 	(h) the county attorney of the county in which the property
195.16 	is located must certify to the assessor that the property meets
195.17 	the requirements of this subdivision;
195.18 	(i) the public financing received must be from at least one
195.19 	of the following sources:
195.20 	(1) tax increment financing proceeds used for the
195.21 	acquisition or rehabilitation of the building or interest rate
195.22 	write-downs relating to the acquisition of the building;
195.23 	(2) government issued bonds exempt from taxes under section
195.24 	103 of the Internal Revenue Code of 1986, as amended through
195.25 	December 31, 1991, the proceeds of which are used for the
195.26 	acquisition or rehabilitation of the building;
195.27 	(3) programs under section 221(d)(3), 202, or 236, of Title
195.28 	II of the National Housing Act;
195.29 	(4) rental housing program funds under Section 8 of the
195.30 	United States Housing Act of 1937 or the market rate family
195.31 	graduated payment mortgage program funds administered by the
195.32 	Minnesota Housing Finance Agency that are used for the
195.33 	acquisition or rehabilitation of the building;
195.34 	(5) low-income housing credit under section 42 of the
195.35 	Internal Revenue Code of 1986, as amended through December 31,
195.36 	1991;
196.1 	(6) public financing provided by a local government used
196.2 	for the acquisition or rehabilitation of the building, including
196.3 	grants or loans from (i) federal community development block
196.4 	grants; (ii) HOME block grants; or (iii) residential rental
196.5 	bonds issued under chapter 474A; or
196.6 	(7) other rental housing program funds provided by the
196.7 	Minnesota Housing Finance Agency for the acquisition or
196.8 	rehabilitation of the building;
196.9 	(j) at the time of the initial request for homestead
196.10 	classification or of any transfer of ownership of the property,
196.11 	the governing body of the municipality in which the property is
196.12 	located must hold a public hearing and make the following
196.13 	findings:
196.14 	(1) that the granting of the homestead treatment of the
196.15 	apartment's units will facilitate safe, clean, affordable
196.16 	housing for the cooperative members that would otherwise not be
196.17 	available absent the homestead designation;
196.18 	(2) that the owner has presented information satisfactory
196.19 	to the governing body showing that the savings garnered from the
196.20 	homestead designation of the units will be used to reduce
196.21 	tenant's rents or provide a level of furnishing or maintenance
196.22 	not possible absent the designation; and
196.23 	(3) that the requirements of paragraphs (b), (d), and (i)
196.24 	have been met.
196.25 	Homestead treatment must be afforded to units occupied by
196.26 	members of the cooperative association and the units must be
196.27 	assessed as provided in subdivision 3, provided that any unit
196.28 	not so occupied shall be classified and assessed pursuant to the
196.29 	appropriate class.  No more than three acres of land may, for
196.30 	assessment purposes, be included with each dwelling unit that
196.31 	qualifies for homestead treatment under this subdivision.
196.32 	When dwelling units no longer qualify under this
196.33 	subdivision, the current owner must notify the assessor within
196.34 	60 days.  Failure to notify the assessor within 60 days shall
196.35 	result in the loss of benefits under this subdivision for taxes
196.36 	payable in the year that the failure is discovered.  For these
197.1 	purposes, "benefits under this subdivision" means the difference
197.2 	in the net tax capacity of the units which no longer qualify as
197.3 	computed under this subdivision and as computed under the
197.4 	otherwise applicable law, times the local tax rate applicable to
197.5 	the building for that taxes payable year.  Upon discovery of a
197.6 	failure to notify, the assessor shall inform the auditor of the
197.7 	difference in net tax capacity for the building or buildings in
197.8 	which units no longer qualify, and the auditor shall calculate
197.9 	the benefits under this subdivision.  Such amount, plus a
197.10 	penalty equal to 100 percent of that amount, shall then be
197.11 	demanded of the building's owner.  The property owner may appeal
197.12 	the county's determination by serving copies of a petition for
197.13 	review with county officials as provided in section 278.01 and
197.14 	filing a proof of service as provided in section 278.01 with the
197.15 	Minnesota Tax Court within 60 days of the date of the notice
197.16 	from the county.  The appeal shall be governed by the Tax Court
197.17 	procedures provided in chapter 271, for cases relating to the
197.18 	tax laws as defined in section 271.01, subdivision 5;
197.19 	disregarding sections 273.125, subdivision 5, and 278.03, but
197.20 	including section 278.05, subdivision 2.  If the amount of the
197.21 	benefits under this subdivision and penalty are not paid within
197.22 	60 days, and if no appeal has been filed, the county auditor
197.23 	shall certify the amount of the benefit and penalty to the
197.24 	succeeding year's tax list to be collected as part of the
197.25 	property taxes on the affected buildings.
197.26 	
EFFECTIVE DATE. This section is effective for taxes
197.27 	payable in 2004 and thereafter.

197.28 	Sec. 19. Minnesota Statutes 2004, section 273.124,
197.29 	subdivision 8, is amended to read:
197.30 		Subd. 8.Homestead owned by or leased to family farm
197.31 	corporation, joint farm venture, limited liability company, or
197.32 	partnership.  (a) Each family farm corporation, each ; each joint
197.33 	family farm venture,; and each limited liability company, and
197.34 	each or partnership operating which operates a family farm;is
197.35 	entitled to class 1b under section 273.13, subdivision 22,
197.36 	paragraph (b), or class 2a assessment for one homestead occupied
198.1 	by a shareholder, member, or partner thereof who is residing on
198.2 	the land, and actively engaged in farming of the land owned by
198.3 	the family farm corporation, joint family farm venture, limited
198.4 	liability company, or partnership operating a family farm.
198.5 	Homestead treatment applies even if legal title to the property
198.6 	is in the name of the family farm corporation, joint family farm
198.7 	venture, limited liability company, or partnership operating the
198.8 	family farm, and not in the name of the person residing on it.
198.9 	"Family farm corporation," "family farm," and "partnership
198.10 	operating a family farm" have the meanings given in section
198.11 	500.24, except that the number of allowable shareholders,
198.12 	members, or partners under this subdivision shall not exceed
198.13 	12.  "Limited liability company" has the meaning contained in
198.14 	sections 322B.03, subdivision 28, and 500.24, subdivision 2,
198.15 	paragraphs (l) and (m).  "Joint family farm venture" means a
198.16 	cooperative agreement among two or more farm enterprises
198.17 	authorized to operate a family farm under section 500.24.
198.18 	(b) In addition to property specified in paragraph (a), any
198.19 	other residences owned by family farm corporations, joint family
198.20 	farm ventures, limited liability companies, or partnerships
198.21 	operating a family farm described in paragraph (a) which are
198.22 	located on agricultural land and occupied as homesteads by its
198.23 	shareholders, members, or partners who are actively engaged in
198.24 	farming on behalf of that corporation, joint farm venture,
198.25 	limited liability company, or partnership must also be assessed
198.26 	as class 2a property or as class 1b property under section
198.27 	273.13.
198.28 	(c) Agricultural property that is owned by a member,
198.29 	partner, or shareholder of a family farm corporation or joint
198.30 	family farm venture, limited liability company operating a
198.31 	family farm, or by a partnership operating a family farm and
198.32 	leased to the family farm corporation, limited liability
198.33 	company, or partnership operating a family farm, or joint farm
198.34 	venture, as defined in paragraph (a), is eligible for
198.35 	classification as class 1b or class 2a under section 273.13, if
198.36 	the owner is actually residing on the property, and is actually
199.1 	engaged in farming the land on behalf of that corporation, joint
199.2 	farm venture, limited liability company, or partnership.  This
199.3 	paragraph applies without regard to any legal possession rights
199.4 	of the family farm corporation, joint family farm venture,
199.5 	limited liability company, or partnership operating a family
199.6 	farm under the lease.
199.7 	
EFFECTIVE DATE. This section is effective the day
199.8 	following final enactment.

199.9 	Sec. 20. Minnesota Statutes 2004, section 273.124,
199.10 	subdivision 13, is amended to read:
199.11 		Subd. 13.Homestead application.  (a) A person who meets
199.12 	the homestead requirements under subdivision 1 must file a
199.13 	homestead application with the county assessor to initially
199.14 	obtain homestead classification.
199.15 	(b) On or before January 2, 1993, each county assessor
199.16 	shall mail a homestead application to the owner of each parcel
199.17 	of property within the county which was classified as homestead
199.18 	for the 1992 assessment year.  The format and contents of a
199.19 	uniform homestead application shall be prescribed by the
199.20 	commissioner of revenue.  The commissioner shall consult with
199.21 	the chairs of the house and senate tax committees on the
199.22 	contents of the homestead application form.  The application
199.23 	must clearly inform the taxpayer that this application must be
199.24 	signed by all owners who occupy the property or by the
199.25 	qualifying relative and returned to the county assessor in order
199.26 	for the property to continue receiving homestead treatment.  The
199.27 	envelope containing the homestead application shall clearly
199.28 	identify its contents and alert the taxpayer of its necessary
199.29 	immediate response.
199.30 	(c) Every property owner applying for homestead
199.31 	classification must furnish to the county assessor the Social
199.32 	Security number of each occupant who is listed as an owner of
199.33 	the property on the deed of record, the name and address of each
199.34 	owner who does not occupy the property, and the name and Social
199.35 	Security number of each owner's spouse who occupies the
199.36 	property.  The application must be signed by each owner who
200.1 	occupies the property and by each owner's spouse who occupies
200.2 	the property, or, in the case of property that qualifies as a
200.3 	homestead under subdivision 1, paragraph (c), by the qualifying
200.4 	relative.
200.5 	If a property owner occupies a homestead, the property
200.6 	owner's spouse may not claim another property as a homestead
200.7 	unless the property owner and the property owner's spouse file
200.8 	with the assessor an affidavit or other proof required by the
200.9 	assessor stating that the property qualifies as a homestead
200.10 	under subdivision 1, paragraph (e).
200.11 	Owners or spouses occupying residences owned by their
200.12 	spouses and previously occupied with the other spouse, either of
200.13 	whom fail to include the other spouse's name and Social Security
200.14 	number on the homestead application or provide the affidavits or
200.15 	other proof requested, will be deemed to have elected to receive
200.16 	only partial homestead treatment of their residence.  The
200.17 	remainder of the residence will be classified as nonhomestead
200.18 	residential.  When an owner or spouse's name and Social Security
200.19 	number appear on homestead applications for two separate
200.20 	residences and only one application is signed, the owner or
200.21 	spouse will be deemed to have elected to homestead the residence
200.22 	for which the application was signed.
200.23 	The Social Security numbers or affidavits or other proofs
200.24 	of the property owners and spouses are private data on
200.25 	individuals as defined by section 13.02, subdivision 12, but,
200.26 	notwithstanding that section, the private data may be disclosed
200.27 	to the commissioner of revenue, or, for purposes of proceeding
200.28 	under the Revenue Recapture Act to recover personal property
200.29 	taxes owing, to the county treasurer.
200.30 	(d) If residential real estate is occupied and used for
200.31 	purposes of a homestead by a relative of the owner and qualifies
200.32 	for a homestead under subdivision 1, paragraph (c), in order for
200.33 	the property to receive homestead status, a homestead
200.34 	application must be filed with the assessor.  The Social
200.35 	Security number of each relative occupying the property and the
200.36 	Social Security number of each owner who is related to an
201.1 	occupant of the property shall be required on the homestead
201.2 	application filed under this subdivision.  If a different
201.3 	relative of the owner subsequently occupies the property, the
201.4 	owner of the property must notify the assessor within 30 days of
201.5 	the change in occupancy.  The Social Security number of a
201.6 	relative occupying the property is private data on individuals
201.7 	as defined by section 13.02, subdivision 12, but may be
201.8 	disclosed to the commissioner of revenue.
201.9 	(e) The homestead application shall also notify the
201.10 	property owners that the application filed under this section
201.11 	will not be mailed annually and that if the property is granted
201.12 	homestead status for the 1993 assessment, or any assessment year
201.13 	thereafter, that same property shall remain classified as
201.14 	homestead until the property is sold or transferred to another
201.15 	person, or the owners, the spouse of the owner, or the relatives
201.16 	no longer use the property as their homestead.  Upon the sale or
201.17 	transfer of the homestead property, a certificate of value must
201.18 	be timely filed with the county auditor as provided under
201.19 	section 272.115.  Failure to notify the assessor within 30 days
201.20 	that the property has been sold, transferred, or that the owner,
201.21 	the spouse of the owner, or the relative is no longer occupying
201.22 	the property as a homestead, shall result in the penalty
201.23 	provided under this subdivision and the property will lose its
201.24 	current homestead status.
201.25 	(f) If the homestead application is not returned within 30
201.26 	days, the county will send a second application to the present
201.27 	owners of record.  The notice of proposed property taxes
201.28 	prepared under section 275.065, subdivision 3, shall reflect the
201.29 	property's classification.  Beginning with assessment year 1993
201.30 	for all properties, if a homestead application has not been
201.31 	filed with the county by December 15, the assessor shall
201.32 	classify the property as nonhomestead for the current assessment
201.33 	year for taxes payable in the following year, provided that the
201.34 	owner may be entitled to receive the homestead classification by
201.35 	proper application under section 375.192.
201.36 	(g) At the request of the commissioner, each county must
202.1 	give the commissioner a list that includes the name and Social
202.2 	Security number of each property owner and the property owner's
202.3 	spouse occupying the property, or relative of a property owner,
202.4 	applying for homestead classification under this subdivision.
202.5 	The commissioner shall use the information provided on the lists
202.6 	as appropriate under the law, including for the detection of
202.7 	improper claims by owners, or relatives of owners, under chapter
202.8 	290A.
202.9 	(h) If the commissioner finds that a property owner may be
202.10 	claiming a fraudulent homestead, the commissioner shall notify
202.11 	the appropriate counties.  Within 90 days of the notification,
202.12 	the county assessor shall investigate to determine if the
202.13 	homestead classification was properly claimed.  If the property
202.14 	owner does not qualify, the county assessor shall notify the
202.15 	county auditor who will determine the amount of homestead
202.16 	benefits that had been improperly allowed.  For the purpose of
202.17 	this section, "homestead benefits" means the tax reduction
202.18 	resulting from the classification as a homestead under section
202.19 	273.13, the taconite homestead credit under section 273.135, the
202.20 	residential homestead and agricultural homestead credits under
202.21 	section 273.1384, and the supplemental homestead credit under
202.22 	section 273.1391.
202.23 	The county auditor shall send a notice to the person who
202.24 	owned the affected property at the time the homestead
202.25 	application related to the improper homestead was filed,
202.26 	demanding reimbursement of the homestead benefits plus a penalty
202.27 	equal to 100 percent of the homestead benefits.  The person
202.28 	notified may appeal the county's determination by serving copies
202.29 	of a petition for review with county officials as provided in
202.30 	section 278.01 and filing proof of service as provided in
202.31 	section 278.01 with the Minnesota Tax Court within 60 days of
202.32 	the date of the notice from the county.  Procedurally, the
202.33 	appeal is governed by the provisions in chapter 271 which apply
202.34 	to the appeal of a property tax assessment or levy, but without
202.35 	requiring any prepayment of the amount in controversy.  If the
202.36 	amount of homestead benefits and penalty is not paid within 60
203.1 	days, and if no appeal has been filed, the county auditor shall
203.2 	certify the amount of taxes and penalty to the county
203.3 	treasurer.  The county treasurer will add interest to the unpaid
203.4 	homestead benefits and penalty amounts at the rate provided in
203.5 	section 279.03 for real property taxes becoming delinquent in
203.6 	the calendar year during which the amount remains unpaid.
203.7 	Interest may be assessed for the period beginning 60 days after
203.8 	demand for payment was made.
203.9 	If the person notified is the current owner of the
203.10 	property, the treasurer may add the total amount of homestead
203.11 	benefits, penalty, interest, and costs to the ad valorem taxes
203.12 	otherwise payable on the property by including the amounts on
203.13 	the property tax statements under section 276.04, subdivision
203.14 	3.  The amounts added under this paragraph to the ad valorem
203.15 	taxes shall include interest accrued through December 31 of the
203.16 	year preceding the taxes payable year for which the amounts are
203.17 	first added.  These amounts, when added to the property tax
203.18 	statement, become subject to all the laws for the enforcement of
203.19 	real or personal property taxes for that year, and for any
203.20 	subsequent year.
203.21 	If the person notified is not the current owner of the
203.22 	property, the treasurer may collect the amounts due under the
203.23 	Revenue Recapture Act in chapter 270A, or use any of the powers
203.24 	granted in sections 277.20 and 277.21 without exclusion, to
203.25 	enforce payment of the homestead benefits, penalty, interest,
203.26 	and costs, as if those amounts were delinquent tax obligations
203.27 	of the person who owned the property at the time the application
203.28 	related to the improperly allowed homestead was filed.  The
203.29 	treasurer may relieve a prior owner of personal liability for
203.30 	the homestead benefits, penalty, interest, and costs, and
203.31 	instead extend those amounts on the tax lists against the
203.32 	property as provided in this paragraph to the extent that the
203.33 	current owner agrees in writing.  On all demands, billings,
203.34 	property tax statements, and related correspondence, the county
203.35 	must list and state separately the amounts of homestead
203.36 	benefits, penalty, interest and costs being demanded, billed or
204.1 	assessed.
204.2 	(i) Any amount of homestead benefits recovered by the
204.3 	county from the property owner shall be distributed to the
204.4 	county, city or town, and school district where the property is
204.5 	located in the same proportion that each taxing district's levy
204.6 	was to the total of the three taxing districts' levy for the
204.7 	current year.  Any amount recovered attributable to taconite
204.8 	homestead credit shall be transmitted to the St. Louis County
204.9 	auditor to be deposited in the taconite property tax relief
204.10 	account.  Any amount recovered that is attributable to
204.11 	supplemental homestead credit is to be transmitted to the
204.12 	commissioner of revenue for deposit in the general fund of the
204.13 	state treasury.  The total amount of penalty collected must be
204.14 	deposited in the county general fund.
204.15 	(j) If a property owner has applied for more than one
204.16 	homestead and the county assessors cannot determine which
204.17 	property should be classified as homestead, the county assessors
204.18 	will refer the information to the commissioner.  The
204.19 	commissioner shall make the determination and notify the
204.20 	counties within 60 days.
204.21 	(k) In addition to lists of homestead properties, the
204.22 	commissioner may ask the counties to furnish lists of all
204.23 	properties and the record owners.  The Social Security numbers
204.24 	and federal identification numbers that are maintained by a
204.25 	county or city assessor for property tax administration
204.26 	purposes, and that may appear on the lists retain their
204.27 	classification as private or nonpublic data; but may be viewed,
204.28 	accessed, and used by the county auditor or treasurer of the
204.29 	same county for the limited purpose of assisting the
204.30 	commissioner in the preparation of microdata samples under
204.31 	section 270.0681.
204.32 	(l) On or before April 30 each year beginning in 2007, each
204.33 	county must provide the commissioner with the following data for
204.34 	each parcel of homestead property by electronic means as defined
204.35 	in section 289A.02, subdivision 8:
204.36 	(i) the property identification number assigned to the
205.1 	parcel for purposes of taxes payable in the current year;
205.2 	(ii) the name and Social Security number of each property
205.3 	owner and property owner's spouse, as shown on the tax rolls for
205.4 	the current and the prior assessment year;
205.5 	(iii) the classification of the property under section
205.6 	273.13 for taxes payable in the current year and in the prior
205.7 	year;
205.8 	(iv) an indication of whether the property was classified
205.9 	as a homestead for taxes payable in the current year or for
205.10 	taxes payable in the prior year because of occupancy by a
205.11 	relative of the owner or by a spouse of a relative;
205.12 	(v) the property taxes payable as defined in section
205.13 	290A.03, subdivision 13, for the current year and the prior
205.14 	year;
205.15 	(vi) the market value of improvements to the property first
205.16 	assessed for tax purposes for taxes payable in the current year;
205.17 	(vii) the assessor's estimated market value assigned to the
205.18 	property for taxes payable in the current year and the prior
205.19 	year;
205.20 	(viii) the taxable market value assigned to the property
205.21 	for taxes payable in the current year and the prior year;
205.22 	(ix) whether there are delinquent property taxes owing on
205.23 	the homestead;
205.24 	(x) the unique taxing district in which the property is
205.25 	located; and 
205.26 	(xi) such other information as the commissioner decides is
205.27 	necessary.
205.28 	The commissioner shall use the information provided on the
205.29 	lists as appropriate under the law, including for the detection
205.30 	of improper claims by owners, or relatives of owners, under
205.31 	chapter 290A.

205.32 	Sec. 21. Minnesota Statutes 2004, section 273.124,
205.33 	subdivision 21, is amended to read:
205.34 		Subd. 21.Trust property; homestead.  Real property held
205.35 	by a trustee under a trust is eligible for classification as
205.36 	homestead property if:
206.1 	(1) the grantor or surviving spouse of the grantor of the
206.2 	trust occupies and uses the property as a homestead;
206.3 	(2) a relative or surviving relative of the grantor who
206.4 	meets the requirements of subdivision 1, paragraph (c), in the
206.5 	case of residential real estate; or subdivision 1, paragraph
206.6 	(d), in the case of agricultural property, occupies and uses the
206.7 	property as a homestead;
206.8 	(3) a family farm corporation, joint farm venture, limited
206.9 	liability company, or partnership operating a family farm rents
206.10 	the property held by a trustee under a trust, and the grantor,
206.11 	the spouse of the grantor, or the son or daughter of the
206.12 	grantor, who is also a shareholder, member, or partner of the
206.13 	corporation, joint farm venture, limited liability company, or
206.14 	partnership occupies and uses the property as a homestead, and 
206.15 	or is actively farming the property on behalf of the
206.16 	corporation, joint farm venture, limited liability company, or
206.17 	partnership; or
206.18 	(4) a person who has received homestead classification for
206.19 	property taxes payable in 2000 on the basis of an unqualified
206.20 	legal right under the terms of the trust agreement to occupy the
206.21 	property as that person's homestead and who continues to use the
206.22 	property as a homestead or a person who received the homestead
206.23 	classification for taxes payable in 2005 under clause (3) who
206.24 	does not qualify under clause (3) for taxes payable in 2006 or
206.25 	thereafter but who continues to qualify under clause (3) as it
206.26 	existed for taxes payable in 2005.
206.27 	For purposes of this subdivision, "grantor" is defined as
206.28 	the person creating or establishing a testamentary, inter Vivos,
206.29 	revocable or irrevocable trust by written instrument or through
206.30 	the exercise of a power of appointment.
206.31 	
EFFECTIVE DATE. This section is effective for taxes
206.32 	payable in 2006 and thereafter.

206.33 	Sec. 22. Minnesota Statutes 2004, section 273.1315, is
206.34 	amended to read:
206.35 	273.1315 CERTIFICATION OF 1B PROPERTY.
206.36 	Any property owner seeking classification and assessment of
207.1 	the owner's homestead as class 1b property pursuant to section
207.2 	273.13, subdivision 22, paragraph (b), shall file with the
207.3 	commissioner of revenue a 1b homestead declaration, on a form
207.4 	prescribed by the commissioner.  The declaration shall contain
207.5 	the following information:
207.6 	(a) the information necessary to verify that on or before
207.7 	June 30 of the filing year,the property owner or the owner's
207.8 	spouse satisfies the requirements of section 273.13, subdivision
207.9 	22, paragraph (b), for 1b classification; and
207.10 	(b) any additional information prescribed by the
207.11 	commissioner.
207.12 	The declaration must be filed on or before October 1 to be
207.13 	effective for property taxes payable during the succeeding
207.14 	calendar year.  The declaration and any supplementary
207.15 	information received from the property owner pursuant to this
207.16 	section shall be subject to chapter 270B.  If approved by the
207.17 	commissioner, the declaration remains in effect until the
207.18 	property no longer qualifies under section 273.13, subdivision
207.19 	22, paragraph (b).  Failure to notify the commissioner within 30
207.20 	days that the property no longer qualifies under that paragraph
207.21 	because of a sale, change in occupancy, or change in the status
207.22 	or condition of an occupant shall result in the penalty provided
207.23 	in section 273.124, subdivision 13, computed on the basis of the
207.24 	class 1b benefits for the property, and the property shall lose
207.25 	its current class 1b classification.
207.26 	The commissioner shall provide to the assessor on or before
207.27 	November 1 a listing of the parcels of property qualifying for
207.28 	1b classification.

207.29 	EFFECTIVE DATE. This section is effective the day
207.30 	following final enactment.

207.31 	Sec. 23. Minnesota Statutes 2004, section 273.19,
207.32 	subdivision 1a, is amended to read:
207.33 		Subd. 1a.Effective date. This section is effective the day
208.10 	following final enactment.

