1.1 	A bill for an act
1.2 	relating to natural resources; modifying sales authority; creating an account; 
1.3 	extending expiration of sustainable forest resources provisions; modifying 
1.4 	restrictions on vehicles hauling unfinished forest products; modifying timber 
1.5 	sales on tax-forfeited lands; modifying apportionment of net income; defining 
1.6 	wood products industry; modifying certain tax exemptions; appropriating money;
1.7 	amending Minnesota Statutes 2006, sections 84.025, subdivision 9; 84.026, 
1.8 	subdivision 1; 84.0855, subdivisions 1, 2; 89A.11; 169.8261; 282.04, subdivision 
1.9 	1; 290.191, subdivision 2; 297A.68, subdivision 5; 297A.69, subdivision 3; 
1.10 	proposing coding for new law in Minnesota Statutes, chapter 89.
1.11 	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

1.12 	Section 1. Minnesota Statutes 2006, section 84.025, subdivision 9, is amended to read:
1.13 		Subd. 9.Professional services support account. The commissioner of natural 
1.14 	resources may bill the various programs carried out by the commissioner for the costs of 
1.15 	providing them with professional support services. Except as provided under section 
1.16 	89.421, receipts must be credited to a special account in the state treasury and are 
1.17 	appropriated to the commissioner to pay the costs for which the billings were made.
1.18 	The commissioner of natural resources shall submit to the commissioner of finance 
1.19 	before the start of each fiscal year a work plan showing the estimated work to be done 
1.20 	during the coming year, the estimated cost of doing the work, and the positions and fees 
1.21 	that will be necessary. This account is exempted from statewide and agency indirect 
1.22 	cost payments.

1.23 	Sec. 2. Minnesota Statutes 2006, section 84.026, subdivision 1, is amended to read:
1.24 		Subdivision 1.Contracts. The commissioner of natural resources is authorized 
1.25 	to enter into contractual agreements with any public or private entity for the provision 
1.26 	of statutorily prescribed natural resources services by the department. The contracts 
2.1 	shall specify the services to be provided. Except as provided under section 89.421, funds 
2.2 	generated in a contractual agreement made pursuant to this section shall be deposited in 
2.3 	the special revenue fund and are appropriated to the department for purposes of providing 
2.4 	the services specified in the contracts. The commissioner shall report revenues collected 
2.5 	and expenditures made under this subdivision to the chairs of the Committees on Ways and 
2.6 	Means in the house and Finance in the senate by January 1 of each odd-numbered year.

2.7 	Sec. 3. Minnesota Statutes 2006, section 84.0855, subdivision 1, is amended to read:
2.8 		Subdivision 1.Sales authorized; gift certificates. The commissioner may 
2.9 	sell natural resources-related publications and maps; forest resource assessment 
2.10 	products; federal migratory waterfowl, junior duck, and other federal stamps; and other 
2.11 	nature-related merchandise, and may rent or sell items for the convenience of persons using 
2.12 	Department of Natural Resources facilities or services. The commissioner may sell gift 
2.13 	certificates for any items rented or sold. Notwithstanding section 16A.1285, a fee charged 
2.14 	by the commissioner under this section may include a reasonable amount in excess of the 
2.15 	actual cost to support Department of Natural Resources programs. The commissioner may 
2.16 	advertise the availability of a program or item offered under this section. 

2.17 	Sec. 4. Minnesota Statutes 2006, section 84.0855, subdivision 2, is amended to read:
2.18 		Subd. 2.Receipts; appropriation. Except as provided under section 89.421, 
2.19 	money received by the commissioner under this section or to buy supplies for the use of 
2.20 	volunteers, may be credited to one or more special accounts in the state treasury and is 
2.21 	appropriated to the commissioner for the purposes for which the money was received. 
2.22 	Money received from sales at the state fair shall be available for state fair related costs. 
2.23 	Money received from sales of intellectual property and software products or services shall 
2.24 	be available for development, maintenance, and support of software products and systems.

