1.1 	A bill for an act
1.2 	relating to the financing and operation of state and local government; modifying 
1.3 	property tax refund; making policy, technical, administrative, enforcement, 
1.4 	collection, refund, clarifying, and other changes to income, franchise, property, 
1.5 	sales and use, minerals, aggregate, motor vehicle, wheelage, mortgage, deed, 
1.6 	cigarette and tobacco, gasoline, and estate taxes, and other taxes and tax-related 
1.7 	provisions; providing for aids to local governments; changing, eliminating, 
1.8 	and providing property tax exemptions and credits; modifying job opportunity 
1.9 	building zone program; modifying green acres; providing aggregate resource 
1.10 	preservation property tax law; modifying levies, property valuation procedures, 
1.11 	homestead provisions, property tax classes, and class rates; providing for and 
1.12 	modifying sales tax exemptions; exempting two-wheel, motorized vehicles 
1.13 	from wheelage tax; providing credits; providing for additional financing of 
1.14 	metropolitan area transit and paratransit capital expenditures; authorizing 
1.15 	issuance of certain obligations; modifying provision governing bonding for 
1.16 	county libraries; changing and authorizing powers, duties, and requirements 
1.17 	of local governments and authorities and state departments or agencies; 
1.18 	modifying, extending, and authorizing certain tax increment financing districts; 
1.19 	authorizing and modifying local sales taxes; providing federal updates; changing 
1.20 	accelerated sales tax; creating Surplus Lines Association of Minnesota; 
1.21 	changing provisions related to data practices and debt collection; requiring 
1.22 	studies; providing appointments; providing levy limits; modifying taxation 
1.23 	of foreign operating corporations; requiring a state review and approval of a 
1.24 	local economic development project; modifying park board fees; modifying 
1.25 	certain tax districts; providing for sale of forest lands; prohibiting imposition 
1.26 	of new local sales tax; providing income tax credit for military service; 
1.27 	providing economic development powers and incentives; providing health 
1.28 	insurance credit; appropriating money;amending Minnesota Statutes 2006, 
1.29 	sections 13.51, subdivision 3; 13.585, subdivision 5; 16D.02, subdivisions 
1.30 	3, 6; 16D.04, subdivision 2, as amended; 60A.196; 116J.993, subdivision 3; 
1.31 	116J.994, subdivisions 2, 5, 8; 126C.41, subdivision 2; 163.051, subdivision 
1.32 	1; 168.012, subdivision 1, by adding a subdivision; 168.013, subdivision 1f; 
1.33 	168A.03, subdivision 1; 169.01, by adding a subdivision; 169.781, subdivisions 
1.34 	1, as amended, 2, as amended; 270A.08, subdivision 1; 270B.15; 270C.33, 
1.35 	subdivision 5; 270C.56, subdivision 1, as amended; 270C.85, subdivision 2; 
1.36 	272.02, subdivisions 13, 20, 21, 27, 31, 38, 49, 55, 84, by adding subdivisions; 
1.37 	272.03, subdivision 3, by adding a subdivision; 273.11, subdivisions 8, 14a, 14b, 
1.38 	by adding a subdivision; 273.111, subdivisions 3, as amended, 4, 8, 9, 11, 11a, 
1.39 	14, by adding subdivisions; 273.121, as amended; 273.124, subdivisions 1, 6, 
2.1 	13, as amended, 21; 273.128, subdivision 1, as amended; 273.13, subdivisions 
2.2 	22, as amended, 23, as amended, 25, as amended, 33, 34, as added; 273.1384, 
2.3 	subdivision 2; 273.19, subdivision 1; 274.014, subdivision 3; 274.14; 275.065, 
2.4 	subdivision 8, by adding a subdivision; 275.70, subdivision 5, by adding a 
2.5 	subdivision; 275.71; 275.74, subdivision 2; 276.04, subdivision 2, as amended; 
2.6 	282.08; 287.20, subdivisions 3a, 9, by adding a subdivision; 289A.12, by adding 
2.7 	a subdivision; 289A.18, subdivision 1, as amended; 289A.19, subdivision 
2.8 	2, by adding a subdivision; 289A.20, subdivision 4, as amended; 289A.55, 
2.9 	by adding a subdivision; 289A.60, subdivision 15, as amended, by adding a 
2.10 	subdivision; 290.01, subdivisions 6b, 19c, as amended, 19d, as amended; 290.06, 
2.11 	subdivision 33, as amended, by adding a subdivision; 290.0677, subdivisions 
2.12 	1, as amended, 2, 3, by adding a subdivision; 290.068, subdivision 3; 290.07, 
2.13 	subdivision 1; 290.091, subdivision 2, as amended; 290.191, subdivisions 5, 
2.14 	6; 290.21, subdivision 4; 290.92, subdivisions 26, 31, as added; 290A.04, 
2.15 	subdivision 2; 290B.04, subdivision 1; 291.03, subdivision 1, by adding a 
2.16 	subdivision; 295.50, subdivision 4; 295.52, subdivision 4, as amended; 295.53, 
2.17 	subdivision 4a; 296A.07, subdivision 4; 296A.08, subdivision 3; 296A.16, 
2.18 	subdivision 2; 297A.61, subdivisions 22, 29; 297A.665, as amended; 297A.67, 
2.19 	subdivisions 7, as amended, 28; 297A.70, subdivision 8; 297A.71, subdivision 
2.20 	23, by adding a subdivision; 297A.75; 297A.99, subdivision 1, as amended; 
2.21 	297A.995, subdivision 10, by adding subdivisions; 297B.01, subdivision 7, by 
2.22 	adding a subdivision; 297B.03; 297F.01, subdivision 8; 297F.09, subdivision 
2.23 	10, as amended; 297F.21, subdivision 1; 297G.01, subdivision 9; 297G.09, 
2.24 	subdivision 9, as amended; 297H.09; 297I.05, subdivision 12; 298.01, by adding 
2.25 	a subdivision; 298.22, subdivisions 2, 5a, as added, by adding a subdivision; 
2.26 	298.24, subdivision 1, as amended; 298.25, as amended; 298.28, subdivisions 
2.27 	3, 9d, as added, 12; 298.292, subdivision 2, as amended; 298.405, subdivision 
2.28 	1; 298.75, subdivisions 1, as amended, 2, 6, 7, as amended; 365.243, by adding 
2.29 	a subdivision; 365A.095, as amended; 383A.80, subdivision 4; 383A.81, 
2.30 	subdivisions 1, 2; 383B.80, subdivision 4; 383B.81, subdivision 2; 383E.20; 
2.31 	429.101, subdivision 1; 469.033, subdivision 6; 469.040, subdivision 4; 
2.32 	469.174, subdivision 10b; 469.177, subdivision 1c, by adding a subdivision; 
2.33 	469.1813, subdivision 8; 469.319; 469.3201; 473.39, by adding a subdivision; 
2.34 	474A.047, subdivision 1; 477A.011, subdivisions 34, 36, as amended, by 
2.35 	adding subdivisions; 477A.0124, subdivision 5; 477A.013, subdivisions 8, 
2.36 	as amended, 9, as amended; 477A.03; Minnesota Statutes 2007 Supplement, 
2.37 	sections 115A.1314, subdivision 2; 268.19, subdivision 1, as amended; 
2.38 	273.1231, subdivision 7, by adding a subdivision; 273.1232, subdivision 1; 
2.39 	273.1233, subdivisions 1, 3; 273.1234; 273.1235, subdivisions 1, 3; 273.124, 
2.40 	subdivision 14, as amended; 273.1393; 290.01, subdivision 19b, as amended; 
2.41 	297A.70, subdivision 3; 298.227; Laws 1991, chapter 291, article 8, section 27, 
2.42 	subdivisions 3, as amended, 4, as amended; Laws 1995, chapter 264, article 
2.43 	5, section 46, subdivision 2; Laws 1998, chapter 389, article 8, section 45, 
2.44 	subdivision 3; Laws 1999, chapter 243, article 4, section 18, subdivisions 1, 3, 
2.45 	4; Laws 2003, chapter 127, article 10, section 31, subdivision 1; Laws 2006, 
2.46 	chapter 259, article 10, section 14, subdivision 1; Laws 2006, chapter 269, 
2.47 	section 2; Laws 2008, chapter 154, article 2, sections 11; 27; article 3, section 
2.48 	3; article 8, section 14; article 9, sections 23; 24; proposing coding for new law 
2.49 	in Minnesota Statutes, chapters 60A; 116J; 169; 272; 273; 275; 469; 477A; 
2.50 	proposing coding for new law as Minnesota Statutes, chapter 62U; repealing 
2.51 	Minnesota Statutes 2006, sections 272.027, subdivision 3; 273.11, subdivision 
2.52 	14; 273.111, subdivision 6; 298.405, subdivisions 2, 3, 4; 477A.014, subdivision 
2.53 	5; Minnesota Statutes 2007 Supplement, section 477A.014, subdivision 4; Laws 
2.54 	2005, First Special Session chapter 3, article 5, section 24; Minnesota Rules, 
2.55 	parts 8031.0100, subpart 3; 8093.2100.
2.56 	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

3.1 	ARTICLE 1
3.2 	HOMEOWNER PROPERTY TAX REFUND

3.3 	Section 1. Minnesota Statutes 2006, section 290A.04, subdivision 2, is amended to 
3.4 	read:
3.5 		Subd. 2.Homeowners. A claimant whose property taxes payable are in excess 
3.6 	of the percentage of the household income stated below shall pay an amount equal to 
3.7 	the percent of income shown for the appropriate household income level along with the 
3.8 	percent to be paid by the claimant of the remaining amount of property taxes payable. 
3.9 	The state refund equals the amount of property taxes payable that remain, up to the state 
3.10 	refund amount shown below.

3.11
3.12	Household Income
	Percent of Income
	Percent Paid by 
Claimant
	Maximum State 
Refund

3.13	$0 to 1,189
	1.0 percent
	15 percent
	$1,450$1,850
	
3.14	1,190 to 2,379
	1.1 percent
	15 percent
	$1,450$1,850
	
3.15	2,380 to 3,589
	1.2 percent
	15 percent
	$1,410$1,800
	
3.16	3,590 to 4,789
	1.3 percent
	20 percent
	$1,410$1,800
	
3.17	4,790 to 5,979
	1.4 percent
	20 percent
	$1,360$1,730
	
3.18	5,980 to 8,369
	1.5 percent
	20 percent
	$1,360$1,730
	
3.19	8,370 to 9,559
	1.6 percent
	25 percent
	$1,310$1,670
	
3.20	9,560 to 10,759
	1.7 percent
	25 percent
	$1,310$1,670
	
3.21	10,760 to 11,949
	1.8 percent
	25 percent
	$1,260$1,610
	
3.22	11,950 to 13,139
	1.9 percent
	30 percent
	$1,260$1,610
	
3.23	13,140 to 14,349
	2.0 percent
	30 percent
	$1,210$1,540
	
3.24	14,350 to 16,739
	2.1 percent
	30 percent
	$1,210$1,540
	
3.25	16,740 to 17,929
	2.2 percent
	35 percent
	$1,160$1,480
	
3.26	17,930 to 19,119
	2.3 percent
	35 percent
	$1,160$1,480
	
3.27	19,120 to 20,319
	2.4 percent
	35 percent
	$1,110$1,420
	
3.28	20,320 to 25,099
	2.5 percent
	40 percent
	$1,110$1,420
	
3.29	25,100 to 28,679
	2.6 percent
	40 percent
	$1,070$1,360
	
3.30	28,680 to 35,849
	2.7 percent
	40 percent
	$1,070$1,360
	
3.31	35,850 to 41,819
	2.8 percent
	45 percent
	$ 970$1,240
	
3.32	41,820 to 47,799
	3.0 percent
	45 percent
	$ 970$1,240
	
3.33	47,800 to 53,779
	3.2 percent
	45 percent
	$ 870$1,110
	
3.34	53,780 to 59,749
	3.5 percent
	50 percent
	$ 780$990
	
3.35	59,750 to 65,729
	4.03.5 percent
	50 percent
	$ 680 $870
	
3.36	65,730 to 69,319
	4.03.5 percent
	50 percent
	$ 580 $740
	
3.37	69,320 to 71,719
	4.03.5 percent
	50 percent
	$ 480$610
	
3.38	71,720 to 74,619
	4.03.5 percent
	50 percent
	$ 390$500
	
3.39	74,620 to 77,519
	4.03.5 percent
	50 percent
	$ 290$370
	
4.1 	The payment made to a claimant shall be the amount of the state refund calculated 
4.2 	under this subdivision. No payment is allowed if the claimant's household income is 
4.3 	$77,520 or more.

4.4 	EFFECTIVE DATE. This section is effective beginning with refunds based on 
4.5 	property taxes payable in 2009.

4.6 	Sec. 2. TAXPAYER ASSISTANCE SERVICES; PROPERTY TAX REFUND.
 4.7 	(a) $100,000 in fiscal year 2009 is appropriated from the general fund to the 
4.8 	commissioner of revenue to make grants to one or more nonprofit organizations, qualifying 
4.9 	under section 501(c)(3) of the Internal Revenue Code of 1986, to coordinate, facilitate, 
4.10 	encourage, and aid in the provision of taxpayer assistance services. The commissioner 
4.11 	must award grants under this section so as to increase the availability of taxpayer 
4.12 	assistance services after April 15, to assist homeowners in filing claims for the property 
4.13 	tax refund, and to increase participation in the program. This appropriation is onetime and 
4.14 	is not added to the agency's base budget.
4.15 	(b) "Taxpayer assistance services" means accounting and tax preparation services 
4.16 	provided by volunteers to low-income and disadvantaged Minnesota residents to help 
4.17 	them file federal and state income tax returns, Minnesota property tax refund claims, and 
4.18 	may include provision of personal representation before the Department of Revenue and 
4.19 	Internal Revenue Service.

4.20 	ARTICLE 2
4.21 	AIDS TO LOCAL GOVERNMENTS

4.22 	Section 1. Minnesota Statutes 2006, section 477A.011, subdivision 34, is amended to 
4.23 	read:
4.24 		Subd. 34.City revenue need. (a) For a city with a population equal to or greater 
4.25 	than 2,500, "city revenue need" is the sum of (1) 5.0734098 times the pre-1940 housing 
4.26 	percentage; plus (2) 19.141678 times the population decline percentage; plus (3) 
4.27 	2504.06334 times the road accidents factor; plus (4) 355.0547; minus (5) the metropolitan 
4.28 	area factor; minus (6) 49.10638 times the household size.
4.29 	(b) For a city with a population less than 2,500, "city revenue need" is the sum of 
4.30 	(1) 2.387 times the pre-1940 housing percentage; plus (2) 2.67591 times the commercial 
4.31 	industrial percentage; plus (3) 3.16042 times the population decline percentage; plus (4) 
4.32 	1.206 times the transformed population; minus (5) 62.772.
5.1 	(c) For a city with a population of 2,500 or more and a population in one of the most 
5.2 	recently available five years that was less than 2,500, "city revenue need" is the sum of (1) 
5.3 	its city revenue need calculated under paragraph (a) multiplied by its transition factor; 
5.4 	plus (2) its city revenue need calculated under the formula in paragraph (b) multiplied 
5.5 	by the difference between one and its transition factor. For purposes of this paragraph, a 
5.6 	city's "transition factor" is equal to 0.2 multiplied by the number of years that the city's 
5.7 	population estimate has been 2,500 or more. This provision only applies for aids payable 
5.8 	in calendar years 2006 to 2008 to cities with a 2002 population of less than 2,500. It 
5.9 	applies to any city for aids payable in 2009 and thereafter. The city revenue need under 
5.10 	this paragraph may not be less than 285.
5.11 	(d) The city revenue need cannot be less than zero.
5.12 	(e) For calendar year 2005 and subsequent years, the city revenue need for a city, 
5.13 	as determined in paragraphs (a) to (d), is multiplied by the ratio of the annual implicit 
5.14 	price deflator for government consumption expenditures and gross investment for state 
5.15 	and local governments as prepared by the United States Department of Commerce, for 
5.16 	the most recently available year to the 2003 implicit price deflator for state and local 
5.17 	government purchases.

5.18 	EFFECTIVE DATE. This section is effective for aids payable in calendar year 
5.19 	2009 and thereafter.

5.20 	Sec. 2. Minnesota Statutes 2006, section 477A.011, subdivision 36, as amended by 
5.21 	Laws 2008, chapter 154, article 1, section 1, is amended to read:
5.22 		Subd. 36. City aid base. (a) Except as otherwise provided in this subdivision, 
5.23 	"city aid base" is zero. 
5.24 	(b) The city aid base for any city with a population less than 500 is increased by 
5.25 	$40,000 for aids payable in calendar year 1995 and thereafter, and the maximum amount 
5.26 	of total aid it may receive under section 477A.013, subdivision 9, paragraph (c), is also 
5.27 	increased by $40,000 for aids payable in calendar year 1995 only, provided that: 
5.28 	(i) the average total tax capacity rate for taxes payable in 1995 exceeds 200 percent; 
5.29 	(ii) the city portion of the tax capacity rate exceeds 100 percent; and 
5.30 	(iii) its city aid base is less than $60 per capita. 
5.31 	(c) The city aid base for a city is increased by $20,000 in 1998 and thereafter and 
5.32 	the maximum amount of total aid it may receive under section 477A.013, subdivision 9, 
5.33 	paragraph (c), is also increased by $20,000 in calendar year 1998 only, provided that: 
5.34 	(i) the city has a population in 1994 of 2,500 or more; 
6.1 	(ii) the city is located in a county, outside of the metropolitan area, which contains a 
6.2 	city of the first class; 
6.3 	(iii) the city's net tax capacity used in calculating its 1996 aid under section 
6.4 	477A.013 is less than $400 per capita; and 
6.5 	(iv) at least four percent of the total net tax capacity, for taxes payable in 1996, of 
6.6 	property located in the city is classified as railroad property. 
6.7 	(d) The city aid base for a city is increased by $200,000 in 1999 and thereafter and 
6.8 	the maximum amount of total aid it may receive under section 477A.013, subdivision 9, 
6.9 	paragraph (c), is also increased by $200,000 in calendar year 1999 only, provided that: 
6.10 	(i) the city was incorporated as a statutory city after December 1, 1993; 
6.11 	(ii) its city aid base does not exceed $5,600; and 
6.12 	(iii) the city had a population in 1996 of 5,000 or more. 
6.13 	(e) The city aid base for a city is increased by $450,000 in 1999 to 2008 and the 
6.14 	maximum amount of total aid it may receive under section 477A.013, subdivision 9, 
6.15 	paragraph (c), is also increased by $450,000 in calendar year 1999 only, provided that: 
6.16 	(i) the city had a population in 1996 of at least 50,000; 
6.17 	(ii) its population had increased by at least 40 percent in the ten-year period ending 
6.18 	in 1996; and 
6.19 	(iii) its city's net tax capacity for aids payable in 1998 is less than $700 per capita. 
6.20 	(f) (e) The city aid base for a city is increased by $150,000 for aids payable in 
6.21 	2000 and thereafter, and the maximum amount of total aid it may receive under section 
6.22 	477A.013, subdivision 9, paragraph (c), is also increased by $150,000 in calendar year 
6.23 	2000 only, provided that: 
6.24 	(1) the city has a population that is greater than 1,000 and less than 2,500; 
6.25 	(2) its commercial and industrial percentage for aids payable in 1999 is greater 
6.26 	than 45 percent; and 
6.27 	(3) the total market value of all commercial and industrial property in the city 
6.28 	for assessment year 1999 is at least 15 percent less than the total market value of all 
6.29 	commercial and industrial property in the city for assessment year 1998. 
6.30 	(g) (f) The city aid base for a city is increased by $200,000 in 2000 and thereafter, 
6.31 	and the maximum amount of total aid it may receive under section 477A.013, subdivision 
6.32 	9, paragraph (c), is also increased by $200,000 in calendar year 2000 only, provided that: 
6.33 	(1) the city had a population in 1997 of 2,500 or more; 
6.34 	(2) the net tax capacity of the city used in calculating its 1999 aid under section 
6.35 	477A.013 is less than $650 per capita; 
7.1 	(3) the pre-1940 housing percentage of the city used in calculating 1999 aid under 
7.2 	section 477A.013 is greater than 12 percent; 
7.3 	(4) the 1999 local government aid of the city under section 477A.013 is less than 
7.4 	20 percent of the amount that the formula aid of the city would have been if the need 
7.5 	increase percentage was 100 percent; and 
7.6 	(5) the city aid base of the city used in calculating aid under section 477A.013
7.7 	is less than $7 per capita. 
7.8 	(h) (g) The city aid base for a city is increased by $102,000 in 2000 and thereafter, 
7.9 	and the maximum amount of total aid it may receive under section 477A.013, subdivision 
7.10 	9, paragraph (c), is also increased by $102,000 in calendar year 2000 only, provided that: 
7.11 	(1) the city has a population in 1997 of 2,000 or more; 
7.12 	(2) the net tax capacity of the city used in calculating its 1999 aid under section 
7.13 	477A.013 is less than $455 per capita; 
7.14 	(3) the net levy of the city used in calculating 1999 aid under section 477A.013 is 
7.15 	greater than $195 per capita; and 
7.16 	(4) the 1999 local government aid of the city under section 477A.013 is less than 
7.17 	38 percent of the amount that the formula aid of the city would have been if the need 
7.18 	increase percentage was 100 percent. 
7.19 	(i) (h) The city aid base for a city is increased by $32,000 in 2001 and thereafter, and 
7.20 	the maximum amount of total aid it may receive under section 477A.013, subdivision 9, 
7.21 	paragraph (c), is also increased by $32,000 in calendar year 2001 only, provided that: 
7.22 	(1) the city has a population in 1998 that is greater than 200 but less than 500; 
7.23 	(2) the city's revenue need used in calculating aids payable in 2000 was greater 
7.24 	than $200 per capita; 
7.25 	(3) the city net tax capacity for the city used in calculating aids available in 2000 
7.26 	was equal to or less than $200 per capita; 
7.27 	(4) the city aid base of the city used in calculating aid under section 477A.013
7.28 	is less than $65 per capita; and 
7.29 	(5) the city's formula aid for aids payable in 2000 was greater than zero. 
7.30 	(j) (i) The city aid base for a city is increased by $7,200 in 2001 and thereafter, and 
7.31 	the maximum amount of total aid it may receive under section 477A.013, subdivision 9, 
7.32 	paragraph (c), is also increased by $7,200 in calendar year 2001 only, provided that: 
7.33 	(1) the city had a population in 1998 that is greater than 200 but less than 500; 
7.34 	(2) the city's commercial industrial percentage used in calculating aids payable in 
7.35 	2000 was less than ten percent; 
8.1 	(3) more than 25 percent of the city's population was 60 years old or older according 
8.2 	to the 1990 census; 
8.3 	(4) the city aid base of the city used in calculating aid under section 477A.013
8.4 	is less than $15 per capita; and 
8.5 	(5) the city's formula aid for aids payable in 2000 was greater than zero. 
8.6 	(k) (j) The city aid base for a city is increased by $45,000 in 2001 and thereafter 
8.7 	and by an additional $50,000 in calendar years 2002 to 2011, and the maximum amount 
8.8 	of total aid it may receive under section 477A.013, subdivision 9, paragraph (c), is also 
8.9 	increased by $45,000 in calendar year 2001 only, and by $50,000 in calendar year 2002 
8.10 	only, provided that: 
8.11 	(1) the net tax capacity of the city used in calculating its 2000 aid under section 
8.12 	477A.013 is less than $810 per capita; 
8.13 	(2) the population of the city declined more than two percent between 1988 and 1998; 
8.14 	(3) the net levy of the city used in calculating 2000 aid under section 477A.013 is 
8.15 	greater than $240 per capita; and 
8.16 	(4) the city received less than $36 per capita in aid under section 477A.013, 
8.17 	subdivision 9, for aids payable in 2000. 
8.18 	(l) (k) The city aid base for a city with a population of 10,000 or more which is 
8.19 	located outside of the seven-county metropolitan area is increased in 2002 and thereafter, 
8.20 	and the maximum amount of total aid it may receive under section 477A.013, subdivision 
8.21 	9, paragraph (b) or (c), is also increased in calendar year 2002 only, by an amount equal to 
8.22 	the lesser of: 
8.23 	(1)(i) the total population of the city, as determined by the United States Bureau of 
8.24 	the Census, in the 2000 census, (ii) minus 5,000, (iii) times 60; or 
8.25 	(2) $2,500,000. 
8.26 	(m) (l) The city aid base is increased by $50,000 in 2002 and thereafter, and the 
8.27 	maximum amount of total aid it may receive under section 477A.013, subdivision 9, 
8.28 	paragraph (c), is also increased by $50,000 in calendar year 2002 only, provided that: 
8.29 	(1) the city is located in the seven-county metropolitan area; 
8.30 	(2) its population in 2000 is between 10,000 and 20,000; and 
8.31 	(3) its commercial industrial percentage, as calculated for city aid payable in 2001, 
8.32 	was greater than 25 percent. 
8.33 	(n) (m) The city aid base for a city is increased by $150,000 in calendar years 2002 
8.34 	to 2011 and by an additional $75,000 in calendar years 2009 to 2014 and the maximum 
8.35 	amount of total aid it may receive under section 477A.013, subdivision 9, paragraph (c), is 
9.1 	also increased by $150,000 in calendar year 2002 only and by $75,000 in calendar year 
9.2 	2009 only, provided that: 
9.3 	(1) the city had a population of at least 3,000 but no more than 4,000 in 1999; 
9.4 	(2) its home county is located within the seven-county metropolitan area; 
9.5 	(3) its pre-1940 housing percentage is less than 15 percent; and 
9.6 	(4) its city net tax capacity per capita for taxes payable in 2000 is less than $900 
9.7 	per capita. 
9.8 	(o) (n) The city aid base for a city is increased by $200,000 beginning in calendar 
9.9 	year 2003 and the maximum amount of total aid it may receive under section 477A.013, 
9.10 	subdivision 9, paragraph (c), is also increased by $200,000 in calendar year 2003 only, 
9.11 	provided that the city qualified for an increase in homestead and agricultural credit aid 
9.12 	under Laws 1995, chapter 264, article 8, section 18. 
9.13 	(p) (o) The city aid base for a city is increased by $200,000 in 2004 only and the 
9.14 	maximum amount of total aid it may receive under section 477A.013, subdivision 9, is 
9.15 	also increased by $200,000 in calendar year 2004 only, if the city is the site of a nuclear 
9.16 	dry cask storage facility. 
9.17 	(q) (p) The city aid base for a city is increased by $10,000 in 2004 and thereafter 
9.18 	and the maximum total aid it may receive under section 477A.013, subdivision 9, is also 
9.19 	increased by $10,000 in calendar year 2004 only, if the city was included in a federal 
9.20 	major disaster designation issued on April 1, 1998, and its pre-1940 housing stock was 
9.21 	decreased by more than 40 percent between 1990 and 2000. 
9.22 	(r) (q) The city aid base for a city is increased by $30,000  in 2009 and thereafter  
9.23 	and the maximum total aid it may receive under section 477A.013, subdivision 9, is also 
9.24 	increased by $25,000 in calendar year 2006 only if the city had a population in 2003 
9.25 	of at least 1,000 and has a state park for which the city provides rescue services and 
9.26 	which comprised at least 14 percent of the total geographic area included within the 
9.27 	city boundaries in 2000. 
9.28 	(s) The city aid base for a city with a population less than 5,000 is increased in 
9.29 	2006 and thereafter and the minimum and maximum amount of total aid it may receive 
9.30 	under this section is also increased in calendar year 2006 only by an amount equal to 
9.31 	$6 multiplied by its population. 
9.32 	(t) (r) The city aid base for a city is increased by $80,000 in 2009 and thereafter and 
9.33 	the minimum and maximum amount of total aid it may receive under section 477A.013, 
9.34 	subdivision 9, is also increased by $80,000 in calendar year 2009 only, if: 
9.35 	(1) as of May 1, 2006, at least 25 percent of the tax capacity of the city is proposed 
9.36 	to be placed in trust status as tax-exempt Indian land; 
10.1 	(2) the placement of the land is being challenged administratively or in court; and 
10.2 	(3) due to the challenge, the land proposed to be placed in trust is still on the tax 
10.3 	rolls as of May 1, 2006. 
10.4 	(u) (s) The city aid base for a city is increased by $100,000 in 2007 and thereafter 
10.5 	and the minimum and maximum total amount of aid it may receive under this section is 
10.6 	also increased in calendar year 2007 only, provided that: 
10.7 	(1) the city has a 2004 estimated population greater than 200 but less than 2,000; 
10.8 	(2) its city net tax capacity for aids payable in 2006 was less than $300 per capita; 
10.9 	(3) the ratio of its pay 2005 tax levy compared to its city net tax capacity for aids 
10.10 	payable in 2006 was greater than 110 percent; and 
10.11 	(4) it is located in a county where at least 15,000 acres of land are classified as 
10.12 	tax-exempt Indian reservations according to the 2004 abstract of tax-exempt property. 
10.13 	(v) (t) The city aid base for a city is increased by $30,000 in 2009 only, and the 
10.14 	maximum total aid it may receive under section 477A.013, subdivision 9, is also increased 
10.15 	by $30,000 in calendar year 2009, only if the city had a population in 2005 of less than 
10.16 	3,000 and the city's boundaries as of 2007 were formed by the consolidation of two cities 
10.17 	and one township in 2002. 
10.18 	(u) The city aid base for a city is increased by $100,000 in 2009 and thereafter, and 
10.19 	the maximum total aid it may receive under section 477A.013, subdivision 9, is also 
10.20 	increased by $100,000 in calendar year 2009 only, if the city had a city net tax capacity for 
10.21 	aids payable in 2007 of less than $150 per capita and the city experienced flooding on 
10.22 	March 14, 2007, that resulted in evacuation of at least 40 homes.
10.23 	(v) The city aid base for a city is increased by $100,000 in 2009 to 2013, and the 
10.24 	maximum total aid it may receive under section 477A.013, subdivision 9, is also increased 
10.25 	by $100,000 in calendar year 2009 only, if the city:
10.26 	(1) is located outside of the Minneapolis-St. Paul standard metropolitan statistical 
10.27 	area;
10.28 	(2) has a 2005 population greater than 7,000 but less than 8,000; and
10.29 	(3) has a 2005 net tax capacity per capita of less than $500.
10.30 	(w) The city aid base is increased by $25,000 in calendar years 2009 to 2013 and the 
10.31 	maximum amount of total aid it may receive under section 477A.013, subdivision 9, is 
10.32 	increased by $25,000 in calendar year 2009 only, provided that:
10.33 	(1) the city is located in the seven-county metropolitan area;
10.34 	(2) its population in 2006 is less than 200; and 
10.35 	(3) the percentage of its housing stock built before 1940, according to the 2000 
10.36 	United States Census, is greater than 40 percent.
11.1 	(x) The city aid base is increased by $90,000 in calendar year 2009 only and the 
11.2 	minimum and maximum total amount of aid it may receive under section 477A.013, 
11.3 	subdivision 9, is also increased by $90,000 in calendar year 2009 only, provided that the 
11.4 	city is located in the seven-county metropolitan area, has a 2006 population between 5,000 
11.5 	and 7,000 and has a 1997 population of over 7,000.