208.11 	Sec. 24. Minnesota Statutes 2004, section 273.372, is
208.12 	amended to read:
 208.13 	273.372 [PROCEEDINGS AND APPEALS; UTILITY OR RAILROAD
208.14 	VALUATIONS.]
208.15 		Subdivision 1.Scope. (a) As provided in this section,
208.16 	an appeal by a utility or railroad company concerning the
208.17 	exemption, valuation, or classification of property for which
208.18 	the commissioner of revenue has provided the city or county
208.19 	assessor with valuations by order, or for which the commissioner
208.20 	has recommended values to the city or county assessor, must be
208.21 	brought against the commissioner in Tax Court or in district
208.22 	court of the county where the property is located, and not
208.23 	against the county or taxing district where the property is
208.24 	located.
208.25 	(b) This section governs administrative appeals and appeals
208.26 	to court of a claim that utility or railroad operating property
208.27 	has been partially, unfairly, or unequally assessed, or assessed
208.28 	at a valuation greater than its real or actual value,
208.29 	misclassified, or that the property is exempt.  This section
208.30 	applies only to property described in sections 270.81,
208.31 	subdivision 1, 273.33, 273.35, 273.36, and 273.37, and only with
208.32 	regard to taxable net tax capacities that have been provided to
208.33 	the city or county by the commissioner and which have not been
208.34 	changed by city or county.  If the taxable net tax capacity
208.35 	being appealed is not the taxable net tax capacity established
208.36 	by the commissioner, or if the appeal claims that the tax rate
209.1 	applied against the parcel is incorrect, or that the tax has
209.2 	been paid, this section does not apply.
209.3 		Subd. 2.Contents and filing of petition. (a) In all
209.4 	appeals to court that are required to be brought against the
209.5 	commissioner under this section, the petition initiating the
209.6 	appeal must be served on the commissioner and must be filed with
209.7 	the Tax Court in Ramsey County, as provided in paragraph (b) or
209.8 	(c).
209.9 	(b) If the appeal to court is from an order of the
209.10 	commissioner, it must be brought under chapter 271, except that
209.11 	when the provisions of this section conflict with chapter 271,
209.12 	this section prevails.  In addition, the petition must include
209.13 	all the parcels encompassed by that order which the petitioner
209.14 	claims have been partially, unfairly, or unequally assessed,
209.15 	assessed at a valuation greater than their real or actual value,
209.16 	misclassified, or are exempt.  For this purpose, an order of the
209.17 	commissioner is either (1) a certification or notice of value by
209.18 	the commissioner for property described in subdivision 1, or (2)
209.19 	the final determination by the commissioner of either an
209.20 	administrative appeal conference or informal administrative
209.21 	appeal described in subdivision 4.
209.22 	(c) If the appeal is from the exemption, valuation,
209.23 	classification, or tax that results from implementation of the
209.24 	commissioner's order, certification,or recommendation, it must
209.25 	be brought under chapter 278, and the provisions in that chapter
209.26 	apply, except that service shall be on the commissioner only and
209.27 	not on the county local officials specified in section 278.01,
209.28 	subdivision 1, and if any other provision of this section
209.29 	conflicts with chapter 278, this section prevails.  In addition,
209.30 	the petition must include either all the utility parcels or all
209.31 	the railroad parcels in the state in which the petitioner claims
209.32 	an interest and which the petitioner claims have been partially,
209.33 	unfairly, or unequally assessed, assessed at a valuation greater
209.34 	than their real or actual value, misclassified, or are
209.35 	exempt. This provision applies to the property described in
209.36 	sections 273.33, 273.35, 273.36, and 273.37, but only if the
210.1 	appealed values have remained unchanged from those provided to
210.2 	the city or county by the commissioner.  If the exemption,
210.3 	valuation, or classification being appealed has been changed by
210.4 	the city or county, then the action must be brought under
210.5 	chapter 278 in the county where the property is located and
210.6 	proper service must be made upon the county officials as
210.7 	specified in section 278.01, subdivision 1.
210.8 		Subd. 3.Notice. Upon filing of any appeal in court by a
210.9 	utility company or railroad against the commissioner pursuant to
210.10 	this section, the commissioner shall give notice by first class
210.11 	mail to the county auditor of each county which would be
210.12 	affected by the appeal where property included in the petition
210.13 	is located.
210.14 		Subd. 4.Administrative appeals. (a) Companies that
210.15 	submit the reports under section 270.82 or 273.371 by the date
210.16 	specified in that section, or by the date specified by the
210.17 	commissioner in an extension, may appeal administratively to the
210.18 	commissioner under the procedures in section 270.11, subdivision
210.19 	6,prior to bringing an action in Tax Court or in district court
210.20 	, however, instituting an administrative appeal by submitting a
210.21 	written request with the commissioner does not change or
210.22 	modify for a conference within ten days after the date of the
210.23 	commissioner's valuation certification or notice to the company,
210.24 	or by May 15, whichever is earlier.  The commissioner shall
210.25 	conduct the conference upon the commissioner's entire files and
210.26 	records and such further information as may be offered.  The
210.27 	conference must be held no later than 20 days after the date of
210.28 	the commissioner's valuation certification or notice to the
210.29 	company, or by the date specified by the commissioner in an
210.30 	extension.  Within 60 days after the conference the commissioner
210.31 	shall make a final determination of the matter and shall notify
210.32 	the company promptly of the determination.  The conference is
210.33 	not a contested case hearing.
210.34 	(b) In addition to the opportunity for a conference under
210.35 	paragraph (a), the commissioner shall also provide the railroad
210.36 	and utility companies the opportunity to discuss any questions
211.1 	or concerns relating to the values established by the
211.2 	commissioner through certification or notice in a less formal
211.3 	manner.  This does not change or modify the deadline for
211.4 	requesting a conference under paragraph (a),the deadline in
211.5 	section 271.06 for appealing an order of the commissioner in Tax
211.6 	Court ,or the deadline in section 278.01 for filing a property
211.7 	tax claim or objection in Tax Court or district appealing
211.8 	property taxes in court.
211.9 	
EFFECTIVE DATE. This section is effective September 1,
211.10 	2005, and thereafter.

211.11 	Sec. 25. Minnesota Statutes 2004, section 274.014,
211.12 	subdivision 2, is amended to read:
211.13 		Subd. 2.Appeals and equalization course. By no later
211.14 	than January 1,Beginning in 2006, and each year thereafter,
211.15 	there must be at least one member at each meeting of a local
211.16 	board of appeal and equalization who has attended an appeals and
211.17 	equalization course developed or approved by the commissioner
211.18 	within the last four years, as certified by the commissioner.
211.19 	The course may be offered in conjunction with a meeting of the
211.20 	Minnesota League of Cities or the Minnesota Association of
211.21 	Townships.  The course content must include, but need not be
211.22 	limited to, a review of the handbook developed by the
211.23 	commissioner under subdivision 1.
211.24 	
EFFECTIVE DATE. This section is effective the day
211.25 	following final enactment.

211.26 	Sec. 26. Minnesota Statutes 2004, section 274.014,
211.27 	subdivision 3, is amended to read:
211.28 		Subd. 3.Proof of compliance; transfer of duties. (a) 
211.29 	Any city or town that does not conducts local boards of appeal
211.30 	and equalization meetings must provide proof to the county
211.31 	assessor by December 1, 2006, and each year thereafter, that it
211.32 	is in compliance with the requirements of subdivision 2, and
211.33 	that it had .  Beginning in 2006, this notice must also verify
211.34 	that there was a quorum of voting members at each meeting of the
211.35 	board of appeal and equalization in the prior current year,.  A
211.36 	city or town that does not comply with these requirements is
212.1 	deemed to have transferred its board of appeal and equalization
212.2 	powers to the county under section 274.01, subdivision 3,
212.3 	for beginning with the following year's assessment and
212.4 	continuing unless the powers are reinstated under paragraph (c).
212.5 	(b) The county shall notify the taxpayers when the board of
212.6 	appeal and equalization for a city or town has been transferred
212.7 	to the county under this subdivision and, prior to the meeting
212.8 	time of the county board of equalization, the county shall make
212.9 	available to those taxpayers a procedure for a review of the
212.10 	assessments, including, but not limited to, open book meetings.
212.11 	This alternate review process shall take place in April and May.
212.12 	(c) A local board whose powers are transferred to the
212.13 	county under this subdivision may be reinstated by resolution of
212.14 	the governing body of the city or town and upon proof of
212.15 	compliance with the requirements of subdivision 2.  The
212.16 	resolution and proofs must be provided to the county assessor by
212.17 	December 1 in order to be effective for the following year's
212.18 	assessment.
212.19 	
EFFECTIVE DATE. This section is effective the day
212.20 	following final enactment.

212.21 	Sec. 27. Minnesota Statutes 2004, section 274.14, is
212.22 	amended to read:
212.23 	274.14 LENGTH OF SESSION; RECORD.
212.24 	The county board of equalization or the special board of
212.25 	equalization appointed by it shall meet during the last ten
212.26 	meeting days in June.  For this purpose, "meeting days" are
212.27 	defined as any day of the week excluding Saturday and Sunday.
212.28 	The board may meet on any ten consecutive meeting days in June,
212.29 	after the second Friday in June, if .The actual meeting dates
212.30 	are must be contained on the valuation notices mailed to each
212.31 	property owner in the county under as provided in section
212.32 	273.121. For this purpose, "meeting days" is defined as any day
212.33 	of the week excluding Saturday and Sunday.No action taken by
212.34 	the county board of review after June 30 is valid, except for
212.35 	corrections permitted in sections 273.01 and 274.01.  The county
212.36 	auditor shall keep an accurate record of the proceedings and
213.1 	orders of the board.  The record must be published like other
213.2 	proceedings of county commissioners.  A copy of the published
213.3 	record must be sent to the commissioner of revenue, with the
213.4 	abstract of assessment required by section 274.16.

213.5 	EFFECTIVE DATE. This section is effective the day
213.6 	following final enactment.

213.7 	Sec. 28. Minnesota Statutes 2004, section 275.07,
213.8 	subdivision 1, is amended to read:
213.9 		Subdivision 1.Certification of levy.  (a) Except as
213.10 	provided under paragraph (b), the taxes voted by cities,
213.11 	counties, school districts, and special districts shall be
213.12 	certified by the proper authorities to the county auditor on or
213.13 	before five working days after December 20 in each year.  A town
213.14 	must certify the levy adopted by the town board to the county
213.15 	auditor by September 15 each year.  If the town board modifies
213.16 	the levy at a special town meeting after September 15, the town
213.17 	board must recertify its levy to the county auditor on or before
213.18 	five working days after December 20. The taxes certified shall
213.19 	be reduced by the county auditor by the aid received under
213.20 	section 273.1398, subdivision 3.If a city, town, county,
213.21 	school district, or special district fails to certify its levy
213.22 	by that date, its levy shall be the amount levied by it for the
213.23 	preceding year.
213.24 	(b)(i) The taxes voted by counties under sections 103B.241,
213.25 	103B.245, and 103B.251 shall be separately certified by the
213.26 	county to the county auditor on or before five working days
213.27 	after December 20 in each year.  The taxes certified shall not
213.28 	be reduced by the county auditor by the aid received under
213.29 	section 273.1398, subdivision 3.  If a county fails to certify
213.30 	its levy by that date, its levy shall be the amount levied by it
213.31 	for the preceding year.
213.32 	(ii) For purposes of the proposed property tax notice under
213.33 	section 275.065 and the property tax statement under section
213.34 	276.04, for the first year in which the county implements the
213.35 	provisions of this paragraph, the county auditor shall reduce
213.36 	the county's levy for the preceding year to reflect any amount
214.1 	levied for water management purposes under clause (i) included
214.2 	in the county's levy.
214.3 	
EFFECTIVE DATE. This section is effective the day
214.4 	following final enactment.

214.5 	Sec. 29. Minnesota Statutes 2004, section 275.07,
214.6 	subdivision 4, is amended to read:
214.7 		Subd. 4.Report to commissioner.  (a) On or before
214.8 	October 8 of each year, the county auditor shall report to the
214.9 	commissioner of revenue the proposed levy certified by local
214.10 	units of government under section 275.065, subdivision 1.  If
214.11 	any taxing authorities have notified the county auditor that
214.12 	they are in the process of negotiating an agreement for sharing,
214.13 	merging, or consolidating services but that when the proposed
214.14 	levy was certified under section 275.065, subdivision 1c, the
214.15 	agreement was not yet finalized, the county auditor shall supply
214.16 	that information to the commissioner when filing the report
214.17 	under this section and shall recertify the affected levies as
214.18 	soon as practical after October 10.
214.19 	(b) On or before January 15 of each year, the county
214.20 	auditor shall report to the commissioner of revenue the final
214.21 	levy certified by local units of government under subdivision 1.
214.22 	(c) The levies must be reported in the manner prescribed by
214.23 	the commissioner. The reports must show a total levy and the
214.24 	amount of each special levy.
214.25 	
EFFECTIVE DATE. This section is effective the day
214.26 	following final enactment.

214.27 	Sec. 30. Minnesota Statutes 2004, section 276.112, is
214.28 	amended to read:
214.29 	276.112 STATE PROPERTY TAXES; COUNTY TREASURER.
214.30 	On or before January 25 each year, for the period ending
214.31 	December 31 of the prior year, and on or before June 29 28 each
214.32 	year, for the period ending on the most recent settlement day
214.33 	determined in section 276.09, and on or before December 2 each
214.34 	year, for the period ending November 20, the county treasurer
214.35 	must make full settlement with the county auditor according to
214.36 	sections 276.09, 276.10, and 276.111 for all receipts of state
215.1 	property taxes levied under section 275.025, and must transmit
215.2 	those receipts to the commissioner of revenue by electronic
215.3 	means.

215.4 	EFFECTIVE DATE. This section is effective the day
215.5 	following final enactment.

215.6 	Sec. 31. Minnesota Statutes 2004, section 282.016, is
215.7 	amended to read:
215.8 	282.016 PROHIBITED PURCHASERS.
215.9 	No (a) A county auditor, county treasurer, county attorney,
215.10 	court administrator of the district court, or county assessor
215.11 	or ,supervisor of assessments, or deputy or clerk or an employee
215.12 	of such officer, and no a commissioner for tax-forfeited lands
215.13 	or an assistant to such commissioner may , must not become a
215.14 	purchaser, either personally or as an agent or attorney for
215.15 	another person,of the properties offered for sale under the
215.16 	provisions of this chapter, either personally, or as agent or
215.17 	attorney for any other person, except that in the county for
215.18 	which the person performs duties.  A person prohibited from
215.19 	purchasing property under this section must not directly or
215.20 	indirectly have another person purchase it on behalf of the
215.21 	prohibited purchaser for the prohibited purchaser's benefit or
215.22 	gain.
215.23 	(b) Notwithstanding paragraph (a),such officer, deputy,
215.24 	court administrator clerk, or employee or commissioner for
215.25 	tax-forfeited lands or assistant to such commissioner may (1)
215.26 	purchase lands owned by that official at the time the state
215.27 	became the absolute owner thereof or (2) bid upon and purchase
215.28 	forfeited property offered for sale under the alternate sale
215.29 	procedure described in section 282.01, subdivision 7a.

215.30 	EFFECTIVE DATE. This section is effective the day
215.31 	following final enactment.

215.32 	Sec. 32. Minnesota Statutes 2004, section 282.08, is
215.33 	amended to read:
215.34 	282.08 APPORTIONMENT OF PROCEEDS TO TAXING DISTRICTS.
215.35 	The net proceeds from the sale or rental of any parcel of
215.36 	forfeited land, or from the sale of products from the forfeited
216.1 	land, must be apportioned by the county auditor to the taxing
216.2 	districts interested in the land, as follows:
216.3 	(1) the amounts necessary to pay the state general tax levy
216.4 	against the parcel for taxes payable in the year for which the
216.5 	tax judgment was entered, and for each subsequent payable year
216.6 	up to and including the year of forfeiture, must be apportioned
216.7 	to the state;
216.8 	(2) the portion required to pay any amounts included in the
216.9 	appraised value under section 282.01, subdivision 3, as
216.10 	representing increased value due to any public improvement made
216.11 	after forfeiture of the parcel to the state, but not exceeding
216.12 	the amount certified by the clerk of the municipality must be
216.13 	apportioned to the municipal subdivision entitled to it;
216.14 	(3) (2) the portion required to pay any amount included in
216.15 	the appraised value under section 282.019, subdivision 5,
216.16 	representing increased value due to response actions taken after
216.17 	forfeiture of the parcel to the state, but not exceeding the
216.18 	amount of expenses certified by the Pollution Control Agency or
216.19 	the commissioner of agriculture, must be apportioned to the
216.20 	agency or the commissioner of agriculture and deposited in the
216.21 	fund from which the expenses were paid;
216.22 	(4) (3) the portion of the remainder required to discharge
216.23 	any special assessment chargeable against the parcel for
216.24 	drainage or other purpose whether due or deferred at the time of
216.25 	forfeiture, must be apportioned to the municipal subdivision
216.26 	entitled to it; and
216.27 	(5) (4) any balance must be apportioned as follows:
216.28 	(i) The county board may annually by resolution set aside
216.29 	no more than 30 percent of the receipts remaining to be used for
216.30 	timber development on tax-forfeited land and dedicated memorial
216.31 	forests, to be expended under the supervision of the county
216.32 	board.  It must be expended only on projects approved by the
216.33 	commissioner of natural resources.
216.34 	(ii) The county board may annually by resolution set aside
216.35 	no more than 20 percent of the receipts remaining to be used for
216.36 	the acquisition and maintenance of county parks or recreational
217.1 	areas as defined in sections 398.31 to 398.36, to be expended
217.2 	under the supervision of the county board.
217.3 	(iii) Any balance remaining must be apportioned as
217.4 	follows:  county, 40 percent; town or city, 20 percent; and
217.5 	school district, 40 percent, provided, however, that in
217.6 	unorganized territory that portion which would have accrued to
217.7 	the township must be administered by the county board of
217.8 	commissioners.

217.9 	EFFECTIVE DATE. This section is effective the day
217.10 	following final enactment for state general tax levy amounts
217.11 	payable in 2004 and thereafter.

217.12 	Sec. 33. Minnesota Statutes 2004, section 282.15, is
217.13 	amended to read:
217.14 	282.15 SALES OF FORFEITED AGRICULTURAL LANDS.
217.15 	The sale shall be conducted by the auditor of the county in
217.16 	which the parcels lie.  The parcels shall be sold to the highest
217.17 	bidder but not for less than the appraised value.  The sales
217.18 	shall be for cash or on the following terms:  The appraised
217.19 	value of all merchantable timber on agricultural lands shall be
217.20 	paid for in full at the date of sale.  At least 15 percent of
217.21 	the purchase price of the land shall be paid in cash at the time
217.22 	of purchase.  The balance shall be paid in not more than 20
217.23 	equal annual installments, with interest at a rate equal to the
217.24 	rate in effect at the time under section 549.09 on the unpaid
217.25 	balance each year.  Both principal and interest are due and
217.26 	payable on December 31 each year following that in which the
217.27 	purchase was made.  The purchaser may pay any number of
217.28 	installments of principal and interest on or before their due
217.29 	date.  When the sale is on terms other than for cash in full,
217.30 	the purchaser shall receive from the county auditor a contract
217.31 	for deed, in a form prescribed by the attorney general.  The
217.32 	county auditor shall make a report to the commissioner of
217.33 	natural resources not more than 30 days after each public sale
217.34 	showing the lands sold at the sales, and submit a copy of each
217.35 	contract of sale.
217.36 	All lands sold pursuant to this section shall, on the
218.1 	second day of January following the date of the sale,must be
218.2 	restored to the tax rolls and become subject to taxation in the
218.3 	same manner as they were assessed and taxed before becoming the
218.4 	absolute property of the state for the assessment year
218.5 	determined under section 272.02, subdivision 38, paragraph (c).

218.6 	EFFECTIVE DATE. This section is effective for sales
218.7 	occurring on or after July 1, 2005.

218.8 	Sec. 34. Minnesota Statutes 2004, section 282.21, is
218.9 	amended to read:
218.10 	282.21 FORM OF CONVEYANCE.
218.11 	When any sale has been made under sections 282.14 to
218.12 	282.22,upon payment in full of the purchase price, appropriate
218.13 	conveyance in fee in such form as may be prescribed by the
218.14 	attorney general shall be issued by the commissioner of finance 
218.15 	natural resources to the purchaser or the purchaser's assigns
218.16 	and this conveyance shall have the force and effect of a patent
218.17 	from the state.

218.18 	EFFECTIVE DATE. This section is effective the day
218.19 	following final enactment.

218.20 	Sec. 35. Minnesota Statutes 2004, section 282.224, is
218.21 	amended to read:
218.22 	282.224 FORM OF CONVEYANCE.
218.23 	When any sale has been made under sections 282.221 to
218.24 	282.226,upon payment in full of the purchase price,appropriate
218.25 	conveyance in fee, in such form as may be prescribed by the
218.26 	attorney general, shall be issued by the commissioner of natural
218.27 	resources to the purchaser or the purchaser's assignee, and the
218.28 	conveyance shall have the force and effect of a patent from the
218.29 	state.

218.30 	EFFECTIVE DATE. This section is effective the day
218.31 	following final enactment.

218.32 	Sec. 36. Minnesota Statutes 2004, section 282.301, is
218.33 	amended to read:
218.34 	282.301 RECEIPTS FOR PAYMENTS.
218.35 	When any sale has been made under sections 282.012 and
218.36 	282.241 to 282.324,the purchaser shall receive from the county
219.1 	auditor at the time of repurchase a receipt, in such form as may
219.2 	be prescribed by the attorney general.  When the purchase price
219.3 	of a parcel of land shall be paid in full, the following facts
219.4 	shall be certified by the county auditor to the commissioner of
219.5 	revenue of the state of Minnesota:  the description of land, the
219.6 	date of sale, the name of the purchaser or the purchaser's
219.7 	assignee, and the date when the final installment of the
219.8 	purchase price was paid.  Upon payment in full of the purchase
219.9 	price, the purchaser or the assignee shall receive a quitclaim
219.10 	deed from the state, to be executed by the commissioner of
219.11 	revenue.  The deed must be sent to the county auditor who shall
219.12 	have it recorded before it is forwarded to the purchaser.
219.13 	Failure to make any payment herein required shall constitute
219.14 	default and upon such default and cancellation in accord with
219.15 	section 282.40, the right, title and interest of the purchaser
219.16 	or the purchaser's heirs, representatives, or assigns in such
219.17 	parcel shall terminate.

219.18 	EFFECTIVE DATE. This section is effective the day
219.19 	following final enactment.

219.20 	Sec. 37. Minnesota Statutes 2004, section 290B.05,
219.21 	subdivision 3, is amended to read:
219.22 		Subd. 3.Calculation of deferred property tax amount.
 219.23 	When final property tax amounts for the following year have been
219.24 	determined, the county auditor shall calculate the "deferred
219.25 	property tax amount."  The deferred property tax amount is equal
219.26 	to the lesser of (1) the maximum allowable deferral for the
219.27 	year; or (2) the difference between (i) the total amount of
219.28 	property taxes and special assessments levied upon the
219.29 	qualifying homestead by all taxing jurisdictions and (ii) the
219.30 	maximum property tax amount. Any special assessments levied by
219.31 	any local unit of government must not be included in the total
219.32 	tax used to calculate the deferred tax amount.For this purpose
219.33 	"special assessments" includes any assessment, fee, or other
219.34 	charge that may by law, and which does, appear on the property
219.35 	tax statement for the property for collection under the laws
219.36 	applicable to the enforcement of real estate taxes.Any tax
220.1 	attributable to new improvements made to the property after the
220.2 	initial application has been approved under section 290B.04,
220.3 	subdivision 2, must be excluded when determining any subsequent
220.4 	deferred property tax amount.  The county auditor shall
220.5 	annually, on or before April 15, certify to the commissioner of
220.6 	revenue the property tax deferral amounts determined under this
220.7 	subdivision by property and by owner.
220.8 	
EFFECTIVE DATE. This section is effective for amounts
220.9 	deferred in 2006 and thereafter.

220.10 	Sec. 38. Minnesota Statutes 2004, section 290C.05, is
220.11 	amended to read:
220.12 	290C.05 ANNUAL CERTIFICATION.
220.13 	On or before July 1 of each year, beginning with the year
220.14 	after the claimant has received an approved application, the
220.15 	commissioner shall send each claimant enrolled under the
220.16 	sustainable forest incentive program a certification form.  The
220.17 	claimant must sign the certification, attesting that the
220.18 	requirements and conditions for continued enrollment in the
220.19 	program are currently being met, and must return the signed
220.20 	certification form to the commissioner by August 15 of that same
220.21 	year. Failure to If the claimant does not return an annual
220.22 	certification form by the due date shall result in removal of
220.23 	the lands from the provisions of the sustainable forest
220.24 	incentive program, and the imposition of any applicable removal
220.25 	penalty , the provisions in section 290C.11 apply. The claimant
220.26 	may appeal the removal and any associated penalty according to
220.27 	the procedures and within the time allowed under this chapter.

220.28 	EFFECTIVE DATE. This section is effective the day
220.29 	following final enactment.

220.30 	Sec. 39. [290C.055] LENGTH OF COVENANT.
220.31 	The covenant remains in effect for a minimum of eight
220.32 	years.  If land is removed from the program before it has been
220.33 	enrolled for four years, the covenant remains in effect for
220.34 	eight years from the date recorded.
220.35 	If land that has been enrolled for four years or more is
220.36 	removed from the program for any reason, there is a waiting
221.1 	period before the covenant terminates.  The covenant terminates
221.2 	on January 1 of the fifth calendar year that begins after the
221.3 	date that:
221.4 	(1) the commissioner receives notification from the
221.5 	claimant that the claimant wishes to remove the land from the
221.6 	program under section 290C.10; or 
221.7 	(2) the date that the land is removed from the program
221.8 	under section 290C.11.
221.9 	Notwithstanding the other provisions of this section, the
221.10 	covenant is terminated at the same time that the land is removed
221.11 	from the program due to acquisition of title or possession for a
221.12 	public purpose under section 290C.10.

221.13 	EFFECTIVE DATE. This section is effective the day
221.14 	following final enactment.

221.15 	Sec. 40. Minnesota Statutes 2004, section 290C.10, is
221.16 	amended to read:
221.17 	290C.10 WITHDRAWAL PROCEDURES.
221.18 	An approved claimant under the sustainable forest incentive
221.19 	program for a minimum of four years may notify the commissioner
221.20 	of the intent to terminate enrollment.  Within 90 days of
221.21 	receipt of notice to terminate enrollment, the commissioner
221.22 	shall inform the claimant in writing, acknowledging receipt of
221.23 	this notice and indicating the effective date of termination
221.24 	from the sustainable forest incentive program.  Termination of
221.25 	enrollment in the sustainable forest incentive program occurs on
221.26 	January 1 of the fifth calendar year that begins after receipt
221.27 	by the commissioner of the termination notice.  After the
221.28 	commissioner issues an effective date of termination, a claimant
221.29 	wishing to continue the land's enrollment in the sustainable
221.30 	forest incentive program beyond the termination date must apply
221.31 	for enrollment as prescribed in section 290C.04.  A claimant who
221.32 	withdraws a parcel of land from this program may not reenroll
221.33 	the parcel for a period of three years.  Within 90 days after
221.34 	the termination date, the commissioner shall execute and
221.35 	acknowledge a document releasing the land from the covenant
221.36 	required under this chapter.  The document must be mailed to the
222.1 	claimant and is entitled to be recorded.  The commissioner may
222.2 	allow early withdrawal from the Sustainable Forest Incentive Act
222.3 	without penalty in cases of condemnation when the state of
222.4 	Minnesota, any local government unit, or any other entity which
222.5 	has the right of eminent domain acquires title or possession to
222.6 	the land for a public purpose notwithstanding the provisions of
222.7 	this section. In the case of such acquisition, the commissioner
222.8 	shall execute and acknowledge a document releasing the land
222.9 	acquired by the state, local government unit, or other entity
222.10 	from the covenant.  All other enrolled land must remain in the
222.11 	program.