2.25 	Sec. 5. [89.421] FOREST RESOURCE ASSESSMENT PRODUCTS AND 
2.26 	SERVICES ACCOUNT.
2.27 		Subdivision 1.Creation. The forest resource assessment products and services 
2.28 	account is created in the state treasury in the natural resources fund.
2.29 		Subd. 2.Receipts. Money received from forest resource assessment product sales 
2.30 	and services provided by the commissioner under sections 84.025, subdivision 9; 84.026; 
2.31 	and 84.0855 shall be credited to the forest resource assessment products and services 
2.32 	account. Forest resource assessment products and services include the sale of aerial 
2.33 	photography, remote sensing, and satellite imagery products and services.
3.1 		Subd. 3.Use of money in account. Money credited to the forest resource 
3.2 	assessment products and services account under subdivision 2 is annually appropriated to 
3.3 	the commissioner and shall be used to maintain the staff and facilities producing the aerial 
3.4 	photography, remote sensing, and satellite imagery products and services.

3.5 	Sec. 6. Minnesota Statutes 2006, section 89A.11, is amended to read:
3.6 	89A.11 REPEALER.
3.7 	Sections 89A.01; 89A.02; 89A.03; 89A.04; 89A.05; 89A.06; 89A.07; 89A.08; 
3.8 	89A.09; 89A.10; and 89A.11 are repealed June 30, 2007 2017.

3.9 	Sec. 7. Minnesota Statutes 2006, section 169.8261, is amended to read:
3.10 	169.8261 GROSS WEIGHT LIMITATIONS; FOREST PRODUCTS.
3.11 	(a) A vehicle or combination of vehicles hauling raw or unfinished forest products, 
3.12 	including wood chips, paper, pulp, oriented strandboard, laminated strand lumber, 
3.13 	hardboard, treated lumber, untreated lumber, or barrel staves, by the most direct route to the 
3.14 	nearest highway that has been designated under section 169.832, subdivision 11, may be 
3.15 	operated on any highway with gross weights permitted under sections 169.822 to 169.829
3.16 	without regard to load restrictions imposed on that highway, except that the vehicles must:
3.17 	(1) comply with seasonal load restrictions in effect between the dates set by the 
3.18 	commissioner under section 169.87, subdivision 2;
3.19 	(2) comply with bridge load limits posted under section 169.84;
3.20 	(3) be equipped and operated with six axles and brakes;
3.21 	(4) not exceed 90,000 pounds gross weight, or 98,000 pounds gross weight during 
3.22 	the time when seasonal increases are authorized under section 169.826;
3.23 	(5) not be operated on interstate and defense highways;
3.24 	(6) obtain an annual permit from the commissioner of transportation;
3.25 	(7) obey all road postings; and
3.26 	(8) not exceed 20,000 pounds gross weight on any single axle.
3.27 	(b) A vehicle operated under this section may exceed the legal axle weight limits 
3.28 	listed in section 169.824 by not more than 12.5 percent; except that, the weight limits may 
3.29 	be exceeded by not more than 22.5 percent during the time when seasonal increases are 
3.30 	authorized under section 169.826, subdivision 1.