11.6 	EFFECTIVE DATE. This section is effective for aids payable in calendar year 
11.7 	2009 and thereafter.

11.8 	Sec. 3. Minnesota Statutes 2006, section 477A.011, is amended by adding a 
11.9 	subdivision to read:
11.10 		Subd. 41.Small city aid base. (a) "Small city aid base" for a city with a population 
11.11 	less than 5,000 is equal to $8.50 multiplied by its population. The small city aid base for 
11.12 	all other cities is equal to zero.
11.13 	(b) For calendar year 2010 and subsequent years, the small city aid base for a city, as 
11.14 	determined in paragraph (a), is multiplied by the ratio of the appropriation under section 
11.15 	477A.03, subdivision 2a, for the year in which the aid is paid to the appropriation under 
11.16 	that section for aids payable in 2009.

11.17 	EFFECTIVE DATE. This section is effective for aids payable in calendar year 
11.18 	2009 and thereafter.

11.19 	Sec. 4. Minnesota Statutes 2006, section 477A.011, is amended by adding a 
11.20 	subdivision to read:
11.21 		Subd. 42.City jobs base. (a) "City jobs base" for a city with a population of 5,000 
11.22 	or more is equal to the product of (1) $25.20, (2) the number of jobs per capita in the 
11.23 	city, and (3) its population. For cities with a population less than 5,000, the city jobs 
11.24 	base is equal to zero. For a city receiving aid under section 477A.011, subdivision 36, 
11.25 	paragraph (l), its city jobs base is reduced by the lesser of 36 percent of the amount of 
11.26 	aid received under that paragraph or $1,000,000. No city's city jobs base may exceed 
11.27 	$4,725,000 under this paragraph.
11.28 	(b) For calendar year 2010 and subsequent years, the city jobs base for a city, as 
11.29 	determined in paragraph (a), is multiplied by the ratio of the appropriation under section 
11.30 	477A.03, subdivision 2a, for the year in which the aid is paid to the appropriation under 
11.31 	that section for aids payable in 2009.
11.32 	(c) For purposes of this subdivision, "jobs per capita in the city" means (1) the 
11.33 	average annual number of employees in the city based on the data from the Quarterly 
12.1 	Census of Employment and Wages, as reported by the Department of Employment and 
12.2 	Economic Development, for the most recent calendar year available as of May 1, 2008, 
12.3 	divided by (2) the city's population for the same calendar year as the employment data. 
12.4 	The commissioner of the Department of Employment and Economic Development shall 
12.5 	certify to the city the average annual number of employees for each city by June 1, 2008. 
12.6 	A city may challenge an estimate under this paragraph by filing its specific objection, 
12.7 	including the names of employers that it feels may have misreported data, in writing with 
12.8 	the commissioner by June 20, 2008. The commissioner shall make every reasonable effort 
12.9 	to address the specific objection and adjust the data as necessary. The commissioner shall 
12.10 	certify the estimates of the annual employment to the commissioner of revenue by July 15, 
12.11 	2008, including any estimates still under objection.

12.12 	EFFECTIVE DATE. This section is effective for aids payable in calendar year 
12.13 	2009 and thereafter.

12.14 	Sec. 5. Minnesota Statutes 2006, section 477A.011, is amended by adding a 
12.15 	subdivision to read:
12.16 		Subd. 43.Unmet need. "Unmet need" for a city is equal to the difference between 
12.17 	(1) its city revenue need multiplied by its population, and (2) its city net tax capacity 
12.18 	multiplied by the tax effort rate.

12.19 	EFFECTIVE DATE. This section is effective for aids payable in calendar year 
12.20 	2009 and thereafter.

12.21 	Sec. 6. Minnesota Statutes 2006, section 477A.0124, subdivision 5, is amended to read:
12.22 		Subd. 5.County transition aid. (a) For 2005, a county is eligible for transition 
12.23 	aid equal to the amount, if any, by which:
12.24 	(1) the difference between:
12.25 	(i) the aid the county received under subdivision 1 in 2004, divided by the total aid 
12.26 	paid to all counties under subdivision 1, multiplied by $205,000,000; and
12.27 	(ii) the amount of aid the county is certified to receive in 2005 under subdivisions 
12.28 	3 and 4;
12.29 	exceeds:
12.30 	(2) three percent of the county's adjusted net tax capacity.
12.31 	A county's aid under this paragraph may not be less than zero.
12.32 	(b) In 2006, a county is eligible to receive two-thirds of the transition aid it received 
12.33 	in 2005.
13.1 	(c) In 2007,For 2009 and each year thereafter, a county is eligible to receive 
13.2 	one-third of the transition aid it received in 2005 2007.
13.3 	(d) No county shall receive aid under this subdivision after 2007.
13.4 	(b) In 2009 only, a county with (1) a 2006 population less than 30,000, and (2) 
13.5 	an average Part I crimes per capita greater than 3.9 percent based on factors used in 
13.6 	determining county program aid payable in 2008, shall receive $100,000.

13.7 	EFFECTIVE DATE. This section is effective for aids payable in 2009 and 
13.8 	thereafter.

13.9 	Sec. 7. Minnesota Statutes 2006, section 477A.013, subdivision 8, as amended by 
13.10 	Laws 2008, chapter 154, article 1, section 2, is amended to read:
13.11 		Subd. 8. City formula aid.  (a) In calendar year 2009, the formula aid for a city 
13.12 	is equal to the sum of (1) its city jobs base, (2) its small city aid base, and (3) the need 
13.13 	increase percentage multiplied by its unmet need. 
13.14 	(b) In calendar year 2004 2010 and subsequent years, the formula aid for a city is 
13.15 	equal to the need increase percentage multiplied by the difference between (1) the city's 
13.16 	revenue need multiplied by its population, and (2) the sum of the city's net tax capacity 
13.17 	multiplied by the tax effort rate.the sum of (1) its city jobs base, (2) its small city aid 
13.18 	base, and (3) the need increase percentage multiplied by the average of its unmet need 
13.19 	for the most recently available two years.
13.20 	No city may have a formula aid amount less than zero. The need increase percentage 
13.21 	must be the same for all cities. 
13.22 	The applicable need increase percentage must be calculated by the Department of 
13.23 	Revenue so that the total of the aid under subdivision 9 equals the total amount available 
13.24 	for aid under section 477A.03after the subtraction under section 477A.014, subdivisions 
13.25 	4 and 5. For aids payable in 2009 only, all data used in calculating aid to cities under 
13.26 	sections 477A.011 to 477A.013 will be based on the data available for calculating aid to 
13.27 	cities for aids payable in 2008. For aids payable in 2010 and thereafter, data used in 
13.28 	calculating aids to cities under sections 477A.011 to 477A.013 shall be the most recently 
13.29 	available data as of January 1 in the year in which the aid is calculated.

13.30 	EFFECTIVE DATE. This section is effective for aids payable in calendar year 
13.31 	2009 and thereafter, provided that the appropriation increase for aids payable in 2009 
13.32 	under section 477A.03, subdivision 2a, goes into effect.

14.1 	Sec. 8. Minnesota Statutes 2006, section 477A.013, subdivision 9, as amended by 
14.2 	Laws 2008, chapter 154, article 1, section 3, is amended to read:
14.3 		Subd. 9. City aid distribution. (a) In calendar year 2009 and thereafter, each 
14.4 	city shall receive an aid distribution equal to the sum of (1) the city formula aid under 
14.5 	subdivision 8, and (2) its city aid base, and (3) one-half of the difference between its total 
14.6 	aid in the previous year under this subdivision and its city aid base in the previous year. 
14.7 	(b) For aids payable in 2010 and thereafter, each city shall receive an aid distribution 
14.8 	equal to (1) the city aid formula under subdivision 8, (2) its city aid base, and (3) its 
14.9 	formula aid under subdivision 8 in the previous year, prior to any adjustments under 
14.10 	this subdivision 2009 only, the total aid for any city shall not exceed the sum of (1) 35 
14.11 	percent of the city's net levy for the year prior to the aid distribution, plus (2) its total 
14.12 	aid in the previous year.
14.13 	(c) For aids payable in 2009 2010 and thereafter, the total aid for any city shall 
14.14 	not exceed the sum of (1) ten percent of the city's net levy for the year prior to the aid 
14.15 	distribution plus (2) its total aid in the previous year. For aids payable in 2009 and 
14.16 	thereafter, the total aid for any city with a population of 2,500 or more may not be less than 
14.17 	its total aid under this section in the previous year minus the lesser of $15 $10 multiplied 
14.18 	by its population, or ten percent of its net levy in the year prior to the aid distribution. 
14.19 	(d) For aids payable in 20092010  and thereafter, the total aid for a city with a 
14.20 	population less than 2,500 must not be less than the amount it was certified to receive in 
14.21 	the previous year minus the lesser of $15 $10 multiplied by its population, or five percent 
14.22 	of its 2003 certified aid amount. For aids payable in 2009 only, the total aid for a city with 
14.23 	a population less than 2,500 must not be less than what it received under this section in the 
14.24 	previous year unless its total aid in calendar year 2008 was aid under section 477A.011, 
14.25 	subdivision 36, paragraph (s), in which case its minimum aid is zero.
14.26 	(e)  A city's aid loss under this section may not exceed $300,000 in any year in 
14.27 	which the total city aid appropriation under section 477A.03, subdivision 2a, is equal or 
14.28 	greater than the appropriation under that subdivision in the previous year, unless the 
14.29 	city has an adjustment in its city net tax capacity under the process described in section 
14.30 	469.174, subdivision 28.
14.31 	(f) If a city's net tax capacity used in calculating aid under this section has decreased 
14.32 	in any year by more than 25 percent from its net tax capacity in the previous year due to 
14.33 	property becoming tax-exempt Indian land, the city's maximum allowed aid increase 
14.34 	under paragraph (c) shall be increased by an amount equal to (1) the city's tax rate in the 
14.35 	year of the aid calculation, multiplied by (2) the amount of its net tax capacity decrease 
14.36 	resulting from the property becoming tax exempt. 

15.1 	EFFECTIVE DATE. This section is effective for aids payable in calendar year 
15.2 	2009 and thereafter, provided that the appropriation increase for aids payable in 2009 
15.3 	under section 477A.03, subdivision 2a, goes into effect.

15.4 	Sec. 9. Minnesota Statutes 2006, section 477A.03, is amended to read:
15.5 	477A.03 APPROPRIATION.
15.6 		Subd. 2.Annual appropriation. A sum sufficient to discharge the duties imposed 
15.7 	by sections 477A.011 to 477A.014 is annually appropriated from the general fund to the 
15.8 	commissioner of revenue. 
15.9 		Subd. 2a.Cities. For aids payable in 2004 2009 and thereafter, the total aids aid
15.10 	paid under section 477A.013, subdivision 9, are limited to $429,000,000 is $526,148,487, 
15.11 	subject to adjustment in subdivision 5. For aids payable in 2005, the total aids paid under 
15.12 	section 477A.013, subdivision 9, are limited to $437,052,000. For aids payable in 2006 
15.13 	and thereafter, the total aids paid under section 477A.013, subdivision 9, is limited to 
15.14 	$485,052,000.
15.15 		Subd. 2b.Counties. (a) For aids payable in calendar year 2005 and thereafter, 
15.16 	the total aids paid to counties under section 477A.0124, subdivision 3, are limited to 
15.17 	$100,500,000.For aids payable in 2009 and thereafter, the total aid payable under section 
15.18 	477A.0124, subdivision 3, is $111,500,000 minus one-half of the total aid amount 
15.19 	determined under section 477A.0124, subdivision 5, paragraph (b), subject to adjustment 
15.20 	in subdivision 5. Each calendar year, $500,000 shall be retained by the commissioner of 
15.21 	revenue to make reimbursements to the commissioner of finance for payments made 
15.22 	under section 611.27. For calendar year 2004, the amount shall be in addition to the 
15.23 	payments authorized under section 477A.0124, subdivision 1. For calendar year 2005 
15.24 	and subsequent years, the amount shall be deducted from the appropriation under 
15.25 	this paragraph. The reimbursements shall be to defray the additional costs associated 
15.26 	with court-ordered counsel under section 611.27. Any retained amounts not used for 
15.27 	reimbursement in a year shall be included in the next distribution of county need aid 
15.28 	that is certified to the county auditors for the purpose of property tax reduction for the 
15.29 	next taxes payable year.
15.30 	(b) For aids payable in 2005 2009 and thereafter, the total aids aid under section 
15.31 	477A.0124, subdivision 4, are limited to $105,000,000 is $116,132,923 minus one-half 
15.32 	of the total aid amount determined under section 477A.0124, subdivision 5, paragraph 
15.33 	(b), subject to adjustment in subdivision 5. For aids payable in 2006 and thereafter, 
15.34 	the total aid under section 477A.0124, subdivision 4, is limited to $105,132,923. The 
15.35 	commissioner of finance shall bill the commissioner of revenue for the cost of preparation 
16.1 	of local impact notes as required by section 3.987, not to exceed $207,000 in fiscal year 
16.2 	2004 and thereafter. The commissioner of education shall bill the commissioner of 
16.3 	revenue for the cost of preparation of local impact notes for school districts as required by 
16.4 	section 3.987, not to exceed $7,000 in fiscal year 2004 and thereafter. The commissioner 
16.5 	of revenue shall deduct the amounts billed under this paragraph from the appropriation 
16.6 	under this paragraph. The amounts deducted are appropriated to the commissioner of 
16.7 	finance and the commissioner of education for the preparation of local impact notes.
16.8 		Subd. 5.Aid adjustments. For aids payable in 2010, the aid amounts contained 
16.9 	in subdivisions 2a and 2b are increased by two percent. For aids payable in 2011 and 
16.10 	thereafter, the aids amounts contained in subdivisions 2a and 2b are equal to 104 percent 
16.11 	of the amounts for aids payable in 2010 under this section.

16.12 	EFFECTIVE DATE. This section is effective for aids payable in calendar year 
16.13 	2009 and thereafter.

16.14 	Sec. 10. [477A.16] UTILITY VALUATION TRANSITION AID.
16.15 		Subdivision 1.Definitions. (a) When used in this section, the following terms have 
16.16 	the meanings indicated in this subdivision.
16.17 	(b) "Local unit" means a home rule charter or statutory city, or a town.
16.18 	(c) "Old rule utility net tax capacity" means the net tax capacity of all public utility 
16.19 	property within the local unit's taxing jurisdiction for assessment year 2007, calculated as 
16.20 	if the property were valued under valuation rules in effect prior to assessment year 2007.
16.21 	(d) "New rule utility net tax capacity" means the net tax capacity of all public utility 
16.22 	property within the local unit's taxing jurisdiction for assessment year 2007, calculated as 
16.23 	if the property were valued under valuation rules in effect for assessment year 2007, but 
16.24 	without the phase-in provisions of Minnesota Rules, part 8100.0800.
16.25 	(e) "Modified net tax capacity" means the local unit's net tax capacity for taxes 
16.26 	payable in 2008, modified by substituting the old rule utility net tax capacity for the actual 
16.27 	net tax capacity of utility property. Modified net tax capacity must be determined by the 
16.28 	commissioner of revenue based on information and data available to the commissioner 
16.29 	as of July 1, 2008.
16.30 	(f) "Net tax capacity differential" means the positive difference, if any, by which the 
16.31 	local unit's old rule utility net tax capacity exceeds its new rule utility net tax capacity.
16.32 	(g) "Current year net tax capacity differential" means the positive difference, if any, 
16.33 	by which the local unit's old rule utility net tax capacity exceeds its total tax capacity of 
16.34 	utility property for taxes payable in the current year.
17.1 		Subd. 2.Aid eligibility; payment. (a) If the net tax capacity differential of the 
17.2 	local unit exceeds four percent of its modified net tax capacity, the local unit is eligible 
17.3 	for transition aid computed under paragraphs (b) and (c).
17.4 	(b) For aids payable in 2009, transition aid under this section for an eligible local 
17.5 	unit equals 50 percent of (1) the net tax capacity differential, times (2) the jurisdiction's 
17.6 	tax rate for taxes payable in 2008.
17.7 	(c) For aids payable in 2010 and thereafter, transition aid under this section for 
17.8 	an eligible local unit equals (1) the current year net tax capacity differential for taxes 
17.9 	payable in the year preceding the aid distribution year, times (2) the jurisdiction's tax rate 
17.10 	for taxes payable in 2008.
17.11 	(c) The commissioner of revenue shall compute the amount of transition aid payable 
17.12 	to each local unit under this section. On or before August 1 of each year, the commissioner 
17.13 	shall certify the amount of transition aid computed for aids payable in the following year 
17.14 	for each recipient local unit. The commissioner shall pay transition aid to local units 
17.15 	annually at the times provided in section 477A.015.
17.16 		Subd. 3.Appropriation. An amount sufficient to pay transition aid under this 
17.17 	section is annually appropriated to the commissioner of revenue from the general fund.

17.18 	EFFECTIVE DATE. This section is effective for aids payable in 2009 and 
17.19 	thereafter.

17.20 	Sec. 11. STATE PARKS LOCATED ON LAKE VERMILION; DISTRIBUTION 
17.21 	OF PAYMENTS IN LIEU OF TAXES.
 17.22 	(a) Notwithstanding Minnesota Statutes, section 477A.14, payments in lieu of 
17.23 	taxation under Minnesota Statutes, sections 477A.11 to 477A.145, for the land included 
17.24 	in any state park located in whole or in part on the shores of Lake Vermilion must be 
17.25 	distributed to the taxing jurisdictions containing the property as follows: one-third to the 
17.26 	school district, one-third to the township, and one-third to the county. Each of those taxing 
17.27 	jurisdictions may use the payments for their general purposes.
17.28 	(b) Notwithstanding Minnesota Statutes, section 477A.11, the payments for all lands 
17.29 	described in paragraph (a) must be made at the rate set for acquired natural resources land.

17.30 	Sec. 12. STUDY OF AIDS TO LOCAL GOVERNMENTS.
 17.31 	The chairs of the senate and house of representatives committees with jurisdiction 
17.32 	over taxes shall each appoint five members to a study group of the tax committees to 
17.33 	examine the current system of aids to local governments and make recommendations on 
17.34 	improvements to the system. Of the five members appointed by each chair, two must be 
18.1 	members of the tax committee, one of whom is a majority party member and one of 
18.2 	whom is a minority party member. The remaining members must represent local units of 
18.3 	government. The chairs of the divisions of the tax committees having jurisdiction over 
18.4 	property taxes shall also be members and shall serve as cochairs of the study group. 
18.5 	The study shall include, but not be limited to, consideration of existing disparities in 
18.6 	the distribution of local government aid, an analysis of current law need and capacity 
18.7 	factors as well as alternative need factors, alternative analytical methods for determining 
18.8 	correlations between factors and need, the formula used to calculate aid for small cities, 
18.9 	and volatility in the local government aid distribution. The group must report on its 
18.10 	specific recommendations to the legislature by December 15, 2010.

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

18.12 	Sec. 13. OUT-OF-HOME PLACEMENT AID.
 18.13 	In calendar year 2009 only, $500,000 shall be distributed to any county in which (1) 
18.14 	the 2006 estimated population exceeds 30,000, and (2) the 2006 percentage of households 
18.15 	receiving food stamps exceeds 15 percent, based on data used in computing county 
18.16 	program aids for aids payable in 2008 and the 2006 estimated household count according 
18.17 	to the state demographer. The aid must be used to meet the county's cost of out-of-home 
18.18 	placement programs. $500,000 is appropriated to the commissioner of revenue from 
18.19 	the general fund to make the payment authorized under this section. The payment must 
18.20 	be made prior to June 30, 2009.

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

18.22 	Sec. 14.  REPEALER.
 18.23 	Minnesota Statutes 2006, section 477A.014, subdivision 5, and Minnesota Statutes 
18.24 	2007 Supplement, section 477A.014, subdivision 4, are repealed.

18.25 	EFFECTIVE DATE. This section is effective for aid payable in 2009 and thereafter.

18.26 	ARTICLE 3
18.27 	LEVY LIMITS

18.28 	Section 1. Minnesota Statutes 2006, section 275.70, subdivision 5, is amended to read:
18.29 		Subd. 5.Special levies. "Special levies" means those portions of ad valorem taxes 
18.30 	levied by a local governmental unit for the following purposes or in the following manner:
19.1 	(1) to pay the costs of the principal and interest on bonded indebtedness or to 
19.2 	reimburse for the amount of liquor store revenues used to pay the principal and interest 
19.3 	due on municipal liquor store bonds in the year preceding the year for which the levy 
19.4 	limit is calculated;
19.5 	(2) to pay the costs of principal and interest on certificates of indebtedness issued for 
19.6 	any corporate purpose except for the following:
19.7 	(i) tax anticipation or aid anticipation certificates of indebtedness;
19.8 	(ii) certificates of indebtedness issued under sections 298.28 and 298.282;
19.9 	(iii) certificates of indebtedness used to fund current expenses or to pay the costs of 
19.10 	extraordinary expenditures that result from a public emergency; or
19.11 	(iv) certificates of indebtedness used to fund an insufficiency in tax receipts or 
19.12 	an insufficiency in other revenue sources;
19.13 	(3) to provide for the bonded indebtedness portion of payments made to another 
19.14 	political subdivision of the state of Minnesota;
19.15 	(4) to fund payments made to the Minnesota State Armory Building Commission 
19.16 	under section 193.145, subdivision 2, to retire the principal and interest on armory 
19.17 	construction bonds;
19.18 	(5) property taxes approved by voters which are levied against the referendum 
19.19 	market value as provided under section 275.61;
19.20 	(6) to fund matching requirements needed to qualify for federal or state grants or 
19.21 	programs to the extent that either (i) the matching requirement exceeds the matching 
19.22 	requirement in calendar year 2001, or (ii) it is a new matching requirement that did not 
19.23 	exist prior to 2002;
19.24 	(7) to pay the expenses reasonably and necessarily incurred in preparing for or 
19.25 	repairing the effects of natural disaster including the occurrence or threat of widespread 
19.26 	or severe damage, injury, or loss of life or property resulting from natural causes, in 
19.27 	accordance with standards formulated by the Emergency Services Division of the state 
19.28 	Department of Public Safety, as allowed by the commissioner of revenue under section 
19.29 	275.74, subdivision 2;
19.30 	(8) pay amounts required to correct an error in the levy certified to the county 
19.31 	auditor by a city or county in a levy year, but only to the extent that when added to the 
19.32 	preceding year's levy it is not in excess of an applicable statutory, special law or charter 
19.33 	limitation, or the limitation imposed on the governmental subdivision by sections 275.70
19.34 	to 275.74 in the preceding levy year;
19.35 	(9) to pay an abatement under section 469.1815;
20.1 	(10) to pay any costs attributable to increases in the employer contribution rates 
20.2 	under chapter 353, or locally administered pension plans, that are effective after June 
20.3 	30, 2001;
20.4 	(11) to pay the operating or maintenance costs of a county jail as authorized in 
20.5 	section 641.01 or 641.262, or of a correctional facility as defined in section 241.021, 
20.6 	subdivision 1, paragraph (f), to the extent that the county can demonstrate to the 
20.7 	commissioner of revenue that the amount has been included in the county budget as 
20.8 	a direct result of a rule, minimum requirement, minimum standard, or directive of the 
20.9 	Department of Corrections, or to pay the operating or maintenance costs of a regional jail 
20.10 	as authorized in section 641.262. For purposes of this clause, a district court order is 
20.11 	not a rule, minimum requirement, minimum standard, or directive of the Department of 
20.12 	Corrections. If the county utilizes this special levy, except to pay operating or maintenance 
20.13 	costs of a new regional jail facility under sections 641.262 to 641.264 which will not 
20.14 	replace an existing jail facility, any amount levied by the county in the previous levy year 
20.15 	for the purposes specified under this clause and included in the county's previous year's 
20.16 	levy limitation computed under section 275.71, shall be deducted from the levy limit 
20.17 	base under section 275.71, subdivision 2, when determining the county's current year 
20.18 	levy limitation. The county shall provide the necessary information to the commissioner 
20.19 	of revenue for making this determination;
20.20 	(12) to pay for operation of a lake improvement district, as authorized under section 
20.21 	103B.555. If the county utilizes this special levy, any amount levied by the county in the 
20.22 	previous levy year for the purposes specified under this clause and included in the county's 
20.23 	previous year's levy limitation computed under section 275.71 shall be deducted from 
20.24 	the levy limit base under section 275.71, subdivision 2, when determining the county's 
20.25 	current year levy limitation. The county shall provide the necessary information to the 
20.26 	commissioner of revenue for making this determination;
20.27 	(13) to repay a state or federal loan used to fund the direct or indirect required 
20.28 	spending by the local government due to a state or federal transportation project or other 
20.29 	state or federal capital project. This authority may only be used if the project is not a 
20.30 	local government initiative;
20.31 	(14) to pay for court administration costs as required under section 273.1398, 
20.32 	subdivision 4b, less the (i) county's share of transferred fines and fees collected by the 
20.33 	district courts in the county for calendar year 2001 and (ii) the aid amount certified to be 
20.34 	paid to the county in 2004 under section 273.1398, subdivision 4c; however, for taxes 
20.35 	levied to pay for these costs in the year in which the court financing is transferred to the 
21.1 	state, the amount under this clause is limited to the amount of aid the county is certified to 
21.2 	receive under section 273.1398, subdivision 4a;
21.3 	(15) to fund a police or firefighters relief association as required under section 69.77
21.4 	to the extent that the required amount exceeds the amount levied for this purpose in 2001;
21.5 	(16) for purposes of a storm sewer improvement district under section 444.20; and
21.6 	(17) to pay for the maintenance and support of a city or county society for the 
21.7 	prevention of cruelty to animals under section 343.11. If the city or county uses this 
21.8 	special levy, any amount levied by the city or county in the previous levy year for the 
21.9 	purposes specified in this clause and included in the city's or county's previous year's levy 
21.10 	limit computed under section 275.71, must be deducted from the levy limit base under 
21.11 	section 275.71, subdivision 2, in determining the city's or county's current year levy limit.; 
21.12 	(18) for counties, to pay for the increase in their share of health and human service 
21.13 	costs caused by reductions in federal health and human services grants effective after 
21.14 	September 30, 2007;
21.15 	(19) for a city, for the costs reasonably and necessarily incurred for securing, 
21.16 	maintaining, or demolishing foreclosed or abandoned residential properties, as allowed by 
21.17 	the commissioner of revenue under section 275.74, subdivision 2. A city must have either 
21.18 	(i) a foreclosure rate of at least 1.4 percent in 2007, or (ii) a foreclosure rate in 2007 in 
21.19 	the city or in a zip code area of the city that is at least 50 percent higher than the average 
21.20 	foreclosure rate in the metropolitan area, as defined in Minnesota Statutes section 473.121, 
21.21 	subdivision 2, to use this special levy. For purposes of this paragraph, "foreclosure rate" 
21.22 	means the number of foreclosures, as indicated by sheriff sales records, divided by the 
21.23 	number of households in the city in 2007;
21.24 	(20) for a city, for the unreimbursed costs of redeployed traffic control agents and 
21.25 	lost traffic citation revenue due to the collapse of the Interstate 35W bridge, as certified 
21.26 	to the Federal Highway Administration;
21.27 	(21) to pay costs attributable to wages and benefits for sheriff, police, and fire 
21.28 	personnel. If a local governmental unit did not use this special levy in the previous year its 
21.29 	levy limit base under section 275.71 shall be reduced by the amount equal to the amount it 
21.30 	levied for the purposes specified in this clause in the previous year; and
21.31 	(22) an amount equal to any reductions in the certified aids or credits payable 
21.32 	under sections 477A.011 to 477A.014, and section 273.1384, due to unallotment under 
21.33 	section 16A.152. The amount of the levy allowed under this clause is equal to the amount 
21.34 	unallotted in the calendar year in which the tax is levied unless the unallotment amount is 
21.35 	not known by September 1 of the levy year, in which case the unallotment amount may 
21.36 	be levied in the following year.