222.12 	EFFECTIVE DATE. This section is effective the day
222.13 	following final enactment.

222.14 	Sec. 41. Minnesota Statutes 2004, section 373.45,
222.15 	subdivision 7, is amended to read:
222.16 		Subd. 7.Aid reduction for repayment.  (a) Except as
222.17 	provided in paragraph (b), the commissioner may reduce, by the
222.18 	amount paid by the state under this section on behalf of the
222.19 	county, plus the interest due on the state payments, the
222.20 	following aids payable to the county:
222.21 	(1) homestead and agricultural credit aid and disparity
222.22 	reduction aid payable under section 273.1398;
222.23 	(2) county criminal justice aid payable under section
222.24 	477A.0121; and 
222.25 	(3) family preservation aid payable under section 477A.0122
222.26 	county program aid under section 477A.0124.
222.27 	The amount of any aid reduction reverts from the appropriate
222.28 	account to the state general fund.
222.29 	(b) If, after review of the financial situation of the
222.30 	county, the authority advises the commissioner that a total
222.31 	reduction of the aids would cause an undue hardship on the
222.32 	county, the authority, with the approval of the commissioner,
222.33 	may establish a different schedule for reduction of aids to
222.34 	repay the state.  The amount of aids to be reduced are decreased
222.35 	by any amounts repaid to the state by the county from other
222.36 	revenue sources.
223.1 	
EFFECTIVE DATE. This section is effective for aid payable
223.2 	in 2005 and thereafter.

223.3 	Sec. 42. Minnesota Statutes 2004, section 469.1735,
223.4 	subdivision 3, is amended to read:
223.5 		Subd. 3.Transfer authority for property tax.  (a) A city
223.6 	may elect to use all or part of its allocation under subdivision
223.7 	2 to reimburse the city or county or both for property tax
223.8 	reductions under section 272.0212.  To elect this option, the
223.9 	city must notify the commissioner of revenue by October 1 of
223.10 	each calendar year of the amount of the property tax
223.11 	reductions for which it seeks reimbursements for taxes payable
223.12 	during the following current year and the governmental units to
223.13 	which the amounts will be paid.  The commissioner may require
223.14 	the city to provide information substantiating the amount of the
223.15 	reductions granted or any other information necessary to
223.16 	administer this provision.  The commissioner shall pay the
223.17 	reimbursements by December 26 of the taxes payable year.  Any
223.18 	amount transferred under this authority reduces the amount of
223.19 	tax credit certificates available under subdivisions 1 and 2.
223.20 	(b) The amount elected by the city under paragraph (a) is
223.21 	appropriated to the commissioner of revenue from the general
223.22 	fund to reimburse the city or county for tax reductions under
223.23 	section 272.0212.  The amount appropriated may not exceed the
223.24 	maximum amounts allocated to a city under subdivision 2,
223.25 	paragraph (b), less the amount of certificates issued by the
223.26 	city under subdivision 1, and is available until expended.
223.27 	
EFFECTIVE DATE. This section is effective for
223.28 	reimbursements of taxes payable in 2005 and thereafter.

223.29 	Sec. 43. Laws 2003, chapter 127, article 5, section 27,
223.30 	the effective date, is amended to read:

223.31 	EFFECTIVE DATE. This section is effective for taxes
223.32 	payable in 2004 and thereafter distributions occurring on or
223.33 	after June 10, 2003.

223.34 	Sec. 44. Laws 2003, chapter 127, article 5, section 28,
223.35 	the effective date, is amended to read:

223.36 	EFFECTIVE DATE. This section is effective for taxes
224.1 	payable in 2004 and thereafter distributions occurring on or
224.2 	after June 10, 2003.

224.3 	Sec. 45. LINCOLN AND PIPESTONE COUNTIES; TOWN LEVY
224.4 	ADJUSTMENT FOR WIND ENERGY PRODUCTION TAX.
 224.5 	Notwithstanding the deadlines in Minnesota Statutes,
224.6 	section 275.07, towns located in Lincoln or Pipestone County are
224.7 	authorized to adjust their payable 2004 levy for all or a
224.8 	portion of their estimated wind energy production tax amounts
224.9 	for 2004, as computed by the commissioner of revenue from
224.10 	reports filed under Minnesota Statutes, section 272.029,
224.11 	subdivision 4.  The Lincoln and Pipestone County auditors may
224.12 	adjust the payable 2004 levy certifications under Minnesota
224.13 	Statutes, section 275.07, subdivision 1, based upon the towns
224.14 	that have recertified their levies under this section by March
224.15 	15, 2004.

224.16 	EFFECTIVE DATE. This section is effective for taxes
224.17 	payable in 2004.

224.18 	Sec. 46. REPEALER.
 224.19 	(a) Minnesota Statutes 2004, sections 273.19, subdivision
224.20 	5; 274.05; 275.15; 275.61, subdivision 2; and 283.07, are
224.21 	repealed effective the day following final enactment.
224.22 	(b) Laws 1975, chapter 287, section 5, and Laws 2003,
224.23 	chapter 127, article 9, section 9, subdivision 4, are repealed
224.24 	effective without local approval for taxes payable in 2006 and
224.25 	thereafter.
224.26 	(c) Minnesota Statutes 2004, sections 270.85; 270.88; and
224.27 	273.37, subdivision 3, are repealed effective September 1, 2005.

224.28 	ARTICLE 6
224.29 	INCOME, CORPORATE FRANCHISE, AND ESTATE TAXES

224.30 	Section 1. Minnesota Statutes 2004, section 289A.08,
224.31 	subdivision 3, is amended to read:
224.32 		Subd. 3.Corporations.  A corporation that is subject to
224.33 	the state's jurisdiction to tax under section 290.014,
224.34 	subdivision 5, must file a return, except that a foreign
224.35 	operating corporation as defined in section 290.01, subdivision
224.36 	6b, is not required to file a return.  The commissioner shall
225.1 	adopt rules for the filing of one return on behalf of the
225.2 	members of an affiliated group of corporations that are required
225.3 	to file a combined report.  All members of an affiliated group
225.4 	that are required to file a combined report must file one return
225.5 	on behalf of the members of the group under rules adopted by the
225.6 	commissioner. If a corporation claims on a return that it has
225.7 	paid tax in excess of the amount of taxes lawfully due, that
225.8 	corporation must include on that return information necessary
225.9 	for payment of the tax in excess of the amount lawfully due by
225.10 	electronic means.
225.11 	
EFFECTIVE DATE. This section is effective for returns
225.12 	filed after December 31, 2005.

225.13 	Sec. 2. Minnesota Statutes 2004, section 289A.18,
225.14 	subdivision 1, is amended to read:
225.15 		Subdivision 1.Individual income, fiduciary income,
225.16 	corporate franchise, and entertainment taxes; partnership and s
225.17 	corporation returns; information returns; mining company
225.18 	returns.  The returns required to be made under sections 289A.08
225.19 	and 289A.12 must be filed at the following times:
225.20 	(1) returns made on the basis of the calendar year must be
225.21 	filed on April 15 following the close of the calendar year,
225.22 	except that returns of corporations must be filed on March 15
225.23 	following the close of the calendar year;
225.24 	(2) returns made on the basis of the fiscal year must be
225.25 	filed on the 15th day of the fourth month following the close of
225.26 	the fiscal year, except that returns of corporations must be
225.27 	filed on the 15th day of the third month following the close of
225.28 	the fiscal year;
225.29 	(3) returns for a fractional part of a year must be filed
225.30 	on the 15th day of the fourth month following the end of the
225.31 	month in which falls the last day of the period for which the
225.32 	return is made, except that the returns of corporations must be
225.33 	filed on the 15th day of the third month following the end of
225.34 	the month tax year of the unitary group in which falls the last
225.35 	day of the period for which the return is made;
225.36 	(4) in the case of a final return of a decedent for a
226.1 	fractional part of a year, the return must be filed on the 15th
226.2 	day of the fourth month following the close of the 12-month
226.3 	period that began with the first day of that fractional part of
226.4 	a year;
226.5 	(5) in the case of the return of a cooperative association,
226.6 	returns must be filed on or before the 15th day of the ninth
226.7 	month following the close of the taxable year;
226.8 	(6) if a corporation has been divested from a unitary group
226.9 	and files a return for a fractional part of a year in which it
226.10 	was a member of a unitary business that files a combined report
226.11 	under section 290.34, subdivision 2, the divested corporation's
226.12 	return must be filed on the 15th day of the third month
226.13 	following the close of the common accounting period that
226.14 	includes the fractional year;
226.15 	(7) returns of entertainment entities must be filed on
226.16 	April 15 following the close of the calendar year;
226.17 	(8) returns required to be filed under section 289A.08,
226.18 	subdivision 4, must be filed on the 15th day of the fifth month
226.19 	following the close of the taxable year;
226.20 	(9) returns of mining companies must be filed on May 1
226.21 	following the close of the calendar year; and
226.22 	(10) returns required to be filed with the commissioner
226.23 	under section 289A.12, subdivision 2, 4 to 10, or 14, must be
226.24 	filed within 30 days after being demanded by the commissioner.
226.25 	
EFFECTIVE DATE. This section is effective for fractional
226.26 	years closing after December 31, 2004.

226.27 	Sec. 3. Minnesota Statutes 2004, section 289A.19,
226.28 	subdivision 4, is amended to read:
226.29 		Subd. 4.Estate tax returns. When in the commissioner's
226.30 	judgment good cause exists, the commissioner may extend the time
226.31 	for filing an estate tax return for not more than six months.
226.32 	When an extension to file the federal estate tax return has been
226.33 	granted under section 6081 of the Internal Revenue Code, the
226.34 	time for filing the estate tax return is extended for that
226.35 	period. If the estate requests an extension to file an estate
226.36 	tax return within the time provided in section 289A.18,
227.1 	subdivision 3, the commissioner shall extend the time for filing
227.2 	the estate tax return for six months.
227.3 	
EFFECTIVE DATE. This section is effective for estates of
227.4 	decedents dying after December 31, 2004.

227.5 	Sec. 4. Minnesota Statutes 2004, section 289A.31,
227.6 	subdivision 2, is amended to read:
227.7 		Subd. 2.Joint income tax returns.  (a) If a joint income
227.8 	tax return is made by a husband and wife, the liability for the
227.9 	tax is joint and several.  A spouse who qualifies for relief
227.10 	from a liability attributable to an underpayment under section
227.11 	6015(b) of the Internal Revenue Code is relieved of the state
227.12 	income tax liability on the underpayment.
227.13 	(b) In the case of individuals who were a husband and wife
227.14 	prior to the dissolution of their marriage or their legal
227.15 	separation, or prior to the death of one of the individuals, for
227.16 	tax liabilities reported on a joint or combined return, the
227.17 	liability of each person is limited to the proportion of the tax
227.18 	due on the return that equals that person's proportion of the
227.19 	total tax due if the husband and wife filed separate returns for
227.20 	the taxable year.  This provision is effective only when the
227.21 	commissioner receives written notice of the marriage
227.22 	dissolution, legal separation, or death of a spouse from the
227.23 	husband or wife.  No refund may be claimed by an ex-spouse,
227.24 	legally separated or widowed spouse for any taxes paid more than
227.25 	60 days before receipt by the commissioner of the written notice.
227.26 	(c) A request for calculation of separate liability
227.27 	pursuant to paragraph (b) for taxes reported on a return must be
227.28 	made within six years after the due date of the return.  For
227.29 	calculation of separate liability for taxes assessed by the
227.30 	commissioner under section 289A.35 or 289A.37, the request must
227.31 	be made within six years after the date of assessment.  The
227.32 	commissioner is not required to calculate separate liability if
227.33 	the remaining unpaid liability for which recalculation is
227.34 	requested is $100 or less.
227.35 	
EFFECTIVE DATE. This section is effective for requests
227.36 	for relief made on or after the day following final enactment.

228.1 	Sec. 5. Minnesota Statutes 2004, section 289A.38,
228.2 	subdivision 7, is amended to read:
228.3 		Subd. 7.Federal tax changes.  If the amount of income,
228.4 	items of tax preference, deductions, or credits for any year of
228.5 	a taxpayer as reported to the Internal Revenue Service is
228.6 	changed or corrected by the commissioner of Internal Revenue or
228.7 	other officer of the United States or other competent authority,
228.8 	or where a renegotiation of a contract or subcontract with the
228.9 	United States results in a change in income, items of tax
228.10 	preference, deductions, credits, or withholding tax, or, in the
228.11 	case of estate tax, where there are adjustments to the taxable
228.12 	estate resulting in a change to the credit for state death
228.13 	taxes, the taxpayer shall report the change or correction or
228.14 	renegotiation results in writing to the commissioner.  The
228.15 	report must be submitted within 180 days after the final
228.16 	determination and must be in the form of either an amended
228.17 	Minnesota estate, withholding tax, corporate franchise tax,or
228.18 	income tax return conceding the accuracy of the federal
228.19 	determination or a letter detailing how the federal
228.20 	determination is incorrect or does not change the Minnesota
228.21 	tax.  An amended Minnesota income tax return must be accompanied
228.22 	by an amended property tax refund return, if necessary.  A
228.23 	taxpayer filing an amended federal tax return must also file a
228.24 	copy of the amended return with the commissioner of revenue
228.25 	within 180 days after filing the amended return.
228.26 	
EFFECTIVE DATE. This section is effective the day
228.27 	following final enactment.

228.28 	Sec. 6. Minnesota Statutes 2004, section 289A.39,
228.29 	subdivision 1, is amended to read:
228.30 		Subdivision 1.Extensions for service members.  (a) The
228.31 	limitations of time provided by this chapter, chapter 290
228.32 	relating to income taxes, chapter 271 relating to the Tax Court
228.33 	for filing returns, paying taxes, claiming refunds, commencing
228.34 	action thereon, appealing to the Tax Court from orders relating
228.35 	to income taxes, and the filing of petitions under chapter 278
228.36 	that would otherwise be due May 15, 1996 prior to May 1 of the
229.1 	year in which the taxes are payable, and appealing to the
229.2 	Supreme Court from decisions of the Tax Court relating to income
229.3 	taxes are extended, as provided in section 7508 of the Internal
229.4 	Revenue Code.
229.5 	(b) If a member of the National Guard or reserves is called
229.6 	to active duty in the armed forces, the limitations of time
229.7 	provided by this chapter and chapters 290 and 290A relating to
229.8 	income taxes and claims for property tax refunds are extended by
229.9 	the following period of time:
229.10 	(1) in the case of an individual whose active service is in
229.11 	the United States, six months; or
229.12 	(2) in the case of an individual whose active service
229.13 	includes service abroad, the period of initial service plus six
229.14 	months.
229.15 	Nothing in this paragraph reduces the time within which an
229.16 	act is required or permitted under paragraph (a).
229.17 	(c) If an individual entitled to the benefit of paragraph
229.18 	(a) files a return during the period disregarded under paragraph
229.19 	(a), interest must be paid on an overpayment or refundable
229.20 	credit from the due date of the return, notwithstanding section
229.21 	289A.56, subdivision 2.
229.22 	(d) The provisions of this subdivision apply to the spouse
229.23 	of an individual entitled to the benefits of this subdivision
229.24 	with respect to a joint return filed by the spouses.
229.25 	
EFFECTIVE DATE. This section is effective for taxable
229.26 	years beginning after December 31, 2002, and for property taxes
229.27 	payable after 2003.

229.28 	Sec. 7. Minnesota Statutes 2004, section 289A.50,
229.29 	subdivision 1a, is amended to read:
229.30 		Subd. 1a.Refund form.  On or before January 1, 2000, the
229.31 	commissioner of revenue shall prepare and make available to
229.32 	taxpayers a form for filing claims for refund of taxes paid in
229.33 	excess of the amount due. If the commissioner fails to prepare
229.34 	a form under this subdivision by January 1, 2000, any claims for
229.35 	refund made after January 1, 2000, and up to ten days after the
229.36 	form is made available to taxpayers are deemed to be made in
230.1 	compliance with the requirement of the form.The commissioner
230.2 	may require corporate franchise taxpayers claiming a refund of
230.3 	corporate franchise taxes paid in excess of the amount lawfully
230.4 	due to include on the claim for refund or amended return
230.5 	information necessary for payment of the taxes paid in excess of
230.6 	taxes lawfully due by electronic means.
230.7 	
EFFECTIVE DATE. This section is effective for claims for
230.8 	refund filed after December 31, 2005.

230.9 	Sec. 8. Minnesota Statutes 2004, section 289A.60,
230.10 	subdivision 6, is amended to read:
230.11 		Subd. 6.Penalty for false or fraudulent return,
230.12 	evasion. (a) If a person files a false or fraudulent return, or
230.13 	attempts in any manner to evade or defeat a tax or payment of
230.14 	tax, there is imposed on the person a penalty equal to 50
230.15 	percent of the tax, less amounts paid by the person on the basis
230.16 	of the false or fraudulent return, due for the period to which
230.17 	the return related.
230.18 	(b) If a person files a false or fraudulent return that
230.19 	includes a claim for refund, there is imposed on the person a
230.20 	penalty equal to 50 percent of the portion of any refund claimed
230.21 	that is attributable to fraud.  The penalty under this paragraph
230.22 	is in addition to any penalty imposed under paragraph (a).
230.23 	
EFFECTIVE DATE. This section is effective for returns
230.24 	filed after December 31, 2005.

230.25 	Sec. 9. Minnesota Statutes 2004, section 289A.60,
230.26 	subdivision 12, is amended to read:
230.27 		Subd. 12.Penalties relating to property tax refunds.
 230.28 	(a) If the commissioner determines that a property tax refund
230.29 	claim is or was excessive and was filed with fraudulent intent,
230.30 	the claim must be disallowed in full.  If the claim has been
230.31 	paid, the amount disallowed may be recovered by assessment and
230.32 	collection.
230.33 	(b) If it is determined that a property tax refund claim is
230.34 	excessive and was negligently prepared, ten percent of the
230.35 	corrected claim must be disallowed.  If the claim has been paid,
230.36 	the amount disallowed must be recovered by assessment and
231.1 	collection.
231.2 	(c) (b) An owner who without reasonable cause fails to give
231.3 	a certificate of rent constituting property tax to a renter, as
231.4 	required by section 290A.19, paragraph (a), is liable to the
231.5 	commissioner for a penalty of $100 for each failure.
231.6 	(d) (c) If the owner or managing agent knowingly gives rent
231.7 	certificates that report total rent constituting property taxes
231.8 	in excess of the amount of actual rent constituting property
231.9 	taxes paid on the rented part of a property, the owner or
231.10 	managing agent is liable for a penalty equal to the greater of
231.11 	(1) $100 or (2) 50 percent of the excess that is reported.  An
231.12 	overstatement of rent constituting property taxes is presumed to
231.13 	be knowingly made if it exceeds by ten percent or more the
231.14 	actual rent constituting property taxes.
231.15 	
EFFECTIVE DATE. This section is effective for returns
231.16 	filed after December 31, 2005.

231.17 	Sec. 10. Minnesota Statutes 2004, section 289A.60,
231.18 	subdivision 13, is amended to read:
231.19 		Subd. 13.Penalties for tax return preparers.  (a) If an
231.20 	understatement of liability with respect to a return or claim
231.21 	for refund is due to a reckless disregard of laws and rules or 
231.22 	willful attempt in any manner to understate the liability for a
231.23 	tax by a person who is a tax return preparer with respect to the
231.24 	return or claim, the person shall pay to the commissioner a
231.25 	penalty of $500.  If a part of a property tax refund claim is
231.26 	excessive due to a reckless disregard or willful attempt in any
231.27 	manner to overstate the claim for relief allowed under chapter
231.28 	290A by a person who is a tax refund or return preparer, the
231.29 	person shall pay to the commissioner a penalty of $500 with
231.30 	respect to the claim.  These penalties may not be assessed
231.31 	against the employer of a tax return preparer unless the
231.32 	employer was actively involved in the reckless disregard or 
231.33 	willful attempt to understate the liability for a tax or to
231.34 	overstate the claim for refund.  These penalties are income tax
231.35 	liabilities and may be assessed at any time as provided in
231.36 	section 289A.38, subdivision 5.
232.1 	(b) A civil action in the name of the state of Minnesota
232.2 	may be commenced to enjoin any person who is a tax return
232.3 	preparer doing business in this state from further engaging in
232.4 	any conduct described in paragraph (c).  An action under this
232.5 	paragraph must be brought by the attorney general in the
232.6 	district court for the judicial district of the tax return
232.7 	preparer's residence or principal place of business, or in which
232.8 	the taxpayer with respect to whose tax return the action is
232.9 	brought resides.  The court may exercise its jurisdiction over
232.10 	the action separate and apart from any other action brought by
232.11 	the state of Minnesota against the tax return preparer or any
232.12 	taxpayer.
232.13 	(c) In an action under paragraph (b), if the court finds
232.14 	that a tax return preparer has:
232.15 	(1) engaged in any conduct subject to a civil penalty under
232.16 	section 289A.60 or a criminal penalty under section 289A.63;
232.17 	(2) misrepresented the preparer's eligibility to practice
232.18 	before the Department of Revenue, or otherwise misrepresented
232.19 	the preparer's experience or education as a tax return preparer;
232.20 	(3) guaranteed the payment of any tax refund or the
232.21 	allowance of any tax credit; or
232.22 	(4) engaged in any other fraudulent or deceptive conduct
232.23 	that substantially interferes with the proper administration of
232.24 	state tax law, and injunctive relief is appropriate to prevent
232.25 	the recurrence of that conduct,
232.26 	the court may enjoin the person from further engaging in that
232.27 	conduct.
232.28 	(d) If the court finds that a tax return preparer has
232.29 	continually or repeatedly engaged in conduct described in
232.30 	paragraph (c), and that an injunction prohibiting that conduct
232.31 	would not be sufficient to prevent the person's interference
232.32 	with the proper administration of state tax laws, the court may
232.33 	enjoin the person from acting as a tax return preparer.  The
232.34 	court may not enjoin the employer of a tax return preparer for
232.35 	conduct described in paragraph (c) engaged in by one or more of
232.36 	the employer's employees unless the employer was also actively
233.1 	involved in that conduct.
233.2 	(e) For purposes of this subdivision, the term
233.3 	"understatement of liability" means an understatement of the net
233.4 	amount payable with respect to a tax imposed by state tax law,
233.5 	or an overstatement of the net amount creditable or refundable
233.6 	with respect to a tax.  The determination of whether or not
233.7 	there is an understatement of liability must be made without
233.8 	regard to any administrative or judicial action involving the
233.9 	taxpayer.  For purposes of this subdivision, the amount
233.10 	determined for underpayment of estimated tax under either
233.11 	section 289A.25 or 289A.26 is not considered an understatement
233.12 	of liability.
233.13 	(f) For purposes of this subdivision, the term
233.14 	"overstatement of claim" means an overstatement of the net
233.15 	amount refundable with respect to a claim for property tax
233.16 	relief provided by chapter 290A.  The determination of whether
233.17 	or not there is an overstatement of a claim must be made without
233.18 	regard to administrative or judicial action involving the
233.19 	claimant.
233.20 	(g) For purposes of this section, the term "tax refund or
233.21 	return preparer" means an individual who prepares for
233.22 	compensation, or who employs one or more individuals to prepare
233.23 	for compensation, a return of tax, or a claim for refund of
233.24 	tax.  The preparation of a substantial part of a return or claim
233.25 	for refund is treated as if it were the preparation of the
233.26 	entire return or claim for refund.  An individual is not
233.27 	considered a tax return preparer merely because the individual:
233.28 	(1) gives typing, reproducing, or other mechanical
233.29 	assistance;
233.30 	(2) prepares a return or claim for refund of the employer,
233.31 	or an officer or employee of the employer, by whom the
233.32 	individual is regularly and continuously employed;
233.33 	(3) prepares a return or claim for refund of any person as
233.34 	a fiduciary for that person; or
233.35 	(4) prepares a claim for refund for a taxpayer in response
233.36 	to a tax order issued to the taxpayer.
234.1 	
EFFECTIVE DATE. This section is effective for returns
234.2 	filed after December 31, 2005.

234.3 	Sec. 11. Minnesota Statutes 2004, section 290.01,
234.4 	subdivision 7b, is amended to read:
234.5 		Subd. 7b.Resident trust. (a) Resident trust means a
234.6 	trust, except a grantor type trust, which either (1) was created
234.7 	by a will of a decedent who at death was domiciled in this state
234.8 	or (2) is an irrevocable trust, the grantor of which was
234.9 	domiciled in this state at the time the trust became
234.10 	irrevocable.  For the purpose of this subdivision, a trust is
234.11 	considered irrevocable to the extent the grantor is not treated
234.12 	as the owner thereof under sections 671 to 678 of the Internal
234.13 	Revenue Code.  The term "grantor type trust" means a trust where
234.14 	the income or gains of the trust are taxable to the grantor or
234.15 	others treated as substantial owners under sections 671 to 678
234.16 	of the Internal Revenue Code. This paragraph applies to trusts,
234.17 	except grantor type trusts, that became irrevocable after
234.18 	December 31, 1995, or are first administered in Minnesota after
234.19 	December 31, 1995.
234.20 	(b) This paragraph applies to trusts, except grantor type
234.21 	trusts, that are not governed under paragraph (a).  A trust,
234.22 	except a grantor type trust, is a resident trust only if two or
234.23 	more of the following conditions are satisfied:
234.24 	(i) a majority of the discretionary decisions of the
234.25 	trustees relative to the investment of trust assets are made in
234.26 	Minnesota;
234.27 	(ii) a majority of the discretionary decisions of the
234.28 	trustees relative to the distributions of trust income and
234.29 	principal are made in Minnesota;
234.30 	(iii) the official books and records of the trust,
234.31 	consisting of the original minutes of trustee meetings and the
234.32 	original trust instruments, are located in Minnesota.
234.33 	(c) For purposes of paragraph (b), if the trustees delegate
234.34 	decisions and actions to an agent or custodian, the actions and
234.35 	decisions of the agent or custodian must not be taken into
234.36 	account in determining whether the trust is administered in
235.1 	Minnesota, if:
235.2 	(i) the delegation was permitted under the trust agreement;
235.3 	(ii) the trustees retain the power to revoke the delegation
235.4 	on reasonable notice; and 
235.5 	(iii) the trustees monitor and evaluate the performance of
235.6 	the agent or custodian on a regular basis as is reasonably
235.7 	determined by the trustees.
235.8 	
EFFECTIVE DATE. This section is effective for taxable
235.9 	years beginning after December 31, 2004.