3.31 	Sec. 8. Minnesota Statutes 2006, section 282.04, subdivision 1, is amended to read:
3.32 		Subdivision 1.Timber sales; land leases and uses. (a) The county auditor may 
3.33 	sell timber upon any tract that may be approved by the natural resources commissioner. 
4.1 	The sale of timber shall be made for cash at not less than the appraised value determined 
4.2 	by the county board to the highest bidder after not less than one week's published notice 
4.3 	in an official paper within the county. Any timber offered at the public sale and not sold 
4.4 	may thereafter be sold at private sale by the county auditor at not less than the appraised 
4.5 	value thereof, until the time as the county board may withdraw the timber from sale. The 
4.6 	appraised value of the timber and the forestry practices to be followed in the cutting of 
4.7 	said timber shall be approved by the commissioner of natural resources.
4.8 	(b) Payment of the full sale price of all timber sold on tax-forfeited lands shall be 
4.9 	made in cash at the time of the timber sale, except in the case of oral or sealed bid auction 
4.10 	sales, the down payment shall be no less than 15 percent of the appraised value, and the 
4.11 	balance shall be paid prior to entry. In the case of auction sales that are partitioned and 
4.12 	sold as a single sale with predetermined cutting blocks, the down payment shall be no less 
4.13 	than 15 percent of the appraised price of the entire timber sale which may be held until the 
4.14 	satisfactory completion of the sale or applied in whole or in part to the final cutting block. 
4.15 	The value of each separate block must be paid in full before any cutting may begin in that 
4.16 	block. With the permission of the county contract administrator the purchaser may enter 
4.17 	unpaid blocks and cut necessary timber incidental to developing logging roads as may 
4.18 	be needed to log other blocks provided that no timber may be removed from an unpaid 
4.19 	block until separately scaled and paid for. If payment is provided as specified in this 
4.20 	paragraph as security under paragraph (a) and no cutting has taken place on the contract, 
4.21 	the county auditor may credit the security provided, less any down payment required for 
4.22 	an auction sale under this paragraph, to any other contract issued to the contract holder 
4.23 	by the county under this chapter to which the contract holder requests in writing that it 
4.24 	be credited, provided the request and transfer is made within the same calendar year as 
4.25 	the security was received.
4.26 	(c) The county board may require final settlement on the basis of a scale of cut 
4.27 	products sell any timber, including biomass, as appraised or scaled, at its discretion. 
4.28 	Any parcels of land from which timber is to be sold by scale of cut products shall be so 
4.29 	designated in the published notice of sale under paragraph (a), in which case the notice 
4.30 	shall contain a description of the parcels, a statement of the estimated quantity of each 
4.31 	species of timber, and the appraised price of each species of timber for 1,000 feet, per cord 
4.32 	or per piece, as the case may be. In those cases any bids offered over and above the 
4.33 	appraised prices shall be by percentage, the percent bid to be added to the appraised price 
4.34 	of each of the different species of timber advertised on the land. The purchaser of timber 
4.35 	from the parcels shall pay in cash at the time of sale at the rate bid for all of the timber 
4.36 	shown in the notice of sale as estimated to be standing on the land, and in addition shall 
5.1 	pay at the same rate for any additional amounts which the final scale shows to have been 
5.2 	cut or was available for cutting on the land at the time of sale under the terms of the sale. 
5.3 	Where the final scale of cut products shows that less timber was cut or was available 
5.4 	for cutting under terms of the sale than was originally paid for, the excess payment 
5.5 	shall be refunded from the forfeited tax sale fund upon the claim of the purchaser, to be 
5.6 	audited and allowed by the county board as in case of other claims against the county. No 
5.7 	timber, except hardwood pulpwood, may be removed from the parcels of land or other 
5.8 	designated landings until scaled by a person or persons designated by the county board 
5.9 	and approved by the commissioner of natural resources. Landings other than the parcel 
5.10 	of land from which timber is cut may be designated for scaling by the county board by 
5.11 	written agreement with the purchaser of the timber. The county board may, by written 
5.12 	agreement with the purchaser and with a consumer designated by the purchaser when the 
5.13 	timber is sold by the county auditor, and with the approval of the commissioner of natural 
5.14 	resources, accept the consumer's scale of cut products delivered at the consumer's landing. 
5.15 	No timber shall be removed until fully paid for in cash. Small amounts of timber not 
5.16 	exceeding $3,000 in appraised valuation may be sold for not less than the full appraised 
5.17 	value at private sale to individual persons without first publishing notice of sale or calling 
5.18 	for bids, provided that in case of a sale involving a total appraised value of more than $200 
5.19 	the sale shall be made subject to final settlement on the basis of a scale of cut products in 
5.20 	the manner above provided and not more than two of the sales, directly or indirectly to any 
5.21 	individual shall be in effect at one time.
5.22 	(d) As directed by the county board, the county auditor may lease tax-forfeited land 
5.23 	to individuals, corporations or organized subdivisions of the state at public or private sale, 
5.24 	and at the prices and under the terms as the county board may prescribe, for use as cottage 