22.1 	EFFECTIVE DATE. This section is effective for taxes levied in calendar year 2008 
22.2 	and thereafter, payable in 2009 and thereafter.

22.3 	Sec. 2. Minnesota Statutes 2006, section 275.70, is amended by adding a subdivision 
22.4 	to read:
22.5 		Subd. 6.Levy aid base. "Levy aid base" for a local governmental unit for a levy 
22.6 	year means its total levy spread on net tax capacity, minus any amounts that would 
22.7 	qualify as a special levy under section 275.70, plus the sum of (1) the total amount of 
22.8 	aids and reimbursements that the local governmental unit is certified to receive under 
22.9 	sections 477A.011 to 477A.014 in the same year, (2) taconite aids under sections 298.28
22.10 	and 298.282  in the same year, including any aid which was required to be placed in a 
22.11 	special fund for expenditure in the next succeeding year, and (3) payments to the local 
22.12 	governmental unit under section 272.029 in the same year, adjusted for any error in 
22.13 	estimation in the preceding year.

22.14 	EFFECTIVE DATE. This section is effective for levies certified in calendar year 
22.15 	2008, payable in calendar year 2009 and thereafter.

22.16 	Sec. 3. Minnesota Statutes 2006, section 275.71, is amended to read:
22.17 	275.71 LEVY LIMITS.
22.18 		Subdivision 1.Limit on levies. Notwithstanding any other provision of law or 
22.19 	municipal charter to the contrary which authorize ad valorem taxes in excess of the limits 
22.20 	established by sections 275.70 to 275.74, the provisions of this section apply to local 
22.21 	governmental units for all purposes other than those for which special levies and special 
22.22 	assessments are made. 
22.23 		Subd. 2.Levy limit base.  (a) The levy limit base for a local governmental unit for 
22.24 	taxes levied in 2003 is equal to its adjusted levy limit base in the previous year, subject 
22.25 	to any adjustments under section 275.72, plus any aid amounts received in 2003 under 
22.26 	section 273.138 or 273.166, minus the difference between its levy limit under subdivision 
22.27 	5 for taxes levied in 2002 and the amount it actually levied under that subdivision in that 
22.28 	year, and certified property tax replacement aid payable in 2003 under section 174.242.
22.29 	2008 is its levy aid base from the previous year, subject to any adjustments under section 
22.30 	275.72. For taxes levied in 2009 and 2010, the levy limit base for a local governmental 
22.31 	unit is its adjusted levy limit base in the previous year, subject to any adjustments under 
22.32 	section 275.72.
23.1 		Subd. 3.Adjustments for state takeovers. (a) The levy limit base for each local 
23.2 	unit of government shall be adjusted to reflect the assumption by the state of financing for 
23.3 	certain government functions as indicated in this subdivision.
23.4 	(b) For a county in a judicial district for which financing has not been transferred 
23.5 	to the state by January 1, 2001, the levy limit base for 2001 is permanently reduced by 
23.6 	the amount of the county's 2001 budget for court administration costs, as certified under 
23.7 	section 273.1398, subdivision 4b, paragraph (b), net of the county's share of transferred 
23.8 	fines and fees collected by the district courts in the county for the same budget period. 
23.9 	(c) For a governmental unit which levied a tax in 2000 under section 473.388, 
23.10 	subdivision 7, the levy limit base for 2001 is permanently reduced by an amount equal 
23.11 	to the sum of the governmental unit's taxes payable 2001 nondebt transit services levy 
23.12 	plus the portion of its 2001 homestead and agricultural credit aid under section 273.1398, 
23.13 	subdivision 2, attributable to nondebt transit services. 
23.14 	(d) For counties in a judicial district in which the state assumed financing of 
23.15 	mandated services costs as defined in section 480.181, subdivision 4, on July 1, 2001, the 
23.16 	levy limit base for taxes levied in 2001 is permanently reduced by an amount equal to 
23.17 	one-half of the aid reduction under section 273.1398, subdivision 4a, paragraph (g). 
23.18 		Subd. 4.Adjusted levy limit base. (a) For taxes levied in 2003 2008 through 2010, 
23.19 	the adjusted levy limit base is equal to the levy limit base computed under subdivisions 2 
23.20 	and 3 subdivision 2 or section 275.72, reduced by 40 percent of the difference between 
23.21 	(1) the sum of 2003 certified aid payments, under sections 273.138, 273.1398 except for 
23.22 	amounts certified under subdivision 4a, paragraph (b), 273.166, 477A.011 to 477A.03, 
23.23 	477A.06, and 477A.07, before any reduction under Laws 2003, First Special Session 
23.24 	chapter 21, articles 5 and 6, and (2) the sum of the aids paid in 2004 under those same 
23.25 	sections, after any reductions in 2004 under Laws 2003, First Special Session chapter 21, 
23.26 	articles 5 and 6. multiplied by:
23.27 	(1) one plus the lessor of 3.9 percent or the percentage growth in the implicit price 
23.28 	deflator;
23.29 	(2) one plus a percentage equal to 50 percent of the percentage increase in the number 
23.30 	of households, if any, for the most recent 12-month period for which data is available; and
23.31 	(3) one plus a percentage equal to 50 percent of the percentage increase in the 
23.32 	taxable market value of the jurisdiction due to new construction of class 3 property, as 
23.33 	defined in section 273.13, subdivision 4, except for state-assessed utility and railroad 
23.34 	property, for the most recent year for which data is available.
23.35 	(b) For taxes levied in 2003 only, the adjusted levy limit base is increased by 60 
23.36 	percent of the difference between a jurisdiction's market value credit in 2003 before any 
24.1 	reductions under Laws 2003, First Special Session chapter 21, articles 5 and 6, and its 
24.2 	market value credit in 2004 after reductions in Laws 2003, First Special Session chapter 
24.3 	21, articles 5 and 6.
24.4 		Subd. 5.Property tax levy limit. For taxes levied in 2003 2008 through 2010, the 
24.5 	property tax levy limit for a local governmental unit is equal to its adjusted levy limit 
24.6 	base determined under subdivision 4 plus any additional levy authorized under section 
24.7 	275.73, which is levied against net tax capacity, reduced by the sum of (i) the total amount 
24.8 	of aids and reimbursements that the local governmental unit is certified to receive under 
24.9 	sections 477A.011 to 477A.014, except for the increases in city aid bases in calendar 
24.10 	year 2002 under section 477A.011, subdivision 36, paragraphs (l), (n), and (o), (ii) 
24.11 	homestead and agricultural aids it is certified to receive under section 273.1398, (iii) (ii)
24.12 	taconite aids under sections 298.28 and 298.282 including any aid which was required to 
24.13 	be placed in a special fund for expenditure in the next succeeding year, (iv) temporary 
24.14 	court aid under section 273.1398, subdivision 4a, and (v) (iii) estimated payments to the 
24.15 	local governmental unit under section 272.029, adjusted for any error in estimation in the 
24.16 	preceding year, and (iv) aids under section 477A.16. 
24.17 		Subd. 6.Levies in excess of levy limits. If the levy made by a city or county 
24.18 	exceeds the levy limit provided in sections 275.70 to 275.74, except when the excess 
24.19 	levy is due to the rounding of the rate in accordance with section 275.28, the county 
24.20 	auditor shall only extend the amount of taxes permitted under sections 275.70 to 275.74, 
24.21 	as provided for in section 275.16. 

24.22 	EFFECTIVE DATE. This section is effective for levies certified in calendar years 
24.23 	2008 through 2010, payable in 2009 through 2011.

24.24 	Sec. 4. Minnesota Statutes 2006, section 275.74, subdivision 2, is amended to read:
24.25 		Subd. 2.Authorization for special levies. (a) A local governmental unit may 
24.26 	request authorization to levy for unreimbursed costs for natural disasters under section 
24.27 	275.70, subdivision 5, clause (7). The local governmental unit shall submit a request to 
24.28 	levy under section 275.70, subdivision 5, clause (7), to the commissioner of revenue by 
24.29 	September 30 of the levy year and the request must include information documenting the 
24.30 	estimated unreimbursed costs. The commissioner of revenue may grant levy authority, 
24.31 	up to the amount requested based on the documentation submitted. All decisions of the 
24.32 	commissioner are final. 
24.33 	(b) A city may request authorization to levy for reasonable and necessary costs for 
24.34 	securing, maintaining, or demolishing foreclosed or abandoned residential properties 
24.35 	under section 275.70, subdivision 5, clause (19). The local governmental unit shall submit 
25.1 	a request to levy under section 275.70, subdivision 5, clause (19), to the commissioner 
25.2 	of revenue by September 30 of the levy year and the request must include information 
25.3 	documenting the estimated costs. For taxes payable in 2009, the amount may include 
25.4 	unanticipated costs incurred above the amount budgeted for these purposes in 2008. Costs 
25.5 	of securing foreclosed or abandoned residential properties include payment for police and 
25.6 	fire department services. The commissioner of revenue may grant levy authority, up to the 
25.7 	lesser of (1) the amount requested based on the documentation submitted, or (2) $3,000 
25.8 	multiplied by the number of foreclosed residential properties, as defined by sheriff sales 
25.9 	records, in calendar year 2007. All decisions of the commissioner are final.

25.10 	EFFECTIVE DATE. This section is effective for levies certified in 2008 through 
25.11 	2010, payable in 2009 through 2011.

25.12 	Sec. 5. [275.76] MAINTENANCE OF EFFORT AND MATCHING 
25.13 	REQUIREMENTS SUSPENDED.
25.14 	Notwithstanding any law to the contrary, all maintenance of effort and matching 
25.15 	fund requirements for counties, including, but not limited to, those under sections 
25.16 	116L.872, 119B.11, 134.34, 145A.131, 145.882, 242.39, 245.4835, 245.714, 254B.02, 
25.17 	254B.03, 256B.0625, 256F.10, and 256F.13, are suspended for the taxes payable years that 
25.18 	levy limits are in effect.

25.19 	ARTICLE 4
25.20 	INCOME AND ESTATE TAXES

25.21 	Section 1. Minnesota Statutes 2006, section 289A.19, subdivision 2, is amended to 
25.22 	read:
25.23 		Subd. 2.Corporate franchise and mining company taxes. Corporations or mining 
25.24 	companies shall receive an extension of seven months or the amount of time granted by 
25.25 	the Internal Revenue Service, whichever is longer, for filing the return of a corporation 
25.26 	subject to tax under chapter 290 or for filing the return of a mining company subject to 
25.27 	tax under sections 298.01 and 298.015. Interest on any balance of tax not paid when the 
25.28 	regularly required return is due must be paid at the rate specified in section 270C.40, 
25.29 	from the date such payment should have been made if no extension was granted, until 
25.30 	the date of payment of such tax.
25.31 	If a corporation or mining company does not:
26.1 	(1) pay at least 90 percent of the amount of tax shown on the return on or before the 
26.2 	regular due date of the return, the penalty prescribed by section 289A.60, subdivision 1, 
26.3 	shall be imposed on the unpaid balance of tax; or
26.4 	(2) pay the balance due shown on the regularly required return on or before the 
26.5 	extended due date of the return, the penalty prescribed by section 289A.60, subdivision 1, 
26.6 	shall be imposed on the unpaid balance of tax from the original due date of the return.

26.7 	EFFECTIVE DATE. This section is effective the day following final enactment 
26.8 	and applies to any federal extension that allows filing after that date.

26.9 	Sec. 2. Minnesota Statutes 2006, section 289A.19, is amended by adding a subdivision 
26.10 	to read:
26.11 		Subd. 7.Federal extensions. When an extension of time to file a partnership or 
26.12 	S corporation tax return is granted by the Internal Revenue Service, the commissioner 
26.13 	shall grant an automatic extension to file the comparable Minnesota return for that period. 
26.14 	An extension granted under this subdivision does not affect the due date for making 
26.15 	payments of tax.

26.16 	EFFECTIVE DATE. This section is effective the day following final enactment 
26.17 	and applies to any federal extension that allows filing after that date.

26.18 	Sec. 3. Minnesota Statutes 2006, section 290.01, subdivision 6b, is amended to read:
26.19 		Subd. 6b.Foreign operating corporation. The term "foreign operating 
26.20 	corporation," when applied to a corporation, means a domestic corporation with the 
26.21 	following characteristics:
26.22 	(1) it is part of a unitary business at least one member of which is taxable in this state;
26.23 	(2) it is not a foreign sales corporation under section 922 of the Internal Revenue 
26.24 	Code, as amended through December 31, 1999, for the taxable year;
26.25 	(3) it is not an interest charge domestic international sales corporation under sections 
26.26 	992, 993, 994, and 995 of the Internal Revenue Code;
26.27 	 (4) either (i) the average of the percentages of its property and payrolls, including 
26.28 	the pro rata share of its unitary partnerships' property and payrolls, assigned to locations 
26.29 	outside the United States, where the United States includes the District of Columbia and 
26.30 	excludes the commonwealth of Puerto Rico and possessions of the United States, as 
26.31 	determined under section 290.191 or 290.20, is 80 percent or more; or (ii) it has in effect a 
26.32 	valid election under section 936 of the Internal Revenue Code; or (ii) at least 80 percent 
27.1 	of the gross income from all sources of the corporation in the tax year is active foreign 
27.2 	business income; and
27.3 	(4) it has $1,000,000 of payroll and $2,000,000 of property, as determined under 
27.4 	section 290.191 or 290.20, that are located outside the United States. If the domestic 
27.5 	corporation does not have payroll as determined under section 290.191 or 290.20, but it 
27.6 	or its partnerships have paid $1,000,000 for work, performed directly for the domestic 
27.7 	corporation or the partnerships, outside the United States, then paragraph (3)(i) shall not 
27.8 	require payrolls to be included in the average calculation
27.9 	(5) for purposes of this subdivision, active foreign business income means gross 
27.10 	income that is (i) derived from sources without the United States, as defined in subtitle A, 
27.11 	chapter 1, subchapter N, part 1, of the Internal Revenue Code; and (ii) attributable to the 
27.12 	active conduct of a trade or business in a foreign country.

27.13 	EFFECTIVE DATE. This section is effective for taxable years beginning after 
27.14 	December 31, 2007.

27.15 	Sec. 4. Minnesota Statutes 2007 Supplement, section 290.01, subdivision 19b, as 
27.16 	amended by Laws 2008, chapter 154, article 3, section 3, is amended to read:
27.17 		Subd. 19b. Subtractions from federal taxable income. For individuals, estates, 
27.18 	and trusts, there shall be subtracted from federal taxable income: 
27.19 	(1) net interest income on obligations of any authority, commission, or 
27.20 	instrumentality of the United States to the extent includable in taxable income for federal 
27.21 	income tax purposes but exempt from state income tax under the laws of the United States; 
27.22 	(2) if included in federal taxable income, the amount of any overpayment of income 
27.23 	tax to Minnesota or to any other state, for any previous taxable year, whether the amount 
27.24 	is received as a refund or as a credit to another taxable year's income tax liability; 
27.25 	(3) the amount paid to others, less the amount used to claim the credit allowed under 
27.26 	section 290.0674, not to exceed $1,625 for each qualifying child in grades kindergarten 
27.27 	to 6 and $2,500 for each qualifying child in grades 7 to 12, for tuition, textbooks, and 
27.28 	transportation of each qualifying child in attending an elementary or secondary school 
27.29 	situated in Minnesota, North Dakota, South Dakota, Iowa, or Wisconsin, wherein a 
27.30 	resident of this state may legally fulfill the state's compulsory attendance laws, which 
27.31 	is not operated for profit, and which adheres to the provisions of the Civil Rights Act 
27.32 	of 1964 and chapter 363A. For the purposes of this clause, "tuition" includes fees or 
27.33 	tuition as defined in section 290.0674, subdivision 1, clause (1). As used in this clause, 
27.34 	"textbooks" includes books and other instructional materials and equipment purchased 
27.35 	or leased for use in elementary and secondary schools in teaching only those subjects 
28.1 	legally and commonly taught in public elementary and secondary schools in this state. 
28.2 	Equipment expenses qualifying for deduction includes expenses as defined and limited in 
28.3 	section 290.0674, subdivision 1, clause (3). "Textbooks" does not include instructional 
28.4 	books and materials used in the teaching of religious tenets, doctrines, or worship, the 
28.5 	purpose of which is to instill such tenets, doctrines, or worship, nor does it include books 
28.6 	or materials for, or transportation to, extracurricular activities including sporting events, 
28.7 	musical or dramatic events, speech activities, driver's education, or similar programs. For 
28.8 	purposes of the subtraction provided by this clause, "qualifying child" has the meaning 
28.9 	given in section 32(c)(3) of the Internal Revenue Code; 
28.10 	(4) income as provided under section 290.0802; 
28.11 	(5) to the extent included in federal adjusted gross income, income realized on 
28.12 	disposition of property exempt from tax under section 290.491; 
28.13 	(6) to the extent not deducted or not deductible pursuant to section 408(d)(8)(E) 
28.14 	of the Internal Revenue Code in determining federal taxable income by an individual 
28.15 	who does not itemize deductions for federal income tax purposes for the taxable year, an 
28.16 	amount equal to 50 percent of the excess of charitable contributions over $500 allowable 
28.17 	as a deduction for the taxable year under section 170(a) of the Internal Revenue Code and 
28.18 	under the provisions of Public Law 109-1; 
28.19 	(7) for taxable years beginning before January 1, 2008, the amount of the federal 
28.20 	small ethanol producer credit allowed under section 40(a)(3) of the Internal Revenue Code 
28.21 	which is included in gross income under section 87 of the Internal Revenue Code; 
28.22 	(8) for individuals who are allowed a federal foreign tax credit for taxes that do not 
28.23 	qualify for a credit under section 290.06, subdivision 22, an amount equal to the carryover 
28.24 	of subnational foreign taxes for the taxable year, but not to exceed the total subnational 
28.25 	foreign taxes reported in claiming the foreign tax credit. For purposes of this clause, 
28.26 	"federal foreign tax credit" means the credit allowed under section 27 of the Internal 
28.27 	Revenue Code, and "carryover of subnational foreign taxes" equals the carryover allowed 
28.28 	under section 904(c) of the Internal Revenue Code minus national level foreign taxes to 
28.29 	the extent they exceed the federal foreign tax credit; 
28.30 	(9) in each of the five tax years immediately following the tax year in which an 
28.31 	addition is required under subdivision 19a, clause (7), or 19c, clause (15), in the case 
28.32 	of a shareholder of a corporation that is an S corporation, an amount equal to one-fifth 
28.33 	of the delayed depreciation. For purposes of this clause, "delayed depreciation" means 
28.34 	the amount of the addition made by the taxpayer under subdivision 19a, clause (7), or 
28.35 	subdivision 19c, clause (15), in the case of a shareholder of an S corporation, minus the 
28.36 	positive value of any net operating loss under section 172 of the Internal Revenue Code 
29.1 	generated for the tax year of the addition. The resulting delayed depreciation cannot be 
29.2 	less than zero; 
29.3 	(10) job opportunity building zone income as provided under section 469.316; 
29.4 	(11) to the extent included in federal taxable income, the amount of compensation 
29.5 	paid to members of the Minnesota National Guard or other reserve components of the 
29.6 	United States military for active service performed in Minnesota, excluding compensation 
29.7 	for services performed under the Active Guard Reserve (AGR) program. For purposes of 
29.8 	this clause, "active service" means (i) state active service as defined in section 190.05, 
29.9 	subdivision 5a, clause (1); (ii) federally funded state active service as defined in section 
29.10 	190.05, subdivision 5b; or (iii) federal active service as defined in section 190.05, 
29.11 	subdivision 5c, but "active service" excludes services performed exclusively for purposes 
29.12 	of basic combat training, advanced individual training, annual training, and periodic 
29.13 	inactive duty training; special training periodically made available to reserve members; 
29.14 	and service performed in accordance with section 190.08, subdivision 3; 
29.15 	(12) to the extent included in federal taxable income, the amount of compensation 
29.16 	paid to Minnesota residents who are members of the armed forces of the United States or 
29.17 	United Nations for active duty performed outside Minnesota under United States Code, 
29.18 	title 10, section 101(d); United States Code, title 32, section 101(12); or the authority of 
29.19 	the United Nations; 
29.20 	(13) an amount, not to exceed $10,000, equal to qualified expenses related to a 
29.21 	qualified donor's donation, while living, of one or more of the qualified donor's organs 
29.22 	to another person for human organ transplantation. For purposes of this clause, "organ" 
29.23 	means all or part of an individual's liver, pancreas, kidney, intestine, lung, or bone marrow; 
29.24 	"human organ transplantation" means the medical procedure by which transfer of a human 
29.25 	organ is made from the body of one person to the body of another person; "qualified 
29.26 	expenses" means unreimbursed expenses for both the individual and the qualified donor 
29.27 	for (i) travel, (ii) lodging, and (iii) lost wages net of sick pay, except that such expenses 
29.28 	may be subtracted under this clause only once; and "qualified donor" means the individual 
29.29 	or the individual's dependent, as defined in section 152 of the Internal Revenue Code. An 
29.30 	individual may claim the subtraction in this clause for each instance of organ donation for 
29.31 	transplantation during the taxable year in which the qualified expenses occur; 
29.32 	(14) in each of the five tax years immediately following the tax year in which an 
29.33 	addition is required under subdivision 19a, clause (8), or 19c, clause (16), in the case of a 
29.34 	shareholder of a corporation that is an S corporation, an amount equal to one-fifth of the 
29.35 	addition made by the taxpayer under subdivision 19a, clause (8), or 19c, clause (16), in the 
29.36 	case of a shareholder of a corporation that is an S corporation, minus the positive value of 
30.1 	any net operating loss under section 172 of the Internal Revenue Code generated for the 
30.2 	tax year of the addition. If the net operating loss exceeds the addition for the tax year, a 
30.3 	subtraction is not allowed under this clause; 
30.4 	(15) to the extent included in federal taxable income, compensation paid to a 
30.5 	nonresident who is a service member as defined in United States Code, title 10, section 
30.6 	101(a)(5), for military service as defined in the Service Member Civil Relief Act, Public 
30.7 	Law 108-189, section 101(2); and
30.8 	(16) international economic development zone income as provided under section 
30.9 	469.325; and
30.10 	(17) to the extent included in federal taxable income, the amount of national service 
30.11 	educational awards received from the National Service Trust under United States Code, 
30.12 	title 42, sections 12601 to 12604, for service in an approved Americorps National Service 
30.13 	program. 

30.14 	EFFECTIVE DATE. This section is effective for tax years beginning after 
30.15 	December 31, 2008, except clause (17) is effective for tax years beginning after December 
30.16 	31, 2007.