235.10 	Sec. 12. Minnesota Statutes 2004, section 290.01,
235.11 	subdivision 19a, is amended to read:
235.12 		Subd. 19a.Additions to federal taxable income.  For
235.13 	individuals, estates, and trusts, there shall be added to
235.14 	federal taxable income:
235.15 	(1)(i) interest income on obligations of any state other
235.16 	than Minnesota or a political or governmental subdivision,
235.17 	municipality, or governmental agency or instrumentality of any
235.18 	state other than Minnesota exempt from federal income taxes
235.19 	under the Internal Revenue Code or any other federal statute;
235.20 	and
235.21 	(ii) exempt-interest dividends as defined in section
235.22 	852(b)(5) of the Internal Revenue Code, except the portion of
235.23 	the exempt-interest dividends derived from interest income on
235.24 	obligations of the state of Minnesota or its political or
235.25 	governmental subdivisions, municipalities, governmental agencies
235.26 	or instrumentalities, but only if the portion of the
235.27 	exempt-interest dividends from such Minnesota sources paid to
235.28 	all shareholders represents 95 percent or more of the
235.29 	exempt-interest dividends that are paid by the regulated
235.30 	investment company as defined in section 851(a) of the Internal
235.31 	Revenue Code, or the fund of the regulated investment company as
235.32 	defined in section 851(g) of the Internal Revenue Code, making
235.33 	the payment; and
235.34 	(iii) for the purposes of items (i) and (ii), interest on
235.35 	obligations of an Indian tribal government described in section
235.36 	7871(c) of the Internal Revenue Code shall be treated as
236.1 	interest income on obligations of the state in which the tribe
236.2 	is located;
236.3 	(2) the amount of income taxes paid or accrued within the
236.4 	taxable year under this chapter and income the amount of taxes
236.5 	based on net income paid to any other state or to any province
236.6 	or territory of Canada, to the extent allowed as a deduction
236.7 	under section 63(d) of the Internal Revenue Code, but the
236.8 	addition may not be more than the amount by which the itemized
236.9 	deductions as allowed under section 63(d) of the Internal
236.10 	Revenue Code exceeds the amount of the standard deduction as
236.11 	defined in section 63(c) of the Internal Revenue Code.  For the
236.12 	purpose of this paragraph, the disallowance of itemized
236.13 	deductions under section 68 of the Internal Revenue Code of
236.14 	1986, income tax is the last itemized deduction disallowed;
236.15 	(3) the capital gain amount of a lump sum distribution to
236.16 	which the special tax under section 1122(h)(3)(B)(ii) of the Tax
236.17 	Reform Act of 1986, Public Law 99-514, applies;
236.18 	(4) the amount of income taxes paid or accrued within the
236.19 	taxable year under this chapter and income taxes based on net
236.20 	income paid to any other state or any province or territory of
236.21 	Canada, to the extent allowed as a deduction in determining
236.22 	federal adjusted gross income.  For the purpose of this
236.23 	paragraph, income taxes do not include the taxes imposed by
236.24 	sections 290.0922, subdivision 1, paragraph (b), 290.9727,
236.25 	290.9728, and 290.9729;
236.26 	(5) the amount of expense, interest, or taxes disallowed
236.27 	pursuant to section 290.10other than expenses or interest used
236.28 	in computing net interest income for the subtraction allowed
236.29 	under subdivision 19b, clause (1);
236.30 	(6) the amount of a partner's pro rata share of net income
236.31 	which does not flow through to the partner because the
236.32 	partnership elected to pay the tax on the income under section
236.33 	6242(a)(2) of the Internal Revenue Code; and
236.34 	(7) 80 percent of the depreciation deduction allowed under
236.35 	section 168(k) of the Internal Revenue Code.  For purposes of
236.36 	this clause, if the taxpayer has an activity that in the taxable
237.1 	year generates a deduction for depreciation under section 168(k)
237.2 	and the activity generates a loss for the taxable year that the
237.3 	taxpayer is not allowed to claim for the taxable year, "the
237.4 	depreciation allowed under section 168(k)" for the taxable year
237.5 	is limited to excess of the depreciation claimed by the activity
237.6 	under section 168(k) over the amount of the loss from the
237.7 	activity that is not allowed in the taxable year.  In succeeding
237.8 	taxable years when the losses not allowed in the taxable year
237.9 	are allowed, the depreciation under section 168(k) is allowed.
237.10 	
EFFECTIVE DATE. This section is effective for tax years
237.11 	beginning after December 31, 2004.

237.12 	Sec. 13. Minnesota Statutes 2004, section 290.01,
237.13 	subdivision 19b, is amended to read:
237.14 		Subd. 19b.Subtractions from federal taxable income.  For
237.15 	individuals, estates, and trusts, there shall be subtracted from
237.16 	federal taxable income:
237.17 	(1) net interest income on obligations of any authority,
237.18 	commission, or instrumentality of the United States to the
237.19 	extent includable in taxable income for federal income tax
237.20 	purposes but exempt from state income tax under the laws of the
237.21 	United States;
237.22 	(2) if included in federal taxable income, the amount of
237.23 	any overpayment of income tax to Minnesota or to any other
237.24 	state, for any previous taxable year, whether the amount is
237.25 	received as a refund or as a credit to another taxable year's
237.26 	income tax liability;
237.27 	(3) the amount paid to others, less the amount used to
237.28 	claim the credit allowed under section 290.0674, not to exceed
237.29 	$1,625 for each qualifying child in grades kindergarten to 6 and
237.30 	$2,500 for each qualifying child in grades 7 to 12, for tuition,
237.31 	textbooks, and transportation of each qualifying child in
237.32 	attending an elementary or secondary school situated in
237.33 	Minnesota, North Dakota, South Dakota, Iowa, or Wisconsin,
237.34 	wherein a resident of this state may legally fulfill the state's
237.35 	compulsory attendance laws, which is not operated for profit,
237.36 	and which adheres to the provisions of the Civil Rights Act of
238.1 	1964 and chapter 363A.  For the purposes of this clause,
238.2 	"tuition" includes fees or tuition as defined in section
238.3 	290.0674, subdivision 1, clause (1).  As used in this clause,
238.4 	"textbooks" includes books and other instructional materials and
238.5 	equipment purchased or leased for use in elementary and
238.6 	secondary schools in teaching only those subjects legally and
238.7 	commonly taught in public elementary and secondary schools in
238.8 	this state.  Equipment expenses qualifying for deduction
238.9 	includes expenses as defined and limited in section 290.0674,
238.10 	subdivision 1, clause (3).  "Textbooks" does not include
238.11 	instructional books and materials used in the teaching of
238.12 	religious tenets, doctrines, or worship, the purpose of which is
238.13 	to instill such tenets, doctrines, or worship, nor does it
238.14 	include books or materials for, or transportation to,
238.15 	extracurricular activities including sporting events, musical or
238.16 	dramatic events, speech activities, driver's education, or
238.17 	similar programs.  For purposes of the subtraction provided by
238.18 	this clause, "qualifying child" has the meaning given in section
238.19 	32(c)(3) of the Internal Revenue Code;
238.20 	(4) income as provided under section 290.0802;
238.21 	(5) to the extent included in federal adjusted gross
238.22 	income, income realized on disposition of property exempt from
238.23 	tax under section 290.491;
238.24 	(6) to the extent included in federal taxable income,
238.25 	postservice benefits for youth community service under section
238.26 	124D.42 for volunteer service under United States Code, title
238.27 	42, sections 12601 to 12604;
238.28 	(7) to the extent not deducted in determining federal
238.29 	taxable income by an individual who does not itemize deductions
238.30 	for federal income tax purposes for the taxable year, an amount
238.31 	equal to 50 percent of the excess of charitable contributions
238.32 	allowable as a deduction for the taxable year under section
238.33 	170(a) of the Internal Revenue Code over $500 ;
238.34 	(8) (7) for taxable years beginning before January 1, 2008,
238.35 	the amount of the federal small ethanol producer credit allowed
238.36 	under section 40(a)(3) of the Internal Revenue Code which is
239.1 	included in gross income under section 87 of the Internal
239.2 	Revenue Code;
239.3 	(9) (8) for individuals who are allowed a federal foreign
239.4 	tax credit for taxes that do not qualify for a credit under
239.5 	section 290.06, subdivision 22, an amount equal to the carryover
239.6 	of subnational foreign taxes for the taxable year, but not to
239.7 	exceed the total subnational foreign taxes reported in claiming
239.8 	the foreign tax credit.  For purposes of this clause, "federal
239.9 	foreign tax credit" means the credit allowed under section 27 of
239.10 	the Internal Revenue Code, and "carryover of subnational foreign
239.11 	taxes" equals the carryover allowed under section 904(c) of the
239.12 	Internal Revenue Code minus national level foreign taxes to the
239.13 	extent they exceed the federal foreign tax credit;
239.14 	(10) (9) in each of the five tax years immediately
239.15 	following the tax year in which an addition is required under
239.16 	subdivision 19a, clause (7), or 19c, clause (15), in the case of
239.17 	a shareholder of a corporation that is an S corporation,an
239.18 	amount equal to one-fifth of the delayed depreciation.  For
239.19 	purposes of this clause, "delayed depreciation" means the amount
239.20 	of the addition made by the taxpayer under subdivision 19a,
239.21 	clause (7), or subdivision 19c, clause (15), in the case of a
239.22 	shareholder of an S corporation,minus the positive value of any
239.23 	net operating loss under section 172 of the Internal Revenue
239.24 	Code generated for the tax year of the addition.  The resulting
239.25 	delayed depreciation cannot be less than zero; and
239.26 	(11) (10) job opportunity building zone income as provided
239.27 	under section 469.316.
239.28 	
EFFECTIVE DATE. The amendment to clause (9) is effective
239.29 	retroactively for tax years beginning after December 31, 2001.
239.30 	The rest of this section is effective for the tax years
239.31 	beginning after December 31, 2004.

239.32 	Sec. 14. Minnesota Statutes 2004, section 290.01,
239.33 	subdivision 19c, is amended to read:
239.34 		Subd. 19c.Corporations; additions to federal taxable
239.35 	income.  For corporations, there shall be added to federal
239.36 	taxable income:
240.1 	(1) the amount of any deduction taken for federal income
240.2 	tax purposes for income, excise, or franchise taxes based on net
240.3 	income or related minimum taxes, including but not limited to
240.4 	the tax imposed under section 290.0922, paid by the corporation
240.5 	to Minnesota, another state, a political subdivision of another
240.6 	state, the District of Columbia, or any foreign country or
240.7 	possession of the United States;
240.8 	(2) interest not subject to federal tax upon obligations
240.9 	of:  the United States, its possessions, its agencies, or its
240.10 	instrumentalities; the state of Minnesota or any other state,
240.11 	any of its political or governmental subdivisions, any of its
240.12 	municipalities, or any of its governmental agencies or
240.13 	instrumentalities; the District of Columbia; or Indian tribal
240.14 	governments;
240.15 	(3) exempt-interest dividends received as defined in
240.16 	section 852(b)(5) of the Internal Revenue Code;
240.17 	(4) the amount of any net operating loss deduction taken
240.18 	for federal income tax purposes under section 172 or 832(c)(10)
240.19 	of the Internal Revenue Code or operations loss deduction under
240.20 	section 810 of the Internal Revenue Code;
240.21 	(5) the amount of any special deductions taken for federal
240.22 	income tax purposes under sections 241 to 247 of the Internal
240.23 	Revenue Code;
240.24 	(6) losses from the business of mining, as defined in
240.25 	section 290.05, subdivision 1, clause (a), that are not subject
240.26 	to Minnesota income tax;
240.27 	(7) the amount of any capital losses deducted for federal
240.28 	income tax purposes under sections 1211 and 1212 of the Internal
240.29 	Revenue Code;
240.30 	(8) the exempt foreign trade income of a foreign sales
240.31 	corporation under sections 921(a) and 291 of the Internal
240.32 	Revenue Code;
240.33 	(9) the amount of percentage depletion deducted under
240.34 	sections 611 through 614 and 291 of the Internal Revenue Code;
240.35 	(10) for certified pollution control facilities placed in
240.36 	service in a taxable year beginning before December 31, 1986,
241.1 	and for which amortization deductions were elected under section
241.2 	169 of the Internal Revenue Code of 1954, as amended through
241.3 	December 31, 1985, the amount of the amortization deduction
241.4 	allowed in computing federal taxable income for those
241.5 	facilities;
241.6 	(11) the amount of any deemed dividend from a foreign
241.7 	operating corporation determined pursuant to section 290.17,
241.8 	subdivision 4, paragraph (g);
241.9 	(12) the amount of any environmental tax paid under section
241.10 	59(a) of the Internal Revenue Code;
241.11 	(13) the amount of a partner's pro rata share of net income
241.12 	which does not flow through to the partner because the
241.13 	partnership elected to pay the tax on the income under section
241.14 	6242(a)(2) of the Internal Revenue Code;
241.15 	(14) (13) the amount of net income excluded under section
241.16 	114 of the Internal Revenue Code;
241.17 	(15) (14) any increase in subpart F income, as defined in
241.18 	section 952(a) of the Internal Revenue Code, for the taxable
241.19 	year when subpart F income is calculated without regard to the
241.20 	provisions of section 614 of Public Law 107-147; and
241.21 	(16) (15) 80 percent of the depreciation deduction allowed
241.22 	under section 168(k) (1)(A) and (k)(4)(A) of the Internal Revenue
241.23 	Code.  For purposes of this clause, if the taxpayer has an
241.24 	activity that in the taxable year generates a deduction for
241.25 	depreciation under section 168(k) (1)(A) and (k)(4)(A) and the
241.26 	activity generates a loss for the taxable year that the taxpayer
241.27 	is not allowed to claim for the taxable year, "the depreciation
241.28 	allowed under section 168(k) (1)(A) and (k)(4)(A) " for the
241.29 	taxable year is limited to excess of the depreciation claimed by
241.30 	the activity under section 168(k) (1)(A) and (k)(4)(A) over the
241.31 	amount of the loss from the activity that is not allowed in the
241.32 	taxable year.  In succeeding taxable years when the losses not
241.33 	allowed in the taxable year are allowed, the depreciation under
241.34 	section 168(k) (1)(A) and (k)(4)(A) is allowed.
241.35 	
EFFECTIVE DATE. This section is effective the day
241.36 	following final enactment.

242.1 	Sec. 15. Minnesota Statutes 2004, section 290.06,
242.2 	subdivision 22, is amended to read:
242.3 		Subd. 22.Credit for taxes paid to another state.  (a) A
242.4 	taxpayer who is liable for taxes based on or measured by net
242.5 	income to another state, as provided in paragraphs (b) through
242.6 	(f), upon income allocated or apportioned to Minnesota, is
242.7 	entitled to a credit for the tax paid to another state if the
242.8 	tax is actually paid in the taxable year or a subsequent taxable
242.9 	year.  A taxpayer who is a resident of this state pursuant to
242.10 	section 290.01, subdivision 7, clause (2) paragraph (b), and who
242.11 	is subject to income tax as a resident in the state of the
242.12 	individual's domicile is not allowed this credit unless the
242.13 	state of domicile does not allow a similar credit.
242.14 	(b) For an individual, estate, or trust, the credit is
242.15 	determined by multiplying the tax payable under this chapter by
242.16 	the ratio derived by dividing the income subject to tax in the
242.17 	other state that is also subject to tax in Minnesota while a
242.18 	resident of Minnesota by the taxpayer's federal adjusted gross
242.19 	income, as defined in section 62 of the Internal Revenue Code,
242.20 	modified by the addition required by section 290.01, subdivision
242.21 	19a, clause (1), and the subtraction allowed by section 290.01,
242.22 	subdivision 19b, clause (1), to the extent the income is
242.23 	allocated or assigned to Minnesota under sections 290.081 and
242.24 	290.17.
242.25 	(c) If the taxpayer is an athletic team that apportions all
242.26 	of its income under section 290.17, subdivision 5, the credit is
242.27 	determined by multiplying the tax payable under this chapter by
242.28 	the ratio derived from dividing the total net income subject to
242.29 	tax in the other state by the taxpayer's Minnesota taxable
242.30 	income.
242.31 	(d) The credit determined under paragraph (b) or (c) shall
242.32 	not exceed the amount of tax so paid to the other state on the
242.33 	gross income earned within the other state subject to tax under
242.34 	this chapter, nor shall the allowance of the credit reduce the
242.35 	taxes paid under this chapter to an amount less than what would
242.36 	be assessed if such income amount was excluded from taxable net
243.1 	income.
243.2 	(e) In the case of the tax assessed on a lump sum
243.3 	distribution under section 290.032, the credit allowed under
243.4 	paragraph (a) is the tax assessed by the other state on the lump
243.5 	sum distribution that is also subject to tax under section
243.6 	290.032, and shall not exceed the tax assessed under section
243.7 	290.032.  To the extent the total lump sum distribution defined
243.8 	in section 290.032, subdivision 1, includes lump sum
243.9 	distributions received in prior years or is all or in part an
243.10 	annuity contract, the reduction to the tax on the lump sum
243.11 	distribution allowed under section 290.032, subdivision 2,
243.12 	includes tax paid to another state that is properly apportioned
243.13 	to that distribution.
243.14 	(f) If a Minnesota resident reported an item of income to
243.15 	Minnesota and is assessed tax in such other state on that same
243.16 	income after the Minnesota statute of limitations has expired,
243.17 	the taxpayer shall receive a credit for that year under
243.18 	paragraph (a), notwithstanding any statute of limitations to the
243.19 	contrary.  The claim for the credit must be submitted within one
243.20 	year from the date the taxes were paid to the other state.  The
243.21 	taxpayer must submit sufficient proof to show entitlement to a
243.22 	credit.
243.23 	(g) For the purposes of this subdivision, a resident
243.24 	shareholder of a corporation treated as an "S" corporation under
243.25 	section 290.9725, must be considered to have paid a tax imposed
243.26 	on the shareholder in an amount equal to the shareholder's pro
243.27 	rata share of any net income tax paid by the S corporation to
243.28 	another state.  For the purposes of the preceding sentence, the
243.29 	term "net income tax" means any tax imposed on or measured by a
243.30 	corporation's net income.
243.31 	(h) For the purposes of this subdivision, a resident
243.32 	partner of an entity taxed as a partnership under the Internal
243.33 	Revenue Code must be considered to have paid a tax imposed on
243.34 	the partner in an amount equal to the partner's pro rata share
243.35 	of any net income tax paid by the partnership to another state.
243.36 	For purposes of the preceding sentence, the term "net income"
244.1 	tax means any tax imposed on or measured by a partnership's net
244.2 	income.
244.3 	(i) For the purposes of this subdivision, "another state":
244.4 	(1) includes:
244.5 	(i) the District of Columbia; and
244.6 	(ii) a province or territory of Canada; but
244.7 	(2) excludes Puerto Rico and the several territories
244.8 	organized by Congress.
244.9 	(j) The limitations on the credit in paragraphs (b), (c),
244.10 	and (d), are imposed on a state by state basis.
244.11 	(k) For a tax imposed by a province or territory of Canada,
244.12 	the tax for purposes of this subdivision is the excess of the
244.13 	tax over the amount of the foreign tax credit allowed under
244.14 	section 27 of the Internal Revenue Code.  In determining the
244.15 	amount of the foreign tax credit allowed, the net income taxes
244.16 	imposed by Canada on the income are deducted first.  Any
244.17 	remaining amount of the allowable foreign tax credit reduces the
244.18 	provincial or territorial tax that qualifies for the credit
244.19 	under this subdivision.
244.20 	
EFFECTIVE DATE. This section is effective for tax years
244.21 	beginning after December 31, 2004.

244.22 	Sec. 16. Minnesota Statutes 2004, section 290.0671,
244.23 	subdivision 1a, is amended to read:
244.24 		Subd. 1a.Definitions.  For purposes of this section, the
244.25 	terms "qualifying child," and "earned income," and "adjusted
244.26 	gross income" have the meanings given in section 32(c) of the
244.27 	Internal Revenue Code, and the term "adjusted gross income" has
244.28 	the meaning given in section 62 of the Internal Revenue Code.
244.29 	"Earned income of the lesser-earning spouse" has the
244.30 	meaning given in section 290.0675, subdivision 1, paragraph (d).
244.31 	
EFFECTIVE DATE. This section is effective for taxable
244.32 	years beginning after December 31, 2004.

244.33 	Sec. 17. Minnesota Statutes 2004, section 290.0674,
244.34 	subdivision 1, is amended to read:
244.35 		Subdivision 1.Credit allowed.  An individual is allowed
244.36 	a credit against the tax imposed by this chapter in an amount
245.1 	equal to 75 percent of the amount paid for education-related
245.2 	expenses for a qualifying child in kindergarten through grade
245.3 	12.  For purposes of this section, "education-related expenses"
245.4 	means:
245.5 	(1) fees or tuition for instruction by an instructor under
245.6 	section 120A.22, subdivision 10, clause (1), (2), (3), (4), or
245.7 	(5), or a member of the Minnesota Music Teachers Association,
245.8 	and who is not a lineal ancestor or sibling of the dependent for
245.9 	instruction outside the regular school day or school year,
245.10 	including tutoring, driver's education offered as part of school
245.11 	curriculum, regardless of whether it is taken from a public or
245.12 	private entity or summer camps, in grade or age appropriate
245.13 	curricula that supplement curricula and instruction available
245.14 	during the regular school year, that assists a dependent to
245.15 	improve knowledge of core curriculum areas or to expand
245.16 	knowledge and skills under the graduation rule under section
245.17 	120B.02, paragraph (e), clauses (1) to (7), (9), and (10) 
245.18 	required academic standards under section 120B.021, subdivision
245.19 	1, and the elective standard under section 120B.022, subdivision
245.20 	1, clause (2), and that do not include the teaching of religious
245.21 	tenets, doctrines, or worship, the purpose of which is to
245.22 	instill such tenets, doctrines, or worship;
245.23 	(2) expenses for textbooks, including books and other
245.24 	instructional materials and equipment purchased or leased for
245.25 	use in elementary and secondary schools in teaching only those
245.26 	subjects legally and commonly taught in public elementary and
245.27 	secondary schools in this state.  "Textbooks" does not include
245.28 	instructional books and materials used in the teaching of
245.29 	religious tenets, doctrines, or worship, the purpose of which is
245.30 	to instill such tenets, doctrines, or worship, nor does it
245.31 	include books or materials for extracurricular activities
245.32 	including sporting events, musical or dramatic events, speech
245.33 	activities, driver's education, or similar programs;
245.34 	(3) a maximum expense of $200 per family for personal
245.35 	computer hardware, excluding single purpose processors, and
245.36 	educational software that assists a dependent to improve
246.1 	knowledge of core curriculum areas or to expand knowledge and
246.2 	skills under the graduation rule under section 120B.02required
246.3 	academic standards under section 120B.021, subdivision 1, and
246.4 	the elective standard under section 120B.022, subdivision 1,
246.5 	clause (2),purchased for use in the taxpayer's home and not
246.6 	used in a trade or business regardless of whether the computer
246.7 	is required by the dependent's school; and
246.8 	(4) the amount paid to others for transportation of a
246.9 	qualifying child attending an elementary or secondary school
246.10 	situated in Minnesota, North Dakota, South Dakota, Iowa, or
246.11 	Wisconsin, wherein a resident of this state may legally fulfill
246.12 	the state's compulsory attendance laws, which is not operated
246.13 	for profit, and which adheres to the provisions of the Civil
246.14 	Rights Act of 1964 and chapter 363A.
246.15 	For purposes of this section, "qualifying child" has the
246.16 	meaning given in section 32(c)(3) of the Internal Revenue Code.
246.17 	
EFFECTIVE DATE. This section is effective for tax years
246.18 	beginning after December 31, 2004.

246.19 	Sec. 18. Minnesota Statutes 2004, section 290.92,
246.20 	subdivision 4b, is amended to read:
246.21 		Subd. 4b.Withholding by partnerships.  (a) A partnership
246.22 	shall deduct and withhold a tax as provided in paragraph (b) for
246.23 	nonresident individual partners based on their distributive
246.24 	shares of partnership income for a taxable year of the
246.25 	partnership.
246.26 	(b) The amount of tax withheld is determined by multiplying
246.27 	the partner's distributive share allocable to Minnesota under
246.28 	section 290.17, paid or credited during the taxable year by the
246.29 	highest rate used to determine the income tax liability for an
246.30 	individual under section 290.06, subdivision 2c, except that the
246.31 	amount of tax withheld may be determined by the commissioner if
246.32 	the partner submits a withholding exemption certificate under
246.33 	subdivision 5.
246.34 	(c) The commissioner may reduce or abate the tax withheld
246.35 	under this subdivision if the partnership had reasonable cause
246.36 	to believe that no tax was due under this section.
247.1 	(d) Notwithstanding paragraph (a), a partnership is not
247.2 	required to deduct and withhold tax for a nonresident partner if:
247.3 	(1) the partner elects to have the tax due paid as part of
247.4 	the partnership's composite return under section 289A.08,
247.5 	subdivision 7;
247.6 	(2) the partner has Minnesota assignable federal adjusted
247.7 	gross income from the partnership of less than $1,000; or
247.8 	(3) the partnership is liquidated or terminated, the income
247.9 	was generated by a transaction related to the termination or
247.10 	liquidation, and no cash or other property was distributed in
247.11 	the current or prior taxable year; or 
247.12 	(4) the distributive shares of partnership income are
247.13 	attributable to:
247.14 	(i) income required to be recognized because of discharge
247.15 	of indebtedness;
247.16 	(ii) income recognized because of a sale, exchange, or
247.17 	other disposition of real estate, depreciable property, or
247.18 	property described in section 179 of the Internal Revenue Code;
247.19 	or
247.20 	(iii) income recognized on the sale, exchange, or other
247.21 	disposition of any property that has been the subject of a basis
247.22 	reduction pursuant to section 108, 734, 743, 754, or 1017 of the
247.23 	Internal Revenue Code
247.24 	to the extent that the income does not include cash received or
247.25 	receivable or, if there is cash received or receivable, to the
247.26 	extent that the cash is required to be used to pay indebtedness
247.27 	by the partnership or a secured debt on partnership property; or 
247.28 	(5) the partnership is a publicly traded partnership, as
247.29 	defined in section 7704(b) of the Internal Revenue Code.
247.30 	(e) For purposes of subdivision 6a, and sections 289A.09,
247.31 	subdivision 2, 289A.20, subdivision 2, paragraph (c), 289A.50,
247.32 	289A.56, 289A.60, and 289A.63, a partnership is considered an
247.33 	employer.
247.34 	(f) To the extent that income is exempt from withholding
247.35 	under paragraph (d), clause (4), the commissioner has a lien in
247.36 	an amount up to the amount that would be required to be withheld
248.1 	with respect to the income of the partner attributable to the
248.2 	partnership interest, but for the application of paragraph (d),
248.3 	clause (4).  The lien arises under section 270.69 from the date
248.4 	of assessment of the tax against the partner, and attaches to
248.5 	that partner's share of the profits and any other money due or
248.6 	to become due to that partner in respect of the partnership.
248.7 	Notice of the lien may be sent by mail to the partnership,
248.8 	without the necessity for recording the lien.  The notice has
248.9 	the force and effect of a levy under section 270.70, and is
248.10 	enforceable against the partnership in the manner provided by
248.11 	that section.  Upon payment in full of the liability subsequent
248.12 	to the notice of lien, the partnership must be notified that the
248.13 	lien has been satisfied.
248.14 	
EFFECTIVE DATE. This section is effective for taxable
248.15 	years beginning after December 31, 2004.