5.25 	and camp sites and for agricultural purposes and for the purpose of taking and removing of 
5.26 	hay, stumpage, sand, gravel, clay, rock, marl, and black dirt from the land, and for garden 
5.27 	sites and other temporary uses provided that no leases shall be for a period to exceed ten 
5.28 	years; provided, further that any leases involving a consideration of more than $12,000 per 
5.29 	year, except to an organized subdivision of the state shall first be offered at public sale in 
5.30 	the manner provided herein for sale of timber. Upon the sale of any leased land, it shall 
5.31 	remain subject to the lease for not to exceed one year from the beginning of the term of the 
5.32 	lease. Any rent paid by the lessee for the portion of the term cut off by the cancellation 
5.33 	shall be refunded from the forfeited tax sale fund upon the claim of the lessee, to be 
5.34 	audited and allowed by the county board as in case of other claims against the county.
5.35 	(e) As directed by the county board, the county auditor may lease tax-forfeited land 
5.36 	to individuals, corporations, or organized subdivisions of the state at public or private sale, 
6.1 	at the prices and under the terms as the county board may prescribe, for the purpose 
6.2 	of taking and removing for use for road construction and other purposes tax-forfeited 
6.3 	stockpiled iron-bearing material. The county auditor must determine that the material is 
6.4 	needed and suitable for use in the construction or maintenance of a road, tailings basin, 
6.5 	settling basin, dike, dam, bank fill, or other works on public or private property, and 
6.6 	that the use would be in the best interests of the public. No lease shall exceed ten years. 
6.7 	The use of a stockpile for these purposes must first be approved by the commissioner of 
6.8 	natural resources. The request shall be deemed approved unless the requesting county 
6.9 	is notified to the contrary by the commissioner of natural resources within six months 
6.10 	after receipt of a request for approval for use of a stockpile. Once use of a stockpile has 
6.11 	been approved, the county may continue to lease it for these purposes until approval is 
6.12 	withdrawn by the commissioner of natural resources.
6.13 	(f) The county auditor, with the approval of the county board is authorized to grant 
6.14 	permits, licenses, and leases to tax-forfeited lands for the depositing of stripping, lean 
6.15 	ores, tailings, or waste products from mines or ore milling plants, upon the conditions and 
6.16 	for the consideration and for the period of time, not exceeding 15 years, as the county 
6.17 	board may determine. The permits, licenses, or leases are subject to approval by the 
6.18 	commissioner of natural resources.
6.19 	(g) Any person who removes any timber from tax-forfeited land before said 
6.20 	timber has been scaled and fully paid for as provided in this subdivision is guilty of a 
6.21 	misdemeanor.
6.22 	(h) The county auditor may, with the approval of the county board, and without first 
6.23 	offering at public sale, grant leases, for a term not exceeding 25 years, for the removal 
6.24 	of peat and for the production or removal of farm-grown closed-loop biomass as defined 
6.25 	in section 216B.2424, subdivision 1, or short-rotation woody crops from tax-forfeited 
6.26 	lands upon the terms and conditions as the county board may prescribe. Any lease for 
6.27 	the removal of peat, farm-grown closed-loop biomass, or short-rotation woody crops 
6.28 	from tax-forfeited lands must first be reviewed and approved by the commissioner of 
6.29 	natural resources if the lease covers 320 or more acres. No lease for the removal of 
6.30 	peat, farm-grown closed-loop biomass, or short-rotation woody crops shall be made by 
6.31 	the county auditor pursuant to this section without first holding a public hearing on the 
6.32 	auditor's intention to lease. One printed notice in a legal newspaper in the county at least 
6.33 	ten days before the hearing, and posted notice in the courthouse at least 20 days before 
6.34 	the hearing shall be given of the hearing.
6.35 	(i) Notwithstanding any provision of paragraph (c) to the contrary, the St. Louis 
6.36 	County auditor may, at the discretion of the county board, sell timber to the party who 
7.1 	bids the highest price for all the several kinds of timber, as provided for sales by the 
7.2 	commissioner of natural resources under section 90.14. Bids offered over and above the 
7.3 	appraised price need not be applied proportionately to the appraised price of each of 
7.4 	the different species of timber.
7.5 	(j) In lieu of any payment or deposit required in paragraph (b), as directed by the 
7.6 	county board and under terms set by the county board, the county auditor may accept an 
7.7 	irrevocable bank letter of credit in the amount equal to the amount otherwise determined 
7.8 	in paragraph (b). If an irrevocable bank letter of credit is provided under this paragraph, 
7.9 	at the written request of the purchaser, the county may periodically allow the bank letter 
7.10 	of credit to be reduced by an amount proportionate to the value of timber that has been 
7.11 	harvested and for which the county has received payment. The remaining amount of 
7.12 	the bank letter of credit after a reduction under this paragraph must not be less than 20 
7.13 	percent of the value of the timber purchased. If an irrevocable bank letter of credit or 
7.14 	cash deposit is provided for the down payment required in paragraph (b), and no cutting 
7.15 	of timber has taken place on the contract for which a letter of credit has been provided, 
7.16 	the county may allow the transfer of the letter of credit to any other contract issued to the 
7.17 	contract holder by the county under this chapter to which the contract holder requests in 
7.18 	writing that it be credited.