30.17 	Sec. 5. Minnesota Statutes 2006, section 290.01, subdivision 19c, as amended by Laws 
30.18 	2008, chapter 154, article 3, section 4, is amended to read:
30.19 		Subd. 19c. Corporations; additions to federal taxable income. For corporations, 
30.20 	there shall be added to federal taxable income: 
30.21 	(1) the amount of any deduction taken for federal income tax purposes for income, 
30.22 	excise, or franchise taxes based on net income or related minimum taxes, including but not 
30.23 	limited to the tax imposed under section 290.0922, paid by the corporation to Minnesota, 
30.24 	another state, a political subdivision of another state, the District of Columbia, or any 
30.25 	foreign country or possession of the United States; 
30.26 	(2) interest not subject to federal tax upon obligations of: the United States, its 
30.27 	possessions, its agencies, or its instrumentalities; the state of Minnesota or any other 
30.28 	state, any of its political or governmental subdivisions, any of its municipalities, or any 
30.29 	of its governmental agencies or instrumentalities; the District of Columbia; or Indian 
30.30 	tribal governments; 
30.31 	(3) exempt-interest dividends received as defined in section 852(b)(5) of the Internal 
30.32 	Revenue Code; 
30.33 	(4) the amount of any net operating loss deduction taken for federal income tax 
30.34 	purposes under section 172 or 832(c)(10) of the Internal Revenue Code or operations loss 
30.35 	deduction under section 810 of the Internal Revenue Code; 
31.1 	(5) the amount of any special deductions taken for federal income tax purposes 
31.2 	under sections 241 to 247 and 965 of the Internal Revenue Code; 
31.3 	(6) losses from the business of mining, as defined in section 290.05, subdivision 1, 
31.4 	clause (a), that are not subject to Minnesota income tax; 
31.5 	(7) the amount of any capital losses deducted for federal income tax purposes under 
31.6 	sections 1211 and 1212 of the Internal Revenue Code; 
31.7 	(8) the exempt foreign trade income of a foreign sales corporation under sections 
31.8 	921(a) and 291 of the Internal Revenue Code; 
31.9 	(9) the amount of percentage depletion deducted under sections 611 through 614 and 
31.10 	291 of the Internal Revenue Code; 
31.11 	(10) for certified pollution control facilities placed in service in a taxable year 
31.12 	beginning before December 31, 1986, and for which amortization deductions were elected 
31.13 	under section 169 of the Internal Revenue Code of 1954, as amended through December 
31.14 	31, 1985, the amount of the amortization deduction allowed in computing federal taxable 
31.15 	income for those facilities; 
31.16 	(11) the amount of any deemed dividend from a foreign operating corporation 
31.17 	determined pursuant to section 290.17, subdivision 4, paragraph (g). The deemed dividend 
31.18 	shall be reduced by the amount of the addition to income required by clauses (20), (21), 
31.19 	(22), and (23); 
31.20 	(12) the amount of a partner's pro rata share of net income which does not flow 
31.21 	through to the partner because the partnership elected to pay the tax on the income under 
31.22 	section 6242(a)(2) of the Internal Revenue Code; 
31.23 	(13) the amount of net income excluded under section 114 of the Internal Revenue 
31.24 	Code; 
31.25 	(14) any increase in subpart F income, as defined in section 952(a) of the Internal 
31.26 	Revenue Code, for the taxable year when subpart F income is calculated without regard 
31.27 	to the provisions of section 103 of Public Law 109-222; 
31.28 	(15) 80 percent of the depreciation deduction allowed under section 168(k)(1)(A) 
31.29 	and (k)(4)(A) of the Internal Revenue Code. For purposes of this clause, if the taxpayer 
31.30 	has an activity that in the taxable year generates a deduction for depreciation under 
31.31 	section 168(k)(1)(A) and (k)(4)(A) and the activity generates a loss for the taxable year 
31.32 	that the taxpayer is not allowed to claim for the taxable year, "the depreciation allowed 
31.33 	under section 168(k)(1)(A) and (k)(4)(A)" for the taxable year is limited to excess of the 
31.34 	depreciation claimed by the activity under section 168(k)(1)(A) and (k)(4)(A) over the 
31.35 	amount of the loss from the activity that is not allowed in the taxable year. In succeeding 
32.1 	taxable years when the losses not allowed in the taxable year are allowed, the depreciation 
32.2 	under section 168(k)(1)(A) and (k)(4)(A) is allowed; 
32.3 	(16) 80 percent of the amount by which the deduction allowed by section 179 of the 
32.4 	Internal Revenue Code exceeds the deduction allowable by section 179 of the Internal 
32.5 	Revenue Code of 1986, as amended through December 31, 2003; 
32.6 	(17) to the extent deducted in computing federal taxable income, the amount of the 
32.7 	deduction allowable under section 199 of the Internal Revenue Code; 
32.8 	(18) the exclusion allowed under section 139A of the Internal Revenue Code for 
32.9 	federal subsidies for prescription drug plans; and
32.10 	(19) the amount of expenses disallowed under section 290.10, subdivision 2;
32.11 	(20) an amount equal to the interest and intangible expenses, losses, and costs paid, 
32.12 	accrued, or incurred by any member of the taxpayer's unitary group to or for the benefit 
32.13 	of a corporation that is a member of the taxpayer's unitary business group that qualifies 
32.14 	as a foreign operating corporation. For purposes of this clause, intangible expenses and 
32.15 	costs include:
32.16 	(i) expenses, losses, and costs for, or related to, the direct or indirect acquisition, 
32.17 	use, maintenance or management, ownership, sale, exchange, or any other disposition of 
32.18 	intangible property;
32.19 	(ii) losses incurred, directly or indirectly, from factoring transactions or discounting 
32.20 	transactions;
32.21 	(iii) royalty, patent, technical, and copyright fees;
32.22 	(iv) licensing fees; and
32.23 	(v) other similar expenses and costs. 
32.24 	For purposes of this clause, "intangible property" includes stocks, bonds, patents, patent 
32.25 	applications, trade names, trademarks, service marks, copyrights, mask works, trade 
32.26 	secrets, and similar types of intangible assets.
32.27 	This clause does not apply to any item of interest or intangible expenses or costs paid, 
32.28 	accrued, or incurred, directly or indirectly, to a foreign operating corporation with respect 
32.29 	to such item of income to the extent that the income to the foreign operating corporation 
32.30 	is income from sources without the United States as defined in subtitle A, chapter 1, 
32.31 	subchapter N, part 1, of the Internal Revenue Code;
32.32 	(21) except as already included in the taxpayer's taxable income pursuant to clause 
32.33 	(20), any interest income and income generated from intangible property received or 
32.34 	accrued by a foreign operating corporation that is a member of the taxpayer's unitary 
32.35 	group. For purposes of this clause, income generated from intangible property includes:
33.1 	(i) income related to the direct or indirect acquisition, use, maintenance or 
33.2 	management, ownership, sale, exchange, or any other disposition of intangible property;
33.3 	(ii) income from factoring transactions or discounting transactions;
33.4 	(iii) royalty, patent, technical, and copyright fees;
33.5 	(iv) licensing fees; and
33.6 	(v) other similar income.
33.7 	For purposes of this clause, "intangible property" includes stocks, bonds, patents, patent 
33.8 	applications, trade names, trademarks, service marks, copyrights, mask works, trade 
33.9 	secrets, and similar types of intangible assets. 
33.10 	This clause does not apply to any item of interest or intangible income received or accrued 
33.11 	by a foreign operating corporation with respect to such item of income to the extent that 
33.12 	the income is income from sources without the United States as defined in subtitle A, 
33.13 	chapter 1, subchapter N, part 1, of the Internal Revenue Code;
33.14 	(22) the dividends attributable to the income of a foreign operating corporation that 
33.15 	is a member of the taxpayer's unitary group in an amount that is equal to the dividends 
33.16 	paid deduction of a real estate investment trust under section 561(a) of the Internal 
33.17 	Revenue Code for amounts paid or accrued by the real estate investment trust to the 
33.18 	foreign operating corporation; and
33.19 	(23) the income of a foreign operating corporation that is a member of the taxpayer's 
33.20 	unitary group in an amount that is equal to gains derived from the sale of real or personal 
33.21 	property located in the United States.

33.22 	EFFECTIVE DATE. This section is effective for taxable years beginning after 
33.23 	December 31, 2007.

33.24 	Sec. 6. Minnesota Statutes 2006, section 290.01, subdivision 19d, as amended by Laws 
33.25 	2008, chapter 154, article 11, section 12, is amended to read:
33.26 		Subd. 19d. Corporations; modifications decreasing federal taxable income. For 
33.27 	corporations, there shall be subtracted from federal taxable income after the increases 
33.28 	provided in subdivision 19c: 
33.29 	(1) the amount of foreign dividend gross-up added to gross income for federal 
33.30 	income tax purposes under section 78 of the Internal Revenue Code; 
33.31 	(2) the amount of salary expense not allowed for federal income tax purposes due to 
33.32 	claiming the work opportunity credit under section 51 of the Internal Revenue Code; 
33.33 	(3) any dividend (not including any distribution in liquidation) paid within the 
33.34 	taxable year by a national or state bank to the United States, or to any instrumentality of 
34.1 	the United States exempt from federal income taxes, on the preferred stock of the bank 
34.2 	owned by the United States or the instrumentality; 
34.3 	(4) amounts disallowed for intangible drilling costs due to differences between 
34.4 	this chapter and the Internal Revenue Code in taxable years beginning before January 
34.5 	1, 1987, as follows: 
34.6 	(i) to the extent the disallowed costs are represented by physical property, an amount 
34.7 	equal to the allowance for depreciation under Minnesota Statutes 1986, section 290.09, 
34.8 	subdivision 7, subject to the modifications contained in subdivision 19e; and 
34.9 	(ii) to the extent the disallowed costs are not represented by physical property, an 
34.10 	amount equal to the allowance for cost depletion under Minnesota Statutes 1986, section 
34.11 	290.09, subdivision 8; 
34.12 	(5) the deduction for capital losses pursuant to sections 1211 and 1212 of the 
34.13 	Internal Revenue Code, except that: 
34.14 	(i) for capital losses incurred in taxable years beginning after December 31, 1986, 
34.15 	capital loss carrybacks shall not be allowed; 
34.16 	(ii) for capital losses incurred in taxable years beginning after December 31, 1986, 
34.17 	a capital loss carryover to each of the 15 taxable years succeeding the loss year shall be 
34.18 	allowed; 
34.19 	(iii) for capital losses incurred in taxable years beginning before January 1, 1987, a 
34.20 	capital loss carryback to each of the three taxable years preceding the loss year, subject to 
34.21 	the provisions of Minnesota Statutes 1986, section 290.16, shall be allowed; and 
34.22 	(iv) for capital losses incurred in taxable years beginning before January 1, 1987, 
34.23 	a capital loss carryover to each of the five taxable years succeeding the loss year to the 
34.24 	extent such loss was not used in a prior taxable year and subject to the provisions of 
34.25 	Minnesota Statutes 1986, section 290.16, shall be allowed; 
34.26 	(6) an amount for interest and expenses relating to income not taxable for federal 
34.27 	income tax purposes, if (i) the income is taxable under this chapter and (ii) the interest and 
34.28 	expenses were disallowed as deductions under the provisions of section 171(a)(2), 265 or 
34.29 	291 of the Internal Revenue Code in computing federal taxable income; 
34.30 	(7) in the case of mines, oil and gas wells, other natural deposits, and timber for 
34.31 	which percentage depletion was disallowed pursuant to subdivision 19c, clause (9), a 
34.32 	reasonable allowance for depletion based on actual cost. In the case of leases the deduction 
34.33 	must be apportioned between the lessor and lessee in accordance with rules prescribed 
34.34 	by the commissioner. In the case of property held in trust, the allowable deduction must 
34.35 	be apportioned between the income beneficiaries and the trustee in accordance with the 
35.1 	pertinent provisions of the trust, or if there is no provision in the instrument, on the basis 
35.2 	of the trust's income allocable to each; 
35.3 	(8) for certified pollution control facilities placed in service in a taxable year 
35.4 	beginning before December 31, 1986, and for which amortization deductions were elected 
35.5 	under section 169 of the Internal Revenue Code of 1954, as amended through December 
35.6 	31, 1985, an amount equal to the allowance for depreciation under Minnesota Statutes 
35.7 	1986, section 290.09, subdivision 7; 
35.8 	(9) amounts included in federal taxable income that are due to refunds of income, 
35.9 	excise, or franchise taxes based on net income or related minimum taxes paid by the 
35.10 	corporation to Minnesota, another state, a political subdivision of another state, the 
35.11 	District of Columbia, or a foreign country or possession of the United States to the extent 
35.12 	that the taxes were added to federal taxable income under section 290.01, subdivision 19c, 
35.13 	clause (1), in a prior taxable year; 
35.14 	(10) 80 percent of royalties, fees, or other like income accrued or received from a 
35.15 	foreign operating corporation or a foreign corporation which is part of the same unitary 
35.16 	business as the receiving corporation, unless the income resulting from such payments or 
35.17 	accruals is income from sources within the United States as defined in subtitle A, chapter 
35.18 	1, subchapter N, part 1, of the Internal Revenue Code; 
35.19 	(11) income or gains from the business of mining as defined in section 290.05, 
35.20 	subdivision 1, clause (a), that are not subject to Minnesota franchise tax; 
35.21 	(12) the amount of disability access expenditures in the taxable year which are not 
35.22 	allowed to be deducted or capitalized under section 44(d)(7) of the Internal Revenue Code; 
35.23 	(13) the amount of qualified research expenses not allowed for federal income tax 
35.24 	purposes under section 280C(c) of the Internal Revenue Code, but only to the extent that 
35.25 	the amount exceeds the amount of the credit allowed under section 290.068; 
35.26 	(14) the amount of salary expenses not allowed for federal income tax purposes due 
35.27 	to claiming the Indian employment credit under section 45A(a) of the Internal Revenue 
35.28 	Code; 
35.29 	(15) for taxable years beginning before January 1, 2008, the amount of the federal 
35.30 	small ethanol producer credit allowed under section 40(a)(3) of the Internal Revenue Code 
35.31 	which is included in gross income under section 87 of the Internal Revenue Code; 
35.32 	(16) for a corporation whose foreign sales corporation, as defined in section 922 
35.33 	of the Internal Revenue Code, constituted a foreign operating corporation during any 
35.34 	taxable year ending before January 1, 1995, and a return was filed by August 15, 1996, 
35.35 	claiming the deduction under section 290.21, subdivision 4, for income received from 
35.36 	the foreign operating corporation, an amount equal to 1.23 multiplied by the amount of 
36.1 	income excluded under section 114 of the Internal Revenue Code, provided the income is 
36.2 	not income of a foreign operating company; 
36.3 	(17) any decrease in subpart F income, as defined in section 952(a) of the Internal 
36.4 	Revenue Code, for the taxable year when subpart F income is calculated without regard 
36.5 	to the provisions of section 103 of Public Law 109-222; 
36.6 	(16) (18) in each of the five tax years immediately following the tax year in which 
36.7 	an addition is required under subdivision 19c, clause (15), an amount equal to one-fifth 
36.8 	of the delayed depreciation. For purposes of this clause, "delayed depreciation" means 
36.9 	the amount of the addition made by the taxpayer under subdivision 19c, clause (15). The 
36.10 	resulting delayed depreciation cannot be less than zero; and 
36.11 	(17) (19) in each of the five tax years immediately following the tax year in which an 
36.12 	addition is required under subdivision 19c, clause (16), an amount equal to one-fifth of the 
36.13 	amount of the addition. 

36.14 	EFFECTIVE DATE. This section is effective for taxable years beginning after 
36.15 	December 31, 2007.

36.16 	Sec. 7. Minnesota Statutes 2006, section 290.06, subdivision 33, as amended by Laws 
36.17 	2008, chapter 154, article 11, section 13, is amended to read:
36.18 		Subd. 33. Bovine testing credit. (a) An owner of cattle in Minnesota may take a 
36.19 	credit against the tax due under this chapter for an amount equal to: (1) for corporate 
36.20 	filers, including shareholders of an "S" corporation under section 290.9725, 25 percent 
36.21 	of the expenses incurred during the taxable year to conduct tuberculosis testing on those 
36.22 	cattle; and (2) for all other filers, one-half the expenses incurred during the taxable year to 
36.23 	conduct tuberculosis testing on those cattle. 
36.24 	(b) If the amount of credit which the taxpayer is eligible to receive under this 
36.25 	subdivision exceeds the taxpayer's tax liability under this chapter, the commissioner of 
36.26 	revenue shall refund the excess to the taxpayer. 
36.27 	(c) The amount necessary to pay claims for the refund provided in this subdivision is 
36.28 	appropriated from the general fund to the commissioner of revenue. 
36.29 	(d) Expenses incurred in a calendar year in which tuberculosis testing of cattle in 
36.30 	Minnesota is not federally required are not allowed in claiming the credit under paragraph 
36.31 	(a). 

36.32 	EFFECTIVE DATE. This section is effective for taxable years beginning after 
36.33 	December 31, 2008.

37.1 	Sec. 8. Minnesota Statutes 2006, section 290.0677, subdivision 1, as amended by Laws 
37.2 	2008, chapter 154, article 3, section 5, is amended to read:
37.3 		Subdivision 1. Credit allowed; current military service.  (a) An individual is 
37.4 	allowed a credit against the tax due under this chapter equal to $59 for each month or 
37.5 	portion thereof that the individual was in active military service in a designated area after 
37.6 	September 11, 2001, and before January 1, 2009, while a Minnesota domiciliary. 
37.7 	(b) An individual is allowed a credit against the tax due under this chapter equal to 
37.8 	$120 for each month or portion thereof that the individual was in active military service in 
37.9 	a designated area after December 31, 2008, while a Minnesota domiciliary.
37.10 	(c) For active service performed after September 11, 2001, and before December 31, 
37.11 	2006, the individual may claim the credit in the taxable year beginning after December 31, 
37.12 	2005, and before January 1, 2007. 
37.13 	(c)(d) For active service performed after December 31, 2006, the individual may 
37.14 	claim the credit for the taxable year in which the active service was performed. 
37.15 	(d)(e) If an individual entitled to the credit died prior to January 1, 2006, the 
37.16 	individual's estate or heirs at law, if the individual's probate estate has closed or the estate 
37.17 	was not probated, may claim the credit. 

37.18 	EFFECTIVE DATE. This section is effective for taxable years beginning after 
37.19 	December 31, 2008.

37.20 	Sec. 9. Minnesota Statutes 2006, section 290.0677, is amended by adding a subdivision 
37.21 	to read:
37.22 		Subd. 1a.Credit allowed; past military service. (a) A qualified individual is 
37.23 	allowed a credit against the tax imposed under this chapter for past military service. The 
37.24 	credit equals $750. The credit allowed under this subdivision is reduced by 10 percent of 
37.25 	adjusted gross income in excess of $30,000, but in no case is the credit less than zero.
37.26 	(b) For a nonresident or a part-year resident, the credit under this subdivision 
37.27 	must be allocated based on the percentage calculated under section 290.06, subdivision 
37.28 	2c, paragraph (e).

37.29 	EFFECTIVE DATE. This section is effective for taxable years beginning after 
37.30 	December 31, 2008.

37.31 	Sec. 10. Minnesota Statutes 2006, section 290.0677, subdivision 2, is amended to read:
37.32 		Subd. 2.Definitions. (a) For purposes of this section the following terms have 
37.33 	the meanings given. 
38.1 	(b) "Designated area" means a: 
38.2 	(1) combat zone designated by Executive Order from the President of the United 
38.3 	States; 
38.4 	(2) qualified hazardous duty area, designated in Public Law; or 
38.5 	(3) location certified by the U. S. Department of Defense as eligible for combat zone 
38.6 	tax benefits due to the location's direct support of military operations. 
38.7 	(c) "Active military service" means active duty service in any of the United States 
38.8 	Armed Forces, the National Guard, or reserves.
38.9 	(d) "Qualified individual" means an individual who has
38.10 	(1) either (i) served at least 20 years in the military or (ii) has a service-connected 
38.11 	disability rating of 100 percent for a total and permanent disability; and
38.12 	(2) separated from military service before the end of the taxable year.
38.13 	(e) "Adjusted gross income" has the meaning given in section 61 of the Internal 
38.14 	Revenue Code.

38.15 	EFFECTIVE DATE. This section is effective for taxable years beginning after 
38.16 	December 31, 2008.

38.17 	Sec. 11. Minnesota Statutes 2006, section 290.0677, subdivision 3, is amended to read:
38.18 		Subd. 3.Credit refundable. If the amount of credit which the individual is eligible 
38.19 	to receive under this section subdivision 1 exceeds the individual's tax liability under this 
38.20 	chapter, the commissioner shall refund the excess to the individual.

38.21 	EFFECTIVE DATE. This section is effective for taxable years beginning after 
38.22 	December 31, 2008.

38.23 	Sec. 12. Minnesota Statutes 2006, section 290.091, subdivision 2, as amended by Laws 
38.24 	2008, chapter 154, article 4, section 7, is amended to read:
38.25 		Subd. 2. Definitions. For purposes of the tax imposed by this section, the following 
38.26 	terms have the meanings given: 
38.27 	(a) "Alternative minimum taxable income" means the sum of the following for 
38.28 	the taxable year: 
38.29 	(1) the taxpayer's federal alternative minimum taxable income as defined in section 
38.30 	55(b)(2) of the Internal Revenue Code; 
38.31 	(2) the taxpayer's itemized deductions allowed in computing federal alternative 
38.32 	minimum taxable income, but excluding: 
39.1 	(i) the charitable contribution deduction under section 170 of the Internal Revenue 
39.2 	Code:;
39.3 	(A) for taxable years beginning before January 1, 2006, to the extent that the 
39.4 	deduction exceeds 1.0 percent of adjusted gross income;
39.5 	(B) for taxable years beginning after December 31, 2005, to the full extent of the 
39.6 	deduction.
39.7 	For purposes of this clause, "adjusted gross income" has the meaning given in 
39.8 	section 62 of the Internal Revenue Code;
39.9 	(ii) the medical expense deduction; 
39.10 	(iii) the casualty, theft, and disaster loss deduction; and 
39.11 	(iv) the impairment-related work expenses of a disabled person; 
39.12 	(3) for depletion allowances computed under section 613A(c) of the Internal 
39.13 	Revenue Code, with respect to each property (as defined in section 614 of the Internal 
39.14 	Revenue Code), to the extent not included in federal alternative minimum taxable income, 
39.15 	the excess of the deduction for depletion allowable under section 611 of the Internal 
39.16 	Revenue Code for the taxable year over the adjusted basis of the property at the end of the 
39.17 	taxable year (determined without regard to the depletion deduction for the taxable year); 
39.18 	(4) to the extent not included in federal alternative minimum taxable income, the 
39.19 	amount of the tax preference for intangible drilling cost under section 57(a)(2) of the 
39.20 	Internal Revenue Code determined without regard to subparagraph (E); 
39.21 	(5) to the extent not included in federal alternative minimum taxable income, the 
39.22 	amount of interest income as provided by section 290.01, subdivision 19a, clause (1); and 
39.23 	(6) the amount of addition required by section 290.01, subdivision 19a, clauses 
39.24 	(7) to (9), (11), and (12); 
39.25 	less the sum of the amounts determined under the following: 
39.26 	(1) interest income as defined in section 290.01, subdivision 19b, clause (1); 
39.27 	(2) an overpayment of state income tax as provided by section 290.01, subdivision 
39.28 	19b, clause (2), to the extent included in federal alternative minimum taxable income; 
39.29 	(3) the amount of investment interest paid or accrued within the taxable year on 
39.30 	indebtedness to the extent that the amount does not exceed net investment income, as 
39.31 	defined in section 163(d)(4) of the Internal Revenue Code. Interest does not include 
39.32 	amounts deducted in computing federal adjusted gross income; and 
39.33 	(4) amounts subtracted from federal taxable income as provided by section 290.01, 
39.34 	subdivision 19b, clauses (6) and (9) to (16). 
39.35 	In the case of an estate or trust, alternative minimum taxable income must be 
39.36 	computed as provided in section 59(c) of the Internal Revenue Code. 
40.1 	(b) "Investment interest" means investment interest as defined in section 163(d)(3) 
40.2 	of the Internal Revenue Code. 
40.3 	(c) "Tentative minimum tax" equals 6.4 percent of alternative minimum taxable 
40.4 	income after subtracting the exemption amount determined under subdivision 3. 
40.5 	(d) "Regular tax" means the tax that would be imposed under this chapter (without 
40.6 	regard to this section and section 290.032), reduced by the sum of the nonrefundable 
40.7 	credits allowed under this chapter. 
40.8 	(e) "Net minimum tax" means the minimum tax imposed by this section. 

40.9 	EFFECTIVE DATE. This section is effective for taxable years beginning after 
40.10 	December 31, 2007.

40.11 	Sec. 13. Minnesota Statutes 2006, section 290.191, subdivision 5, is amended to read:
40.12 		Subd. 5.Determination of sales factor. For purposes of this section, the following 
40.13 	rules apply in determining the sales factor.
40.14 	(a) The sales factor includes all sales, gross earnings, or receipts received in the 
40.15 	ordinary course of the business, except that the following types of income are not included 
40.16 	in the sales factor:
40.17 	(1) interest;
40.18 	(2) dividends;
40.19 	(3) sales of capital assets as defined in section 1221 of the Internal Revenue Code;
40.20 	(4) sales of property used in the trade or business, except sales of leased property of 
40.21 	a type which is regularly sold as well as leased;
40.22 	(5) sales of debt instruments as defined in section 1275(a)(1) of the Internal Revenue 
40.23 	Code or sales of stock; and
40.24 	(6) royalties, fees, or other like income of a type which qualify for a subtraction from 
40.25 	federal taxable income under section 290.01, subdivision 19d(10). 
40.26 	(b) Sales of tangible personal property are made within this state if the property is 
40.27 	received by a purchaser at a point within this state, and the taxpayer is taxable in this state, 
40.28 	regardless of the f.o.b. point, other conditions of the sale, or the ultimate destination 
40.29 	of the property.
40.30 	(c) Tangible personal property delivered to a common or contract carrier or foreign 
40.31 	vessel for delivery to a purchaser in another state or nation is a sale in that state or nation, 
40.32 	regardless of f.o.b. point or other conditions of the sale.
40.33 	(d) Notwithstanding paragraphs (b) and (c), when intoxicating liquor, wine, 
40.34 	fermented malt beverages, cigarettes, or tobacco products are sold to a purchaser who is 
41.1 	licensed by a state or political subdivision to resell this property only within the state of 
41.2 	ultimate destination, the sale is made in that state.
41.3 	(e) Sales made by or through a corporation that is qualified as a domestic 
41.4 	international sales corporation under section 992 of the Internal Revenue Code are not 
41.5 	considered to have been made within this state.
41.6 	(f) Sales, rents, royalties, and other income in connection with real property is 
41.7 	attributed to the state in which the property is located.
41.8 	(g) Receipts from the lease or rental of tangible personal property, including finance 
41.9 	leases and true leases, must be attributed to this state if the property is located in this 
41.10 	state and to other states if the property is not located in this state. Receipts from the 
41.11 	lease or rental of moving property including, but not limited to, motor vehicles, rolling 
41.12 	stock, aircraft, vessels, or mobile equipment are included in the numerator of the receipts 
41.13 	factor to the extent that the property is used in this state. The extent of the use of moving 
41.14 	property is determined as follows:
41.15 	(1) A motor vehicle is used wholly in the state in which it is registered.
41.16 	(2) The extent that rolling stock is used in this state is determined by multiplying 
41.17 	the receipts from the lease or rental of the rolling stock by a fraction, the numerator of 
41.18 	which is the miles traveled within this state by the leased or rented rolling stock and the 
41.19 	denominator of which is the total miles traveled by the leased or rented rolling stock.
41.20 	(3) The extent that an aircraft is used in this state is determined by multiplying the 
41.21 	receipts from the lease or rental of the aircraft by a fraction, the numerator of which is 
41.22 	the number of landings of the aircraft in this state and the denominator of which is the 
41.23 	total number of landings of the aircraft.
41.24 	(4) The extent that a vessel, mobile equipment, or other mobile property is used in 
41.25 	the state is determined by multiplying the receipts from the lease or rental of the property 
41.26 	by a fraction, the numerator of which is the number of days during the taxable year the 
41.27 	property was in this state and the denominator of which is the total days in the taxable year.
41.28 	(h) Royalties and other income not described in paragraph (a), clause (6), received 
41.29 	for the use of or for the privilege of using intangible property, including patents, 
41.30 	know-how, formulas, designs, processes, patterns, copyrights, trade names, service names, 
41.31 	franchises, licenses, contracts, customer lists, or similar items, must be attributed to the 
41.32 	state in which the property is used by the purchaser. If the property is used in more 
41.33 	than one state, the royalties or other income must be apportioned to this state pro rata 
41.34 	according to the portion of use in this state. If the portion of use in this state cannot be 
41.35 	determined, the royalties or other income must be excluded from both the numerator 
41.36 	and the denominator. Intangible property is used in this state if the purchaser uses the 
42.1 	intangible property or the rights therein in the regular course of its business operations in 
42.2 	this state, regardless of the location of the purchaser's customers.
42.3 	(i) Sales of intangible property are made within the state in which the property is 
42.4 	used by the purchaser. If the property is used in more than one state, the sales must be 
42.5 	apportioned to this state pro rata according to the portion of use in this state. If the 
42.6 	portion of use in this state cannot be determined, the sale must be excluded from both the 
42.7 	numerator and the denominator of the sales factor. Intangible property is used in this 
42.8 	state if the purchaser used the intangible property in the regular course of its business 
42.9 	operations in this state.
42.10 	(j) Receipts from the performance of services must be attributed to the state where 
42.11 	the services are received. For the purposes of this section, receipts from the performance 
42.12 	of services provided to a corporation, partnership, or trust may only be attributed to a state 
42.13 	where it has a fixed place of doing business. If the state where the services are received is 
42.14 	not readily determinable or is a state where the corporation, partnership, or trust receiving 
42.15 	the service does not have a fixed place of doing business, the services shall be deemed 
42.16 	to be received at the location of the office of the customer from which the services were 
42.17 	ordered in the regular course of the customer's trade or business. If the ordering office 
42.18 	cannot be determined, the services shall be deemed to be received at the office of the 
42.19 	customer to which the services are billed.
42.20 	(k) For the purposes of this subdivision and subdivision 6, paragraph (l), receipts 
42.21 	from management, distribution, or administrative services performed by a corporation 
42.22 	or trust for a fund of a corporation or trust regulated under United States Code, title 15, 
42.23 	sections 80a-1 through 80a-64, must be attributed to the state where the shareholder of 
42.24 	the fund resides. Under this paragraph, receipts for services attributed to shareholders are 
42.25 	determined on the basis of the ratio of: (1) the average of the outstanding shares in the 
42.26 	fund owned by shareholders residing within Minnesota at the beginning and end of each 
42.27 	year; and (2) the average of the total number of outstanding shares in the fund at the 
42.28 	beginning and end of each year. Residence of the shareholder, in the case of an individual, 
42.29 	is determined by the mailing address furnished by the shareholder to the fund. Residence 
42.30 	of the shareholder, when the shares are held by an insurance company as a depositor for 
42.31 	the insurance company policyholders, is the mailing address of the policyholders. In 
42.32 	the case of an insurance company holding the shares as a depositor for the insurance 
42.33 	company policyholders, if the mailing address of the policyholders cannot be determined 
42.34 	by the taxpayer, the receipts must be excluded from both the numerator and denominator. 
42.35 	Residence of other shareholders is the mailing address of the shareholder.