248.16 	Sec. 19. Minnesota Statutes 2004, section 291.005,
248.17 	subdivision 1, is amended to read:
248.18 		Subdivision 1.Scope.  Unless the context otherwise
248.19 	clearly requires, the following terms used in this chapter shall
248.20 	have the following meanings:
248.21 	(1) "Federal gross estate" means the gross estate of a
248.22 	decedent as valued and otherwise determined for federal estate
248.23 	tax purposes by federal taxing authorities pursuant to the
248.24 	provisions of the Internal Revenue Code.
248.25 	(2) "Minnesota gross estate" means the federal gross estate
248.26 	of a decedent after (a) excluding therefrom any property
248.27 	included therein which has its situs outside Minnesota, and (b)
248.28 	including therein any property omitted from the federal gross
248.29 	estate which is includable therein, has its situs in Minnesota,
248.30 	and was not disclosed to federal taxing authorities.
248.31 	(3) "Personal representative" means the executor,
248.32 	administrator or other person appointed by the court to
248.33 	administer and dispose of the property of the decedent.  If
248.34 	there is no executor, administrator or other person appointed,
248.35 	qualified, and acting within this state, then any person in
248.36 	actual or constructive possession of any property having a situs
249.1 	in this state which is included in the federal gross estate of
249.2 	the decedent shall be deemed to be a personal representative to
249.3 	the extent of the property and the Minnesota estate tax due with
249.4 	respect to the property.
249.5 	(4) "Resident decedent" means an individual whose domicile
249.6 	at the time of death was in Minnesota.
249.7 	(5) "Nonresident decedent" means an individual whose
249.8 	domicile at the time of death was not in Minnesota.
249.9 	(6) "Situs of property" means, with respect to real
249.10 	property, the state or country in which it is located; with
249.11 	respect to tangible personal property, the state or country in
249.12 	which it was normally kept or located at the time of the
249.13 	decedent's death; and with respect to intangible personal
249.14 	property, the state or country in which the decedent was
249.15 	domiciled at death.
249.16 	(7) "Commissioner" means the commissioner of revenue or any
249.17 	person to whom the commissioner has delegated functions under
249.18 	this chapter.
249.19 	(8) "Internal Revenue Code" means the United States
249.20 	Internal Revenue Code of 1986, as amended through December 31,
249.21 	2002 April 15, 2005.
249.22 	(9) "Minnesota adjusted taxable estate" means federal
249.23 	adjusted taxable estate as defined by section 2011(b)(3) of the
249.24 	Internal Revenue Code, increased by the amount of deduction for
249.25 	state death taxes allowed under section 2058 of the Internal
249.26 	Revenue Code.
249.27 	
EFFECTIVE DATE. The change to clause (8) is effective for
249.28 	estates of decedents dying after January 31, 2003, and the new
249.29 	clause (9) is effective for estates of decedents dying after
249.30 	December 31, 2004.

249.31 	Sec. 20. Minnesota Statutes 2004, section 291.03,
249.32 	subdivision 1, is amended to read:
249.33 		Subdivision 1.Tax amount.  The tax imposed shall be an
249.34 	amount equal to the proportion of the maximum credit for state
249.35 	death taxes computed under section 2011 of the Internal Revenue
249.36 	Code, as amended through December 31, 2000, for state death
250.1 	taxes but using Minnesota adjusted taxable estate instead of
250.2 	federal adjusted taxable estate,as the Minnesota gross estate
250.3 	bears to the value of the federal gross estate.  The tax
250.4 	determined under this paragraph shall not be greater than the
250.5 	federal estate tax amount computed by applying the rates and
250.6 	brackets under section 2001 (c) of the Internal Revenue Code
250.7 	after the allowance of to the Minnesota adjusted gross estate
250.8 	and subtracting the federal credits credit allowed under section
250.9 	2010 of the Internal Revenue Code of 1986, as amended through
250.10 	December 31, 2000.  For the purposes of this section, expenses
250.11 	which are deducted for federal income tax purposes under section
250.12 	642(g) of the Internal Revenue Code as amended through December
250.13 	31, 2002, are not allowable in computing the tax under this
250.14 	chapter.
250.15 	
EFFECTIVE DATE. This section is effective for estates of
250.16 	decedents dying after December 31, 2004.

250.17 	Sec. 21. REPEALER.
 250.18 	Minnesota Rules, parts 8093.2000; and 8093.3000, are
250.19 	repealed effective the day following final enactment.

250.20 	ARTICLE 7
250.21 	SALES AND USE TAXES

250.22 	Section 1. Minnesota Statutes 2004, section 289A.38,
250.23 	subdivision 6, is amended to read:
250.24 		Subd. 6.Omission in excess of 25 percent.  Additional
250.25 	taxes may be assessed within 6-1/2 years after the due date of
250.26 	the return or the date the return was filed, whichever is later,
250.27 	if:
250.28 	(1) the taxpayer omits from gross income an amount properly
250.29 	includable in it that is in excess of 25 percent of the amount
250.30 	of gross income stated in the return;
250.31 	(2) the taxpayer omits from a sales, use,or withholding
250.32 	tax return an amount of taxes in excess of 25 percent of the
250.33 	taxes reported in the return; or
250.34 	(3) the taxpayer omits from the gross estate assets in
250.35 	excess of 25 percent of the gross estate reported in the return.
250.36 	
EFFECTIVE DATE. This section is effective the day
251.1 	following final enactment.

251.2 	Sec. 2. Minnesota Statutes 2004, section 289A.38, is
251.3 	amended by adding a subdivision to read:
251.4 		Subd. 15.Purchaser filed refund claims. If a purchaser
251.5 	refund claim is filed under section 289A.50, subdivision 2a, and
251.6 	the basis for the claim is that the purchaser was improperly
251.7 	charged tax on an improvement to real property or on the
251.8 	purchase of nontaxable services, sales or use tax may be
251.9 	assessed for the cost of materials used to make the real
251.10 	property improvement or to perform the nontaxable service.  The
251.11 	assessment may be made against the person making the improvement
251.12 	to real property or the sale of nontaxable services, within the
251.13 	period prescribed in subdivision 1, or within one year after the
251.14 	date of the refund order, whichever is later.
251.15 	
EFFECTIVE DATE. This section is effective for purchaser
251.16 	refund claims filed on or after July 1, 2005.

251.17 	Sec. 3. Minnesota Statutes 2004, section 289A.40,
251.18 	subdivision 2, is amended to read:
251.19 		Subd. 2.Bad debt loss.  If a claim relates to an
251.20 	overpayment because of a failure to deduct a loss due to a bad
251.21 	debt or to a security becoming worthless, the claim is
251.22 	considered timely if filed within seven years from the date
251.23 	prescribed for the filing of the return.  A claim relating to an
251.24 	overpayment of taxes under chapter 297A must be filed within
251.25 	3-1/2 years from the date prescribed for filing the return, plus
251.26 	any extensions granted for filing the return, but only if filed
251.27 	within the extended time.  The refund or credit is limited to
251.28 	the amount of overpayment attributable to the loss.  "Bad debt"
251.29 	for purposes of this subdivision, has the same meaning as that
251.30 	term is used in United States Code, title 26, section 166,
251.31 	except that for a claim relating to an overpayment of taxes
251.32 	under chapter 297A the following are excluded from the
251.33 	calculation of bad debt:  financing charges or interest; sales
251.34 	or use taxes charged on the purchase price; uncollectible
251.35 	amounts on property that remain in the possession of the seller
251.36 	until the full purchase price is paid; expenses incurred in
252.1 	attempting to collect any debt; and repossessed property.
252.2 	
EFFECTIVE DATE. For claims relating to an overpayment of
252.3 	taxes under chapter 297A, this section is effective for sales
252.4 	and purchases made on or after January 1, 2004; for all other
252.5 	bad debts or claims, this section is effective on or after July
252.6 	1, 2003.

252.7 	Sec. 4. Minnesota Statutes 2004, section 289A.40, is
252.8 	amended by adding a subdivision to read:
252.9 		Subd. 4.Purchaser filed refund claims. A claim for
252.10 	refund of taxes paid on a transaction not subject to tax under
252.11 	chapter 297A, where the purchaser may apply directly to the
252.12 	commissioner under section 289A.50, subdivision 2a, must be
252.13 	filed within 3-1/2 years from the 20th day of the month
252.14 	following the month of the invoice date for the purchase.
252.15 	
EFFECTIVE DATE. This section is effective for claims
252.16 	filed on or after the day following final enactment.

252.17 	Sec. 5. Minnesota Statutes 2004, section 289A.40, is
252.18 	amended by adding a subdivision to read:
252.19 		Subd. 5.Capital equipment refund claims. A claim for
252.20 	refund for taxes paid under chapter 297A on capital equipment
252.21 	must be filed within 3-1/2 years from the 20th day of the month
252.22 	following the month of the invoice date for the purchase of the
252.23 	capital equipment.  A claim for refund for taxes imposed on
252.24 	capital equipment under section 297A.63 must be filed within
252.25 	3-1/2 years from the date prescribed for filing the return, or
252.26 	one year from the date of an order assessing tax under section
252.27 	289A.37, subdivision 1, upon payment in full of the tax,
252.28 	penalties, and interest shown on the order, whichever period
252.29 	expires later.
252.30 	
EFFECTIVE DATE. This section is effective for claims
252.31 	filed on or after the day following final enactment.

252.32 	Sec. 6. Minnesota Statutes 2004, section 297A.61,
252.33 	subdivision 3, is amended to read:
252.34 		Subd. 3.Sale and purchase.  (a) "Sale" and "purchase"
252.35 	include, but are not limited to, each of the transactions listed
252.36 	in this subdivision.
253.1 	(b) Sale and purchase include:
253.2 	(1) any transfer of title or possession, or both, of
253.3 	tangible personal property, whether absolutely or conditionally,
253.4 	for a consideration in money or by exchange or barter; and
253.5 	(2) the leasing of or the granting of a license to use or
253.6 	consume, for a consideration in money or by exchange or barter,
253.7 	tangible personal property, other than a manufactured home used
253.8 	for residential purposes for a continuous period of 30 days or
253.9 	more.
253.10 	(c) Sale and purchase include the production, fabrication,
253.11 	printing, or processing of tangible personal property for a
253.12 	consideration for consumers who furnish either directly or
253.13 	indirectly the materials used in the production, fabrication,
253.14 	printing, or processing.
253.15 	(d) Sale and purchase include the preparing for a
253.16 	consideration of food.  Notwithstanding section 297A.67,
253.17 	subdivision 2, taxable food includes, but is not limited to, the
253.18 	following:
253.19 	(1) prepared food sold by the retailer;
253.20 	(2) soft drinks;
253.21 	(3) candy; and 
253.22 	(4) dietary supplements; and 
253.23 	(5) all food sold through vending machines.
253.24 	(e) A sale and a purchase includes the furnishing for a
253.25 	consideration of electricity, gas, water, or steam for use or
253.26 	consumption within this state.
253.27 	(f) A sale and a purchase includes the transfer for a
253.28 	consideration of prewritten computer software whether delivered
253.29 	electronically, by load and leave, or otherwise.
253.30 	(g) A sale and a purchase includes the furnishing for a
253.31 	consideration of the following services:
253.32 	(1) the privilege of admission to places of amusement,
253.33 	recreational areas, or athletic events, and the making available
253.34 	of amusement devices, tanning facilities, reducing salons, steam
253.35 	baths, turkish baths, health clubs, and spas or athletic
253.36 	facilities;
254.1 	(2) lodging and related services by a hotel, rooming house,
254.2 	resort, campground, motel, or trailer camp and the granting of
254.3 	any similar license to use real property in a specific facility,
254.4 	other than the renting or leasing of it for a continuous period
254.5 	of 30 days or more under an enforceable written agreement that
254.6 	may not be terminated without prior notice;
254.7 	(3) nonresidential parking services, whether on a
254.8 	contractual, hourly, or other periodic basis, except for parking
254.9 	at a meter;
254.10 	(4) the granting of membership in a club, association, or
254.11 	other organization if:
254.12 	(i) the club, association, or other organization makes
254.13 	available for the use of its members sports and athletic
254.14 	facilities, without regard to whether a separate charge is
254.15 	assessed for use of the facilities; and
254.16 	(ii) use of the sports and athletic facility is not made
254.17 	available to the general public on the same basis as it is made
254.18 	available to members.
254.19 	Granting of membership means both onetime initiation fees and
254.20 	periodic membership dues.  Sports and athletic facilities
254.21 	include golf courses; tennis, racquetball, handball, and squash
254.22 	courts; basketball and volleyball facilities; running tracks;
254.23 	exercise equipment; swimming pools; and other similar athletic
254.24 	or sports facilities;
254.25 	(5) delivery of aggregate materials and concrete block by a
254.26 	third party if the delivery would be subject to the sales tax if
254.27 	provided by the seller of the aggregate material or concrete
254.28 	block; and
254.29 	(6) services as provided in this clause:
254.30 	(i) laundry and dry cleaning services including cleaning,
254.31 	pressing, repairing, altering, and storing clothes, linen
254.32 	services and supply, cleaning and blocking hats, and carpet,
254.33 	drapery, upholstery, and industrial cleaning.  Laundry and dry
254.34 	cleaning services do not include services provided by coin
254.35 	operated facilities operated by the customer;
254.36 	(ii) motor vehicle washing, waxing, and cleaning services,
255.1 	including services provided by coin operated facilities operated
255.2 	by the customer, and rustproofing, undercoating, and towing of
255.3 	motor vehicles;
255.4 	(iii) building and residential cleaning, maintenance, and
255.5 	disinfecting and exterminating services;
255.6 	(iv) detective, security, burglar, fire alarm, and armored
255.7 	car services; but not including services performed within the
255.8 	jurisdiction they serve by off-duty licensed peace officers as
255.9 	defined in section 626.84, subdivision 1, or services provided
255.10 	by a nonprofit organization for monitoring and electronic
255.11 	surveillance of persons placed on in-home detention pursuant to
255.12 	court order or under the direction of the Minnesota Department
255.13 	of Corrections;
255.14 	(v) pet grooming services;
255.15 	(vi) lawn care, fertilizing, mowing, spraying and sprigging
255.16 	services; garden planting and maintenance; tree, bush, and shrub
255.17 	pruning, bracing, spraying, and surgery; indoor plant care;
255.18 	tree, bush, shrub, and stump removal; and tree trimming for
255.19 	public utility lines.  Services performed under a construction
255.20 	contract for the installation of shrubbery, plants, sod, trees,
255.21 	bushes, and similar items are not taxable;
255.22 	(vii) massages, except when provided by a licensed health
255.23 	care facility or professional or upon written referral from a
255.24 	licensed health care facility or professional for treatment of
255.25 	illness, injury, or disease; and
255.26 	(viii) the furnishing of lodging, board, and care services
255.27 	for animals in kennels and other similar arrangements, but
255.28 	excluding veterinary and horse boarding services.
255.29 	In applying the provisions of this chapter, the terms
255.30 	"tangible personal property" and "sales at retail" include
255.31 	taxable services listed in clause (6), items (i) to (vi) and
255.32 	(viii), and the provision of these taxable services, unless
255.33 	specifically provided otherwise.  Services performed by an
255.34 	employee for an employer are not taxable.  Services performed by
255.35 	a partnership or association for another partnership or
255.36 	association are not taxable if one of the entities owns or
256.1 	controls more than 80 percent of the voting power of the equity
256.2 	interest in the other entity.  Services performed between
256.3 	members of an affiliated group of corporations are not taxable.
256.4 	For purposes of the preceding sentence, "affiliated group of
256.5 	corporations" includes those entities that would be classified
256.6 	as members of an affiliated group under United States Code,
256.7 	title 26, section 1504, and that are eligible to file a
256.8 	consolidated tax return for federal income tax purposes.
256.9 	(h) A sale and a purchase includes the furnishing for a
256.10 	consideration of tangible personal property or taxable services
256.11 	by the United States or any of its agencies or
256.12 	instrumentalities, or the state of Minnesota, its agencies,
256.13 	instrumentalities, or political subdivisions.
256.14 	(i) A sale and a purchase includes the furnishing for a
256.15 	consideration of telecommunications services, including cable
256.16 	television services and direct satellite services.
256.17 	Telecommunications services are taxed to the extent allowed
256.18 	under federal law.
256.19 	(j) A sale and a purchase includes the furnishing for a
256.20 	consideration of installation if the installation charges would
256.21 	be subject to the sales tax if the installation were provided by
256.22 	the seller of the item being installed.
256.23 	(k) A sale and a purchase includes the rental of a vehicle
256.24 	by a motor vehicle dealer to a customer when (1) the vehicle is
256.25 	rented by the customer for a consideration, or (2) the motor
256.26 	vehicle dealer is reimbursed pursuant to a service contract as
256.27 	defined in section 65B.29, subdivision 1, clause (1).
256.28 	
EFFECTIVE DATE. This section is effective the day
256.29 	following final enactment.

256.30 	Sec. 7. Minnesota Statutes 2004, section 297A.61,
256.31 	subdivision 4, is amended to read:
256.32 		Subd. 4.Retail sale.  (a) A "retail sale" means any
256.33 	sale, lease, or rental for any purpose,other than resale,
256.34 	sublease, or subrent of items by the purchaser in the normal
256.35 	course of business as defined in subdivision 21.
256.36 	(b) A sale of property used by the owner only by leasing it
257.1 	to others or by holding it in an effort to lease it, and put to
257.2 	no use by the owner other than resale after the lease or effort
257.3 	to lease, is a sale of property for resale.
257.4 	(c) A sale of master computer software that is purchased
257.5 	and used to make copies for sale or lease is a sale of property
257.6 	for resale.
257.7 	(d) A sale of building materials, supplies, and equipment
257.8 	to owners, contractors, subcontractors, or builders for the
257.9 	erection of buildings or the alteration, repair, or improvement
257.10 	of real property is a retail sale in whatever quantity sold,
257.11 	whether the sale is for purposes of resale in the form of real
257.12 	property or otherwise.
257.13 	(e) A sale of carpeting, linoleum, or similar floor
257.14 	covering to a person who provides for installation of the floor
257.15 	covering is a retail sale and not a sale for resale since a sale
257.16 	of floor covering which includes installation is a contract for
257.17 	the improvement of real property.
257.18 	(f) A sale of shrubbery, plants, sod, trees, and similar
257.19 	items to a person who provides for installation of the items is
257.20 	a retail sale and not a sale for resale since a sale of
257.21 	shrubbery, plants, sod, trees, and similar items that includes
257.22 	installation is a contract for the improvement of real property.
257.23 	(g) A sale of tangible personal property that is awarded as
257.24 	prizes is a retail sale and is not considered a sale of property
257.25 	for resale.
257.26 	(h) A sale of tangible personal property utilized or
257.27 	employed in the furnishing or providing of services under
257.28 	subdivision 3, paragraph (g), clause (1), including, but not
257.29 	limited to, property given as promotional items, is a retail
257.30 	sale and is not considered a sale of property for resale.
257.31 	(i) A sale of tangible personal property used in conducting
257.32 	lawful gambling under chapter 349 or the state lottery under
257.33 	chapter 349A, including, but not limited to, property given as
257.34 	promotional items, is a retail sale and is not considered a sale
257.35 	of property for resale.
257.36 	(j) A sale of machines, equipment, or devices that are used
258.1 	to furnish, provide, or dispense goods or services, including,
258.2 	but not limited to, coin-operated devices, is a retail sale and
258.3 	is not considered a sale of property for resale.
258.4 	(k) In the case of a lease, a retail sale occurs when an
258.5 	obligation to make a lease payment becomes due under the terms
258.6 	of the agreement or the trade practices of the lessor.
258.7 	(l) In the case of a conditional sales contract, a retail
258.8 	sale occurs upon the transfer of title or possession of the
258.9 	tangible personal property.
258.10 	
EFFECTIVE DATE. This section is effective the day
258.11 	following final enactment.

258.12 	Sec. 8. Minnesota Statutes 2004, section 297A.64,
258.13 	subdivision 4, is amended to read:
258.14 		Subd. 4.Exemptions.  (a) The tax and the fee imposed by
258.15 	this section do not apply to a lease or rental of (1) a vehicle
258.16 	to be used by the lessee to provide a licensed taxi service; (2)
258.17 	a hearse or limousine used in connection with a burial or
258.18 	funeral service; or (3) a van designed or adapted primarily for
258.19 	transporting property rather than passengers. The tax and the
258.20 	fee imposed under this section do not apply when the lease or
258.21 	rental of a vehicle is exempt from the tax imposed under section
258.22 	297A.62, subdivision 1.
258.23 	(b) The lessor may elect not to charge the fee imposed in
258.24 	subdivision 2 if in the previous calendar year the lessor had no
258.25 	more than 20 vehicles available for lease that would have been
258.26 	subject to tax under this section, or no more than $50,000 in
258.27 	gross receipts that would have been subject to tax under this
258.28 	section.
258.29 	
EFFECTIVE DATE. This section is effective the day
258.30 	following final enactment.

258.31 	Sec. 9. Minnesota Statutes 2004, section 297A.668,
258.32 	subdivision 1, is amended to read:
258.33 		Subdivision 1. applicability.  The provisions of this
258.34 	section apply regardless of the characterization of a product as
258.35 	tangible personal property, a digital good, or a service; but do
258.36 	not apply to telecommunications services,or the sales of motor
259.1 	vehicles, watercraft, aircraft, modular homes, manufactured
259.2 	homes, or mobile homes.  These provisions only apply to
259.3 	determine a seller's obligation to pay or collect and remit a
259.4 	sales or use tax with respect to the seller's sale of a
259.5 	product.  These provisions do not affect the obligation of a
259.6 	seller as purchaser to remit tax on the use of the product.
259.7 	
EFFECTIVE DATE. This section is effective the day
259.8 	following final enactment.

259.9 	Sec. 10. Minnesota Statutes 2004, section 297A.668,
259.10 	subdivision 5, is amended to read:
259.11 		Subd. 5.Transportation equipment.  (a) The retail sale,
259.12 	including lease or rental, of transportation equipment shall be
259.13 	sourced the same as a retail sale in accordance with the
259.14 	provisions of subdivision 2, notwithstanding the exclusion of
259.15 	lease or rental in subdivision 2.
259.16 	(b) "Transportation equipment" means any of the following:
259.17 	(1) locomotives and railcars that are utilized for the
259.18 	carriage of persons or property in interstate commerce; and/or 
259.19 	(2) trucks and truck-tractors with a gross vehicle weight
259.20 	rating (GVWR) of 10,001 pounds or greater, trailers,
259.21 	semitrailers, or passenger buses that are:
259.22 	(i) registered through the international registration plan;
259.23 	and
259.24 	(ii) operated under authority of a carrier authorized and
259.25 	certified by the United States Department of Transportation or
259.26 	another federal authority to engage in the carriage of persons
259.27 	or property in interstate commerce;
259.28 	(3) aircraft that are operated by air carriers authorized
259.29 	and certificated by the United States Department of
259.30 	Transportation or another federal or a foreign authority to
259.31 	engage in the carriage of persons or property in interstate
259.32 	commerce; or 
259.33 	(4) containers designed for use on and component parts
259.34 	attached or secured on the transportation equipment described in
259.35 	items (1) through (3).
259.36 	
EFFECTIVE DATE. This section is effective for sales and
260.1 	purchases made on or after January 1, 2004.

260.2 	Sec. 11. Minnesota Statutes 2004, section 297A.67,
260.3 	subdivision 2, is amended to read:
260.4 		Subd. 2.Food and food ingredients. Except as otherwise
260.5 	provided in this subdivision,food and food ingredients are
260.6 	exempt.  For purposes of this subdivision, "food" and "food
260.7 	ingredients" mean substances, whether in liquid, concentrated,
260.8 	solid, frozen, dried, or dehydrated form, that are sold for
260.9 	ingestion or chewing by humans and are consumed for their taste
260.10 	or nutritional value.  Food and food ingredients exempt under
260.11 	this subdivision do not include candy, soft drinks, food sold
260.12 	through vending machines, dietary supplements,and prepared
260.13 	foods.  Food and food ingredients do not include alcoholic
260.14 	beverages, dietary supplements,and tobacco.  For purposes of
260.15 	this subdivision, "alcoholic beverages" means beverages that are
260.16 	suitable for human consumption and contain one-half of one
260.17 	percent or more of alcohol by volume.  For purposes of this
260.18 	subdivision, "tobacco" means cigarettes, cigars, chewing or pipe
260.19 	tobacco, or any other item that contains tobacco.  For purposes
260.20 	of this subdivision, "dietary supplements" means any product,
260.21 	other than tobacco, intended to supplement the diet that:
260.22 	(1) contains one or more of the following dietary
260.23 	ingredients:
260.24 	(i) a vitamin;
260.25 	(ii) a mineral;
260.26 	(iii) an herb or other botanical;
260.27 	(iv) an amino acid;
260.28 	(v) a dietary substance for use by humans to supplement the
260.29 	diet by increasing the total dietary intake; and
260.30 	(vi) a concentrate, metabolite, constituent, extract, or
260.31 	combination of any ingredient described in items (i) to (v);
260.32 	(2) is intended for ingestion in tablet, capsule, powder,
260.33 	softgel, gelcap, or liquid form, or if not intended for
260.34 	ingestion in such form, is not represented as conventional food
260.35 	and is not represented for use as a sole item of a meal or of
260.36 	the diet; and
261.1 	(3) is required to be labeled as a dietary supplement,
261.2 	identifiable by the supplement facts box found on the label and
261.3 	as required pursuant to Code of Federal Regulations, title 21,
261.4 	section 101.36.
261.5 	
EFFECTIVE DATE. This section is effective for sales made
261.6 	on or after the day following final enactment.