7.19 	Sec. 9. Minnesota Statutes 2006, section 290.191, subdivision 2, is amended to read:
7.20 		Subd. 2.Apportionment formula of general application. (a) Except for those 
7.21 	trades or businesses required to use a different formula under subdivision 3 or section 
7.22 	290.36, and for those trades or businesses that receive permission to use some other 
7.23 	method under section 290.20 or under subdivision 4, a trade or business required to 
7.24 	apportion its net income must apportion its income to this state on the basis of the 
7.25 	percentage obtained by taking the sum of:
7.26 	(1) the percent for the sales factor under paragraph (b) of the percentage which 
7.27 	the sales made within this state in connection with the trade or business during the tax 
7.28 	period are of the total sales wherever made in connection with the trade or business during 
7.29 	the tax period;
7.30 	(2) the percent for the property factor under paragraph (b) of the percentage which 
7.31 	the total tangible property used by the taxpayer in this state in connection with the trade or 
7.32 	business during the tax period is of the total tangible property, wherever located, used by 
7.33 	the taxpayer in connection with the trade or business during the tax period; and
7.34 	(3) the percent for the payroll factor under paragraph (b) of the percentage which 
7.35 	the taxpayer's total payrolls paid or incurred in this state or paid in respect to labor 
8.1 	performed in this state in connection with the trade or business during the tax period are 
8.2 	of the taxpayer's total payrolls paid or incurred in connection with the trade or business 
8.3 	during the tax period.
8.4 	(b) For purposes of paragraph (a) and subdivision 3, the following percentages apply 
8.5 	for the taxable years specified:

8.6
8.7
8.8	Taxable years 
beginning during 
calendar year
	Sales factor 
percent
	Property factor 
percent
	Payroll factor 
percent
	
8.9	2007
	78
	11
	11
	
8.10	2008
	81 85
	9.5 7.5
	9.5 7.5
	
8.11	2009
	84 90
	8 5
	8 5
	
8.12	2010
	87 95
	6.5 2.5
	6.5 2.5
	
8.13	2011
	90
	5
	5
	
8.14	2012
	93
	3.5
	3.5
	
8.15	2013
	96
	2
	2
	
8.16
8.17	2014 and later 
calendar years
	100
	0
	0

8.18 	EFFECTIVE DATE. This section is effective for tax years beginning after 
8.19 	December 31, 2006.

8.20 	Sec. 10. Minnesota Statutes 2006, section 297A.68, subdivision 5, is amended to read:
8.21 		Subd. 5.Capital equipment. (a) Capital equipment is exempt. as follows:
8.22 	(1) for sales and purchases of capital equipment by the wood products industry, the 
8.23 	tax is not imposed;
8.24 	(2) for sales and purchases of capital equipment by a small business, the tax is 
8.25 	not imposed. For purposes of this subdivision, "small business" is as defined in section 
8.26 	645.445, subdivision 2; and 
8.27 	(3) for all other sales and purchases of capital equipment, the tax must be imposed 
8.28 	and collected as if the rate under section 297A.62, subdivision 1, applied, and then 
8.29 	refunded in the manner provided in section 297A.75.
8.30 	"Capital equipment" means machinery and equipment purchased or leased, and used 
8.31 	in this state by the purchaser or lessee primarily for manufacturing, fabricating, mining, 
8.32 	or refining tangible personal property to be sold ultimately at retail if the machinery and 
8.33 	equipment are essential to the integrated production process of manufacturing, fabricating, 
8.34 	mining, or refining. Capital equipment also includes machinery and equipment 
8.35 	used primarily to electronically transmit results retrieved by a customer of an online 
8.36 	computerized data retrieval system.
8.37 	(b) Capital equipment includes, but is not limited to:
9.1 	(1) machinery and equipment used to operate, control, or regulate the production 
9.2 	equipment;
9.3 	(2) machinery and equipment used for research and development, design, quality 
9.4 	control, and testing activities;
9.5 	(3) environmental control devices that are used to maintain conditions such as 
9.6 	temperature, humidity, light, or air pressure when those conditions are essential to and are 
9.7 	part of the production process;
9.8 	(4) materials and supplies used to construct and install machinery or equipment;
9.9 	(5) repair and replacement parts, including accessories, whether purchased as spare 
9.10 	parts, repair parts, or as upgrades or modifications to machinery or equipment;
9.11 	(6) materials used for foundations that support machinery or equipment;
9.12 	(7) materials used to construct and install special purpose buildings used in the 
9.13 	production process;
9.14 	(8) ready-mixed concrete equipment in which the ready-mixed concrete is mixed 
9.15 	as part of the delivery process regardless if mounted on a chassis, repair parts for 
9.16 	ready-mixed concrete trucks, and leases of ready-mixed concrete trucks; and
9.17 	(9) machinery or equipment used for research, development, design, or production 
9.18 	of computer software.
9.19 	(c) Capital equipment does not include the following:
9.20 	(1) motor vehicles taxed under chapter 297B;
9.21 	(2) machinery or equipment used to receive or store raw materials;
9.22 	(3) building materials, except for materials included in paragraph (b), clauses (6) 
9.23 	and (7);
9.24 	(4) machinery or equipment used for nonproduction purposes, including, but not 
9.25 	limited to, the following: plant security, fire prevention, first aid, and hospital stations; 
9.26 	support operations or administration; pollution control; and plant cleaning, disposal of 
9.27 	scrap and waste, plant communications, space heating, cooling, lighting, or safety;
9.28 	(5) farm machinery and aquaculture production equipment as defined by section 
9.29 	297A.61, subdivisions 12 and 13;
9.30 	(6) machinery or equipment purchased and installed by a contractor as part of an 
9.31 	improvement to real property;
9.32 	(7) machinery and equipment used by restaurants in the furnishing, preparing, or 
9.33 	serving of prepared foods as defined in section 297A.61, subdivision 31;
9.34 	(8) machinery and equipment used to furnish the services listed in section 297A.61, 
9.35 	subdivision 3, paragraph (g), clause (6), items (i) to (vi) and (viii);
10.1 	(9) machinery or equipment used in the transportation, transmission, or distribution 
10.2 	of petroleum, liquefied gas, natural gas, water, or steam, in, by, or through pipes, lines, 
10.3 	tanks, mains, or other means of transporting those products. This clause does not apply to 