43.1 	EFFECTIVE DATE. This section is effective for taxable years beginning after 
43.2 	December 31, 2009.

43.3 	Sec. 14. Minnesota Statutes 2006, section 290.191, subdivision 6, is amended to read:
43.4 		Subd. 6.Determination of receipts factor for financial institutions. (a) For 
43.5 	purposes of this section, the rules in this subdivision and subdivisionsubdivisions 5, 
43.6 	paragraph (k), and 8 apply in determining the receipts factor for financial institutions.
43.7 	(b) "Receipts" for this purpose means gross income, including net taxable gain on 
43.8 	disposition of assets, including securities and money market instruments, when derived 
43.9 	from transactions and activities in the regular course of the taxpayer's trade or business.
43.10 	(c) "Money market instruments" means federal funds sold and securities purchased 
43.11 	under agreements to resell, commercial paper, banker's acceptances, and purchased 
43.12 	certificates of deposit and similar instruments to the extent that the instruments are 
43.13 	reflected as assets under generally accepted accounting principles.
43.14 	(d) "Securities" means United States Treasury securities, obligations of United States 
43.15 	government agencies and corporations, obligations of state and political subdivisions, 
43.16 	corporate stock, bonds, and other securities, participations in securities backed by 
43.17 	mortgages held by United States or state government agencies, loan-backed securities and 
43.18 	similar investments to the extent the investments are reflected as assets under generally 
43.19 	accepted accounting principles.
43.20 	(e) Receipts from the lease or rental of real or tangible personal property, including 
43.21 	both finance leases and true leases, must be attributed to this state if the property is 
43.22 	located in this state. Receipts from the lease or rental of tangible personal property that is 
43.23 	characteristically moving property, including, but not limited to, motor vehicles, rolling 
43.24 	stock, aircraft, vessels, or mobile equipment are included in the numerator of the receipts 
43.25 	factor to the extent that the property is used in this state. The extent of the use of moving 
43.26 	property is determined as follows:
43.27 	(1) A motor vehicle is used wholly in the state in which it is registered.
43.28 	(2) The extent that rolling stock is used in this state is determined by multiplying 
43.29 	the receipts from the lease or rental of the rolling stock by a fraction, the numerator of 
43.30 	which is the miles traveled within this state by the leased or rented rolling stock and the 
43.31 	denominator of which is the total miles traveled by the leased or rented rolling stock.
43.32 	(3) The extent that an aircraft is used in this state is determined by multiplying the 
43.33 	receipts from the lease or rental of the aircraft by a fraction, the numerator of which is 
43.34 	the number of landings of the aircraft in this state and the denominator of which is the 
43.35 	total number of landings of the aircraft.
44.1 	(4) The extent that a vessel, mobile equipment, or other mobile property is used in 
44.2 	the state is determined by multiplying the receipts from the lease or rental of property by a 
44.3 	fraction, the numerator of which is the number of days during the taxable year the property 
44.4 	was in this state and the denominator of which is the total days in the taxable year.
44.5 	(f) Interest income and other receipts from assets in the nature of loans that are 
44.6 	secured primarily by real estate or tangible personal property must be attributed to this state 
44.7 	if the security property is located in this state under the principles stated in paragraph (e).
44.8 	(g) Interest income and other receipts from consumer loans not secured by real or 
44.9 	tangible personal property that are made to residents of this state, whether at a place 
44.10 	of business, by traveling loan officer, by mail, by telephone or other electronic means, 
44.11 	must be attributed to this state.
44.12 	(h) Interest income and other receipts from commercial loans and installment 
44.13 	obligations that are unsecured by real or tangible personal property or secured by 
44.14 	intangible property must be attributed to this state if the proceeds of the loan are to be 
44.15 	applied in this state. If it cannot be determined where the funds are to be applied, the 
44.16 	income and receipts are attributed to the state in which the office of the borrower from 
44.17 	which the application would be made in the regular course of business is located. If this 
44.18 	cannot be determined, the transaction is disregarded in the apportionment formula.
44.19 	(i) Interest income and other receipts from a participating financial institution's 
44.20 	portion of participation and syndication loans must be attributed under paragraphs (e) to 
44.21 	(h). A participation loan is an arrangement in which a lender makes a loan to a borrower 
44.22 	and then sells, assigns, or otherwise transfers all or a part of the loan to a purchasing 
44.23 	financial institution. A syndication loan is a loan transaction involving multiple financial 
44.24 	institutions in which all the lenders are named as parties to the loan documentation, are 
44.25 	known to the borrower, and have privity of contract with the borrower.
44.26 	(j) Interest income and other receipts including service charges from financial 
44.27 	institution credit card and travel and entertainment credit card receivables and credit 
44.28 	card holders' fees must be attributed to the state to which the card charges and fees are 
44.29 	regularly billed.
44.30 	(k) Merchant discount income derived from financial institution credit card holder 
44.31 	transactions with a merchant must be attributed to the state in which the merchant is 
44.32 	located. In the case of merchants located within and outside the state, only receipts from 
44.33 	merchant discounts attributable to sales made from locations within the state are attributed 
44.34 	to this state. It is presumed, subject to rebuttal, that the location of a merchant is the 
44.35 	address shown on the invoice submitted by the merchant to the taxpayer.
45.1 	(l) Receipts from the performance of fiduciary and other services must be attributed 
45.2 	to the state in which the services are received. For the purposes of this section, services 
45.3 	provided to a corporation, partnership, or trust must be attributed to a state where it has a 
45.4 	fixed place of doing business. If the state where the services are received is not readily 
45.5 	determinable or is a state where the corporation, partnership, or trust does not have a fixed 
45.6 	place of doing business, the services shall be deemed to be received at the location of the 
45.7 	office of the customer from which the services were ordered in the regular course of the 
45.8 	customer's trade or business. If the ordering office cannot be determined, the services shall 
45.9 	be deemed to be received at the office of the customer to which the services are billed.
45.10 	(m) Receipts from the issuance of travelers checks and money orders must be 
45.11 	attributed to the state in which the checks and money orders are purchased.
45.12 	(n) Receipts from investments of a financial institution in securities and from money 
45.13 	market instruments must be apportioned to this state based on the ratio that total deposits 
45.14 	from this state, its residents, including any business with an office or other place of 
45.15 	business in this state, its political subdivisions, agencies, and instrumentalities bear to the 
45.16 	total deposits from all states, their residents, their political subdivisions, agencies, and 
45.17 	instrumentalities. In the case of an unregulated financial institution subject to this section, 
45.18 	these receipts are apportioned to this state based on the ratio that its gross business income, 
45.19 	excluding such receipts, earned from sources within this state bears to gross business 
45.20 	income, excluding such receipts, earned from sources within all states. For purposes 
45.21 	of this subdivision, deposits made by this state, its residents, its political subdivisions, 
45.22 	agencies, and instrumentalities must be attributed to this state, whether or not the deposits 
45.23 	are accepted or maintained by the taxpayer at locations within this state.
45.24 	(o) A financial institution's interest in property described in section 290.015, 
45.25 	subdivision 3, paragraph (b), is included in the receipts factor in the same manner as assets 
45.26 	in the nature of securities or money market instruments are included in paragraph (n). 

45.27 	EFFECTIVE DATE. This section is effective for taxable years beginning after 
45.28 	December 31, 2009.

45.29 	Sec. 15. Minnesota Statutes 2006, section 291.03, subdivision 1, is amended to read:
45.30 		Subdivision 1.Tax amount. (a) The tax imposed shall be an amount equal to the 
45.31 	proportion of the maximum credit for state death taxes computed under section 2011 of 
45.32 	the Internal Revenue Code, as amended through December 31, 2000, but using Minnesota 
45.33 	adjusted taxable estate instead of federal adjusted taxable estate, as the Minnesota gross 
45.34 	estate bears to the value of the federal gross estate. The tax determined under this 
45.35 	paragraph shall not be greater than the amount computed by applying the rates and 
46.1 	brackets under section 2001(c) of the Internal Revenue Code to the Minnesota adjusted 
46.2 	gross estate and subtracting the federal credit allowed under section 2010 of the Internal 
46.3 	Revenue Code of 1986, as amended through December 31, 2000. For the purposes of 
46.4 	this section, expenses which are deducted for federal income tax purposes under section 
46.5 	642(g) of the Internal Revenue Code as amended through December 31, 2002, are not 
46.6 	allowable in computing the tax under this chapter.
46.7 	(b) The tax determined under this subdivision must not be greater than the sum of 
46.8 	the following amounts multiplied by a fraction, the numerator of which is the Minnesota 
46.9 	gross estate and the denominator of which is the federal gross estate:
46.10 	(1) the rates and brackets under section 2001(c) of the Internal Revenue Code 
46.11 	multiplied by the sum of:
46.12 	(A) the taxable estate, as defined under section 2051 of the Internal Revenue Code; 
46.13 	plus
46.14 	(B) adjusted taxable gifts, as defined in section 2001(b) of the Internal Revenue 
46.15 	Code; less
46.16 	(2) the amount of tax allowed under section 2001(b)(2) of the Internal Revenue 
46.17 	Code; and less
46.18 	(3) the federal credit allowed under section 2010 of the Internal Revenue Code.
46.19 	(c) For purposes of this subdivision, "Internal Revenue Code" means the Internal 
46.20 	Revenue Code of 1986, as amended through December 31, 2000.

46.21 	EFFECTIVE DATE. This section is effective for estates of decedents dying after 
46.22 	December 31, 2005.

46.23 	Sec. 16. Minnesota Statutes 2006, section 291.03, is amended by adding a subdivision 
46.24 	to read:
46.25 		Subd. 1a.Expenses disallowed. For the purposes of this section, expenses which 
46.26 	are deducted for federal income tax purposes under section 642(g) of the Internal Revenue 
46.27 	Code are not allowable in computing the tax under this chapter.

46.28 	EFFECTIVE DATE. This section is effective for estates of decedents dying after 
46.29 	December 31, 2005.

46.30 	Sec. 17. Laws 2008, chapter 154, article 3, section 3, the effective date, is amended to 
46.31 	read:

46.32 	EFFECTIVE DATE. This section is effective for tax years beginning after 
46.33 	December 31, 2007, except that clause (11) and the phrase "to the extent included in 
47.1 	federal taxable income," added in clause (12) are effective retroactively for taxable years 
47.2 	beginning after December 31, 2004.

47.3 	ARTICLE 5
47.4 	LOCAL DEVELOPMENT

47.5 	Section 1. [116J.8732] SEED CAPITAL INVESTMENT CREDIT; 
47.6 	COMMISSIONER'S RESPONSIBILITIES.
47.7 		Subdivision 1.Scope. This section establishes rules that businesses must satisfy to 
47.8 	qualify for the seed capital investment credit under section 290.06, subdivision 34, and the 
47.9 	commissioner's responsibility for certifying the qualifying businesses. 
47.10 		Subd. 2.Definitions. (a) For purposes of this section and section 290.06, 
47.11 	subdivision 34, the following terms have the meanings given.
47.12 	(b) "Border city" means a city qualifying to designate a border city development 
47.13 	zone under section 469.1731.
47.14 	(c) "Pass-through entity" means a corporation that for the applicable tax year is 
47.15 	treated as an S corporation or a general partnership, limited partnership, limited liability 
47.16 	partnership, trust, or limited liability company and which for the applicable taxable year is 
47.17 	not taxed as a corporation under chapter 290.
47.18 	(d) "Primary sector business" means a qualified business that through the 
47.19 	employment of knowledge or labor adds value to a product, process, or service and 
47.20 	increases revenues to a Minnesota business generated by sales of products or services to 
47.21 	customers outside of the state or increases revenues to a qualified business the customers 
47.22 	of which previously were unable to acquire, or had limited availability of the product or 
47.23 	service from a Minnesota provider.
47.24 	(e) "Qualified business" means a business certified by the commissioner as meeting 
47.25 	the requirements of subdivision 3.
47.26 		Subd. 3.Qualified business. (a) The commissioner shall certify whether a business 
47.27 	that has requested to become a qualified business meets the requirements of paragraph (b).
47.28 	(b) For purposes of this section, a qualified business must be a primary sector 
47.29 	business, other than a real estate investment trust, that:
47.30 	(1) is incorporated or its satellite operation is incorporated as a for-profit corporation 
47.31 	or is a partnership, limited partnership, limited liability company, limited liability 
47.32 	partnership, or joint venture;
47.33 	(2) is in compliance with the requirements for filings with the commissioner of 
47.34 	commerce under the securities laws of this state;
48.1 	(3) has Minnesota residents as a majority of its employees in its principal office or 
48.2 	the satellite operation, which is located in a border city;
48.3 	(4) has its principal office in a border city and has the majority of its business 
48.4 	activity performed in a border city, except sales activity, or has a significant operation in 
48.5 	a border city that has or is projected to have more than ten employees or $150,000 of 
48.6 	sales annually; and
48.7 	(5) relies on innovation, research, or the development of new products and processes 
48.8 	in its plans for growth and profitability.
48.9 	(c) The commissioner shall establish the necessary forms and procedures for 
48.10 	certifying qualified businesses.
48.11 	(d) A qualified business may apply to the commissioner for a recertification. Only 
48.12 	one recertification is available to a qualified business. The application for recertification 
48.13 	must be filed with the commissioner within 90 days before the original certification 
48.14 	expiration date. The recertification issued by the director must comply with the provisions 
48.15 	of paragraph (e).
48.16 	(e) The commissioner shall issue a certification letter to a business the commissioner 
48.17 	determines is a qualified business. The certification letter must include:
48.18 	(1) the certification effective date; and
48.19 	(2) the certification expiration date, which may not be more than four years from the 
48.20 	certification effective date.
48.21 		Subd. 4.Seed capital investment credit reporting. Within 30 days after the date 
48.22 	that an investment in a qualified business is purchased, the qualified business shall file with 
48.23 	the commissioner and the commissioner of revenue and provide to the investor completed 
48.24 	forms prescribed by the commissioner of revenue that show as to each investment in the 
48.25 	qualified business the following:
48.26 	(1) the name, address, and Social Security number of the taxpayer who made the 
48.27 	investment; and
48.28 	(2) the dollar amount paid for the investment by the taxpayer.

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

48.30 	Sec. 2. Minnesota Statutes 2006, section 116J.993, subdivision 3, is amended to read:
48.31 		Subd. 3.Business subsidy. "Business subsidy" or "subsidy" means a state or local 
48.32 	government agency grant, contribution of personal property, real property, infrastructure, 
48.33 	the principal amount of a loan at rates below those commercially available to the recipient, 
48.34 	any reduction or deferral of any tax or any fee, any guarantee of any payment under any 
49.1 	loan, lease, or other obligation, or any preferential use of government facilities given 
49.2 	to a business.
49.3 	The following forms of financial assistance are not a business subsidy:
49.4 	(1) a business subsidy of less than $25,000 $150,000;
49.5 	(2) assistance that is generally available to all businesses or to a general class of 
49.6 	similar businesses, such as a line of business, size, location, or similar general criteria;
49.7 	(3) public improvements to buildings or lands owned by the state or local 
49.8 	government that serve a public purpose and do not principally benefit a single business or 
49.9 	defined group of businesses at the time the improvements are made;
49.10 	(4) redevelopment property polluted by contaminants as defined in section 116J.552, 
49.11 	subdivision 3; 
49.12 	(5) assistance provided for the sole purpose of renovating old or decaying building 
49.13 	stock or bringing it up to code and assistance provided for designated historic preservation 
49.14 	districts, provided that the assistance is equal to or less than 50 percent of the total cost;
49.15 	(6) assistance to provide job readiness and training services if the sole purpose of 
49.16 	the assistance is to provide those services;
49.17 	(7) assistance for housing;
49.18 	(8) assistance for pollution control or abatement, including assistance for a tax 
49.19 	increment financing hazardous substance subdistrict as defined under section 469.174, 
49.20 	subdivision 23; 
49.21 	(9) assistance for energy conservation;
49.22 	(10) tax reductions resulting from conformity with federal tax law;
49.23 	(11) workers' compensation and unemployment insurance;
49.24 	(12) benefits derived from regulation;
49.25 	(13) indirect benefits derived from assistance to educational institutions;
49.26 	(14) funds from bonds allocated under chapter 474A, bonds issued to refund 
49.27 	outstanding bonds, and bonds issued for the benefit of an organization described in section 
49.28 	501(c)(3) of the Internal Revenue Code of 1986, as amended through December 31, 1999;
49.29 	(15) assistance for a collaboration between a Minnesota higher education institution 
49.30 	and a business;
49.31 	(16) assistance for a tax increment financing soils condition district as defined under 
49.32 	section 469.174, subdivision 19; 
49.33 	(17) redevelopment when the recipient's investment in the purchase of the site and in 
49.34 	site preparation is 70 percent or more of the assessor's current year's estimated market 
49.35 	value;
50.1 	(18) general changes in tax increment financing law and other general tax law 
50.2 	changes of a principally technical nature;
50.3 	(19) federal assistance until the assistance has been repaid to, and reinvested by, the 
50.4 	state or local government agency;
50.5 	(20) funds from dock and wharf bonds issued by a seaway port authority;
50.6 	(21) business loans and loan guarantees of $75,000$150,000 or less; 
50.7 	(22) federal loan funds provided through the United States Department of 
50.8 	Commerce, Economic Development Administration; and
50.9 	(23) property tax abatements granted under section 469.1813 to property that is 
50.10 	subject to valuation under Minnesota Rules, chapter 8100.

50.11 	Sec. 3. Minnesota Statutes 2006, section 116J.994, subdivision 2, is amended to read:
50.12 		Subd. 2.Developing a set of criteria. A business subsidy may not be granted until 
50.13 	the grantor has adopted criteria after a public hearing for awarding business subsidies 
50.14 	that comply with this section. The criteria may not be adopted on a case-by-case basis. 
50.15 	The criteria must set specific minimum requirements that recipients must meet in order 
50.16 	to be eligible to receive business subsidies. The criteria must include a specific wage 
50.17 	floor for the wages to be paid for the jobs created. The wage floor may be stated as a 
50.18 	specific dollar amount or may be stated as a formula that will generate a specific dollar 
50.19 	amount. A grantor may deviate from its criteria by documenting in writing the reason 
50.20 	for the deviation and attaching a copy of the document to its next annual report to the 
50.21 	department. The commissioner of employment and economic development may assist 
50.22 	local government agencies in developing criteria. A copy of the criteria must be submitted 
50.23 	to the Department of Employment and Economic Development along with the first annual 
50.24 	report following the enactment of this section or with the first annual report after it has 
50.25 	adopted criteria, whichever is earlier. Notwithstanding section 116J.993, subdivision 3, 
50.26 	clauses (1) and (21), for the purpose of this subdivision, "business subsidies" as defined 
50.27 	under section 116J.993 includes the following forms of financial assistance:
50.28 	(1) a business subsidy of $25,000 or more; and
50.29 	(2) business loans and guarantees of $75,000 or more.

50.30 	Sec. 4. Minnesota Statutes 2006, section 116J.994, subdivision 5, is amended to read:
50.31 		Subd. 5.Public notice and hearing. (a) Before granting a business subsidy that 
50.32 	exceeds $500,000 for a state government grantor and $100,000$150,000 for a local 
50.33 	government grantor, the grantor must provide public notice and a hearing on the subsidy. 
51.1 	A public hearing and notice under this subdivision is not required if a hearing and notice 
51.2 	on the subsidy is otherwise required by law.
51.3 	(b) Public notice of a proposed business subsidy under this subdivision by a state 
51.4 	government grantor, other than the Iron Range Resources and Rehabilitation Board, must 
51.5 	be published in the State Register. Public notice of a proposed business subsidy under this 
51.6 	subdivision by a local government grantor or the Iron Range Resources and Rehabilitation 
51.7 	Board must be published in a local newspaper of general circulation. The public notice 
51.8 	must identify the location at which information about the business subsidy, including a 
51.9 	summary of the terms of the subsidy, is available. Published notice should be sufficiently 
51.10 	conspicuous in size and placement to distinguish the notice from the surrounding text. 
51.11 	The grantor must make the information available in printed paper copies and, if possible, 
51.12 	on the Internet. The government agency must provide at least a ten-day notice for the 
51.13 	public hearing.
51.14 	(c) The public notice must include the date, time, and place of the hearing.
51.15 	(d) The public hearing by a state government grantor other than the Iron Range 
51.16 	Resources and Rehabilitation Board must be held in St. Paul.
51.17 	(e) If more than one nonstate grantor provides a business subsidy to the same 
51.18 	recipient, the nonstate grantors may designate one nonstate grantor to hold a single 
51.19 	public hearing regarding the business subsidies provided by all nonstate grantors. For 
51.20 	the purposes of this paragraph, "nonstate grantor" includes the iron range resources and 
51.21 	rehabilitation board.
51.22 	(f) The public notice of any public meeting about a business subsidy agreement, 
51.23 	including those required by this subdivision and by subdivision 4, must include notice that 
51.24 	a person with residence in or the owner of taxable property in the granting jurisdiction 
51.25 	may file a written complaint with the grantor if the grantor fails to comply with sections 
51.26 	116J.993 to 116J.995, and that no action may be filed against the grantor for the failure to 
51.27 	comply unless a written complaint is filed.

51.28 	Sec. 5. Minnesota Statutes 2006, section 116J.994, subdivision 8, is amended to read:
51.29 		Subd. 8.Reports by grantors. (a) Local government agencies of a local 
51.30 	government with a population of more than 2,500 and state government agencies, 
51.31 	regardless of whether or not they have awarded any business subsidies, must file a report 
51.32 	by April 1 of each year with the commissioner. Local government agencies of a local 
51.33 	government with a population of 2,500 or less are exempt from filing this report if they 
51.34 	have not awarded a business subsidy in the past five years. The report must include a list 
51.35 	of recipients that did not complete the recipient report required under subdivision 7 and a 
52.1 	list of recipients that have not met their job and wage goals within two years and the steps 
52.2 	being taken to bring them into compliance or to recoup the subsidy.
52.3 	If the commissioner has not received the report by April 1 from an entity required 
52.4 	to report, the commissioner shall issue a warning to the government agency. If the 
52.5 	commissioner has still not received the report by June 1 of that same year from an entity 
52.6 	required to report, then that government agency may not award any business subsidies 
52.7 	until the report has been filed.
52.8 	(b) The report required under paragraph (a) is also required for financial assistance 
52.9 	of $25,000 and greater that is excluded from the definition of "business subsidy" by 
52.10 	section 116J.993, subdivision 3, clause (1), and of $75,000 and greater that is excluded 
52.11 	from the definition of "business subsidy" by section 116J.993, subdivision 3, clause (21). 
52.12 	The report for the financial assistance under this paragraph must be completed within one 
52.13 	year of the granting of the financial assistance. The report required for financial assistance 
52.14 	under this paragraph must include:
52.15 	(1) the name of the recipient, its organizational structure, its address and contact 
52.16 	information, and its industry sector;
52.17 	(2) a description of the amount and use of the financial assistance and the total 
52.18 	project budget, including a list of all financial assistance by all grantors for the project and 
52.19 	the private sources of financial assistance;
52.20 	(3) the public purpose of the financial assistance, the job goals associated with both 
52.21 	the financial assistance and the total project in which the financial assistance is included, 
52.22 	the hourly wage of each job created, and the cost of health insurance provided by the 
52.23 	employer;
52.24 	(4) the date the project will be completed;
52.25 	(5) the name and address of the parent corporation of the recipient, if any; and
52.26 	(6) any other information the commissioner may request.
52.27 	(c) Within one year of completing a report under paragraph (b), the local government 
52.28 	agency must report to the commissioner on progress in achieving the purposes and goals 
52.29 	under clause (3).
52.30 	(d) The commissioner of employment and economic development must provide 
52.31 	information on reporting requirements to state and local government agencies.

52.32 	Sec. 6. Minnesota Statutes 2007 Supplement, section 268.19, subdivision 1, as 
52.33 	amended by Laws 2008, chapter 315, section 16, is amended to read:
52.34 		Subdivision 1. Use of data. (a) Except as provided by this section, data gathered 
52.35 	from any person under the administration of the Minnesota Unemployment Insurance Law 
53.1 	are private data on individuals or nonpublic data not on individuals as defined in section 
53.2 	13.02, subdivisions 9 and 12, and may not be disclosed except according to a district court 
53.3 	order or section 13.05. A subpoena is not considered a district court order. These data 
53.4 	may be disseminated to and used by the following agencies without the consent of the 
53.5 	subject of the data: 
53.6 	(1) state and federal agencies specifically authorized access to the data by state 
53.7 	or federal law; 
53.8 	(2) any agency of any other state or any federal agency charged with the 
53.9 	administration of an unemployment insurance program; 
53.10 	(3) any agency responsible for the maintenance of a system of public employment 
53.11 	offices for the purpose of assisting individuals in obtaining employment; 
53.12 	(4) the public authority responsible for child support in Minnesota or any other 
53.13 	state in accordance with section 256.978; 
53.14 	(5) human rights agencies within Minnesota that have enforcement powers; 
53.15 	(6) the Department of Revenue to the extent necessary for its duties under Minnesota 
53.16 	laws; 
53.17 	(7) public and private agencies responsible for administering publicly financed 
53.18 	assistance programs for the purpose of monitoring the eligibility of the program's 
53.19 	recipients; 
53.20 	(8) the Department of Labor and Industry and the Division of Insurance Fraud 
53.21 	Prevention in the Department of Commerce for uses consistent with the administration of 
53.22 	their duties under Minnesota law; 
53.23 	(9) local and state welfare agencies for monitoring the eligibility of the data subject 
53.24 	for assistance programs, or for any employment or training program administered by those 
53.25 	agencies, whether alone, in combination with another welfare agency, or in conjunction 
53.26 	with the department or to monitor and evaluate the statewide Minnesota family investment 
53.27 	program by providing data on recipients and former recipients of food stamps or food 
53.28 	support, cash assistance under chapter 256, 256D, 256J, or 256K, child care assistance 
53.29 	under chapter 119B, or medical programs under chapter 256B, 256D, or 256L; 
53.30 	(10) local and state welfare agencies for the purpose of identifying employment, 
53.31 	wages, and other information to assist in the collection of an overpayment debt in an 
53.32 	assistance program; 
53.33 	(11) local, state, and federal law enforcement agencies for the purpose of ascertaining 
53.34 	the last known address and employment location of an individual who is the subject of 
53.35 	a criminal investigation; 
54.1 	(12) the United States Citizenship and Immigration Services has access to data on 
54.2 	specific individuals and specific employers provided the specific individual or specific 
54.3 	employer is the subject of an investigation by that agency; 
54.4 	(13) the Department of Health for the purposes of epidemiologic investigations; and
54.5 	(14) the Department of Corrections for the purpose of preconfinement and 
54.6 	postconfinement employment tracking of committed offenders for the purpose of case 
54.7 	planning.; and
54.8 	(15) the state auditor to the extent necessary to conduct audits of job opportunity 
54.9 	building zones as required under section 469.3201.
54.10 	(b) Data on individuals and employers that are collected, maintained, or used by 
54.11 	the department in an investigation under section 268.182 are confidential as to data 
54.12 	on individuals and protected nonpublic data not on individuals as defined in section 
54.13 	13.02, subdivisions 3 and 13, and must not be disclosed except under statute or district 
54.14 	court order or to a party named in a criminal proceeding, administrative or judicial, for 
54.15 	preparation of a defense. 
54.16 	(c) Data gathered by the department in the administration of the Minnesota 
54.17 	unemployment insurance program must not be made the subject or the basis for any 
54.18 	suit in any civil proceedings, administrative or judicial, unless the action is initiated by 
54.19 	the department. 

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

54.21 	Sec. 7. Minnesota Statutes 2006, section 270B.15, is amended to read:
54.22 	270B.15 DISCLOSURE TO LEGISLATIVE AUDITOR AND STATE 
54.23 	AUDITOR.
54.24 	(a) Returns and return information must be disclosed to the legislative auditor to the 
54.25 	extent necessary for the legislative auditor to carry out sections 3.97 to 3.979. 
54.26 	(b) The commissioner must disclose return information, including the report 
54.27 	required under section 289A.12, subdivision 15, to the state auditor to the extent necessary 
54.28 	to conduct audits of job opportunity building zones as required under section 469.3201.