261.7 	Sec. 12. Minnesota Statutes 2004, section 297A.67,
261.8 	subdivision 7, is amended to read:
261.9 		Subd. 7.medicines drugs; medical devices.
 261.10 	(a) Prescribed Sales of the following drugs and medical devices
261.11 	are exempt:
261.12 	(1) drugs and medicine, and insulin, intended for internal
261.13 	or external use, in the cure, mitigation, treatment, or
261.14 	prevention of illness or disease in human beings are exempt.
261.15 	"Prescribed drugs and medicine" includes use, including 
261.16 	over-the-counter drugs or medicine prescribed by a licensed
261.17 	health care professional.
261.18 	(b) Nonprescription medicines consisting principally
261.19 	(determined by the weight of all ingredients) of analgesics that
261.20 	are approved by the United States Food and Drug Administration
261.21 	for internal use by human beings are exempt.  For purposes of
261.22 	this subdivision, "principally" means greater than 50 percent
261.23 	analgesics by weight.
261.24 	(c) Prescription glasses, hospital beds, fever
261.25 	thermometers, reusable ;
261.26 	(2) single-use finger-pricking devices for the extraction
261.27 	of blood, blood glucose monitoring machines,and
261.28 	other single-use devices and single-use diagnostic agents used
261.29 	in diagnosing, monitoring, or treating diabetes, and therapeutic
261.30 	and ;
261.31 	(3) insulin and medical oxygen for human use, regardless of
261.32 	whether prescribed or sold over the counter;
261.33 	(4) prosthetic devices are exempt.  "Therapeutic devices"
261.34 	means devices that are attached or applied to the human body to
261.35 	cure, heal, or alleviate injury, illness, or disease, either
261.36 	directly or by administering a curative agent.  "Prosthetic
262.1 	devices" means devices that replace injured, diseased, or
262.2 	missing parts of the human body, either temporarily or
262.3 	permanently ;
262.4 	(5) durable medical equipment for home use only;
262.5 	(6) mobility enhancing equipment; and 
262.6 	(7) prescription corrective eyeglasses.
262.7 	(b) For purposes of this subdivision:
262.8 	(1) "Drug" means a compound, substance, or preparation, and
262.9 	any component of a compound, substance, or preparation, other
262.10 	than food and food ingredients, dietary supplements, or
262.11 	alcoholic beverages that is:
262.12 	(i) recognized in the official United States Pharmacopoeia,
262.13 	official Homeopathic Pharmacopoeia of the United States, or
262.14 	official National Formulary, and supplement to any of them;
262.15 	(ii) intended for use in the diagnosis, cure, mitigation,
262.16 	treatment, or prevention of disease; or 
262.17 	(iii) intended to affect the structure or any function of
262.18 	the body.
262.19 	(2) "Durable medical equipment" means equipment, including
262.20 	repair and replacement parts, but not including mobility
262.21 	enhancing equipment, that:
262.22 	(i) can withstand repeated use;
262.23 	(ii) is primarily and customarily used to serve a medical
262.24 	purpose;
262.25 	(iii) generally is not useful to a person in the absence of
262.26 	illness or injury; and 
262.27 	(iv) is not worn in or on the body.
262.28 	(3) "Mobility enhancing equipment" means equipment,
262.29 	including repair and replacement parts, but not including
262.30 	durable medical equipment, that:
262.31 	(i) is primarily and customarily used to provide or
262.32 	increase the ability to move from one place to another and that
262.33 	is appropriate for use either in a home or a motor vehicle;
262.34 	(ii) is not generally used by persons with normal mobility;
262.35 	and 
262.36 	(iii) does not include any motor vehicle or equipment on a
263.1 	motor vehicle normally provided by a motor vehicle manufacturer.
263.2 	(4) "Over-the-counter drug" means a drug that contains a
263.3 	label that identifies the product as a drug as required by Code
263.4 	of Federal Regulations, title 21, section 201.66.  The label
263.5 	must include a "drug facts" panel or a statement of the active
263.6 	ingredients with a list of those ingredients contained in the
263.7 	compound, substance, or preparation.  Over-the-counter drugs do
263.8 	not include grooming and hygiene products, regardless of whether
263.9 	they otherwise meet the definition.  "Grooming and hygiene
263.10 	products" are soaps, cleaning solutions, shampoo, toothpaste,
263.11 	mouthwash, antiperspirants, and suntan lotions and sunscreens.
263.12 	(5) "Prescribed" and "prescription" means a direction in
263.13 	the form of an order, formula, or recipe issued in any form of
263.14 	oral, written, electronic, or other means of transmission by a
263.15 	duly licensed health care professional.
263.16 	(6) "Prosthetic device" means a replacement, corrective, or
263.17 	supportive device, including repair and replacement parts, worn
263.18 	on or in the body to:
263.19 	(i) artificially replace a missing portion of the body;
263.20 	(ii) prevent or correct physical deformity or malfunction;
263.21 	or 
263.22 	(iii) support a weak or deformed portion of the body.
263.23 	Prosthetic device does not include corrective eyeglasses.
263.24 	
EFFECTIVE DATE. This section is effective for sales and
263.25 	purchases made after June 30, 2005.

263.26 	Sec. 13. Minnesota Statutes 2004, section 297A.67,
263.27 	subdivision 9, is amended to read:
263.28 		Subd. 9.Baby products. (a) Products such as lotion,
263.29 	creams, ointments, oil, powder, or shampoo, and other articles
263.30 	designed for application to the hair or skin of babies are
263.31 	exempt.
263.32 	(b) Baby bottles and nipples, pacifiers, teething rings,
263.33 	thumb sucking preventatives,and infant syringes are exempt.
263.34 	
EFFECTIVE DATE. This section is effective for sales and
263.35 	purchases made after June 30, 2005.

263.36 	Sec. 14. Minnesota Statutes 2004, section 297A.68,
264.1 	subdivision 2, is amended to read:
264.2 		Subd. 2.Materials consumed in industrial production.
 264.3 	(a) Materials stored, used, or consumed in industrial production
264.4 	of personal property intended to be sold ultimately at retail
264.5 	are exempt, whether or not the item so used becomes an
264.6 	ingredient or constituent part of the property produced.
264.7 	Materials that qualify for this exemption include, but are not
264.8 	limited to, the following:
264.9 	(1) chemicals, including chemicals used for cleaning food
264.10 	processing machinery and equipment;
264.11 	(2) materials, including chemicals, fuels, and electricity
264.12 	purchased by persons engaged in industrial production to treat
264.13 	waste generated as a result of the production process;
264.14 	(3) fuels, electricity, gas, and steam used or consumed in
264.15 	the production process, except that electricity, gas, or steam
264.16 	used for space heating, cooling, or lighting is exempt if (i) it
264.17 	is in excess of the average climate control or lighting for the
264.18 	production area, and (ii) it is necessary to produce that
264.19 	particular product;
264.20 	(4) petroleum products and lubricants;
264.21 	(5) packaging materials, including returnable containers
264.22 	used in packaging food and beverage products;
264.23 	(6) accessory tools, equipment, and other items that are
264.24 	separate detachable units with an ordinary useful life of less
264.25 	than 12 months used in producing a direct effect upon the
264.26 	product; and
264.27 	(7) the following materials, tools, and equipment used in
264.28 	metalcasting:  crucibles, thermocouple protection sheaths and
264.29 	tubes, stalk tubes, refractory materials, molten metal filters
264.30 	and filter boxes, degassing lances, and base blocks.
264.31 	(b) This exemption does not include:
264.32 	(1) machinery, equipment, implements, tools, accessories,
264.33 	appliances, contrivances and furniture and fixtures, except
264.34 	those listed in paragraph (a), clause (6); and
264.35 	(2) petroleum and special fuels used in producing or
264.36 	generating power for propelling ready-mixed concrete trucks on
265.1 	the public highways of this state.
265.2 	(c) Industrial production includes, but is not limited to,
265.3 	research, development, design or production of any tangible
265.4 	personal property, manufacturing, processing (other than by
265.5 	restaurants and consumers) of agricultural products (whether
265.6 	vegetable or animal), commercial fishing, refining, smelting,
265.7 	reducing, brewing, distilling, printing, mining, quarrying,
265.8 	lumbering, generating electricity, the production of road
265.9 	building materials, and the research, development, design, or
265.10 	production of computer software.  Industrial production does not
265.11 	include painting, cleaning, repairing or similar processing of
265.12 	property except as part of the original manufacturing process.
265.13 	(d) Industrial production does not include the furnishing
265.14 	of services listed in section 297A.61, subdivision 3, paragraph
265.15 	(g), clause (6), items (i) to (vi) and (viii).
265.16 	
EFFECTIVE DATE. This section is effective the day
265.17 	following final enactment.

265.18 	Sec. 15. Minnesota Statutes 2004, section 297A.68,
265.19 	subdivision 5, is amended to read:
265.20 		Subd. 5.Capital equipment.  (a) Capital equipment is
265.21 	exempt.  The tax must be imposed and collected as if the rate
265.22 	under section 297A.62, subdivision 1, applied, and then refunded
265.23 	in the manner provided in section 297A.75.
265.24 	"Capital equipment" means machinery and equipment purchased
265.25 	or leased, and used in this state by the purchaser or lessee
265.26 	primarily for manufacturing, fabricating, mining, or refining
265.27 	tangible personal property to be sold ultimately at retail if
265.28 	the machinery and equipment are essential to the integrated
265.29 	production process of manufacturing, fabricating, mining, or
265.30 	refining.  Capital equipment also includes machinery and
265.31 	equipment used primarily to electronically transmit results
265.32 	retrieved by a customer of an on-line computerized data
265.33 	retrieval system.
265.34 	(b) Capital equipment includes, but is not limited to:
265.35 	(1) machinery and equipment used to operate, control, or
265.36 	regulate the production equipment;
266.1 	(2) machinery and equipment used for research and
266.2 	development, design, quality control, and testing activities;
266.3 	(3) environmental control devices that are used to maintain
266.4 	conditions such as temperature, humidity, light, or air pressure
266.5 	when those conditions are essential to and are part of the
266.6 	production process;
266.7 	(4) materials and supplies used to construct and install
266.8 	machinery or equipment;
266.9 	(5) repair and replacement parts, including accessories,
266.10 	whether purchased as spare parts, repair parts, or as upgrades
266.11 	or modifications to machinery or equipment;
266.12 	(6) materials used for foundations that support machinery
266.13 	or equipment;
266.14 	(7) materials used to construct and install special purpose
266.15 	buildings used in the production process;
266.16 	(8) ready-mixed concrete equipment in which the ready-mixed
266.17 	concrete is mixed as part of the delivery process regardless if
266.18 	mounted on a chassis, repair parts for ready-mixed concrete
266.19 	trucks,and leases of ready-mixed concrete trucks; and
266.20 	(9) machinery or equipment used for research, development,
266.21 	design, or production of computer software.
266.22 	(c) Capital equipment does not include the following:
266.23 	(1) motor vehicles taxed under chapter 297B;
266.24 	(2) machinery or equipment used to receive or store raw
266.25 	materials;
266.26 	(3) building materials, except for materials included in
266.27 	paragraph (b), clauses (6) and (7);
266.28 	(4) machinery or equipment used for nonproduction purposes,
266.29 	including, but not limited to, the following:  plant security,
266.30 	fire prevention, first aid, and hospital stations; support
266.31 	operations or administration; pollution control; and plant
266.32 	cleaning, disposal of scrap and waste, plant communications,
266.33 	space heating, cooling, lighting, or safety;
266.34 	(5) farm machinery and aquaculture production equipment as
266.35 	defined by section 297A.61, subdivisions 12 and 13;
266.36 	(6) machinery or equipment purchased and installed by a
267.1 	contractor as part of an improvement to real property; or 
267.2 	(7) machinery and equipment used by restaurants in the
267.3 	furnishing, preparing, or serving of prepared foods as defined
267.4 	in section 297A.61, subdivision 31;
267.5 	(8) machinery and equipment used to furnish the services
267.6 	listed in section 297A.61, subdivision 3, paragraph (g), clause
267.7 	(6), items (i) to (vi) and (viii); or 
267.8 	(9) any other item that is not essential to the integrated
267.9 	process of manufacturing, fabricating, mining, or refining.
267.10 	(d) For purposes of this subdivision:
267.11 	(1) "Equipment" means independent devices or tools separate
267.12 	from machinery but essential to an integrated production
267.13 	process, including computers and computer software, used in
267.14 	operating, controlling, or regulating machinery and equipment;
267.15 	and any subunit or assembly comprising a component of any
267.16 	machinery or accessory or attachment parts of machinery, such as
267.17 	tools, dies, jigs, patterns, and molds.
267.18 	(2) "Fabricating" means to make, build, create, produce, or
267.19 	assemble components or property to work in a new or different
267.20 	manner.
267.21 	(3) "Integrated production process" means a process or
267.22 	series of operations through which tangible personal property is
267.23 	manufactured, fabricated, mined, or refined.  For purposes of
267.24 	this clause, (i) manufacturing begins with the removal of raw
267.25 	materials from inventory and ends when the last process prior to
267.26 	loading for shipment has been completed; (ii) fabricating begins
267.27 	with the removal from storage or inventory of the property to be
267.28 	assembled, processed, altered, or modified and ends with the
267.29 	creation or production of the new or changed product; (iii)
267.30 	mining begins with the removal of overburden from the site of
267.31 	the ores, minerals, stone, peat deposit, or surface materials
267.32 	and ends when the last process before stockpiling is completed;
267.33 	and (iv) refining begins with the removal from inventory or
267.34 	storage of a natural resource and ends with the conversion of
267.35 	the item to its completed form.
267.36 	(4) "Machinery" means mechanical, electronic, or electrical
268.1 	devices, including computers and computer software, that are
268.2 	purchased or constructed to be used for the activities set forth
268.3 	in paragraph (a), beginning with the removal of raw materials
268.4 	from inventory through completion of the product, including
268.5 	packaging of the product.
268.6 	(5) "Machinery and equipment used for pollution control"
268.7 	means machinery and equipment used solely to eliminate, prevent,
268.8 	or reduce pollution resulting from an activity described in
268.9 	paragraph (a).
268.10 	(6) "Manufacturing" means an operation or series of
268.11 	operations where raw materials are changed in form, composition,
268.12 	or condition by machinery and equipment and which results in the
268.13 	production of a new article of tangible personal property.  For
268.14 	purposes of this subdivision, "manufacturing" includes the
268.15 	generation of electricity or steam to be sold at retail.
268.16 	(7) "Mining" means the extraction of minerals, ores, stone,
268.17 	or peat.
268.18 	(8) "On-line data retrieval system" means a system whose
268.19 	cumulation of information is equally available and accessible to
268.20 	all its customers.
268.21 	(9) "Primarily" means machinery and equipment used 50
268.22 	percent or more of the time in an activity described in
268.23 	paragraph (a).
268.24 	(10) "Refining" means the process of converting a natural
268.25 	resource to an intermediate or finished product, including the
268.26 	treatment of water to be sold at retail.
268.27 	
EFFECTIVE DATE. This section is effective the day
268.28 	following final enactment.

268.29 	Sec. 16. Minnesota Statutes 2004, section 297A.68,
268.30 	subdivision 28, is amended to read:
268.31 		Subd. 28.Medical supplies.  Medical supplies purchased
268.32 	by a licensed health care facility or licensed health care
268.33 	professional to provide medical treatment to residents or
268.34 	patients are exempt.  The exemption does not apply to durable 
268.35 	medical equipment or components of durable medical equipment,
268.36 	laboratory supplies, radiological supplies, and other items used
269.1 	in providing medical services.  For purposes of this
269.2 	subdivision, "medical supplies" means adhesive and nonadhesive
269.3 	bandages, gauze pads and strips, cotton applicators,
269.4 	antiseptics, nonprescription drugs,eye solution, and other
269.5 	similar supplies used directly on the resident or patient in
269.6 	providing medical services.
269.7 	
EFFECTIVE DATE. This section is effective for sales and
269.8 	purchases made after June 30, 2005.

269.9 	Sec. 17. Minnesota Statutes 2004, section 297A.68,
269.10 	subdivision 39, is amended to read:
269.11 		Subd. 39.Preexisting bids or contracts.  (a) The sale of
269.12 	tangible personal property or services is exempt from tax or a
269.13 	tax rate increase for a period of six months from the effective
269.14 	date of the law change that results in the imposition of the tax
269.15 	or the tax rate increase under this chapter if:
269.16 	(1) the act imposing the tax or increasing the tax rate 
269.17 	does not have transitional effective date language for existing
269.18 	construction contracts and construction bids; and
269.19 	(2) the requirements of paragraph (b) are met.
269.20 	(b) A sale is tax exempt under paragraph (a) if it meets
269.21 	the requirements of either clause (1) or (2):
269.22 	(1) For a construction contract:
269.23 	(i) the goods or services sold must be used for the
269.24 	performance of a bona fide written lump sum or fixed price
269.25 	construction contract;
269.26 	(ii) the contract must be entered into before the date the
269.27 	goods or services become subject to the sales tax or the tax
269.28 	rate was increased;
269.29 	(iii) the contract must not provide for allocation of
269.30 	future taxes; and
269.31 	(iv) for each qualifying contract the contractor must give
269.32 	the seller documentation of the contract on which an exemption
269.33 	is to be claimed.
269.34 	(2) For a construction bid:
269.35 	(i) the goods or services sold must be used pursuant to an
269.36 	obligation of a bid or bids;
270.1 	(ii) the bid or bids must be submitted and accepted before
270.2 	the date the goods or services became subject to the sales
270.3 	tax or the tax rate was increased;
270.4 	(iii) the bid or bids must not be able to be withdrawn,
270.5 	modified, or changed without forfeiting a bond; and
270.6 	(iv) for each qualifying bid, the contractor must give the
270.7 	seller documentation of the bid on which an exemption is to be
270.8 	claimed.
270.9 	
EFFECTIVE DATE. This section is effective the day
270.10 	following final enactment.

270.11 	Sec. 18. Minnesota Statutes 2004, section 297A.71,
270.12 	subdivision 12, is amended to read:
270.13 		Subd. 12.Chair lifts, ramps, elevators. Chair lifts,
270.14 	ramps, and Elevators and building materials used to install or
270.15 	construct them chair lifts, ramps, and elevators are exempt, if
270.16 	they are authorized by a physician and installed in or attached
270.17 	to the owner's homestead.  The tax must be imposed and collected
270.18 	as if the rate under section 297A.62, subdivision 1, applied and
270.19 	then refunded in the manner provided in section 297A.75.
270.20 	
EFFECTIVE DATE. This section is effective for sales and
270.21 	purchases made after June 30, 2005.

270.22 	Sec. 19. Minnesota Statutes 2004, section 297A.75,
270.23 	subdivision 1, is amended to read:
270.24 		Subdivision 1.Tax collected.  The tax on the gross
270.25 	receipts from the sale of the following exempt items must be
270.26 	imposed and collected as if the sale were taxable and the rate
270.27 	under section 297A.62, subdivision 1, applied.  The exempt items
270.28 	include:
270.29 	(1) capital equipment exempt under section 297A.68,
270.30 	subdivision 5;
270.31 	(2) building materials for an agricultural processing
270.32 	facility exempt under section 297A.71, subdivision 13;
270.33 	(3) building materials for mineral production facilities
270.34 	exempt under section 297A.71, subdivision 14;
270.35 	(4) building materials for correctional facilities under
270.36 	section 297A.71, subdivision 3;
271.1 	(5) building materials used in a residence for disabled
271.2 	veterans exempt under section 297A.71, subdivision 11;
271.3 	(6) chair lifts, ramps,elevators,and associated building
271.4 	materials exempt under section 297A.71, subdivision 12;
271.5 	(7) building materials for the Long Lake Conservation
271.6 	Center exempt under section 297A.71, subdivision 17;
271.7 	(8) materials, supplies, fixtures, furnishings, and
271.8 	equipment for a county law enforcement and family service center
271.9 	under section 297A.71, subdivision 26; and
271.10 	(9) materials and supplies for qualified low-income housing
271.11 	under section 297A.71, subdivision 23.
271.12 	
EFFECTIVE DATE. This section is effective for sales and
271.13 	purchases made after June 30, 2005.

271.14 	Sec. 20. Minnesota Statutes 2004, section 297A.87,
271.15 	subdivision 2, is amended to read:
271.16 		Subd. 2.Seller's permit or alternate statement.  (a) The
271.17 	operator of an event under subdivision 1 shall obtain one of the
271.18 	following from a person who wishes to do business as a seller at
271.19 	the event:
271.20 	(1) evidence that the person holds a valid seller's permit
271.21 	under section 297A.84; or 
271.22 	(2) a written statement that the person is not offering for
271.23 	sale any item that is taxable under this chapter; or 
271.24 	(3) a written statement that this is the only selling event
271.25 	that the person will be participating in for that calendar year,
271.26 	that the person will be participating for three or fewer days,
271.27 	and that the person will make less than $500 in total sales in
271.28 	the calendar year.  The written statement shall include the
271.29 	person's name, address, and telephone number.
271.30 	(b) The operator shall require the evidence or statement as
271.31 	a prerequisite to participating in the event as a seller.
271.32 	
EFFECTIVE DATE. This section is effective for selling
271.33 	events occurring after June 15, 2005.

271.34 	Sec. 21. Minnesota Statutes 2004, section 297A.87,
271.35 	subdivision 3, is amended to read:
271.36 		Subd. 3.Occasional sale provisions not applicable under
272.1 	limited circumstances.  The isolated and occasional
272.2 	sale provisions provision under section 297A.67, subdivision 23,
272.3 	or applies, provided that the seller only participates for three
272.4 	or fewer days in one event per calendar year, makes $500 or less
272.5 	in sales in the calendar year, and provides the written
272.6 	statement required in subdivision 2, paragraph (a), clause (3).
272.7 	The isolated and occasional sales provision under section
272.8 	297A.68, subdivision 25, do does not apply to a seller at an
272.9 	event under this section.
272.10 	
EFFECTIVE DATE. This section is effective for selling
272.11 	events occurring after June 15, 2005.

272.12 	Sec. 22. Minnesota Statutes 2004, section 297A.99,
272.13 	subdivision 4, is amended to read:
272.14 		Subd. 4.Tax base.  (a) The tax applies to sales taxable
272.15 	under this chapter that occur within the political subdivision.
272.16 	(b) Taxable goods or services are subject to a political
272.17 	subdivision's sales tax, if they are performed either:
272.18 	(1) within the political subdivision, or 
272.19 	(2) partly within and partly without the political
272.20 	subdivision and more of the service is performed within the
272.21 	political subdivision, based on the cost of performance sourced
272.22 	to the political subdivision pursuant to section 297A.668.
272.23 	
EFFECTIVE DATE. This section is effective for sales made
272.24 	on or after January 1, 2004.

272.25 	Sec. 23. REPEALER.
 272.26 	Minnesota Rules, parts 8130.0110, subpart 4; 8130.0200,
272.27 	subparts 5 and 6; 8130.0400, subpart 9; 8130.1200, subparts 5
272.28 	and 6; 8130.2900; 8130.3100, subpart 1; 8130.4000, subparts 1
272.29 	and 2; 8130.4200, subpart 1; 8130.4400, subpart 3; 8130.5200;
272.30 	8130.5600, subpart 3; 8130.5800, subpart 5; 8130.7300, subpart
272.31 	5; and 8130.8800, subpart 4, are repealed.

272.32 	EFFECTIVE DATE. This section is effective the day
272.33 	following final enactment.

272.34 	ARTICLE 8
272.35 	SPECIAL TAXES

272.36 	Section 1. Minnesota Statutes 2004, section 287.04, is
273.1 	amended to read:
273.2 	287.04 EXEMPTIONS.
273.3 	The tax imposed by section 287.035 does not apply to:
273.4 	(a) A decree of marriage dissolution or an instrument made
273.5 	pursuant to it.
273.6 	(b) A mortgage given to correct a misdescription of the
273.7 	mortgaged property.
273.8 	(c) A mortgage or other instrument that adds additional
273.9 	security for the same debt for which mortgage registry tax has
273.10 	been paid.
273.11 	(d) A contract for the conveyance of any interest in real
273.12 	property, including a contract for deed.
273.13 	(e) A mortgage secured by real property subject to the
273.14 	minerals production tax of sections 298.24 to 298.28.
273.15 	(f) The principal amount of a mortgage loan made under a
273.16 	low and moderate income or other affordable housing program, if
273.17 	the mortgagee is a federal, state, or local government agency.
273.18 	(g) Mortgages granted by fraternal benefit societies
273.19 	subject to section 64B.24.
273.20 	(h) A mortgage amendment or extension, as defined in
273.21 	section 287.01.
273.22 	(i) An agricultural mortgage if the proceeds of the loan
273.23 	secured by the mortgage are used to acquire or improve real
273.24 	property classified under section 273.13, subdivision 23,
273.25 	paragraph (a), or (b), clause (1), (2), or (3).
273.26 	(j) A mortgage on an armory building as set forth in
273.27 	section 193.147.

273.28 	EFFECTIVE DATE. This section is effective the day
273.29 	following final enactment.

273.30 	Sec. 2. Minnesota Statutes 2004, section 295.60,
273.31 	subdivision 3, is amended to read:
273.32 		Subd. 3.Payment.  (a) Each furrier shall make estimated
273.33 	payments of the taxes for the calendar year in quarterly
273.34 	installments to the commissioner by April 15, July 15, October
273.35 	15, and January 15 of the following calendar year.
273.36 	(b) Estimated tax payments are not required if:
274.1 	(1) the tax for the current calendar year is less than
274.2 	$500; or
274.3 	(2) the tax for the previous calendar year is less than
274.4 	$500, if the taxpayer had a tax liability and was doing business
274.5 	the entire year.
274.6 	(c) Underpayment of estimated installments bear interest at
274.7 	the rate specified in section 270.75, from the due date of the
274.8 	payment until paid or until the due date of the annual return,
274.9 	whichever comes first.  An underpayment of an estimated
274.10 	installment is the difference between the amount paid and the
274.11 	lesser of (1) 90 percent of one-quarter of the tax for the
274.12 	calendar year the tax for the actual gross revenues received
274.13 	during the quarter, or (2) one-quarter of the total tax for the
274.14 	previous calendar year if the taxpayer had a tax liability and
274.15 	was doing business the entire year.
274.16 	
EFFECTIVE DATE. This section is effective for gross
274.17 	revenues received after December 31, 2004.

274.18 	Sec. 3. Minnesota Statutes 2004, section 296A.22, is
274.19 	amended by adding a subdivision to read:
274.20 		Subd. 9.Abatement of penalty. (a) The commissioner may
274.21 	by written order abate any penalty imposed under this section,
274.22 	if in the commissioner's opinion there is reasonable cause to do
274.23 	so.
274.24 	(b) A request for abatement of penalty must be filed with
274.25 	the commissioner within 60 days of the date the notice stating
274.26 	that a penalty has been imposed was mailed to the taxpayer's
274.27 	last known address.
274.28 	(c) If the commissioner issues an order denying a request
274.29 	for abatement of penalty, the taxpayer may file an
274.30 	administrative appeal as provided in section 296A.25 or appeal
274.31 	to Tax Court as provided in section 271.06.  If the commissioner
274.32 	does not issue an order on the abatement request within 60 days
274.33 	from the date the request is received, the taxpayer may appeal
274.34 	to Tax Court as provided in section 271.06.
274.35 	
EFFECTIVE DATE. This section is effective for penalties
274.36 	imposed on or after the day following final enactment.

275.1 	Sec. 4. Minnesota Statutes 2004, section 297E.01,
275.2 	subdivision 5, is amended to read:
275.3 		Subd. 5.Distributor.  "Distributor" means a distributor
275.4 	as defined in section 349.12, subdivision 11, or a person or
275.5 	linked bingo game provider who markets, sells, or provides
275.6 	gambling product to a person or entity for resale or use at the
275.7 	retail level.
275.8 	
EFFECTIVE DATE. This section is effective the day
275.9 	following final enactment.