10.4 	machinery or equipment used to blend petroleum or biodiesel fuel as defined in section 
10.5 	239.77; or
10.6 	(10) any other item that is not essential to the integrated process of manufacturing, 
10.7 	fabricating, mining, or refining.
10.8 	(d) For purposes of this subdivision:
10.9 	(1) "Equipment" means independent devices or tools separate from machinery but 
10.10 	essential to an integrated production process, including computers and computer software, 
10.11 	used in operating, controlling, or regulating machinery and equipment; and any subunit or 
10.12 	assembly comprising a component of any machinery or accessory or attachment parts of 
10.13 	machinery, such as tools, dies, jigs, patterns, and molds.
10.14 	(2) "Fabricating" means to make, build, create, produce, or assemble components or 
10.15 	property to work in a new or different manner.
10.16 	(3) "Integrated production process" means a process or series of operations through 
10.17 	which tangible personal property is manufactured, fabricated, mined, or refined. For 
10.18 	purposes of this clause, (i) manufacturing begins with the removal of raw materials 
10.19 	from inventory and ends when the last process prior to loading for shipment has been 
10.20 	completed; (ii) fabricating begins with the removal from storage or inventory of the 
10.21 	property to be assembled, processed, altered, or modified and ends with the creation 
10.22 	or production of the new or changed product; (iii) mining begins with the removal of 
10.23 	overburden from the site of the ores, minerals, stone, peat deposit, or surface materials and 
10.24 	ends when the last process before stockpiling is completed; and (iv) refining begins with 
10.25 	the removal from inventory or storage of a natural resource and ends with the conversion 
10.26 	of the item to its completed form.
10.27 	(4) "Machinery" means mechanical, electronic, or electrical devices, including 
10.28 	computers and computer software, that are purchased or constructed to be used for the 
10.29 	activities set forth in paragraph (a), beginning with the removal of raw materials from 
10.30 	inventory through completion of the product, including packaging of the product.
10.31 	(5) "Machinery and equipment used for pollution control" means machinery and 
10.32 	equipment used solely to eliminate, prevent, or reduce pollution resulting from an activity 
10.33 	described in paragraph (a).
10.34 	(6) "Manufacturing" means an operation or series of operations where raw materials 
10.35 	are changed in form, composition, or condition by machinery and equipment and which 
10.36 	results in the production of a new article of tangible personal property. For purposes of 
11.1 	this subdivision, "manufacturing" includes the generation of electricity or steam to be 
11.2 	sold at retail.
11.3 	(7) "Mining" means the extraction of minerals, ores, stone, or peat.
11.4 	(8) "Online data retrieval system" means a system whose cumulation of information 
11.5 	is equally available and accessible to all its customers.
11.6 	(9) "Primarily" means machinery and equipment used 50 percent or more of the time 
11.7 	in an activity described in paragraph (a).
11.8 	(10) "Refining" means the process of converting a natural resource to an intermediate 
11.9 	or finished product, including the treatment of water to be sold at retail.
11.10 	(11) "Wood products industry" means: 
11.11 	(i) manufacturers of pulp, paper, and paperboard;
11.12 	(ii) sawmills and planing mills;
11.13 	(iii) manufacturers of panelboard, including veneer, plywood, and reconstituted 
11.14 	wood products, such as particleboard, waferboard, and oriented strandboard;
11.15 	(iv) manufacturers of fabricated wood millwork;
11.16 	(v) manufacturers of structural wood members; and
11.17 	(vi) manufacturers of prefabricated wood buildings and components.
11.18 	(12) Wood products industry does not include:
11.19 	(i) logging;
11.20 	(ii) manufacturers of wood cabinets, furniture, office or store fixtures, toys and 
11.21 	playground equipment, caskets, or miscellaneous wood products;
11.22 	(iii) manufacturers of wood containers;
11.23 	(iv) businesses engaged in wood preserving;
11.24 	(v) the operation of timber tracts or tree farms;
11.25 	(vi) forest nurseries and the gathering of forest products; and
11.26 	(vii) forestry services related to timber production.
11.27 	(13) This subdivision does not apply to telecommunications equipment as 
11.28 	provided in subdivision 35, and does not apply to wire, cable, fiber, poles, or conduit 
11.29 	for telecommunications services.