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

54.30 	Sec. 8. Minnesota Statutes 2006, section 289A.12, is amended by adding a subdivision 
54.31 	to read:
54.32 		Subd. 15.Report of job opportunity zone benefits; penalty for failure to file 
54.33 	report. (a) By October 15 of each year, every qualified business, as defined under section 
55.1 	469.310, subdivision 11, must file with the commissioner, on a form prescribed by the 
55.2 	commissioner, a report listing the tax benefits under section 469.315 received by the 
55.3 	business for the previous year.
55.4 	(b) The commissioner shall send notice to each business that fails to timely submit 
55.5 	the report required under paragraph (a). The notice shall demand that the business submit 
55.6 	the report within 60 days. Where good cause exists, the commissioner may extend 
55.7 	the period for submitting the report as long as a request for extension is filed by the 
55.8 	business before the expiration of the 60-day period. The commissioner shall notify the 
55.9 	commissioner of the Department of Employment and Economic Development and the 
55.10 	appropriate job opportunity subzone administrator whenever notice is sent to a business 
55.11 	under this paragraph.
55.12 	(c) A business that fails to submit the report as required under paragraph (b) is no 
55.13 	longer a qualified business under section 469.310, subdivision 11, and is subject to the 
55.14 	repayment provisions of section 469.319.

55.15 	EFFECTIVE DATE. This section is effective beginning with reports required to be 
55.16 	filed October 15, 2008.

55.17 	Sec. 9. Minnesota Statutes 2006, section 290.06, is amended by adding a subdivision 
55.18 	to read:
55.19 		Subd. 35.Seed capital investment credit. (a) An individual, estate, or trust is 
55.20 	allowed a credit against the tax imposed by this chapter for investments in a qualifying 
55.21 	business certified under section 116J.8732, subdivision 3. The credit equals 45 percent 
55.22 	of the amount invested by the taxpayer in qualified businesses during the taxable year. 
55.23 	The credit must not exceed $112,500 for each taxable year. 
55.24 	(b) A pass-through entity that invests in a qualified business must be considered to 
55.25 	be the taxpayer for purposes of the investment limitations in this subdivision and the 
55.26 	amount of the credit allowed with respect to a pass-through entity's investment in a 
55.27 	qualified business must be determined at the pass-through entity level. The amount of the 
55.28 	total credit determined at the pass-through entity level must be allowed to the members in 
55.29 	proportion to their respective interests in the pass-through entity.
55.30 	(c) An investment made in a qualified business from the assets of a retirement 
55.31 	plan is deemed to be the retirement plan participant's investment for the purpose of this 
55.32 	subdivision if a separate account is maintained for the plan participant and the participant 
55.33 	directly controls where the account assets are invested.
55.34 	(d) The investment must be made on or after the certification effective date and 
55.35 	must be at risk in the business to be eligible for the tax credit under this subdivision. 
56.1 	An investment for which a credit is received under this subdivision must remain in the 
56.2 	qualified business for at least three years. Investments placed in escrow do not qualify 
56.3 	for the credit. 
56.4 	(e) The entire amount of an investment for which a credit is claimed under this 
56.5 	subdivision must be expended by the qualified business for plant, equipment, research and 
56.6 	development, marketing and sales activity, or working capital for the qualified business. 
56.7 	(f) A taxpayer who owns a controlling interest in the qualified business or who 
56.8 	receives more than 50 percent of the taxpayer's gross annual income from the qualified 
56.9 	business is not entitled to a credit under this subdivision. A member of the immediate 
56.10 	family of a taxpayer disqualified by this subdivision is not entitled to the credit under this 
56.11 	subdivision. For purposes of this subdivision, "immediate family" means the taxpayer's 
56.12 	spouse, parent, sibling, or child or the spouse of any such person.
56.13 	(g) The commissioner may disallow any credit otherwise allowed under this 
56.14 	subdivision if any representation by a business in the application for certification as a 
56.15 	qualified business proves to be false or if the taxpayer or qualified business fails to satisfy 
56.16 	any conditions under this subdivision or section 116J.8732 or any conditions consistent 
56.17 	with those requirements otherwise determined by the commissioner. The commissioner 
56.18 	has four years after the due date of the return or after the return was filed, whichever 
56.19 	period expires later, to audit the credit and assess additional tax that may be found due 
56.20 	to failure to comply with the provisions of this subdivision and section 116J.8732. The 
56.21 	amount of any credit disallowed by the commissioner that reduced the taxpayer's income 
56.22 	tax liability for any or all applicable tax years, plus penalty and interest as provided under 
56.23 	chapter 289A, must be paid by the taxpayer. 
56.24 	(h) If the amount of the credit under this subdivision for any taxable year exceeds 
56.25 	the limitations under paragraph (a), the excess is a credit carryover to each of the four 
56.26 	succeeding taxable years. The entire amount of the excess unused credit for the taxable 
56.27 	year must be carried first to the earliest of the taxable years to which the credit may be 
56.28 	carried. The amount of the unused credit that may be added under this paragraph may 
56.29 	not exceed the taxpayer's liability for tax, less the credit for the taxable year. Each year, 
56.30 	the aggregate amount of seed capital investment tax credit allowed for investments under 
56.31 	this subdivision is limited to allocations that a border city has available for tax reductions 
56.32 	in border city enterprise zones under section 469.169. The city must annually notify the 
56.33 	commissioner of the amount of its section 469.169 allocations that it wishes to use to 
56.34 	provide credits under this paragraph and the commissioner, after verifying the available 
56.35 	allocation, shall implement the limit under this paragraph. If investments in qualified 
56.36 	businesses reported to the commissioner exceed the limit on credits for investments 
57.1 	imposed by this subdivision, the credit must be allowed to taxpayers in the chronological 
57.2 	order of their investments in qualified businesses as determined from the forms filed 
57.3 	under section 116J.8732.

57.4 	EFFECTIVE DATE. This section is effective July 1, 2008, for taxable years 
57.5 	beginning after December 31, 2007, and only applies to investments made after the 
57.6 	qualified business has been certified by the commissioner of employment and economic 
57.7 	development.

57.8 	Sec. 10. Minnesota Statutes 2006, section 383E.20, is amended to read:
57.9 	383E.20 BONDING FOR COUNTY LIBRARY BUILDINGS.
57.10 	The Anoka County Board may, by resolution adopted by a four-sevenths vote, 
57.11 	issue and sell general obligation bonds of the county in the manner provided in chapter 
57.12 	475 to acquire, better, and construct county library buildings. The bonds shall not be 
57.13 	subject to the requirements of sections 475.57 to 475.59. The maturity years and amounts 
57.14 	and interest rates of each series of bonds shall be fixed so that the maximum amount of 
57.15 	principal and interest to become due in any year, on the bonds of that series and of all 
57.16 	outstanding series issued by or for the purposes of libraries, shall not exceed an amount 
57.17 	equal to the lesser of (i) .01 percent of the taxable market value of all taxable property in 
57.18 	the county, excluding any taxable property taxed by any city for the support of any free 
57.19 	public library, or (ii) $1,250,000. When the tax levy authorized in this section is collected, 
57.20 	it shall be appropriated and credited to a debt service fund for the bonds. The tax levy for 
57.21 	the debt service fund under section 475.61 shall be reduced by the amount available or 
57.22 	reasonably anticipated to be available in the fund to make payments otherwise payable 
57.23 	from the levy pursuant to section 475.61.

57.24 	EFFECTIVE DATE. This section is effective the day after the governing body 
57.25 	of Anoka County and its chief clerical officer timely complete their compliance with 
57.26 	Minnesota Statutes, section 645.021, subdivisions 2 and 3.

57.27 	Sec. 11. Minnesota Statutes 2006, section 469.033, subdivision 6, is amended to read:
57.28 		Subd. 6.Operation area as taxing district, special tax. All of the territory 
57.29 	included within the area of operation of any authority shall constitute a taxing district for 
57.30 	the purpose of levying and collecting special benefit taxes as provided in this subdivision. 
57.31 	All of the taxable property, both real and personal, within that taxing district shall be 
57.32 	deemed to be benefited by projects to the extent of the special taxes levied under this 
57.33 	subdivision. Subject to the consent by resolution of the governing body of the city in and 
58.1 	for which it was created, an authority may levy a tax upon all taxable property within that 
58.2 	taxing district. The tax shall be extended, spread, and included with and as a part of 
58.3 	the general taxes for state, county, and municipal purposes by the county auditor, to be 
58.4 	collected and enforced therewith, together with the penalty, interest, and costs. As the tax, 
58.5 	including any penalties, interest, and costs, is collected by the county treasurer it shall be 
58.6 	accumulated and kept in a separate fund to be known as the "housing and redevelopment 
58.7 	project fund." The money in the fund shall be turned over to the authority at the same time 
58.8 	and in the same manner that the tax collections for the city are turned over to the city, and 
58.9 	shall be expended only for the purposes of sections 469.001 to 469.047. It shall be paid 
58.10 	out upon vouchers signed by the chair of the authority or an authorized representative. 
58.11 	The amount of the levy shall be an amount approved by the governing body of the city, but 
58.12 	shall not exceed 0.0144 0.0185 percent of taxable market value for the current levy year, 
58.13 	notwithstanding section 273.032. The authority shall each year formulate and file a budget 
58.14 	in accordance with the budget procedure of the city in the same manner as required of 
58.15 	executive departments of the city or, if no budgets are required to be filed, by August 1. 
58.16 	The amount of the tax levy for the following year shall be based on that budget.

58.17 	EFFECTIVE DATE. This section is effective for property taxes payable in 2009.

58.18 	Sec. 12. Minnesota Statutes 2006, section 469.177, is amended by adding a subdivision 
58.19 	to read:
58.20 		Subd. 13.Correction of errors. (a) If the county auditor, as a result of an error 
58.21 	or mistake, decertifies a district, fails to certify a district, incorrectly certifies a district, 
58.22 	or otherwise fails to correctly compute the amount of increment, the county auditor may 
58.23 	undertake one or more of the following actions to correct the error or mistake:
58.24 	(1) certify the original tax capacity of the affected parcels at the appropriate value 
58.25 	for a later taxes payable year and extend the duration of the district, in whole or in part, 
58.26 	to compensate;
58.27 	(2) recertify the affected parcels and extend duration of the district, in whole or in 
58.28 	part, to compensate;
58.29 	(3) recertify or correct the original tax capacity rate for the district;
58.30 	(4) adjust the tax rates of one or more of the taxing districts imposing taxes in the tax 
58.31 	increment financing districts for one or more years to recoup amounts advanced by the 
58.32 	county or other entity to the authority to replace the reduced increments; or
58.33 	(5) take other appropriate action so that the amount of increment compensates for or 
58.34 	offsets the error or mistake and correctly reflects application of the law.
59.1 	(b) At least 30 days before exercising authority under this subdivision, the county 
59.2 	auditor must notify the authority and the municipality, in writing, of the intent to do so, 
59.3 	including supporting information to describe reason for the proposed action. The authority 
59.4 	and municipality may waive the time requirement of this paragraph. If the city or the 
59.5 	authority objects before expiration of the 30-day period, the matter must be submitted to 
59.6 	the commissioner of revenue for a decision or resolution of the dispute. The commissioner 
59.7 	of revenue shall consult with the Office of the State Auditor before making a decision.
59.8 	(c) The county auditor must notify the commissioner of revenue and the Office 
59.9 	of the State Auditor of corrections made under this subdivision. The notification must 
59.10 	be made in the form and manner and at the time prescribed by the commissioner. The 
59.11 	commissioner shall incorporate the corrections in the tax increment financing district tax 
59.12 	list supplement, as appropriate.

59.13 	EFFECTIVE DATE. This section is effective the day following final enactment 
59.14 	and applies to all tax increment financing districts, regardless of when the request for 
59.15 	certification was made or when the error occurred.

59.16 	Sec. 13. Minnesota Statutes 2006, section 469.319, is amended to read:
59.17 	469.319 REPAYMENT OF TAX BENEFITS BY BUSINESSES THAT NO 
59.18 	LONGER OPERATE IN A ZONE.
59.19 		Subdivision 1.Repayment obligation. A business must repay the amount of the
59.20 	total tax reductionbenefits listed in section 469.315and any refund under section 469.318
59.21 	in excess of tax liability, received during the two years immediately before it (1) ceased to 
59.22 	operate in the zone, if the business:
59.23 	(1) received tax reductions authorized by section 469.315; and
59.24 	(2)(i) did not meet the goals specified in an agreement entered into with the applicant 
59.25 	that states any obligation the qualified business must fulfill in order to be eligible for tax 
59.26 	benefits. The commissioner of employment and economic development may extend for 
59.27 	up to one year the period for meeting any goals provided in an agreement. The applicant 
59.28 	may extend the period for meeting other goals by documenting in writing the reason 
59.29 	for the extension and attaching a copy of the document to its next annual report to the 
59.30 	commissioner of employment and economic development; or
59.31 	(ii) ceased to operate its facility located within the job opportunity building zone
59.32 	perform a substantial level of activities described in the business subsidy agreement, or 
59.33 	(2) otherwise ceasesceased to be or is not a qualified business, other than those subject to 
59.34 	the provisions of section 469.3191.
60.1 		Subd. 1a.Repayment obligation of businesses not operating in zone. Persons 
60.2 	that receive benefits without operating a business in a zone are subject to repayment 
60.3 	under this section if the business for which those benefits relate is subject to repayment 
60.4 	under this section. Such persons are deemed to have ceased performing in the zone on 
60.5 	the same day that the qualified business for which the benefits relate becomes subject to 
60.6 	repayment under subdivision 1.
60.7 		Subd. 2.Definitions. (a) For purposes of this section, the following terms have 
60.8 	the meanings given.
60.9 	(b) "Business" means any person whothat received tax benefits enumerated in 
60.10 	section 469.315. 
60.11 	(c) "Commissioner" means the commissioner of revenue.
60.12 	(d) "Persons that receive benefits without operating a business in a zone" means 
60.13 	persons that claim benefits under section 469.316, subdivision 2 or 4, as well as persons 
60.14 	that own property leased by a qualified business and are eligible for benefits under section 
60.15 	272.02, subdivision 64, or 297A.68, subdivision 37, paragraph (b).
60.16 		Subd. 3.Disposition of repayment. The repayment must be paid to the state to 
60.17 	the extent it represents a state tax reduction and to the county to the extent it represents a 
60.18 	property tax reduction. Any amount repaid to the state must be deposited in the general 
60.19 	fund. Any amount repaid to the county for the property tax exemption must be distributed 
60.20 	to the local governments taxing authorities with authority to levy taxes in the zone in the 
60.21 	same manner provided for distribution of payment of delinquent property taxes. Any 
60.22 	repayment of local sales taxes must be repaid to the commissioner for distribution to the 
60.23 	city or county imposing the local sales tax.
60.24 		Subd. 4.Repayment procedures. (a) For the repayment of taxes imposed under 
60.25 	chapter 290 or 297A or local taxes collected pursuant to section 297A.99, a business must 
60.26 	file an amended return with the commissioner of revenue and pay any taxes required 
60.27 	to be repaid within 30 days after ceasing to do business in the zone becoming subject 
60.28 	to repayment under this section. The amount required to be repaid is determined by 
60.29 	calculating the tax for the period or periods for which repayment is required without 
60.30 	regard to the exemptions and credits allowed under section 469.315.
60.31 	(b) For the repayment of taxes imposed under chapter 297B, a business must pay any 
60.32 	taxes required to be repaid to the motor vehicle registrar, as agent for the commissioner 
60.33 	of revenue, within 30 days after ceasing to do business in the zone becoming subject 
60.34 	to repayment under this section.
60.35 	(c) For the repayment of property taxes, the county auditor shall prepare a tax 
60.36 	statement for the business, applying the applicable tax extension rates for each payable 
61.1 	year and provide a copy to the business and to the taxpayer of record. The business must 
61.2 	pay the taxes to the county treasurer within 30 days after receipt of the tax statement. 
61.3 	The business or the taxpayer of record may appeal the valuation and determination of the 
61.4 	property tax to the Tax Court within 30 days after receipt of the tax statement.
61.5 	(d) The provisions of chapters 270C and 289A relating to the commissioner's 
61.6 	authority to audit, assess, and collect the tax and to hear appeals are applicable to the 
61.7 	repayment required under paragraphs (a) and (b). The commissioner may impose civil 
61.8 	penalties as provided in chapter 289A, and the additional tax and penalties are subject to 
61.9 	interest at the rate provided in section 270C.40, from 30 days after ceasing to do business 
61.10 	in the job opportunity building zone becoming subject to repayment under this section
61.11 	until the date the tax is paid.
61.12 	(e) If a property tax is not repaid under paragraph (c), the county treasurer shall add 
61.13 	the amount required to be repaid to the property taxes assessed against the property for 
61.14 	payment in the year following the year in which the treasurer discovers that the business 
61.15 	ceased to operate in the job opportunity building zone auditor provided the statement 
61.16 	under paragraph (c).
61.17 	(f) For determining the tax required to be repaid, a tax reduction of a state or local 
61.18 	sales or use tax is deemed to have been received on the date that the tax would have 
61.19 	been due if the taxpayer had not been entitled to the exemption or on the date a refund 
61.20 	was issued for a refundable tax credit. good or service was purchased or first put to a 
61.21 	taxable use. In the case of an income tax or franchise tax, including the credit payable 
61.22 	under section 469.318, a reduction of tax is deemed to have been received for the two 
61.23 	most recent tax years that have ended prior to the date that the business became subject to 
61.24 	repayment under this section. In the case of a property tax, a reduction of tax is deemed to 
61.25 	have been received for the taxes payable in the year that the business became subject to 
61.26 	repayment under this section and for the taxes payable in the prior year.
61.27 	(g) The commissioner may assess the repayment of taxes under paragraph (d) 
61.28 	any time within two years after the business ceases to operate in the job opportunity 
61.29 	building zone becomes subject to repayment under subdivision 1, or within any period of 
61.30 	limitations for the assessment of tax under section 289A.38, whichever period is later. The 
61.31 	county auditor may send the statement under paragraph (c) any time within three years 
61.32 	after the business becomes subject to repayment under subdivision 1.
61.33 	(h) A business is not entitled to any income tax or franchise tax benefits, including 
61.34 	refundable credits, for any part of the year in which the business becomes subject to 
61.35 	repayment under this section nor for any year thereafter. Property is not exempt from tax 
61.36 	under section 272.02, subdivision 64, for any taxes payable in the year following the year 
62.1 	in which the property became subject to repayment under this section nor for any year 
62.2 	thereafter. A business is not eligible for any sales tax benefits beginning with goods 
62.3 	or services purchased or first put to a taxable use on the day that the business becomes 
62.4 	subject to repayment under this section.
62.5 		Subd. 5.Waiver authority. (a) The commissioner may waive all or part of a 
62.6 	repayment required under subdivision 1, if the commissioner, in consultation with 
62.7 	the commissioner of employment and economic development and appropriate officials 
62.8 	from the local government units in which the qualified business is located, determines 
62.9 	that requiring repayment of the tax is not in the best interest of the state or the local 
62.10 	government units and the business ceased operating as a result of circumstances beyond 
62.11 	its control including, but not limited to:
62.12 	(1) a natural disaster;
62.13 	(2) unforeseen industry trends; or
62.14 	(3) loss of a major supplier or customer.
62.15 	(b)(1) The commissioner shall waive repayment required under subdivision 1a if 
62.16 	the commissioner has waived repayment by the operating business under subdivision 1, 
62.17 	unless the person that received benefits without having to operate a business in the zone 
62.18 	was a contributing factor in the qualified business becoming subject to repayment under 
62.19 	subdivision 1; 
62.20 	(2) the commissioner shall waive the repayment required under subdivision 1a, even 
62.21 	if the repayment has not been waived for the operating business if:
62.22 	(i) the person that received benefits without having to operate a business in the zone 
62.23 	and the business that operated in the zone are not related parties as defined in section 
62.24 	267(b) of the Internal Revenue Code of 1986, as amended through December 31, 2007; and
62.25 	(ii) actions of the person were not a contributing factor in the qualified business 
62.26 	becoming subject to repayment under subdivision 1.
62.27 		Subd. 6.Reconciliation. Where this section is inconsistent with section 116J.994, 
62.28 	subdivision 3, paragraph (e), or 6, or any other provisions of sections 116J.993 to 
62.29 	116J.995, this section prevails.

62.30 	EFFECTIVE DATE. The amendment to subdivision 4, paragraph (c), of this 
62.31 	section is effective the day following final enactment. The amendment to subdivision 
62.32 	4, paragraph (f), is effective retroactively from January 1, 2008, and applies to all 
62.33 	businesses that become subject to this section in 2008. The rest of this section is effective 
62.34 	retroactively from January 1, 2004, except that for violations that occur before the day 
62.35 	following final enactment, this section does not apply if the business has repaid the 
62.36 	benefits or the commissioner has granted a waiver.

63.1 	Sec. 14. [469.3191] BREACH OF AGREEMENTS BY BUSINESSES THAT 
63.2 	CONTINUE TO OPERATE IN ZONE.
63.3 	(a) A "business in violation of its business subsidy agreement but not subject to 
63.4 	section 469.319" means a business that is operating in violation of the business subsidy 
63.5 	agreement but maintains a level of operations in the zone that does not subject it to the 
63.6 	repayment provisions of section 469.319, subdivision 1, clause (1). 
63.7 	(b) A business described in paragraph (a) that does not sign a new or amended 
63.8 	business subsidy agreement, as authorized under paragraph (h), is subject to repayment 
63.9 	of benefits under section 469.319 from the day that it ceases to perform in the zone a 
63.10 	substantial level of activities described in the business subsidy agreement. 
63.11 	(c) A business described in paragraph (a) ceases being a qualified business after the 
63.12 	last day that it has to meet the goals stated in the agreement.
63.13 	(d) A business is not entitled to any income tax or franchise tax benefits, including 
63.14 	refundable credits, for any part of the year in which the business is no longer a qualified 
63.15 	business under paragraph (c), and thereafter. A business is not eligible for sales tax 
63.16 	benefits beginning with goods or services purchased or put to a taxable use on the day that 
63.17 	it is no longer a qualified business under paragraph (c). Property is not exempt from tax 
63.18 	under section 272.02, subdivision 64, for any taxes payable in the year following the year 
63.19 	in which the business is no longer a qualified business under paragraph (c), and thereafter.
63.20 	(e) A business described in paragraph (a) that wants to resume eligibility for benefits 
63.21 	under section 469.315 must request that the commissioner of employment and economic 
63.22 	development determine the length of time that the business is ineligible for benefits. The 
63.23 	commissioner shall determine the length of ineligibility by applying the proportionate 
63.24 	level of performance under the agreement to the total duration of the zone as measured 
63.25 	from the date that the business subsidy agreement was executed. The length of time 
63.26 	must not be less than one full year for each tax benefit listed in section 469.315. The 
63.27 	commissioner of employment and economic development and the appropriate local 
63.28 	government officials shall consult with the commissioner of revenue to ensure that the 
63.29 	period of ineligibility includes at least one full year of benefits for each tax. 
63.30 	(f) The length of ineligibility determined under paragraph (e) must be applied by 
63.31 	reducing the zone duration for the property by the duration of the ineligibility.
63.32 	(g) The zone duration of property that has been adjusted under paragraph (f) must 
63.33 	not be altered again to permit the business additional benefits under section 469.315.
63.34 	(h) A business described in paragraph (a) becomes eligible for benefits available 
63.35 	under section 469.315 by entering into a new or amended business subsidy agreement 
63.36 	with the appropriate local government unit. The new or amended agreement must cover 
64.1 	a period beginning from the date of ineligibility under the original business subsidy 
64.2 	agreement, through the zone duration determined by the commissioner under paragraph 
64.3 	(f). No exemption of property taxes under section 272.02, subdivision 64, is available 
64.4 	under the new or amended agreement for property taxes due or paid before the date of 
64.5 	the final execution of the new or amended agreement, but unpaid taxes due after that 
64.6 	date need not be paid.
64.7 	(i) A business that violates the terms of an agreement authorized under paragraph 
64.8 	(h) is permanently barred from seeking benefits under section 469.315 and is subject to 
64.9 	the repayment provisions under section 469.319 effective from the day that the business 
64.10 	ceases to operate as a qualified business in the zone under the second agreement. 

64.11 	EFFECTIVE DATE. This section is effective retroactively from January 1, 2004. 
64.12 	For violations that occur before the day following final enactment, this section does not 
64.13 	apply if the business has repaid the benefits or the commissioner has granted a waiver. 

64.14 	Sec. 15. [469.3192] PROHIBITION AGAINST AMENDMENTS TO BUSINESS 
64.15 	SUBSIDY AGREEMENT.
64.16 	Except as authorized under section 469.3191, under no circumstance shall terms 
64.17 	of any agreement required as a condition for eligibility for benefits listed under section 
64.18 	469.315 be amended to change job creation, job retention, or wage goals included in 
64.19 	the agreement.

64.20 	EFFECTIVE DATE. This section is effective the day following final enactment 
64.21 	and applies to all agreements executed before, on, or after the effective date.

64.22 	Sec. 16. [469.3193] CERTIFICATION OF CONTINUING ELIGIBILITY FOR 
64.23 	JOBZ BENEFITS.
64.24 	(a) By December 1 of each year, every qualified business must certify to the 
64.25 	commissioner of revenue, on a form prescribed by the commissioner of revenue, whether 
64.26 	it is in compliance with any agreement required as a condition for eligibility for benefits 
64.27 	listed under section 469.315. A business that fails to submit the certification, or any 
64.28 	business, including those still operating in the zone, that submits a certification that 
64.29 	the commissioner of revenue later determines materially misrepresents the business's 
64.30 	compliance with the agreement, is subject to the repayment provisions under section 
64.31 	469.319 from January 1 of the year in which the report is due or the date that the business 
64.32 	became subject to section 469.319, whichever is earlier. Any such business is permanently 
64.33 	barred from obtaining benefits under section 469.315. For purposes of this section, the bar 
65.1 	applies to an entity and also applies to any individuals or entities that have an ownership 
65.2 	interest of at least 20 percent of the entity.
65.3 	(b) Before the sanctions under paragraph (a) apply to a business that fails to 
65.4 	submit the certification, the commissioner of revenue shall send notice to the business, 
65.5 	demanding that the certification be submitted within 30 days and advising the business 
65.6 	of the consequences for failing to do so. The commissioner of revenue shall notify 
65.7 	the commissioner of employment and economic development and the appropriate job 
65.8 	opportunity subzone administrator whenever notice is sent to a business under this 
65.9 	paragraph.
65.10 	(c) The certification required under this section is public. 
65.11 	(d) The commissioner of revenue shall promptly notify the commissioner of 
65.12 	employment and economic development of all businesses that certify that they are not 
65.13 	in compliance with the terms of their business subsidy agreement and all businesses 
65.14 	that fail to file the certification.

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

65.16 	Sec. 17. Minnesota Statutes 2006, section 469.3201, is amended to read:
65.17 	469.3201 JOBZ EXPENDITURE LIMITATIONS; AUDITS STATE 
65.18 	AUDITOR; AUDITS OF JOB OPPORTUNITY BUILDING ZONES AND 
65.19 	BUSINESS SUBSIDY AGREEMENTS.
65.20 	The Tax Increment Financing, Investment and Finance Division of the Office of the 
65.21 	State Auditor must annually audit the creation and operation of all job opportunity building 
65.22 	zones and business subsidy agreements entered into under Minnesota Statutes, sections 
65.23 	469.310 to 469.320. To the extent necessary to perform this audit, the state auditor may 
65.24 	request from the commissioner of revenue tax return information of taxpayers who are 
65.25 	eligible to receive tax benefits authorized under section 469.315. To the extent necessary 
65.26 	to perform this audit, the state auditor may request from the commissioner of employment 
65.27 	and economic development wage detail report information required under section 268.044 
65.28 	of taxpayers eligible to receive tax benefits authorized under section 469.315.

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

65.30 	Sec. 18. Minnesota Statutes 2006, section 473.39, is amended by adding a subdivision 
65.31 	to read:
65.32 		Subd. 1n.Obligations. After July 1, 2008, in addition to other authority in this 
65.33 	section, the council may issue certificates of indebtedness, bonds, or other obligations 
66.1 	under this section in an amount not exceeding $33,000,000 for capital expenditures as 
66.2 	prescribed in the council's regional transit master plan and transit capital improvement 
66.3 	program and for related costs, including the costs of issuance and sale of the obligations.

66.4 	EFFECTIVE DATE. This section is effective July 1, 2008, and applies in the 
66.5 	counties of Anoka, Carver, Dakota, Hennepin, Ramsey, Scott, and Washington.