275.10 	Sec. 5. Minnesota Statutes 2004, section 297E.01,
275.11 	subdivision 7, is amended to read:
275.12 		Subd. 7.Gambling product.  "Gambling product" means
275.13 	bingo hard cards, bingo paper, or sheets, or linked bingo paper
275.14 	sheets; pull-tabs; tipboards; paddletickets and paddleticket
275.15 	cards; raffle tickets; or any other ticket, card, board,
275.16 	placard, device, or token that represents a chance, for which
275.17 	consideration is paid, to win a prize.
275.18 	
EFFECTIVE DATE. This section is effective the day
275.19 	following final enactment.

275.20 	Sec. 6. Minnesota Statutes 2004, section 297E.01, is
275.21 	amended by adding a subdivision to read:
275.22 		Subd. 9a.Linked bingo game. "Linked bingo game" means a
275.23 	bingo game played at two or more locations where licensed
275.24 	organizations are authorized to conduct bingo, when there is a
275.25 	common prize pool and a common selection of numbers or symbols
275.26 	conducted at one location, and when the results of the selection
275.27 	are transmitted to all participating locations by satellite,
275.28 	telephone, or other means by a linked bingo game provider.
275.29 	
EFFECTIVE DATE. This section is effective the day
275.30 	following final enactment.

275.31 	Sec. 7. Minnesota Statutes 2004, section 297E.01, is
275.32 	amended by adding a subdivision to read:
275.33 		Subd. 9b.Linked bingo game provider. "Linked bingo game
275.34 	provider" means any person who provides the means to link bingo
275.35 	prizes in a linked bingo game, who provides linked bingo paper
275.36 	sheets to the participating organizations, who provides linked
276.1 	bingo prize management, and who provides the linked bingo game
276.2 	system.
276.3 	
EFFECTIVE DATE. This section is effective the day
276.4 	following final enactment.

276.5 	Sec. 8. Minnesota Statutes 2004, section 297E.06,
276.6 	subdivision 2, is amended to read:
276.7 		Subd. 2.Business records.  An organization shall
276.8 	maintain records supporting the gambling activity reported to
276.9 	the commissioner.  Records include, but are not limited to, the
276.10 	following items:
276.11 	(1) all winning and unsold tickets, cards, or stubs for
276.12 	pull-tab, tipboard, paddlewheel, and raffle games;
276.13 	(2) all reports and statements, including checker's
276.14 	records, for each bingo occasion;
276.15 	(3) all cash journals and ledgers, deposit slips, register
276.16 	tapes, and bank statements supporting gambling activity
276.17 	receipts;
276.18 	(4) all invoices that represent purchases of gambling
276.19 	product;
276.20 	(5) all canceled checks or copies of substitute checks as
276.21 	defined in Public Law 108-100, section 3, check recorders,
276.22 	journals and ledgers, vouchers, invoices, bank statements, and
276.23 	other documents supporting gambling activity expenditures; and
276.24 	(6) all organizational meeting minutes.
276.25 	All records required to be kept by this section must be
276.26 	preserved by the organization for at least 3-1/2 years and may
276.27 	be inspected by the commissioner of revenue at any reasonable
276.28 	time without notice or a search warrant.
276.29 	
EFFECTIVE DATE. This section is effective July 1, 2005.

276.30 	Sec. 9. Minnesota Statutes 2004, section 297E.07, is
276.31 	amended to read:
276.32 	297E.07 INSPECTION RIGHTS.
276.33 	At any reasonable time, without notice and without a search
276.34 	warrant, the commissioner may enter a place of business of a
276.35 	manufacturer, distributor, or organization, or linked bingo game
276.36 	provider; any site from which pull-tabs or tipboards or other
277.1 	gambling equipment or gambling product are being manufactured,
277.2 	stored, or sold; or any site at which lawful gambling is being
277.3 	conducted, and inspect the premises, books, records, and other
277.4 	documents required to be kept under this chapter to determine
277.5 	whether or not this chapter is being fully complied with.  If
277.6 	the commissioner is denied free access to or is hindered or
277.7 	interfered with in making an inspection of the place of
277.8 	business, books, or records, the permit of the distributor may
277.9 	be revoked by the commissioner, and the license of the
277.10 	manufacturer, the distributor, or the organization, or linked
277.11 	bingo game provider may be revoked by the board.

277.12 	EFFECTIVE DATE. This section is effective the day
277.13 	following final enactment.

277.14 	Sec. 10. Minnesota Statutes 2004, section 297F.08,
277.15 	subdivision 12, is amended to read:
277.16 		Subd. 12.Cigarettes in interstate commerce.  (a) A
277.17 	person may not transport or cause to be transported from this
277.18 	state cigarettes for sale in another state without first
277.19 	affixing to the cigarettes the stamp required by the state in
277.20 	which the cigarettes are to be sold or paying any other excise
277.21 	tax on the cigarettes imposed by the state in which the
277.22 	cigarettes are to be sold.
277.23 	(b) A person may not affix to cigarettes the stamp required
277.24 	by another state or pay any other excise tax on the cigarettes
277.25 	imposed by another state if the other state prohibits stamps
277.26 	from being affixed to the cigarettes, prohibits the payment of
277.27 	any other excise tax on the cigarettes, or prohibits the sale of
277.28 	the cigarettes.
277.29 	(c) Not later than 15 days after the end of each calendar
277.30 	quarter, a person who transports or causes to be transported
277.31 	from this state cigarettes for sale in another state shall
277.32 	submit to the commissioner a report identifying the quantity and
277.33 	style of each brand of the cigarettes transported or caused to
277.34 	be transported in the preceding calendar quarter, and the name
277.35 	and address of each recipient of the cigarettes. This reporting
277.36 	requirement only applies to cigarettes manufactured by companies
278.1 	that are not original or subsequent participating manufacturers
278.2 	in the Master Settlement Agreement with other states.
278.3 	(d) For purposes of this section, "person" has the meaning
278.4 	given in section 297F.01, subdivision 12.  Person does not
278.5 	include any common or contract carrier, or public warehouse that
278.6 	is not owned, in whole or in part, directly or indirectly by
278.7 	such person, and does not include a manufacturer that has
278.8 	entered into is an original or subsequent participating
278.9 	manufacturer in the Master Settlement Agreement with other
278.10 	states.
278.11 	
EFFECTIVE DATE. This section is effective the day
278.12 	following final enactment.

278.13 	Sec. 11. Minnesota Statutes 2004, section 297F.08, is
278.14 	amended by adding a subdivision to read:
278.15 		Subd. 13.Bond. The commissioner may require the
278.16 	furnishing of a corporate surety bond or a certified check in an
278.17 	amount suitable to guarantee payment of the tax stamps purchased
278.18 	by a distributor.  The bond or certified check may be required
278.19 	when the commissioner determines that a distributor is (1)
278.20 	delinquent in the filing of any return required under this
278.21 	chapter, or (2) delinquent in the payment of any uncontested tax
278.22 	liability under this chapter.  The distributor shall furnish the
278.23 	bond or certified check for a period of two years, after which,
278.24 	if the distributor has not been delinquent in the filing of any
278.25 	returns required under this chapter, or delinquent in the paying
278.26 	of any tax under this chapter, a bond or certified check is no
278.27 	longer required.  The commissioner at any time may apply the
278.28 	bond or certified check to any unpaid taxes or fees, including
278.29 	interest and penalties, owed to the department by the
278.30 	distributor.
278.31 	
EFFECTIVE DATE. This section is effective the day
278.32 	following final enactment.

278.33 	Sec. 12. Minnesota Statutes 2004, section 297F.09,
278.34 	subdivision 1, is amended to read:
278.35 		Subdivision 1.Monthly return; cigarette distributor.  On
278.36 	or before the 18th day of each calendar month, a distributor
279.1 	with a place of business in this state shall file a return with
279.2 	the commissioner showing the quantity of cigarettes manufactured
279.3 	or brought in from outside the state or purchased during the
279.4 	preceding calendar month and the quantity of cigarettes sold or
279.5 	otherwise disposed of in this state and outside this state
279.6 	during that month.  A licensed distributor outside this state
279.7 	shall in like manner file a return showing the quantity of
279.8 	cigarettes shipped or transported into this state during the
279.9 	preceding calendar month.  Returns must be made in the form and
279.10 	manner prescribed by the commissioner and must contain any other
279.11 	information required by the commissioner.  The return must be
279.12 	accompanied by a remittance for the full unpaid tax liability
279.13 	shown by it. The return for the May liability and 85 percent of
279.14 	the estimated June liability is due on the date payment of the
279.15 	tax is due.For distributors subject to the accelerated tax
279.16 	payment requirements in subdivision 10, the return for the May
279.17 	liability is due two business days before June 30th of the year
279.18 	and the return for the June liability is due on or before August
279.19 	18th of the year.
279.20 	
EFFECTIVE DATE. This section is effective the day
279.21 	following final enactment.

279.22 	Sec. 13. Minnesota Statutes 2004, section 297F.09,
279.23 	subdivision 2, is amended to read:
279.24 		Subd. 2.Monthly return; tobacco products distributor.
 279.25 	On or before the 18th day of each calendar month, a distributor
279.26 	with a place of business in this state shall file a return with
279.27 	the commissioner showing the quantity and wholesale sales price
279.28 	of each tobacco product:
279.29 	(1) brought, or caused to be brought, into this state for
279.30 	sale; and
279.31 	(2) made, manufactured, or fabricated in this state for
279.32 	sale in this state, during the preceding calendar month.
279.33 	Every licensed distributor outside this state shall in like
279.34 	manner file a return showing the quantity and wholesale sales
279.35 	price of each tobacco product shipped or transported to
279.36 	retailers in this state to be sold by those retailers, during
280.1 	the preceding calendar month.  Returns must be made in the form
280.2 	and manner prescribed by the commissioner and must contain any
280.3 	other information required by the commissioner.  The return must
280.4 	be accompanied by a remittance for the full tax liability
280.5 	shown. The return for the May liability and 85 percent of the
280.6 	estimated June liability is due on the date payment of the tax
280.7 	is due.For distributors subject to the accelerated tax payment
280.8 	requirements in subdivision 10, the return for the May liability
280.9 	is due two business days before June 30th of the year and the
280.10 	return for the June liability is due on or before August 18th of
280.11 	the year.
280.12 	
EFFECTIVE DATE. This section is effective the day
280.13 	following final enactment.

280.14 	Sec. 14. Minnesota Statutes 2004, section 297F.14,
280.15 	subdivision 4, is amended to read:
280.16 		Subd. 4.Bad debt. The commissioner may adopt rules
280.17 	providing a refund of the tax paid under this chapter if the tax
280.18 	paid qualifies as a bad debt under section 166(a) of the
280.19 	Internal Revenue Code.For any reporting period, a taxpayer may
280.20 	offset against taxes payable under this chapter the amount of
280.21 	taxes previously paid under this chapter that is attributable to
280.22 	a bad debt.  The taxes must have been included in a transaction
280.23 	the consideration for which was a debt owed to the taxpayer and
280.24 	which became uncollectible, but only in proportion to the
280.25 	portion of debt that became uncollectible.  To qualify for
280.26 	offset under this subdivision, the debt must have qualified as a
280.27 	bad debt under section 166(a) of the Internal Revenue Code.  The
280.28 	taxpayer may claim the offset within the time period prescribed
280.29 	in section 297F.17, subdivision 6.  If the taxpayer is no longer
280.30 	liable for taxes imposed under this chapter, the commissioner
280.31 	shall refund to the taxpayer the amount of the taxes
280.32 	attributable to the bad debt.  Any recovery of the tax claimed
280.33 	as a refund or credit must be reported to the commissioner on
280.34 	the tax return for the month in which the recovery is made.  If
280.35 	the taxpayer is no longer required to file returns under this
280.36 	chapter, the taxpayer must reimburse the commissioner for tax
281.1 	recovered in the month following the recovery.
281.2 	
EFFECTIVE DATE. This section is effective for claims
281.3 	filed on or after July 1, 2005.

281.4 	Sec. 15. Minnesota Statutes 2004, section 297G.09, is
281.5 	amended by adding a subdivision to read:
281.6 		Subd. 9.Quarterly and annual payments and returns. (a)
281.7 	If a manufacturer, wholesaler, brewer, or importer has an
281.8 	average liquor tax liability equal to or less than $500 per
281.9 	month in any quarter of a calendar year, and has substantially
281.10 	complied with the state tax laws during the preceding four
281.11 	calendar quarters, the manufacturer, wholesaler, brewer, or
281.12 	importer may request authorization to file and pay the taxes
281.13 	quarterly in subsequent calendar quarters.  The authorization
281.14 	remains in effect during the period in which the manufacturer's,
281.15 	wholesaler's, brewer's, or importer's quarterly returns reflect
281.16 	liquor tax liabilities of less than $1,500 and there is
281.17 	continued compliance with state tax laws.
281.18 	(b) If a manufacturer, wholesaler, brewer, or importer has
281.19 	an average liquor tax liability equal to or less than $100 per
281.20 	month during a calendar year, and has substantially complied
281.21 	with the state tax laws during that period, the manufacturer,
281.22 	wholesaler, brewer, or importer may request authorization to
281.23 	file and pay the taxes annually in subsequent years.  The
281.24 	authorization remains in effect during the period in which the
281.25 	manufacturer's, wholesaler's, brewer's, or importer's annual
281.26 	returns reflect liquor tax liabilities of less than $1,200 and
281.27 	there is continued compliance with state tax laws.
281.28 	(c) The commissioner may also grant quarterly or annual
281.29 	filing and payment authorizations to manufacturers, wholesalers,
281.30 	brewers, or importers if the commissioner concludes that the
281.31 	manufacturer's, wholesaler's, brewer's, or importer's future tax
281.32 	liabilities will be less than the monthly totals identified in
281.33 	paragraphs (a) and (b).  An authorization granted under this
281.34 	paragraph is subject to the same conditions as an authorization
281.35 	granted under paragraphs (a) and (b).
281.36 	(d) The annual tax return and payments must be filed and
282.1 	paid on or before the 18th day of January following the calendar
282.2 	year.  The quarterly returns and payments must be filed and paid
282.3 	on or before April 18 for the quarter ending March 31, on or
282.4 	before July 18 for the quarter ending June 30, on or before
282.5 	October 18 for the quarter ending September 30, and on or before
282.6 	January 18 for the quarter ending December 31.
282.7 	
EFFECTIVE DATE. This section is effective for tax returns
282.8 	and payments due on or after January 1, 2006.

282.9 	Sec. 16. Minnesota Statutes 2004, section 297I.01, is
282.10 	amended by adding a subdivision to read:
282.11 		Subd. 13a.Reinsurance. "Reinsurance" is insurance
282.12 	whereby an insurance company, for a consideration, agrees to
282.13 	indemnify another insurance company against all or part of the
282.14 	loss which the latter may sustain under the policy or policies
282.15 	which it has issued.
282.16 	
EFFECTIVE DATE. This section is effective the day
282.17 	following final enactment.

282.18 	Sec. 17. Minnesota Statutes 2004, section 297I.05,
282.19 	subdivision 5, is amended to read:
282.20 		Subd. 5.Health maintenance organizations, nonprofit
282.21 	health service plan corporations, and community integrated
282.22 	service networks.  (a) Health maintenance organizations,
282.23 	community integrated service networks, and nonprofit health care
282.24 	service plan corporations are exempt from the tax imposed under
282.25 	this section for premiums received in calendar years 2001 to
282.26 	2003.
282.27 	(b) For calendar years after 2003,A tax is imposed on
282.28 	health maintenance organizations, community integrated service
282.29 	networks, and nonprofit health care service plan corporations.
282.30 	The rate of tax is equal to one percent of gross premiums less
282.31 	return premiums on all direct business received by the
282.32 	organization, network, or corporation or its agents in
282.33 	Minnesota, in cash or otherwise,in the calendar year.
282.34 	(c) In approving the premium rates as required in sections
282.35 	62L.08, subdivision 8, and 62A.65, subdivision 3, the
282.36 	commissioners of health and commerce shall ensure that any
283.1 	exemption from tax as described in paragraph (a) is reflected in
283.2 	the premium rate.
283.3 	(d) (b) The commissioner shall deposit all revenues,
283.4 	including penalties and interest, collected under this chapter
283.5 	from health maintenance organizations, community integrated
283.6 	service networks, and nonprofit health service plan corporations
283.7 	in the health care access fund.  Refunds of overpayments of tax
283.8 	imposed by this subdivision must be paid from the health care
283.9 	access fund.  There is annually appropriated from the health
283.10 	care access fund to the commissioner the amount necessary to
283.11 	make any refunds of the tax imposed under this subdivision.
283.12 	
EFFECTIVE DATE. This section is effective January 1, 2005.

283.13 	Sec. 18. Minnesota Statutes 2004, section 298.24,
283.14 	subdivision 1, is amended to read:
283.15 		Subdivision 1.Effective date. This section is effective for direct
285.24 	reduced ore produced after the day following final enactment.

285.25 	Sec. 19. Minnesota Statutes 2004, section 473.843,
285.26 	subdivision 5, is amended to read:
 285.27 		Subd. 5.Penalties; enforcement. The audit, penalty, and
285.28 	enforcement provisions applicable to corporate franchise taxes
285.29 	imposed under chapter 290 apply to the fees imposed under this
285.30 	section.  The commissioner of revenue shall administer the
285.31 	provisions.
285.32 	
EFFECTIVE DATE. This section is effective the day
285.33 	following final enactment.

285.34 	Sec. 20. [REPEALER.]
 285.35 	Minnesota Statutes 2004, section 297E.12, subdivision 10,
285.36 	is repealed effective the day following final enactment.

286.1 	ARTICLE 9
286.2 	MISCELLANEOUS

286.3 	Section 1. Minnesota Statutes 2004, section 16D.10, is
286.4 	amended to read:
 286.5 	16D.10 [CASE REVIEWER.]
286.6 		Subdivision 1.Duties. The commissioner shall make a
286.7 	case reviewer available to debtors.  The reviewer must be
286.8 	available to answer a debtor's questions concerning the
286.9 	collection process and to review the collection activity taken.
286.10 	If the reviewer reasonably believes that the particular action
286.11 	being taken is unreasonable or unfair, the reviewer may make
286.12 	recommendations to the commissioner in regard to the collection
286.13 	action.
286.14 		Subd. 2.Authority to issue debtor assistance order. On
286.15 	application filed by a debtor with the case reviewer, in the
286.16 	form, manner, and in the time prescribed by the commissioner,
286.17 	and after thorough investigation, the case reviewer may issue a
286.18 	debtor assistance order if, in the determination of the case
286.19 	reviewer, the manner in which the state debt collection laws are
286.20 	being administered is creating or will create an unjust and
286.21 	inequitable result for the debtor.  Debtor assistance orders are
286.22 	governed by the provisions relating to taxpayer assistance
286.23 	orders under section 270.273.
286.24 		Subd. 3.Transfer of duties to taxpayer rights advocate.
 286.25 	All duties and authority of the case reviewer under subdivisions
286.26 	1 and 2 are transferred to the taxpayer rights advocate.
286.27 	
EFFECTIVE DATE. This section is effective the day
286.28 	following final enactment.

286.29 	Sec. 2. Minnesota Statutes 2004, section 270.30,
286.30 	subdivision 1, is amended to read:
 286.31 		Subdivision 1.Scope. (a) This section applies to a
286.32 	person who offers,provides, or facilitates the provision of
286.33 	refund anticipation loans, as part of or in connection with the
286.34 	provision of tax preparation services.
286.35 	(b) This section does not apply to:
286.36 	(1) a tax preparer who provides tax preparation services
287.1 	for fewer than six clients in a calendar year;
287.2 	(2) the provision by a person of tax preparation services
287.3 	to a spouse, parent, grandparent, child, or sibling; and 
287.4 	(3) the provision of services by an employee for an
287.5 	employer.

287.6 	Sec. 3. Minnesota Statutes 2004, section 270.30,
287.7 	subdivision 5, is amended to read:
 287.8 		Subd. 5.Itemized bill required. A tax preparer must
287.9 	provide an itemized statement of the charges for services, at
287.10 	least separately stating the charges for:
287.11 	(1) return preparation; and 
287.12 	(2) electronic filing; and 
287.13 	(3) providing or facilitating a refund anticipation loan.

287.14 	Sec. 4. Minnesota Statutes 2004, section 270.30,
287.15 	subdivision 6, is amended to read:
 287.16 		Subd. 6.Enforcement; penalties. The commissioner may
287.17 	impose an administrative penalty of not more than $1,000 per
287.18 	violation of subdivision 3, 4, or 5.  The commissioner may
287.19 	terminate a tax preparer's authority to transmit returns
287.20 	electronically to the state, if the commissioner determines the
287.21 	tax preparer engaged in a pattern and practice of violating this
287.22 	section.  Imposition of a penalty under this subdivision is
287.23 	subject to the contested case procedure under chapter 14.  The
287.24 	commissioner shall collect the penalty in the same manner as the
287.25 	income tax. Penalties imposed under this subdivision are public
287.26 	data.

287.27 	Sec. 5. Minnesota Statutes 2004, section 270.30, is
287.28 	amended by adding a subdivision to read:
287.29 		Subd. 6a.Exchange of data; state board of
287.30 	accountancy. The State Board of Accountancy shall refer to the
287.31 	commissioner complaints it receives about tax preparers who are
287.32 	not subject to the jurisdiction of the State Board of
287.33 	Accountancy and who are alleged to have violated the provisions
287.34 	of subdivisions 3 to 5.

287.35 	Sec. 6. Minnesota Statutes 2004, section 270.30, is
287.36 	amended by adding a subdivision to read:
288.1 		Subd. 6b.Exchange of data; lawyers board of professional
288.2 	responsibility. The Lawyers Board of Professional
288.3 	Responsibility may refer to the commissioner complaints it
288.4 	receives about tax preparers who are not subject to its
288.5 	jurisdiction and who are alleged to have violated the provisions
288.6 	of subdivisions 3 to 5.

288.7 	Sec. 7. Minnesota Statutes 2004, section 270.30, is
288.8 	amended by adding a subdivision to read:
288.9 		Subd. 6c.Exchange of data; commissioner. The
288.10 	commissioner shall refer complaints about tax preparers who are
288.11 	alleged to have violated the provisions of subdivisions 3 to 5
288.12 	to:
288.13 	(1) the State Board of Accountancy, if the tax preparer is
288.14 	under its jurisdiction; and 
288.15 	(2) the Lawyers Board of Professional Responsibility, if
288.16 	the tax preparer is under its jurisdiction.

288.17 	Sec. 8. Minnesota Statutes 2004, section 270.30, is
288.18 	amended by adding a subdivision to read:
288.19 		Subd. 6d.Data private. Information exchanged on
288.20 	individuals under subdivisions 6a to 6c are private data under
288.21 	section 13.02, subdivision 12, until such time as a penalty is
288.22 	imposed as provided in section 326A.08 or by the Lawyers Board
288.23 	of Professional Responsibility.

288.24 	Sec. 9. Minnesota Statutes 2004, section 270.30,
288.25 	subdivision 8, is amended to read:
288.26 		Subd. 8.Exemptions; enforcement provisions. (a) The
288.27 	provisions of subdivisions 6 and 7 this section, except for
288.28 	subdivision 4,do not apply to:
288.29 	(1) an attorney admitted to practice under section 481.01;
288.30 	(2) a certified public accountant holding a certificate
288.31 	under section 326A.04 or a person issued a permit to practice
288.32 	under section 326A.05or other person who is subject to the
288.33 	jurisdiction of the State Board of Accountancy;
288.34 	(3) a person designated as a registered accounting
288.35 	practitioner under Minnesota Rules, part 1105.6600, or a
288.36 	registered accounting practitioner firm issued a permit under
289.1 	Minnesota Rules, part 1105.7100;
289.2 	(4) an enrolled agent who has passed the special enrollment
289.3 	examination administered by the Internal Revenue Service; and 
289.4 	(5) (4) any fiduciary, or the regular employees of a
289.5 	fiduciary, while acting on behalf of the fiduciary estate, the
289.6 	testator, trustor, grantor, or beneficiaries of them;
289.7 	(5) a tax preparer who provides tax preparation services
289.8 	for fewer than six clients in a calendar year;
289.9 	(6) tax preparation services to a spouse, parent,
289.10 	grandparent, child, or sibling of the tax preparer; and 
289.11 	(7) the preparation by an employee of the tax return of the
289.12 	employee's employer.

289.13 	Sec. 10. [270.301] PUBLICATION OF NAMES OF TAX PREPARERS
289.14 	SUBJECT TO PENALTIES.
289.15 		Subdivision 1.Publication of list. Notwithstanding any
289.16 	other law, the commissioner must publish as provided in this
289.17 	section a list or lists of tax preparers subject to penalties.
289.18 		Subd. 2.Required and excluded tax preparers. (a)
289.19 	Subject to the limitations of paragraph (b), the commissioner
289.20 	must publish lists of tax preparers who have been convicted
289.21 	under section 289A.63.
289.22 	(b) For the purposes of this section, tax preparers are not
289.23 	subject to publication if:
289.24 	(1) an administrative or court action contesting the
289.25 	penalty has been filed or served and is unresolved at the time
289.26 	when notice would be given under subdivision 3;
289.27 	(2) an appeal period to contest the penalty has not
289.28 	expired; or 
289.29 	(3) the commissioner has been notified that the tax
289.30 	preparer is deceased.
289.31 		Subd. 3.Notice to tax preparer. (a) At least 30 days
289.32 	before publishing the name of a tax preparer subject to penalty,
289.33 	the commissioner shall mail a written notice to the tax
289.34 	preparer, detailing the amount and nature of each penalty and
289.35 	the intended publication of the information listed in
289.36 	subdivision 4 related to the penalty.  The notice must be mailed
290.1 	by first class and certified mail addressed to the last known
290.2 	address of the tax preparer.  The notice must include
290.3 	information regarding the exceptions listed in subdivision 2,
290.4 	paragraph (b), and must state that the tax preparer's
290.5 	information will not be published if the tax preparer provides
290.6 	information establishing that subdivision 2, paragraph (b),
290.7 	prohibits publication of the tax preparer's name.
290.8 	(b) Thirty days after the notice is mailed and if the tax
290.9 	preparer has not proved to the commissioner that subdivision 2,
290.10 	paragraph (b), prohibits publication, the commissioner may
290.11 	publish in a list of tax preparers subject to penalty the
290.12 	information about the tax preparer that is listed in subdivision
290.13 	4.
290.14 		Subd. 4.Form of list. The list may be published by any
290.15 	medium or method.  The list must contain the name, associated
290.16 	business name or names, address or addresses, and violation or
290.17 	violations for which a penalty was imposed of each tax preparer
290.18 	subject to penalty.
290.19 		Subd. 5.Removal from list. The commissioner shall
290.20 	remove the name of a tax preparer from the list of tax preparers
290.21 	published under this section:
290.22 	(1) when the commissioner determines that the name was
290.23 	included on the list in error;
290.24 	(2) within 90 days after the preparer has fully paid all
290.25 	fines imposed, served any suspension, and demonstrated to the
290.26 	satisfaction of the commissioner that the preparer has
290.27 	successfully completed any remedial actions required by the
290.28 	commissioner, the State Board of Accountancy, or the Lawyers
290.29 	Board of Professional Responsibility; or 
290.30 	(3) when the commissioner has been notified that the tax
290.31 	preparer is deceased.
290.32 		Subd. 6.Names published in error. If the commissioner
290.33 	publishes a name under subdivision 1 in error, the tax preparer
290.34 	whose name was erroneously published has a right to request a
290.35 	retraction and apology.  If the tax preparer so requests, the
290.36 	commissioner shall publish a retraction and apology
291.1 	acknowledging that the tax preparer's name was published in
291.2 	error.  The retraction and apology must appear in the same
291.3 	medium and the same format as the original list that contained
291.4 	the name listed in error.
291.5 		Subd. 7.Payment of damages. Actions against the
291.6 	commissioner of revenue or the state of Minnesota arising out of
291.7 	the implementation of this program must be brought under section
291.8 	270.276.
291.9 	
EFFECTIVE DATE. The provision of this section requiring
291.10 	the commissioner to publish the names of tax preparers applies
291.11 	only to publishing the names of those tax preparers who commit a
291.12 	crime under section 289A.63 on or after August 1, 2005.