11.30 	EFFECTIVE DATE. This section is effective for sales and purchases made after 
11.31 	June 30, 2007.

11.32 	Sec. 11. Minnesota Statutes 2006, section 297A.69, subdivision 3, is amended to read:
11.33 		Subd. 3.Repair and replacement parts. Repair and replacement parts, except tires, 
11.34 	used for maintenance or repair of farm machinery, logging equipment, including skidder 
12.1 	tires, and aquaculture production equipment are exempt, if the part replaces a machinery 
12.2 	part assigned a specific or generic part number by the manufacturer of the machinery.

12.3 	Sec. 12. APPROPRIATIONS, DEPARTMENT OF NATURAL RESOURCES.
 12.4 		Subdivision 1.General fund appropriations. (a) $1,500,000 in fiscal year 
12.5 	2008 and $1,500,000 in fiscal year 2009 are appropriated from the general fund to the 
12.6 	commissioner of natural resources to support additional technical and cost-share assistance 
12.7 	to nonindustrial private forest landowners.
12.8 	(b)  $780,000 in fiscal year 2008 and $780,000 in fiscal year 2009 are appropriated 
12.9 	from the general fund to the commissioner of natural resources for implementation of the 
12.10 	Sustainable Forest Resources Act in Minnesota Statutes, chapter 89A.
12.11 	(c) $200,000 in fiscal year 2008 is appropriated from the general fund to the 
12.12 	Minnesota Forest Resources Council under Minnesota Statutes, chapter 89A, to review 
12.13 	and provide recommendations to the legislature and the governor on policies to maintain 
12.14 	the productive forest land base.
12.15 	(d) $200,000 in fiscal year 2008 is appropriated from the general fund to the 
12.16 	Minnesota Forest Resources Council under Minnesota Statutes, chapter 89A, for the 
12.17 	Forest Resources Research Advisory Committee under Minnesota Statutes, section 
12.18 	89A.08, to conduct research on topics recommended by the governor's task force on the 
12.19 	competitiveness of Minnesota's primary forest products industry.
12.20 	(e) $480,000 in fiscal year 2008 is appropriated from the general fund to the 
12.21 	Forest Resources Interagency Information Cooperative under Minnesota Statutes, 
12.22 	section 89A.09, to implement technical assistance, technology development, and transfer 
12.23 	programs as recommended by the governor's task force on the competitiveness of 
12.24 	Minnesota's primary forest products industry.
12.25 		Subd. 2.Forest management investment account appropriations. (a) $3,167,000 
12.26 	in fiscal year 2008 and $3,167,000 in fiscal year 2009 are appropriated from the forest 
12.27 	management investment account to the commissioner of natural resources to cover the 
12.28 	costs attributable to generating revenue to the forest management investment account.
12.29 	(b)  $750,000 in fiscal year 2008 and $750,000 in fiscal year 2009 are appropriated 
12.30 	from the forest management investment account to the commissioner of natural resources 
12.31 	to hire additional field foresters to work on timber sales.
12.32 	(c) $1,000,000 in fiscal year 2008 and $1,000,000 in fiscal year 2009 are appropriated 
12.33 	from the forest management investment account to the commissioner of natural resources 
13.1 	for forest improvement efforts, including precommercial and noncommercial thinning 
13.2 	and seedling protection.
13.3 	(d) $1,100,000 in fiscal year 2008 and $1,100,000 in fiscal year 2009 are 
13.4 	appropriated from the forest management investment account to the commissioner of 
13.5 	natural resources for forest road maintenance.
13.6 	(e)  $400,000 in fiscal year 2008 and $400,000 in fiscal year 2009 are appropriated 
13.7 	from the forest management investment account to the commissioner of natural resources 
13.8 	to accelerate the continual reinventory of state-administered forest lands.