66.6 	Sec. 19. Minnesota Statutes 2006, section 474A.047, subdivision 1, is amended to read:
66.7 		Subdivision 1.Eligibility. (a) An issuer may only use the proceeds from residential 
66.8 	rental bonds if the proposed project meets the following requirements:
66.9 	(1) the proposed residential rental project meets the requirements of section 142(d) 
66.10 	of the Internal Revenue Code regarding the incomes of the occupants of the housing; and
66.11 	(2) the maximum rent for at least 20 percent of the units in the proposed residential 
66.12 	rental project do not exceed the area fair market rent or exception fair market rents for 
66.13 	existing housing, if applicable, as established by the federal Department of Housing and 
66.14 	Urban Development. The rental rates of units in a residential rental project for which 
66.15 	project-based federal assistance payments are made are deemed to be within the rent 
66.16 	limitations of this clause.
66.17 	(b) The proceeds from residential rental bonds may be used for a project for which 
66.18 	project-based federal rental assistance payments are made only if:
66.19 	(1) the owner of the project enters into a binding agreement with the Minnesota 
66.20 	Housing Finance Agency under which the owner is obligated to extend any existing 
66.21 	low-income affordability restrictions and any contract or agreement for rental assistance 
66.22 	payments for the maximum term permitted, including any renewals thereof; and
66.23 	(2) the Minnesota Housing Finance Agency certifies that project reserves will be 
66.24 	maintained at closing of the bond issue and budgeted in future years at the lesser of:
66.25 	(i) the level described in Minnesota Rules, part 4900.0010, subpart 7, item A, 
66.26 	subitem (2), effective May 1, 1997; or
66.27 	(ii) the level of project reserves available prior to the bond issue, provided that 
66.28 	additional money is available to accomplish repairs and replacements needed at the time 
66.29 	of bond issue.

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

66.31 	Sec. 20. Laws 1995, chapter 264, article 5, section 46, subdivision 2, is amended to 
66.32 	read:
67.1 		Subd. 2. Limitation on use of tax increments. (a) All revenues derived from tax 
67.2 	increments must be used in accordance with the housing replacement district plan. The 
67.3 	revenues must be used solely to pay the costs of site acquisition, relocation, demolition 
67.4 	of existing structures, site preparation, and pollution abatement on parcels identified in 
67.5 	the housing replacement district plan, as well as public improvements and administrative 
67.6 	costs directly related to those parcels.
67.7 	(b) Notwithstanding paragraph (a), the city of Minneapolis may use revenues 
67.8 	derived from tax increments from its housing replacement district for activities related 
67.9 	to parcels not identified in the housing replacement plan, but which would qualify for 
67.10 	inclusion under section 45, subdivision 1, paragraph (b), clauses (1) to (3).
67.11 	(c) Notwithstanding paragraph (a), or any other provisions of sections 44 to 47, the 
67.12 	Crystal Economic Development Authority may use revenues derived from tax increments 
67.13 	from its housing replacement districts numbers one and two as if those districts were 
67.14 	housing districts under Minnesota Statutes, section 469.174, subdivision 11, provided that 
67.15 	eligible activities may be located anywhere in the city without regard to the boundaries of 
67.16 	housing replacement district numbers one and two or any project area.

67.17 	EFFECTIVE DATE. This section applies to revenues from the housing replacement 
67.18 	districts, regardless of when they were received, and is effective the day following final 
67.19 	enactment and for the city of Minneapolis, upon compliance by the governing body of 
67.20 	the city of Minneapolis with Minnesota Statutes, section 645.021, subdivision 3, and, for 
67.21 	the city of Crystal, upon compliance by the governing body of the city of Crystal with 
67.22 	Minnesota Statutes, section 645.021, subdivision 3.

67.23 	Sec. 21. Laws 2003, chapter 127, article 10, section 31, subdivision 1, is amended to 
67.24 	read:
67.25 		Subdivision 1. District extension. (a) The governing body of the city of Hopkins 
67.26 	may elect to extend the duration of its redevelopment tax increment financing district 
67.27 	2-11 by up to four additional years. 
67.28 	(b) Notwithstanding any law to the contrary, effective upon approval of this 
67.29 	subdivision, no increments may be spent on activities located outside of the area of the 
67.30 	district, other than:
67.31 	(1) to pay administrative expenses; or
67.32 	(2) to pay the costs of housing activities, provided that expenditures under this 
67.33 	clause may not exceed 20 percent of the total tax increments from the district. 

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

68.1 	Sec. 22. Laws 2006, chapter 259, article 10, section 14, subdivision 1, is amended to 
68.2 	read:
68.3 		Subdivision 1. Definitions. (a) "City" means the city of Minneapolis. 
68.4 	(b) "Homeless assistance tax increment district" means a contiguous area of the 
68.5 	city that: 
68.6 	(1) is no larger than six eight acres; 
68.7 	(2) is located within the boundaries of a city municipal development district; and 
68.8 	(3) contains at least two shelters for homeless persons that have been owned or 
68.9 	operated by nonprofit corporations that (i) are qualified charitable organizations under 
68.10 	section 501(c)(3) of the United States Internal Revenue Code, (ii) have operated such 
68.11 	homeless facilities within the district for at least five years, and (iii) have been recipients 
68.12 	of emergency services grants under Minnesota Statutes, section 256E.36. 

68.13 	EFFECTIVE DATE. This section is effective upon compliance by the city of 
68.14 	Minneapolis with Minnesota Statutes, section 645.021.

68.15 	Sec. 23. Laws 2008, chapter 154, article 9, section 23, is amended to read:
68.16 	Sec. 23. CITY OF FRIDLEY; TAX INCREMENT FINANCING DISTRICT; 
68.17 	SPECIAL RULES.
 68.18 	(a) If the city elects upon the adoption of a tax increment financing plan for a district, 
68.19 	the rules under this section apply to a redevelopment tax increment financing district 
68.20 	established by the city of Fridley or the housing and redevelopment authority of the city. 
68.21 	The redevelopment tax increment district includes city may include one or more of the 
68.22 	following parcels and adjacent railroad property and in the redevelopment tax increment 
68.23 	district, which shall be referred to as the Northstar Transit Station District: parcel 
68.24 	numbers 223024120010, 223024120009, 223024120017, 223024120016, 223024120018, 
68.25 	223024120012, 223024120011, 223024120005, 223024120004, 223024120003, 
68.26 	223024120013, 223024120008, 223024120007, 223024120006, 223024130005, 
68.27 	223024130010, 223024130011, 223024130003, 153024440039, 153024440037, 
68.28 	153024440041, 153024440042, 223024110013, 223024110016, 223024110017, 
68.29 	223024140008, 223024130002, 223024420004, 223024410002, 223024410003, 
68.30 	223024110008, 223024110007, 223024110019, 223024110018, 223024110003, 
68.31 	223024140003, 223024140009, 223024140002, 223024140010, and 223024410007. 
68.32 	(b) The requirements for qualifying a redevelopment tax increment district under 
68.33 	Minnesota Statutes, section 469.174, subdivision 10, do not apply to the parcels located 
68.34 	within the Northstar Transit Station District, which are deemed eligible for inclusion 
68.35 	in a redevelopment tax increment district. 
69.1 	(c) In addition to the costs permitted by Minnesota Statutes, section 469.176, 
69.2 	subdivision 4j, eligible expenditures within the Northstar Transit Station District include 
69.3 	those costs necessary to provide for the construction and land acquisition for a tunnel 
69.4 	under the Burlington Northern Santa Fe railroad tracks to allow access to the Northstar 
69.5 	Commuter Rail. 
69.6 	(d) Notwithstanding the provisions of Minnesota Statutes, section 469.1763, 
69.7 	subdivision 2, the city of Fridley may expend increments generated from its tax increment 
69.8 	financing districts Nos. 11, 12, and 13 for costs permitted by paragraph (c) and Minnesota 
69.9 	Statutes, section 469.176, subdivision 4j, outside the boundaries of tax increment financing 
69.10 	districts Nos. 11, 12, and 13, but only within the Northstar Transit Station District. 
69.11 	(e) The five-year rule under Minnesota Statutes, section 469.1763, subdivision 3, 
69.12 	does not apply to the Northstar Transit Station District or to tax increment financing 
69.13 	districts Nos. 11, 12, and 13. 
69.14 	(f) The use of revenues for decertification under Minnesota Statutes, section 
69.15 	469.1763, subdivision 4, does not apply to tax increment financing districts Nos. 11, 
69.16 	12, and 13. 
69.17 	(g) The city may establish additional tax increment financing districts consisting 
69.18 	of parcels identified in paragraph (a), which it does not include in the Northstar Transit 
69.19 	District, under general law. The provisions of paragraph (c) apply to these districts and the 
69.20 	permitted pooling percentage for the districts under Minnesota Statutes, section 469.1763, 
69.21 	subdivision 2, is increased to 30 percent. The provisions of paragraphs (b), (d), (e), and 
69.22 	(f) do not apply to these districts. The authority to create districts under this authority 
69.23 	expires on December 30, 2017.

69.24 	EFFECTIVE DATE. This section is effective upon approval by the governing body 
69.25 	of the city of Fridley and upon compliance by the city with Minnesota Statutes, section 
69.26 	645.021, subdivision 3.

69.27 	Sec. 24. Laws 2008, chapter 154, article 9, section 24, is amended to read:
69.28 	Sec. 24. CITY OF NEW BRIGHTON; TAX INCREMENT FINANCING; 
69.29 	EXPENDITURES OUTSIDE DISTRICT.
 69.30 		Subdivision 1.Expenditures outside district. Notwithstanding the provisions of 
69.31 	Minnesota Statutes, section sections 469.176, subdivision 4d, and 469.1763, subdivision 
69.32 	2, or any other law to the contrary, the city of New Brighton may expend increments 
69.33 	generated from its tax increment financing district No. 26 to facilitate eligible activities
69.34 	districts 9, 20, and 26. The increments may be used to pay eligible expenses as permitted 
69.35 	by Minnesota Statutes, section 469.176, subdivision 4e 4j, outside the boundaries of 
70.1 	tax increment financing district No. 26 districts 9, 20, and 26, but only within the area 
70.2 	described in Laws 1998, chapter 389, article 11, section 24, subdivision 1, and commonly 
70.3 	referred to as the Northwest Quadrant. Minnesota Statutes, section 469.1763, subdivisions 
70.4 	3 and 4, do not apply to expenditures permitted by this section. 
70.5 		Subd. 2.District duration extension. Notwithstanding the provisions of Minnesota 
70.6 	Statutes, section 469.176, subdivision 1b, or any other law to the contrary, the duration 
70.7 	limits that apply to redevelopment tax increment financing districts numbers 31 and 32 
70.8 	established under Laws 1998, chapter 389, article 11, section 24, and hazardous substance 
70.9 	subdistricts numbers 31A and 32A established under Minnesota Statutes, sections 469.174 
70.10 	to 469.1799, are extended by four years.

70.11 	EFFECTIVE DATE. This section is effective upon approval by the governing body 
70.12 	of the city of New Brighton and upon compliance by the city with Minnesota Statutes, 
70.13 	section 645.021, subdivision 3.

70.14 	Sec. 25. CITY OF AUSTIN; TAX INCREMENT FINANCING AUTHORITY.
 70.15 	Notwithstanding the requirements of Minnesota Statutes, section 469.1763, 
70.16 	subdivision 3, that activities must be undertaken within a five-year period from the date of 
70.17 	certification of tax increment financing district and notwithstanding the provisions of any 
70.18 	other law, the governing body of the city of Austin may use tax increments from its Tax 
70.19 	Increment Financing District No. 9 to reimburse the city's housing and redevelopment 
70.20 	authority for money spent disposing of soils and debris in the tax increment financing 
70.21 	district, as required by the Minnesota Pollution Control Agency.

70.22 	EFFECTIVE DATE. This section is effective upon compliance by the governing 
70.23 	body of the city of Austin with the requirements of Minnesota Statutes, section 645.021.

70.24 	Sec. 26. BLOOMINGTON TAX INCREMENT FINANCING; FIVE-YEAR 
70.25 	RULE.
 70.26 	The requirements of Minnesota Statutes, section 469.1763, subdivision 3, that 
70.27 	activities must be undertaken within a five-year period from the date of certification of a 
70.28 	tax increment financing district, are increased to a ten-year period for the Port Authority 
70.29 	of the City of Bloomington's Tax Increment Financing District No. 1-I, Bloomington 
70.30 	Central Station.

70.31 	EFFECTIVE DATE. This section is effective upon compliance by the governing 
70.32 	body of the Port Authority of the City of Bloomington with the requirements of Minnesota 
70.33 	Statutes, section 645.021.

71.1 	Sec. 27. CITY OF BLOOMINGTON; TAX INCREMENT FINANCING 
71.2 	DISTRICT; PROJECT REQUIREMENTS.
 71.3 		Subdivision 1.Addition of parcels to Tax Increment Financing District No. 1-G.
 71.4 	Notwithstanding the provisions of Minnesota Statutes, section 469.175, subdivision 4, 
71.5 	or any other law to the contrary, the governing bodies of the Port Authority of the city 
71.6 	of Bloomington and the city of Bloomington may elect to eliminate certain real property 
71.7 	from Tax Increment Financing District No. 1-C within Industrial Development District 
71.8 	No. 1 Airport South in the city of Bloomington, Minnesota, and expand the boundaries of 
71.9 	Tax Increment Financing District No. 1-G to include real property, which is described 
71.10 	as follows:
71.11 	(1) PARCEL C: That part of Lindau Lane lying westerly of 24th Avenue South and 
71.12 	lying easterly of State Highway No. 77; and 
71.13 	(2) PARCEL D: Lot 1, Block 1, MALL OF AMERICA 3RD ADDITION, according 
71.14 	to the recorded plat thereof, Hennepin County, Minnesota, Except that part of said Lot 1 
71.15 	described as commencing at the most easterly corner of Lot 2, said Block 1, said MALL 
71.16 	OF AMERICA 3RD ADDITION; thence on an assumed bearing of South 45 degrees 00 
71.17 	minutes 00 seconds West, along the southeasterly line of said Lot 2, Block 1, MALL OF 
71.18 	AMERICA 3RD ADDITION, a distance of 18.58 feet to the point of beginning of the 
71.19 	land to be described: thence South 45 degrees 00 minutes 29 seconds East a distance of 
71.20 	30.69 feet; thence South 89 degrees 59 minutes 52 seconds East a distance of 303.62 feet; 
71.21 	thence South 0 degrees 00 minutes 08 seconds West a distance of 10.00 feet; thence North 
71.22 	89 degrees 57 minutes 47 seconds East a distance of 55.90 feet; thence North 0 degrees 06 
71.23 	minutes 52 minutes West a distance of 10.01 feet; thence North 89 degrees 59 minutes 04 
71.24 	seconds East a distance of 332.04 feet; thence North 44 degrees 57 minutes 59 seconds 
71.25 	East a distance 10.55 feet to the southwesterly line of Lot 3, Block 1, said MALL OF 
71.26 	AMERICA 3RD ADDITION; thence South 45 degrees 00 minutes 00 seconds East along 
71.27 	said southwesterly line of Lot 3, a distance of 244.08 feet to the most southerly southwest 
71.28 	corner of said Lot 3; thence on a bearing of East along the south line of said Lot 3 a 
71.29 	distance of 1.37 feet; thence South 0 degrees 10 minutes 07 seconds West a distance of 
71.30 	30.07 feet; thence North 89 degrees 58 minutes 07 seconds East a distance of 83.84 feet; 
71.31 	thence South 0 degrees 00 minutes 40 seconds West a distance of 540.08 feet; thence 
71.32 	North 89 degrees 58 minutes 39 seconds West a distance of 53.64 feet; thence South 0 
71.33 	degrees 02 minutes 43 seconds West a distance of 29.71 feet to the north line of Lot 4, 
71.34 	Block 1, said MALL OF AMERICA 3RD ADDITION; thence on a bearing of West 
71.35 	along said north line of Lot 4 a distance of 1.13 feet to the most northerly northwest 
71.36 	corner of said Lot 4; thence South 45 degrees 00 minutes 00 seconds West along the 
72.1 	northwesterly line of said Lot 4 a distance of 293.65 feet; thence North 45 degrees 03 
72.2 	minutes 26 seconds West a distance of 59.81 feet; thence North 89 degrees 59 minutes 24 
72.3 	seconds West a distance 277.25 feet; thence North 0 degrees 02 minutes 42 seconds East a 
72.4 	distance of 10.21 feet; thence North 89 degrees 59 minutes 24 seconds West a distance of 
72.5 	55.93 feet; thence South 0 degrees 00 minutes 36 seconds West a distance of 10.17 feet; 
72.6 	thence South 89 degrees 59 minutes 32 seconds West a distance of 261.98 feet; thence 
72.7 	South 45 degrees 07 minutes 13 seconds West a distance of 70.69 feet to the northeasterly 
72.8 	line of Lot 5, Block 1, said MALL OF AMERICA 3RD ADDITION; thence North 45 
72.9 	degrees 00 minutes 00 seconds West along said northeasterly line of Lot 5 a distance of 
72.10 	363.21 feet to the most northerly northeast corner of said Lot 5; thence on a bearing of 
72.11 	West along the north line of said Lot 5 a distance of 1.74 feet; thence North 0 degrees 05 
72.12 	minutes 14 seconds East a distance of 30.30 feet; thence South 89 degrees 56 minutes 58 
72.13 	seconds West a distance of 81.56 feet; thence North 0 degrees 00 minutes 24 seconds East 
72.14 	a distance of 497.92 feet; thence South 89 degrees 58 minutes 55 seconds East a distance 
72.15 	of 123.79 feet; thence North 0 degrees 01 minutes 54 seconds East a distance of 30.06 feet 
72.16 	to the south line of said Lot 2, Block 1, MALL OF AMERICA 3RD ADDITION; thence 
72.17 	on a bearing of East along said south line of Lot 2, Block 1, MALL OF AMERICA 3RD 
72.18 	ADDITION; thence on a bearing of East along said south line of Lot 2, Block 1, MALL 
72.19 	OF AMERICA 3RD ADDITION, a distance of 1.22 feet to the most southerly southeast 
72.20 	corner of said Lot 2, Block 1, MALL OF AMERICA 3RD ADDITION; thence North 45 
72.21 	degrees 00 minutes 00 seconds East along said southeasterly line of Lot 2, Block 1, MALL 
72.22 	OF AMERICA 3RD ADDITION, a distance of 264.05 feet to the point of beginning.
72.23 		Subd. 2.Original tax capacity of Tax Increment Financing District No. 1-G.
 72.24 	Upon inclusion of the real property described above in the Tax Increment District No. 1-G, 
72.25 	the Hennepin County auditor must increase the original tax capacity of Tax Increment 
72.26 	District No. 1-G by $208,000.
72.27 		Subd. 3.Use of increments. Notwithstanding Laws 1996, chapter 464, article 
72.28 	1, section 8, subdivision 3, paragraph (d), clauses (1) and (2), the tax increments, 
72.29 	assessments, and other revenues derived from any portion of Tax Increment Financing 
72.30 	District No. 1-G may be used:
72.31 	(1) to pay debt service on revenue bonds issued under section 29;
72.32 	(2) to reimburse or otherwise pay the developer for public improvements because 
72.33 	of counted value resulting from investment in property in Tax Increment Financing 
72.34 	District No. 1-G under section 9.2(05) of the restated contract for purchase and private 
72.35 	redevelopment of land, by and among the city of Bloomington, the Port Authority of the 
72.36 	city of Bloomington, and the Mall of America Company, dated May 31, 1988; and
73.1 	(3) to pay the principal, premium, and interest on bonds, notes, or other obligations 
73.2 	issued by the city of Bloomington or the Port Authority of the city of Bloomington to 
73.3 	finance capital and related costs of public improvements in Tax Increment Financing 
73.4 	District No. 1-G. In sections 27 to 30, "public improvements" are limited to public 
73.5 	improvements for which tax increments may be expended under the tax increment 
73.6 	financing plan for Tax Increment Financing District No. 1-G as amended November 
73.7 	15, 2001.
73.8 		Subd. 4.Public hearing on district modification. When the governing bodies of 
73.9 	the port authority or the city elect to exercise the authority provided in subdivision 1 to 
73.10 	modify the districts, they must conduct a public hearing after published notice on the 
73.11 	issue, with the meeting beginning between 6:00 p.m. and 7:00 p.m. on a weeknight.
73.12 		Subd. 5.Construction of Mall of America phase II. (a) The governing bodies of 
73.13 	the city of Bloomington and the Bloomington Port Authority, as a condition of providing 
73.14 	tax increments or other financial assistance for parking facilities and other public 
73.15 	improvements, must enter into an agreement with the developers of the project that ensures 
73.16 	that the facility complies with the sustainable building guidelines in Minnesota Statutes, 
73.17 	section 16B.325, and that it must be, to the greatest extent practicable, constructed of 
73.18 	American-made steel.
73.19 	(b) The agreement must prohibit any additional draw from an aquifer for the purpose 
73.20 	of a man-made lake, waterpark, or similar entertainment venue. 
73.21 	(c) The agreement must also prohibit inclusion of an auditorium, theater, or similar 
73.22 	live entertainment venue. This paragraph does not prohibit inclusion of multi-screen 
73.23 	movie theaters, nightclubs, restaurants, or museums.
73.24 		Subd. 6.Living wage. Any agreement to provide financial assistance to phase II of 
73.25 	the Mall of America project must include a provision that requires payment of wages that 
73.26 	meet the requirements of Minnesota Statutes, section 469.310, subdivision 11, paragraph 
73.27 	(g), to persons employed on a full-time basis at the facility. This subdivision does not 
73.28 	apply to seasonal or temporary employees or to internships or similar positions intended 
73.29 	to provide career experience or training. This subdivision does not apply to nonprofit 
73.30 	organizations, educational institutions, or businesses that employ fewer than 50 employees.
73.31 		Subd. 7.Affordable access. To the extent determined by the governing body of 
73.32 	the city or the port authority, any agreement to provide financial assistance to phase II 
73.33 	of the Mall of America project must provide for affordable access to the amusement 
73.34 	areas of the facility.
73.35 		Subd. 8.Labor peace. As a condition to exercising the authority provided in 
73.36 	subdivision 1, the governing bodies of the city of Bloomington and the Bloomington Port 
74.1 	Authority shall require the developers of phase II of the Mall of America project to enter 
74.2 	into a labor peace agreement with the labor organization which is most actively engaged in 
74.3 	representing and attempting to represent hotel workers in Hennepin and Ramsey Counties. 
74.4 	The labor peace agreement must be an enforceable agreement and must prohibit the labor 
74.5 	organization and its members from engaging in any boycott or other activity advising 
74.6 	customers not to patronize any hotel that is part of Phase II for at least the first five years 
74.7 	of the hotel's operation, and must cover all operations at the hotel, other than construction, 
74.8 	alteration, or repair of the premises separately owned and operated, which are conducted 
74.9 	by lessees or tenants or under management agreements, except retail operations, including 
74.10 	gift, jewelry, and clothing shops that have annual gross revenues of less than $250,000.
74.11 		Subd. 9.Certificate of compliance; affirmative action. As a condition of 
74.12 	exercising the authority provided in this section and sections 28 and 29, the governing 
74.13 	bodies of the city of Bloomington and the Bloomington Port Authority must enter into an 
74.14 	agreement with the developers of the project that requires each contractor or subcontractor 
74.15 	in connection with construction of the project to comply with the requirements of 
74.16 	Minnesota Statutes, section 363A.36, as if the contract were with a state agency or 
74.17 	department.

74.18 	EFFECTIVE DATE. This section is effective the day after the governing body of 
74.19 	the city of Bloomington and its chief clerical officer timely complete their compliance 
74.20 	with Minnesota Statutes, section 645.021, subdivision 3, with respect to this section and 
74.21 	section 30.

74.22 	Sec. 28. CITY OF BLOOMINGTON; LOCAL TAXING AUTHORITY.
 74.23 		Subdivision 1.Additional taxes authorized; use of proceeds. Notwithstanding 
74.24 	Minnesota Statutes, section 477A.016, or any other law, ordinance, or charter provision 
74.25 	to the contrary, the governing body of the city of Bloomington may impose any or all of 
74.26 	the taxes described in this section. The proceeds of any taxes imposed under this section 
74.27 	or section 27, less refunds and the cost of collection, must be used to provide financing 
74.28 	for parking facilities or other public improvements for the Mall of America phase II. The 
74.29 	Port Authority of the city of Bloomington may, but is not required to, issue or cause 
74.30 	the sale of bonds, a developer's note, or other obligations to finance the improvements. 
74.31 	If a governmental entity other than the city of Bloomington issues the obligations used 
74.32 	to finance the parking facilities and other public improvements, the city may transfer the 
74.33 	funds available under this section and section 27 for financing the project to the entity 
74.34 	that issued the bonds.
75.1 		Subd. 2.Sales tax. The city of Bloomington may charter a special taxing authority, 
75.2 	which is a separate political subdivision. The geographic area of the special taxing 
75.3 	authority consists of Tax Increment Financing Districts No. 1-C and No. 1-G in the 
75.4 	city. The city council is the governing body of the special taxing authority. The special 
75.5 	taxing authority may impose, by resolution, a sales tax of not less than one-half of one 
75.6 	percent and not more than one percent within its boundaries. The provisions of Minnesota 
75.7 	Statutes, section 297A.99, except for subdivisions 2 and 3, govern the imposition, 
75.8 	administration, collection, and enforcement of the tax authorized in this subdivision.
75.9 		Subd. 3.Lodging tax. The city may impose, by ordinance, a tax of up to one 
75.10 	percent on the gross receipts subject to the lodging tax under Minnesota Statutes, section 
75.11 	469.190. This tax is in addition to any tax imposed under Minnesota Statutes, section 
75.12 	469.190, and may be imposed within a tax district defined by the city council, which must 
75.13 	include Tax Increment Districts No. 1-C and No. 1-G in the city of Bloomington and may 
75.14 	include additional areas of the city, which are not required to be contiguous.
75.15 		Subd. 4.Admissions and recreation tax. The city may impose, by ordinance, a tax 
75.16 	of up to one percent on admissions to entertainment and recreational facilities and rental of 
75.17 	recreation equipment at sites within a tax district defined by the city council, which must 
75.18 	include Tax Increment Financing Districts No. 1-C and No. 1-G in the city of Bloomington 
75.19 	and may include additional areas of the city, which are not required to be contiguous.
75.20 		Subd. 5.Food and beverage tax. The city may impose, by ordinance, an additional 
75.21 	sales tax of up to three percent on sales of food and beverages primarily for consumption 
75.22 	on or off the premises by restaurants and places of refreshment as defined by resolution 
75.23 	of the city within Tax Increment Financing Districts No. 1-C and No. 1-G in the city of 
75.24 	Bloomington.
75.25 		Subd. 6.Lodging taxes. Notwithstanding any law or ordinance, the city may 
75.26 	use the unobligated proceeds of any existing city lodging tax attributable to imposition 
75.27 	of the tax on lodging facilities constructed after the date of enactment of this act within 
75.28 	Tax Increment Financing District No. 1-G. In this subdivision, "unobligated proceeds 
75.29 	of any existing city lodging tax" means the proceeds of a lodging tax imposed by the 
75.30 	city of Bloomington prior to May 1, 2008, to the extent the proceeds of the tax are not 
75.31 	contractually pledged to any other specific uses. Lodging tax proceeds derived from 
75.32 	lodging facilities constructed after the date of enactment of this act within Tax Increment 
75.33 	Financing District No. 1-G that have been required by law to be expended for promotion 
75.34 	of the metropolitan sports area or for marketing and promotion of the city by the city 
75.35 	convention bureau may be expended for the purposes described in subdivision 1, 
75.36 	notwithstanding the dedications in those laws.

76.1 	EFFECTIVE DATE. This section is effective the day after compliance by the 
76.2 	governing body of the city of Bloomington with Minnesota Statutes, section 645.021, 
76.3 	subdivision 3, with respect to this section and section 30.