291.13 	Sec. 11. Minnesota Statutes 2004, section 270.65, is
291.14 	amended to read:
291.15 	270.65 DATE OF ASSESSMENT; DEFINITION.
291.16 	For purposes of taxes administered by the commissioner, the
291.17 	term "date of assessment" means the date a liability reported on
291.18 	a return was entered into the records of the commissioner or the
291.19 	date a return should have been filed, whichever is later; or, in
291.20 	the case of taxes determined by the commissioner, "date of
291.21 	assessment" means the date of the order assessing taxes or date
291.22 	of the return made by the commissioner; or, in the case of an
291.23 	amended return filed by the taxpayer, the assessment date is the
291.24 	date additional liability reported on the return, if any, was
291.25 	entered into the records of the commissioner; or, in the case of
291.26 	a consent agreement signed by the taxpayer under section 270.67,
291.27 	subdivision 3, the assessment date is the notice date shown on
291.28 	the agreement;or, in the case of a check from a taxpayer that
291.29 	is dishonored and results in an erroneous refund being given to
291.30 	the taxpayer, remittance of the check is deemed to be an
291.31 	assessment and the "date of assessment" is the date the check
291.32 	was received by the commissioner.

291.33 	EFFECTIVE DATE. This section is effective the day
291.34 	following final enactment.

291.35 	Sec. 12. Minnesota Statutes 2004, section 270.67,
291.36 	subdivision 4, is amended to read:
292.1 		Subd. 4.Offer-in-compromise and installment payment
292.2 	program.  (a) In implementing the authority provided in
292.3 	subdivision 2 or in sections 8.30 and 16D.15 to accept offers of
292.4 	installment payments or offers-in-compromise of tax liabilities,
292.5 	the commissioner of revenue shall prescribe guidelines for
292.6 	employees of the Department of Revenue to determine whether an
292.7 	offer-in-compromise or an offer to make installment payments is
292.8 	adequate and should be accepted to resolve a dispute.  In
292.9 	prescribing the guidelines, the commissioner shall develop and
292.10 	publish schedules of national and local allowances designed to
292.11 	provide that taxpayers entering into a compromise or payment
292.12 	agreement have an adequate means to provide for basic living
292.13 	expenses.  The guidelines must provide that the taxpayer's
292.14 	ownership interest in a motor vehicle, to the extent of the
292.15 	value allowed in section 550.37, will not be considered as an
292.16 	asset; in the case of an offer related to a joint tax liability
292.17 	of spouses, that value of two motor vehicles must be excluded.
292.18 	The guidelines must provide that employees of the department
292.19 	shall determine, on the basis of the facts and circumstances of
292.20 	each taxpayer, whether the use of the schedules is appropriate
292.21 	and that employees must not use the schedules to the extent the
292.22 	use would result in the taxpayer not having adequate means to
292.23 	provide for basic living expenses.  The guidelines must provide
292.24 	that:
292.25 	(1) an employee of the department shall not reject an
292.26 	offer-in-compromise or an offer to make installment payments
292.27 	from a low-income taxpayer solely on the basis of the amount of
292.28 	the offer; and
292.29 	(2) in the case of an offer-in-compromise which relates
292.30 	only to issues of liability of the taxpayer:
292.31 	(i) the offer must not be rejected solely because the
292.32 	commissioner is unable to locate the taxpayer's return or return
292.33 	information for verification of the liability; and
292.34 	(ii) the taxpayer shall not be required to provide an
292.35 	audited, reviewed, or compiled financial statement.
292.36 	(b) The commissioner shall establish procedures:
293.1 	(1) that require presentation of a counteroffer or a
293.2 	written rejection of the offer by the commissioner if the amount
293.3 	offered by the taxpayer in an offer-in-compromise or an offer to
293.4 	make installment payments is not accepted by the commissioner;
293.5 	(2) for an administrative review of any written rejection
293.6 	of a proposed offer-in-compromise or installment agreement made
293.7 	by a taxpayer under this section before the rejection is
293.8 	communicated to the taxpayer;
293.9 	(3) that allow a taxpayer to request reconsideration of any
293.10 	written rejection of the offer or agreement to the commissioner
293.11 	of revenue to determine whether the rejection is reasonable and
293.12 	appropriate under the circumstances; and
293.13 	(4) that provide for notification to the taxpayer when an
293.14 	offer-in-compromise has been accepted, and issuance of
293.15 	certificates of release of any liens imposed under section
293.16 	270.69 related to the liability which is the subject of the
293.17 	compromise.
293.18 	(c) Each compromise proposal must be accompanied by a
293.19 	nonrefundable payment of $250.  If the compromise proposal is
293.20 	accepted, the payment must be applied to the accepted compromise
293.21 	amount.  If the compromise is rejected, the payment must be
293.22 	applied to the outstanding tax debts of the taxpayer pursuant to
293.23 	section 270.652.  In cases of financial hardship, upon
293.24 	presentation of information establishing an inability to make
293.25 	the $250 payment, the commissioner may waive this requirement.
293.26 	
EFFECTIVE DATE. This section is effective for offers in
293.27 	compromise submitted after August 31, 2005.

293.28 	Sec. 13. Minnesota Statutes 2004, section 270.69,
293.29 	subdivision 4, is amended to read:
293.30 		Subd. 4.Period of limitations.  The lien imposed by this
293.31 	section shall, notwithstanding any other provision of law to the
293.32 	contrary, be enforceable from the time the lien arises and for
293.33 	ten years from the date of filing the notice of lien, which must
293.34 	be filed by the commissioner within five years after the date of
293.35 	assessment of the tax or final administrative or judicial
293.36 	determination of the assessment.  A notice of lien filed in one
294.1 	county may be transcribed to the secretary of state or to any
294.2 	other county within ten years after the date of its filing, but
294.3 	the transcription shall not extend the period during which the
294.4 	lien is enforceable.  A notice of lien may be renewed by the
294.5 	commissioner before the expiration of the ten-year period for an
294.6 	additional ten years.  The taxpayer must receive written notice
294.7 	of the renewal.
294.8 	
EFFECTIVE DATE. This section is effective the day
294.9 	following final enactment.

294.10 	Sec. 14. Minnesota Statutes 2004, section 270A.03,
294.11 	subdivision 5, is amended to read:
294.12 		Subd. 5.Debt.  "Debt" means a legal obligation of a
294.13 	natural person to pay a fixed and certain amount of money, which
294.14 	equals or exceeds $25 and which is due and payable to a claimant
294.15 	agency.  The term includes criminal fines imposed under section
294.16 	609.10 or 609.125, fines imposed for petty misdemeanors as
294.17 	defined in section 609.02, subdivision 4a,and restitution.  The
294.18 	term also includes the co-payment for the appointment of a
294.19 	district public defender imposed under section 611.17, paragraph
294.20 	(c).  A debt may arise under a contractual or statutory
294.21 	obligation, a court order, or other legal obligation, but need
294.22 	not have been reduced to judgment.
294.23 	A debt includes any legal obligation of a current recipient
294.24 	of assistance which is based on overpayment of an assistance
294.25 	grant where that payment is based on a client waiver or an
294.26 	administrative or judicial finding of an intentional program
294.27 	violation; or where the debt is owed to a program wherein the
294.28 	debtor is not a client at the time notification is provided to
294.29 	initiate recovery under this chapter and the debtor is not a
294.30 	current recipient of food support, transitional child care, or
294.31 	transitional medical assistance.
294.32 	A debt does not include any legal obligation to pay a
294.33 	claimant agency for medical care, including hospitalization if
294.34 	the income of the debtor at the time when the medical care was
294.35 	rendered does not exceed the following amount:
294.36 	(1) for an unmarried debtor, an income of $8,800 or less;
295.1 	(2) for a debtor with one dependent, an income of $11,270
295.2 	or less;
295.3 	(3) for a debtor with two dependents, an income of $13,330
295.4 	or less;
295.5 	(4) for a debtor with three dependents, an income of
295.6 	$15,120 or less;
295.7 	(5) for a debtor with four dependents, an income of $15,950
295.8 	or less; and
295.9 	(6) for a debtor with five or more dependents, an income of
295.10 	$16,630 or less.
295.11 	The income amounts in this subdivision shall be adjusted
295.12 	for inflation for debts incurred in calendar years 2001 and
295.13 	thereafter.  The dollar amount of each income level that applied
295.14 	to debts incurred in the prior year shall be increased in the
295.15 	same manner as provided in section 1(f) of the Internal Revenue
295.16 	Code of 1986, as amended through December 31, 2000, except that
295.17 	for the purposes of this subdivision the percentage increase
295.18 	shall be determined from the year starting September 1, 1999,
295.19 	and ending August 31, 2000, as the base year for adjusting for
295.20 	inflation for debts incurred after December 31, 2000.
295.21 	Debt also includes an agreement to pay a MinnesotaCare
295.22 	premium, regardless of the dollar amount of the premium
295.23 	authorized under section 256L.15, subdivision 1a.

295.24 	Sec. 15. Minnesota Statutes 2004, section 289A.08,
295.25 	subdivision 16, is amended to read:
295.26 		Subd. 16.Tax refund or return preparers; electronic
295.27 	filing; paper filing fee imposed.  (a) A "tax refund or return
295.28 	preparer," as defined in section 289A.60, subdivision 13,
295.29 	paragraph (g) (h), who prepared more than 500 100 Minnesota
295.30 	individual income tax returns for the prior calendar year must
295.31 	file all Minnesota individual income tax returns prepared for
295.32 	the current calendar year by electronic means.
295.33 	(b) For tax returns prepared for the tax year beginning in
295.34 	2001, the "500" in paragraph (a) is reduced to 250.
295.35 	(c) For tax returns prepared for tax years beginning after
295.36 	December 31, 2001, the "500" in paragraph (a) is reduced to 100.
296.1 	(d) Paragraph (a) does not apply to a return if the
296.2 	taxpayer has indicated on the return that the taxpayer did not
296.3 	want the return filed by electronic means.
296.4 	(e) (c) For each return that is not filed electronically by
296.5 	a tax refund or return preparer under this subdivision,
296.6 	including returns filed under paragraph (d) (b), a paper filing
296.7 	fee of $5 is imposed upon the preparer.  The fee is collected
296.8 	from the preparer in the same manner as income tax.  The fee
296.9 	does not apply to returns that the commissioner requires to be
296.10 	filed in paper form.

296.11 	Sec. 16. Minnesota Statutes 2004, section 289A.37,
296.12 	subdivision 5, is amended to read:
296.13 		Subd. 5.Sufficiency of notice.  An order of assessment,
296.14 	sent postage prepaid by United States mail to the taxpayer at
296.15 	the taxpayer's last known address, or sent by electronic mail to
296.16 	the taxpayer's last known electronic mailing address as provided
296.17 	for in section 325L.08,is sufficient even if the taxpayer is
296.18 	deceased or is under a legal disability, or, in the case of a
296.19 	corporation, has terminated its existence, unless the department
296.20 	has been provided with a new address by a party authorized to
296.21 	receive notices of assessment.
296.22 	
EFFECTIVE DATE. This section is effective the day
296.23 	following final enactment.

296.24 	Sec. 17. Minnesota Statutes 2004, section 289A.60,
296.25 	subdivision 2a, is amended to read:
296.26 		Subd. 2a.Penalties for extended delinquency.  (a) If an
296.27 	individual income tax is not paid within 180 days after the date
296.28 	of filing of a return or, in the case of taxes assessed by the
296.29 	commissioner, within 180 days after the assessment date or, if
296.30 	appealed, within 180 days after final resolution of the appeal,
296.31 	an extended delinquency penalty of five percent of the tax
296.32 	remaining unpaid is added to the amount due.
296.33 	(b) If a corporate franchise, fiduciary income, mining
296.34 	company, estate, partnership, S corporation, or nonresident
296.35 	entertainer tax return is not filed within 30 days after written
296.36 	demand for the filing of a delinquent return, an extended
297.1 	delinquency penalty of five percent of the tax not paid prior to
297.2 	the demand is added to the tax,or in the case of an individual
297.3 	income tax return, a minimum penalty of $100 or the five percent
297.4 	penalty is imposed, whichever amount is greater.
297.5 	
EFFECTIVE DATE. This section is effective for returns
297.6 	originally due on or after August 1, 2005.

297.7 	Sec. 18. Minnesota Statutes 2004, section 289A.60,
297.8 	subdivision 11, is amended to read:
297.9 		Subd. 11.Penalties relating to information reports,
297.10 	withholding.  (a) When a person required under section 289A.09,
297.11 	subdivision 2, to give a statement to an employee or payee and a
297.12 	duplicate statement to the commissioner, or to give a
297.13 	reconciliation of the statements and quarterly returns to the
297.14 	commissioner, gives a false or fraudulent statement to an
297.15 	employee or payee or a false or fraudulent duplicate statement
297.16 	or reconciliation of statements and quarterly returns to the
297.17 	commissioner, or fails to give a statement or the reconciliation
297.18 	in the manner, when due, and showing the information required by
297.19 	section 289A.09, subdivision 2, or rules prescribed by the
297.20 	commissioner under that section, that person is liable for a
297.21 	penalty of $50 for an act or failure to act.  The total amount
297.22 	imposed on the delinquent person for failures during a calendar
297.23 	year must not exceed $25,000.
297.24 	(b) In addition to any other penalty provided by law, an
297.25 	employee who gives a withholding exemption certificate or a
297.26 	residency affidavit to an employer that the employee has reason
297.27 	to know contains a materially incorrect statement decreases the
297.28 	amount withheld under section 290.92 and as of the time the
297.29 	certificate or affidavit was given to the employer there was no
297.30 	reasonable basis for the statements in the certificate or
297.31 	affidavit is liable to the commissioner of revenue for a penalty
297.32 	of $500 for each instance.
297.33 	(c) In addition to any other penalty provided by law, an
297.34 	employer who fails to submit a copy of a withholding exemption
297.35 	certificate or a residency affidavit required by section 290.92,
297.36 	subdivision 5a, clause (1)(a), (1)(b), or (2) is liable to the
298.1 	commissioner of revenue for a penalty of $50 for each instance.
298.2 	(d) An employer or payor who fails to file an application
298.3 	for a withholding account number, as required by section 290.92,
298.4 	subdivision 24, is liable to the commissioner for a penalty of
298.5 	$100.
298.6 	
EFFECTIVE DATE. This section is effective for
298.7 	certificates and affidavits given to employers after December
298.8 	31, 2005.

298.9 	Sec. 19. Minnesota Statutes 2004, section 289A.60,
298.10 	subdivision 13, is amended to read:
298.11 		Subd. 13.Penalties for tax return preparers.  (a) If an
298.12 	understatement of liability with respect to a return or claim
298.13 	for refund is due to a willful attempt in any manner to
298.14 	understate the liability for a tax by a person who is a tax
298.15 	return preparer with respect to the return or claim, the person
298.16 	shall pay to the commissioner a penalty of $500.  If a part of a
298.17 	property tax refund claim is excessive due to a willful attempt
298.18 	in any manner to overstate the claim for relief allowed under
298.19 	chapter 290A by a person who is a tax refund or return preparer,
298.20 	the person shall pay to the commissioner a penalty of $500 with
298.21 	respect to the claim.  These penalties may not be assessed
298.22 	against the employer of a tax return preparer unless the
298.23 	employer was actively involved in the willful attempt to
298.24 	understate the liability for a tax or to overstate the claim for
298.25 	refund.  These penalties are income tax liabilities and may be
298.26 	assessed at any time as provided in section 289A.38, subdivision
298.27 	5.
298.28 	(b) A civil action in the name of the state of Minnesota
298.29 	may be commenced to enjoin any person who is a tax return
298.30 	preparer doing business in this state from further engaging in
298.31 	any conduct described in paragraph (c).  An action under this
298.32 	paragraph must be brought by the attorney general in the
298.33 	district court for the judicial district of the tax return
298.34 	preparer's residence or principal place of business, or in which
298.35 	the taxpayer with respect to whose tax return the action is
298.36 	brought resides.  The court may exercise its jurisdiction over
299.1 	the action separate and apart from any other action brought by
299.2 	the state of Minnesota against the tax return preparer or any
299.3 	taxpayer.
299.4 	(c) In an action under paragraph (b), if the court finds
299.5 	that a tax return preparer has:
299.6 	(1) engaged in any conduct subject to a civil penalty under
299.7 	section 289A.60 or a criminal penalty under section 289A.63;
299.8 	(2) misrepresented the preparer's eligibility to practice
299.9 	before the Department of Revenue, or otherwise misrepresented
299.10 	the preparer's experience or education as a tax return preparer;
299.11 	(3) guaranteed the payment of any tax refund or the
299.12 	allowance of any tax credit; or
299.13 	(4) engaged in any other fraudulent or deceptive conduct
299.14 	that substantially interferes with the proper administration of
299.15 	state tax law, and injunctive relief is appropriate to prevent
299.16 	the recurrence of that conduct,
299.17 	the court may enjoin the person from further engaging in that
299.18 	conduct.
299.19 	(d) If the court finds that a tax return preparer has
299.20 	continually or repeatedly engaged in conduct described in
299.21 	paragraph (c), and that an injunction prohibiting that conduct
299.22 	would not be sufficient to prevent the person's interference
299.23 	with the proper administration of state tax laws, the court may
299.24 	enjoin the person from acting as a tax return preparer.  The
299.25 	court may not enjoin the employer of a tax return preparer for
299.26 	conduct described in paragraph (c) engaged in by one or more of
299.27 	the employer's employees unless the employer was also actively
299.28 	involved in that conduct.
299.29 	(e) The commissioner may terminate or suspend a tax
299.30 	preparer's authority to transmit returns electronically to the
299.31 	state, if the commissioner determines that the tax preparer has
299.32 	engaged in a pattern and practice of conduct in violation of
299.33 	paragraph (a) of this subdivision or has been convicted under
299.34 	section 289A.63.
299.35 	(f) For purposes of this subdivision, the term
299.36 	"understatement of liability" means an understatement of the net
300.1 	amount payable with respect to a tax imposed by state tax law,
300.2 	or an overstatement of the net amount creditable or refundable
300.3 	with respect to a tax.  The determination of whether or not
300.4 	there is an understatement of liability must be made without
300.5 	regard to any administrative or judicial action involving the
300.6 	taxpayer.  For purposes of this subdivision, the amount
300.7 	determined for underpayment of estimated tax under either
300.8 	section 289A.25 or 289A.26 is not considered an understatement
300.9 	of liability.
300.10 	(f) (g) For purposes of this subdivision, the term
300.11 	"overstatement of claim" means an overstatement of the net
300.12 	amount refundable with respect to a claim for property tax
300.13 	relief provided by chapter 290A.  The determination of whether
300.14 	or not there is an overstatement of a claim must be made without
300.15 	regard to administrative or judicial action involving the
300.16 	claimant.
300.17 	(g) (h) For purposes of this section, the term "tax refund
300.18 	or return preparer" means an individual who prepares for
300.19 	compensation, or who employs one or more individuals to prepare
300.20 	for compensation, a return of tax, or a claim for refund of
300.21 	tax.  The preparation of a substantial part of a return or claim
300.22 	for refund is treated as if it were the preparation of the
300.23 	entire return or claim for refund.  An individual is not
300.24 	considered a tax return preparer merely because the individual:
300.25 	(1) gives typing, reproducing, or other mechanical
300.26 	assistance;
300.27 	(2) prepares a return or claim for refund of the employer,
300.28 	or an officer or employee of the employer, by whom the
300.29 	individual is regularly and continuously employed;
300.30 	(3) prepares a return or claim for refund of any person as
300.31 	a fiduciary for that person; or
300.32 	(4) prepares a claim for refund for a taxpayer in response
300.33 	to a tax order issued to the taxpayer.

300.34 	Sec. 20. Minnesota Statutes 2004, section 290.92,
300.35 	subdivision 1, is amended to read:
300.36 		Subdivision 1.Definitions.  (1)  [WAGES.] For purposes
301.1 	of this section, the term "wages" means the same as that term is
301.2 	defined in section 3401(a) and (f) of the Internal Revenue Code.
301.3 	(2)  [PAYROLL PERIOD.] For purposes of this section the
301.4 	term "payroll period" means a period for which a payment of
301.5 	wages is ordinarily made to the employee by the employee's
301.6 	employer, and the term "miscellaneous payroll period" means a
301.7 	payroll period other than a daily, weekly, biweekly,
301.8 	semimonthly, monthly, quarterly, semiannual, or annual payroll
301.9 	period.
301.10 	(3)  [EMPLOYEE.] For purposes of this section the term
301.11 	"employee" means any resident individual performing services for
301.12 	an employer, either within or without, or both within and
301.13 	without the state of Minnesota, and every nonresident individual
301.14 	performing services within the state of Minnesota, the
301.15 	performance of which services constitute, establish, and
301.16 	determine the relationship between the parties as that of
301.17 	employer and employee.  As used in the preceding sentence, the
301.18 	term "employee" includes an officer of a corporation, and an
301.19 	officer, employee, or elected official of the United States, a
301.20 	state, or any political subdivision thereof, or the District of
301.21 	Columbia, or any agency or instrumentality of any one or more of
301.22 	the foregoing.
301.23 	(4)  [EMPLOYER.] For purposes of this section the term
301.24 	"employer" means any person, including individuals, fiduciaries,
301.25 	estates, trusts, partnerships, limited liability companies, and
301.26 	corporations transacting business in or deriving any income from
301.27 	sources within the state of Minnesota for whom an individual
301.28 	performs or performed any service, of whatever nature, as the
301.29 	employee of such person, except that if the person for whom the
301.30 	individual performs or performed the services does not have
301.31 	legal control of the payment of the wages for such services, the
301.32 	term "employer," except for purposes of paragraph (1), means the
301.33 	person having legal control of the payment of such wages.  As
301.34 	used in the preceding sentence, the term "employer" includes any
301.35 	corporation, individual, estate, trust, or organization which is
301.36 	exempt from taxation under section 290.05 and further includes,
302.1 	but is not limited to, officers of corporations who have legal 
302.2 	control, either individually or jointly with another or others,
302.3 	of the payment of the wages.
302.4 	(5)  [NUMBER OF WITHHOLDING EXEMPTIONS CLAIMED.] For
302.5 	purposes of this section, the term "number of withholding
302.6 	exemptions claimed" means the number of withholding exemptions
302.7 	claimed in a withholding exemption certificate in effect under
302.8 	subdivision 5, except that if no such certificate is in effect,
302.9 	the number of withholding exemptions claimed shall be considered
302.10 	to be zero.
302.11 	
EFFECTIVE DATE. This section is effective the day
302.12 	following final enactment.

302.13 	Sec. 21. Minnesota Statutes 2004, section 325D.33,
302.14 	subdivision 6, is amended to read:
302.15 		Subd. 6.Violations.  If the commissioner determines that
302.16 	a distributor is violating any provision of this chapter, the
302.17 	commissioner must give the distributor a written warning
302.18 	explaining the violation and an explanation of what must be done
302.19 	to comply with this chapter.  Within ten days of issuance of the
302.20 	warning, the distributor must notify the commissioner that the
302.21 	distributor has complied with the commissioner's recommendation
302.22 	or request that the commissioner set the issue for a hearing
302.23 	pursuant to chapter 14.  If a hearing is requested, the hearing
302.24 	shall be scheduled within 20 days of the request and the
302.25 	recommendation of the administrative law judge shall be issued
302.26 	within five working days of the close of the hearing.  The
302.27 	commissioner's final determination shall be issued within five
302.28 	working days of the receipt of the administrative law judge's
302.29 	recommendation.  If the commissioner's final determination is
302.30 	adverse to the distributor and the distributor does not comply
302.31 	within ten days of receipt of the commissioner's final
302.32 	determination, the commissioner may order the distributor to
302.33 	immediately cease the stamping of cigarettes.  As soon as
302.34 	practicable after the order, the commissioner must remove the
302.35 	meter and any unapplied cigarette stamps from the premises of
302.36 	the distributor.
303.1 	If within ten days of issuance of the written warning the
303.2 	distributor has not complied with the commissioner's
303.3 	recommendation or requested a hearing, the commissioner may
303.4 	order the distributor to immediately cease the stamping of
303.5 	cigarettes and remove the meter and unapplied stamps from the
303.6 	distributor's premises.
303.7 	If, within any 12-month period, the commissioner has issued
303.8 	three written warnings to any distributor, even if the
303.9 	distributor has complied within ten days, the commissioner shall
303.10 	notify the distributor of the commissioner's intent to revoke
303.11 	the distributor's license for a continuing course of conduct
303.12 	contrary to this chapter.  For purposes of this paragraph, a
303.13 	written warning that was ultimately resolved by removal of the
303.14 	warning by the commissioner is not deemed to be a warning.  The
303.15 	commissioner must notify the distributor of the date and time of
303.16 	a hearing pursuant to chapter 14 at least 20 days before the
303.17 	hearing is held.  The hearing must provide an opportunity for
303.18 	the distributor to show cause why the license should not be
303.19 	revoked.  If the commissioner revokes a distributor's license,
303.20 	the commissioner shall not issue a new license to that
303.21 	distributor for 180 days.
303.22 	
EFFECTIVE DATE. This section is effective the day
303.23 	following final enactment.