76.4 	Sec. 29. MALL OF AMERICA PHASE II PARKING FACILITY REVENUE 
76.5 	BONDS.
 76.6 		Subdivision 1.Issuing authority. (a) The city of Bloomington may contract with 
76.7 	any of the following authorities to issue and sell revenue bonds for the purposes and 
76.8 	in the amounts specified in subdivision 2:
76.9 	(1) the commissioner of finance, exercising the authority granted under this section 
76.10 	and Minnesota Statutes, sections 16A.672 to 16A.675;
76.11 	(2) the Agricultural and Economic Development Board, exercising the powers 
76.12 	granted under this section and Minnesota Statutes, chapter 41A; or
76.13 	(3) the Minnesota Public Facilities Authority, exercising the powers granted under 
76.14 	this section and Minnesota Statutes, chapter 446A.
76.15 	(b) The authority granted in this section is in addition to the statutes in paragraph 
76.16 	(a) and notwithstanding any contrary provisions in them.
76.17 	(c) The contract must include as a party the developer of phase II of the Mall of 
76.18 	America and may include as a party any other entity deemed appropriate by the city of 
76.19 	Bloomington, the issuing authority, and the developer.
76.20 		Subd. 2.Purposes and amounts. (a) The revenue bonds may be issued in a single 
76.21 	or multiple issues and sold for the following purposes:
76.22 	(1) to pay the costs to design, construct, furnish, and equip parking facilities and 
76.23 	related public improvements for phase II of the Mall of America;
76.24 	(2) to pay the costs of issuance, debt service, and bond insurance or other credit 
76.25 	enhancements, and to fund reserves; and
76.26 	(3) to refund bonds issued under this section.
76.27 	(b) The amount of bonds that may be issued for the purposes of paragraph (a), clause 
76.28 	(1), may not exceed per issue the estimated cost from time to time of the parking facilities 
76.29 	and other public improvements, including soft costs; the amount of bonds that may be 
76.30 	issued for the purposes of paragraph (a), clauses (2) and (3), is not limited.
76.31 		Subd. 3.Revenue sources. The debt service on the bonds is payable only from the 
76.32 	following sources:
76.33 	(1) the tax revenues referred to in section 28; and
76.34 	(2) other nonstate revenues pledged to the payment of the bonds.
77.1 		Subd. 4.Sale and issuance; proceeds. (a) The issuing authority may sell and issue 
77.2 	the bonds on the terms and conditions the issuing authority determines to be in the best 
77.3 	interests of the state after reviewing an agreement between the city of Bloomington and 
77.4 	the developer of phase II of the Mall of America setting out the terms upon which the city 
77.5 	of Bloomington will use the proceeds of the bond sales. The bonds may be sold at public 
77.6 	or private sale at a price or prices the issuing authority finds appropriate. The issuing 
77.7 	authority may enter any agreements or pledges the issuing authority determines necessary 
77.8 	or useful to sell the bonds that are not inconsistent with this section. 
77.9 	(b) The city may enter into a preliminary agreement with the issuing authority under 
77.10 	which the city agrees, if the revenue bonds are not issued, to pay or cause to be paid the 
77.11 	costs and expenses incurred by the issuing authority relating to the proposed issuance of 
77.12 	the revenue bonds.
77.13 	(c) The proceeds of the bonds issued under this section must be credited to a special 
77.14 	Mall of America revenue bond proceeds account with the issuing authority or a trustee 
77.15 	and are appropriated to the issuing authority for payment to the city of Bloomington 
77.16 	for the purposes specified in subdivision 2.
77.17 		Subd. 5.Security. The issuing authority may irrevocably pledge and appropriate 
77.18 	for payment of the revenue bonds and premium, if any, and interest thereon the revenues 
77.19 	it receives from the city of Bloomington derived from tax increments and taxes the city 
77.20 	is authorized to impose under section 28. By a resolution of the issuing authority or 
77.21 	by an indenture of trust executed under its authority, the issuing authority may make 
77.22 	any and all covenants with bondholders, or with a trustee for the bondholders, that are 
77.23 	determined by the issuing authority to be necessary and proper to ensure the marketability 
77.24 	of the revenue bonds and the segregation and application of the revenues pledged to the 
77.25 	payment of the revenue bonds. Any tax revenues transferred to the issuing authority 
77.26 	that are not required by the terms of the bonds or other obligations issued under this 
77.27 	section, or related documents, to be applied to the payment of the principal, premium, or 
77.28 	interest on the bonds or other obligations, the funding of reserves, or the payment of fees, 
77.29 	costs, or reimbursements, must be transferred to the city of Bloomington. The revenue 
77.30 	bonds are not general obligations of the issuing authority but are payable solely from the 
77.31 	revenues received by the city of Bloomington and the proceeds thereof that are pledged 
77.32 	to the payment of the revenue bonds.  The revenue bonds must not be taken into account 
77.33 	for purposes of any limitation on the principal amount of bonds of the issuing authority 
77.34 	under Minnesota Statutes, section 446A.12, subdivision 1, or other law. The proceeds 
77.35 	of the revenue bonds to be applied to the costs of parking facilities and other public 
77.36 	improvements may be made available by the issuing authority to the city of Bloomington 
78.1 	for those purposes by a loan agreement or other agreement between the issuing authority 
78.2 	and the city. The city may, by resolution or in a loan agreement or other instrument with 
78.3 	the issuing authority, pledge to the payment of the revenue bonds issued by the authority 
78.4 	all or a portion of the revenues collected from the imposition of the taxes the city is 
78.5 	authorized to impose under section 28 and make any or all covenants determined by the 
78.6 	city and the issuing authority to be necessary and proper for the security or marketability 
78.7 	of the revenue bonds to be issued by the issuing authority and the payment of the costs and 
78.8 	expenses incurred by the issuing authority relating to the revenue bonds. 
78.9 		Subd. 6.Refunding bonds. The issuing authority may issue bonds to refund 
78.10 	outstanding bonds issued under subdivision 1, including the payment of any redemption 
78.11 	premiums on the bonds and any interest accrued or to accrue to the first redemption date 
78.12 	after delivery of the refunding bonds. The proceeds of the refunding bonds may, in the 
78.13 	discretion of the issuing authority, be applied to the purchases or payment at maturity of the 
78.14 	bonds to be refunded, or the redemption of the outstanding bonds on the first redemption 
78.15 	date after delivery of the refunding bonds and may, until so used, be placed in escrow to 
78.16 	be applied to the purchase, retirement, or redemption. Refunding bonds issued under this 
78.17 	subdivision must be issued and secured in the manner provided by the issuing authority.
78.18 		Subd. 7.Not a general or moral obligation. Bonds issued under this section 
78.19 	are not general or moral obligations of the issuing authority, and the full faith, credit, 
78.20 	and taxing powers of the state are not pledged for their payment. The bonds may not be 
78.21 	paid directly, in whole or in part, from a tax of statewide application on any class of 
78.22 	property, income, transaction, or privilege. Payment of the bonds is limited to the revenues 
78.23 	explicitly authorized to be pledged under this section. The state neither makes nor has 
78.24 	a moral obligation to pay the bonds if the pledged revenues and other legal security for 
78.25 	them is insufficient.
78.26 		Subd. 8.Trustee. The issuing authority may contract with and appoint a trustee 
78.27 	for bond holders. The trustee has the powers and authority vested in it by the issuing 
78.28 	authority under the bond and trust indentures.
78.29 		Subd. 9.Pledges. Any pledge made of money, property, or other revenues to the 
78.30 	bonds by the issuing authority is valid and binding from the time the pledge is made. The 
78.31 	money or property pledged and later received by the issuing authority is immediately 
78.32 	subject to the lien of the pledge without any physical delivery of the property or money or 
78.33 	further act, and the lien of any pledge is valid and binding as against all parties having 
78.34 	claims of any kind in tort, contract, or otherwise against the issuing authority, whether or 
78.35 	not those parties have notice of the lien or pledge. The resolution, indenture, agreement, 
78.36 	or other instrument by which a pledge is created need not be recorded. Any tax revenues 
79.1 	pledged to the issuing authority that are not required by the terms of the bonds or other 
79.2 	obligations issued under this section, or related documents, to be applied to the payment 
79.3 	of the principal, premium, or interest on the bonds or other obligations, the funding of 
79.4 	reserves, or the payment of fees, costs, or reimbursements, must be released from the 
79.5 	pledge to the bonds and other obligations in accordance with the terms of the bonds, 
79.6 	other obligations, and related documents.
79.7 		Subd. 10.Bonds; purchase and cancellation. The issuing authority, subject to 
79.8 	agreements with bondholders that may then exist, may, out of any money available for 
79.9 	the purpose, purchase bonds of the issuing authority at a price not exceeding (1) if the 
79.10 	bonds are then redeemable, the redemption price then applicable plus accrued interest, 
79.11 	or (2) if the bonds are not redeemable, the redemption price applicable on the first date 
79.12 	after the purchase upon which the bonds become subject to redemption plus accrued 
79.13 	interest to that date.
79.14 		Subd. 11.State pledge against impairment of contracts. The state pledges and 
79.15 	agrees with the holders of any bonds that the state will not limit or alter the rights vested in 
79.16 	the issuing authority to fulfill the terms of any agreements made with the bondholders, or 
79.17 	in any way impair the rights and remedies of the holders until the bonds, together with 
79.18 	interest on them, with interest on any unpaid installments of interest, and all costs and 
79.19 	expenses in connection with any action or proceeding by or on behalf of the bondholders, 
79.20 	are fully met and discharged. The issuing authority may include this pledge and agreement 
79.21 	of the state in any agreement with the holders of bonds issued under this section.

79.22 	EFFECTIVE DATE. This section is effective the day after the governing body of 
79.23 	the city of Bloomington and its chief clerical officer timely complete their compliance 
79.24 	with Minnesota Statutes, section 645.021, subdivision 3, with respect to this section and 
79.25 	section 30.

79.26 	Sec. 30. STATE REVIEW; BUT-FOR DETERMINATION; DEVELOPMENT 
79.27 	AGREEMENT.
 79.28 		Subdivision 1.Required conditions. All of the conditions required under this 
79.29 	section must be satisfied before the city and authority may contract with an issuing 
79.30 	authority as provided in section 29. This section only applies if the city and authority 
79.31 	contract with an issuing authority under section 29.
79.32 		Subd. 2.Definitions. (a) For purposes of this section, the following terms have 
79.33 	the meanings given.
79.34 	(b) "Authority" means the port authority of the city of Bloomington.
79.35 	(c) "City" means the city of Bloomington.
80.1 	(d) "Commissioner" means the commissioner of finance.
80.2 		Subd. 3.Required disclosure. The authority, city, and developer shall provide to 
80.3 	the commissioner on a confidential basis all of the materials and information necessary 
80.4 	to carry out the commissioner's responsibilities under this section. The developer shall 
80.5 	provide information or access to its financial records and books as requested by the 
80.6 	commissioner on a confidential basis.
80.7 		Subd. 4.But-for determination. The commissioner shall determine, in writing, 
80.8 	whether the assistance to be funded by the provisions of sections 27 to 29 is necessary to 
80.9 	make the project financially feasible. The determination must be based on full disclosure 
80.10 	by the developer of all costs and other information on the project and a determination 
80.11 	by the commissioner that the amount of assistance to be provided is required to permit 
80.12 	a competitive market return on the investment. The commissioner shall consider an 
80.13 	executed letter of intent to issue financing for the project from a licensed financial 
80.14 	institution or institutions that requires the funding described in this section as a condition 
80.15 	of placing the financing to be evidence of the financial necessity of such assistance and 
80.16 	must subsequently affirm in writing whether assistance is necessary to make the project 
80.17 	financially feasible.
80.18 		Subd. 5.Development agreement required. The city, authority, developer, and 
80.19 	commissioner must enter into a development agreement that includes, at least, the 
80.20 	following provisions:
80.21 	(1) the minimum private improvements that must be undertaken to qualify for 
80.22 	assistance;
80.23 	(2) the developer's contribution to the parking facility or facilities;
80.24 	(3) the dates for commencement and completion of the facility;
80.25 	(4) a requirement that the assistance will be used solely for construction of the 
80.26 	parking facilities and other public improvements and to reimburse the costs of the state in 
80.27 	evaluation of the development and negotiation of the development agreement;
80.28 	(5) the authority is the owner of the parking facilities;
80.29 	(6) construction of the parking facilities and all private improvement construction 
80.30 	are subject to payment of prevailing wage as defined in Minnesota Statutes, section 
80.31 	177.42, subdivision 7, and construction of the parking facilities is subject to competitive 
80.32 	bidding requirements, unless constructed under Minnesota Statutes, section 469.071;
80.33 	(7) all costs for operation, maintenance, capital improvement and repair of the 
80.34 	parking facilities must be paid by the developer; and
80.35 	(8) the developer shall be allowed to utilize bond funds based on progress work in 
80.36 	place for the construction of the parking facilities as design and construction progresses 
81.1 	based on costs incurred and certified by the developer, port authority, and independent 
81.2 	inspecting architect or engineer on a monthly basis subject to the provision of a completion 
81.3 	guarantee by the developer or performance bond assuring the completion of the minimum 
81.4 	parking and public improvements. The developer may assign its right to reimbursement 
81.5 	under the development agreement as collateral for any loan to fund the construction.
81.6 		Subd. 6.Recovery of state costs. The developer shall advance all of the costs of 
81.7 	the commissioner to evaluate the need for the assistance and negotiate the development 
81.8 	agreement as a condition of commencement of the negotiation. Notwithstanding the 
81.9 	provisions of Minnesota Statutes, section 16C.095, the commissioner may contract with 
81.10 	outside entities for any assistance needed in developing this development agreement.
81.11 		Subd. 7.LCPFP Review. The commissioner shall submit the completed 
81.12 	development agreement to the Legislative Commission on Planning and Fiscal Policy for 
81.13 	approval. The development agreement is not effective until approved by the commission, 
81.14 	provided that, if the commission has not approved or rejected the development agreement 
81.15 	within 120 days of its submission by the commissioner, it will be deemed to have been 
81.16 	approved.

81.17 	EFFECTIVE DATE. This section is effective the day after the governing body of 
81.18 	the city of Bloomington and its chief clerical officer timely complete their compliance 
81.19 	with Minnesota Statutes, section 645.021, subdivision 3, with respect to this section and 
81.20 	section 29.

81.21 	Sec. 31. CITY OF DULUTH; EXTENSION OF TIME FOR ACTIVITY IN TAX 
81.22 	INCREMENT FINANCING DISTRICTS.
 81.23 		Subdivision 1.District No. 20. The requirements of Minnesota Statutes, section 
81.24 	469.1763, subdivision 3, that activities must be undertaken within a five-year period from 
81.25 	the date of certification of a tax increment financing district, must be considered to be met 
81.26 	for Duluth Economic Development Authority Tax Increment Financing District No. 20 if 
81.27 	the activities are undertaken within ten years from the date of certification of the district.
81.28 		Subd. 2.District No. 21. The requirements of Minnesota Statutes, section 
81.29 	469.1763, subdivision 3, that activities must be undertaken within a five-year period from 
81.30 	the date of certification of a tax increment financing district, must be considered to be met 
81.31 	for Duluth Economic Development Authority Tax Increment Financing District No. 21 if 
81.32 	the activities are undertaken within ten years from the date of certification of the district.

82.1 	EFFECTIVE DATE. This section is effective upon compliance by the governing 
82.2 	body of the city of Duluth with the requirements of Minnesota Statutes, section 645.021, 
82.3 	subdivision 3.

82.4 	Sec. 32. CITY OF WELLS; DISPOSITION OF TAX INCREMENT FINANCING 
82.5 	REVENUES.
 82.6 	Notwithstanding the provisions of Minnesota Statutes, section 469.174, subdivision 
82.7 	25, the following are deemed not to be "increments," "tax increments," or "revenues 
82.8 	derived from tax increment" for purposes of the redevelopment district in the city of 
82.9 	Wells, identified as Downtown Development Program 1, for amounts received after 
82.10 	decertification of the district:
82.11 	(1) rents paid by private tenants for use of a building acquired in whole or in part 
82.12 	with tax increments; and
82.13 	(2) proceeds from the sale of the building.

82.14 	EFFECTIVE DATE. This section is effective upon compliance by the governing 
82.15 	body of the city of Wells with the requirements of Minnesota Statutes, section 645.021, 
82.16 	subdivision 3.

82.17 	Sec. 33. MULTICOUNTY HOUSING AND REDEVELOPMENT AUTHORITY 
82.18 	LEVY AUTHORITY.
 82.19 	Notwithstanding Minnesota Statutes, section 469.033, subdivision 6, or any other 
82.20 	law to the contrary, the governing body of the Northwest Minnesota Multicounty Housing 
82.21 	and Redevelopment Authority, upon approval by a two-thirds majority of all its members, 
82.22 	may levy an amount not to exceed 25 percent of the total levy permitted under Minnesota 
82.23 	Statutes, section 469.033, subdivision 6, without approval of that levy by the governing 
82.24 	body of the city or county within which the authority operates. The authority to levy the 
82.25 	remainder of the total levy permitted under that provision remains subject to approval 
82.26 	by the governing body of the city or county. For purposes of the levy authorized under 
82.27 	this section only, the Northwest Minnesota Multicounty Housing and Redevelopment 
82.28 	Authority is considered a special taxing jurisdiction as provided in Minnesota Statutes, 
82.29 	section 275.066.

82.30 	EFFECTIVE DATE. This section is effective for taxes levied in 2008, payable in 
82.31 	2009, and is repealed effective for taxes levied in 2013, payable in 2014, and thereafter.

82.32 	Sec. 34. CITY OF OAKDALE; ORIGINAL TAX CAPACITY. 
 83.1 	(a) The provisions of this section apply to redevelopment tax increment financing 
83.2 	districts created by the Housing and Redevelopment Authority in and for the city of 
83.3 	Oakdale in the areas comprised of the parcels with the following parcel identification 
83.4 	numbers: (1) 3102921320053; 3102921320054; 3102921320055; 3102921320056; 
83.5 	3102921320057; 3102921320058; 3102921320062; 3102921320063; 3102921320059; 
83.6 	3102921320060; and 3102921320061; and (2) 3102921330005 and 3102921330004.
83.7 	(b) For a district subject to this section, the Housing and Redevelopment Authority 
83.8 	may, when requesting certification of the original tax capacity of the district under 
83.9 	Minnesota Statutes, section 469.177, elect to have the original tax capacity of the district 
83.10 	be certified as the tax capacity of the land.
83.11 	(c) The authority to request certification of a district under this section expires on 
83.12 	July 1, 2013.

83.13 	EFFECTIVE DATE; LOCAL APPROVAL. This section is effective upon 
83.14 	approval by the governing body of the city of Oakdale and compliance with Minnesota 
83.15 	Statutes, section 645.021, subdivision 3.

83.16 	Sec. 35. DAKOTA COUNTY COMMUNITY DEVELOPMENT AUTHORITY; 
83.17 	PLAN MODIFICATION.
 83.18 	Notwithstanding Minnesota Statutes, section 469.175, subdivision 4, the Dakota 
83.19 	County Community Development Authority may designate additional property to be 
83.20 	acquired by the authority for a tax increment financing project without meeting the 
83.21 	requirements for approval of an original tax increment financing plan if the property:
83.22 	(1) consists of one or more parcels under common ownership;
83.23 	(2) is acquired from a willing seller;
83.24 	(3) is acquired for purposes of development as a housing project as defined in 
83.25 	Minnesota Statutes, section 469.174, subdivision 11; and
83.26 	(4) the acquisition is approved by the governing body of the authority after holding 
83.27 	a public hearing thereon after published notice in a newspaper of general circulation in 
83.28 	the municipality in which the property is located at least once not less than ten days nor 
83.29 	more than 30 days prior to the date of the hearing. The published notice must include a 
83.30 	map depicting the property and the general area of the municipality within which the 
83.31 	property is located. The hearing may be held before or at the time of authority approval 
83.32 	of the acquisition.

84.1 	EFFECTIVE DATE. This section is effective upon compliance by the governing 
84.2 	body of the Dakota County Community Development Authority with the requirements of 
84.3 	Minnesota Statutes, section 645.021, subdivision 3.

84.4 	Sec. 36. CITY OF ST. PAUL; TAX INCREMENT FINANCING DISTRICT.
 84.5 		Subdivision 1.Authorization. Notwithstanding the provisions of any other 
84.6 	law, upon approval of the governing body of the city of St. Paul, the Housing and 
84.7 	Redevelopment Authority of the city of St. Paul may establish a redevelopment tax 
84.8 	increment financing district comprised of the properties included in the existing downtown 
84.9 	and Seventh Place tax increment district (County #82). Notwithstanding Minnesota 
84.10 	Statutes, section 469.177, subdivision 6, if certification of the district is requested by July 
84.11 	31, 2008, the certification will be recognized by the county auditor in determining local 
84.12 	tax rates for taxes payable in 2009 and subsequent years. The district created under this 
84.13 	section terminates December 31, 2023. The city may create the district under this section 
84.14 	only if it enters into an agreement with Ramsey County to pay the county annually out of 
84.15 	the increment from this district an amount equal to the tax that would have been payable 
84.16 	to the county on the captured tax capacity of the district had the district not been created.
84.17 		Subd. 2.Special rules. The requirements for qualifying a redevelopment district 
84.18 	under Minnesota Statutes, section 469.174, subdivision 10, do not apply to parcels located 
84.19 	within the district. Minnesota Statutes, section 469.176, subdivisions 4j and 4l, do not 
84.20 	apply to the district. The original tax capacity of the district is $1,801,052.
84.21 		Subd. 3.Authorized expenditures. Tax increment from the district may be 
84.22 	expended only to pay principal and interest on bond obligations issued by the St. Paul 
84.23 	Housing and Redevelopment Authority in 1996 for the convention center, including 
84.24 	payment of principal and interest on any bonds issued to repay the bonds or loans. All 
84.25 	such expenditures are deemed to be activities within the district under Minnesota Statutes, 
84.26 	section 469.1763, subdivisions 2, 3, and 4.
84.27 		Subd. 4.Adjusted net tax capacity. The captured tax capacity of the district must 
84.28 	be included in the adjusted net tax capacity of the city, county, and school district for the 
84.29 	purposes of determining local government aid, education aid, and county program aid. 
84.30 	The county auditor shall report to the commissioner of revenue the amount of the captured 
84.31 	tax capacity for the district at the time the assessment abstracts are filed.

84.32 	EFFECTIVE DATE. This section is effective upon compliance with Minnesota 
84.33 	Statutes, section 645.021, subdivision 3.

85.1 	Sec. 37. CITY OF MINNEAPOLIS; TAX INCREMENT FINANCING 
85.2 	DISTRICT.
 85.3 		Subdivision 1.Authorization. Notwithstanding the provisions of any other law, 
85.4 	the city of Minneapolis may establish a redevelopment tax increment financing district 
85.5 	comprised of the properties included in the existing tax increment districts in the city 
85.6 	that are exempt under Minnesota Statutes, section 469.179, subdivision 1, and were not 
85.7 	decertified before July 1, 2008. The district created under this section may be certified 
85.8 	after January 1, 2010, and terminates no later than December 31, 2020. The city may 
85.9 	create the district under this section only if it enters into an agreement with Hennepin 
85.10 	County to pay the county annually out of the increment from this district an amount equal 
85.11 	to the tax that would have been payable to the county on the captured tax capacity of the 
85.12 	district had the district not been created.
85.13 		Subd. 2.Special rules. The requirements for qualifying a redevelopment district 
85.14 	under Minnesota Statutes, section 469.174, subdivision 10, do not apply to parcels located 
85.15 	within the district. Minnesota Statutes, section 469.176, subdivisions 4j and 4l, do not 
85.16 	apply to the district. The original tax capacity of the district is $2,731,854.
85.17 		Subd. 3.Authorized expenditures. Tax increment from the district may be 
85.18 	expended only to pay principal and interest on bond obligations issued by the city of 
85.19 	Minneapolis or the Minneapolis Community Development Agency for Target Center, 
85.20 	including payment of principal and interest on any bonds issued to repay bonds or loans 
85.21 	and for neighborhood revitalization purposes. All such expenditures are deemed to be 
85.22 	activities within the district under Minnesota Statutes, section 469.1763, subdivisions 2, 
85.23 	3, and 4.
85.24 		Subd. 4.Adjusted net tax capacity. The captured tax capacity of the district must 
85.25 	be included in the adjusted net tax capacity of the city, county, and school district for the 
85.26 	purposes of determining local government aid, education aid, and county program aid. 
85.27 	The county auditor shall report to the commissioner of revenue the amount of the captured 
85.28 	tax capacity for the district at the time the assessment abstracts are filed.

85.29 	EFFECTIVE DATE. This section is effective upon compliance with Minnesota 
85.30 	Statutes, section 645.021, subdivision 3.

85.31 	Sec. 38. TEMPORARY INCREASE IN ANNUAL VOLUME CAP.
 85.32 		Subdivision 1.Applicability. This section applies if federal tax law is amended 
85.33 	after April 28, 2008, to provide a temporary increase in the annual volume cap for private 
85.34 	activity bonds for housing purposes for calendar year 2008 or 2009, and applies only to the 
85.35 	amount of the annual volume cap attributable to the temporary increase for those purposes.
86.1 		Subd. 2.Definitions. As used in this section, "annual volume cap," "bonding 
86.2 	authority," "commissioner," "federal tax law," and "housing pool" have the meanings given 
86.3 	in Minnesota Statutes, section 474A.02. As used in this section, "agency" and "city" have 
86.4 	the meanings given in Minnesota Statutes, section 474A.061, subdivision 2a, paragraph 
86.5 	(c). As used in this section, "carryforward" means the ability to issue obligations in a year 
86.6 	subsequent to the year in which an allocation of bonding authority was obtained under this 
86.7 	section as provided in section 146(f) of federal tax law.
86.8 		Subd. 3.Allocations. (a) The commissioner shall determine the aggregate dollar 
86.9 	amount attributable to the temporary increase in the annual volume cap for housing 
86.10 	purposes. Of this amount, the commissioner shall make the following allocations for 2008:
86.11 	(1) 43 percent to the housing pool, of which 31 percent of the allocation is reserved 
86.12 	for single-family housing programs for a period ending on the earlier of:
86.13 	(i) October 31, 2008, or October 31, 2009, if the increase is made available for 
86.14 	calendar year 2009; or
86.15 	(ii) 180 days after the allocation by the commissioner of the temporary increase 
86.16 	in the volume cap;
86.17 	(2) 30 percent to the agency;
86.18 	(3) 12 percent to the city of Minneapolis;
86.19 	(4) nine percent to the city of St. Paul; and
86.20 	(5) six percent to the Dakota County Community Development Agency for the 
86.21 	county of Dakota and all political subdivisions located within the county.
86.22 	(b) Allocations provided under this subdivision must be used for mortgage bonds or 
86.23 	residential rental project bonds.
86.24 	(c) Data on the home purchase price amount, mortgage amount, income, household 
86.25 	size, and race of the households served with the proceeds of mortgage bonds and 
86.26 	mortgage credit certificates using an allocation under this section in a calendar year 
86.27 	must be submitted by each issuer to the agency by December 31 of the following year. 
86.28 	Compliance by the agency with the provisions of Minnesota Statutes, section 462A.073, 
86.29 	subdivision 5, shall be deemed to be in compliance by the agency with the reporting 
86.30 	requirements of this paragraph.
86.31 	(d) Any amount allocated under paragraph (a), clause (2), (3), (4), or (5), may be 
86.32 	transferred as provided in Minnesota Statutes, section 474A.04, subdivision 6.
86.33 		Subd. 4.Housing pool. Any amounts allocated to the housing pool under 
86.34 	subdivision 3 that are not reserved for single-family housing programs must be allocated 
86.35 	according to Minnesota Statutes, section 474A.061, subdivisions 2a and 4, subject to 
86.36 	the following conditions:
87.1 	(1) other amounts in the housing pool, if any, must be allocated from the housing 
87.2 	pool before any allocation is made from amounts attributable to the temporary increase in 
87.3 	annual volume cap;
87.4 	(2) any amount of the temporary increase in the annual volume cap remaining in 
87.5 	the housing pool on the last Monday of July 2008, or on the last Monday of July 2009, if 
87.6 	the temporary increase in annual volume cap is made available for calendar year 2009, or 
87.7 	that is allocated to the housing pool under subdivision 3, thereafter shall remain in the 
87.8 	housing pool for allocation until the last Monday in November 2008, or the last Monday 
87.9 	in November 2009, if the temporary increase in the annual volume is made available 
87.10 	for calendar year 2009;
87.11 	(3) any allocation of the temporary increase in the annual volume cap that is 
87.12 	canceled under Minnesota Statutes, section 474A.061, subdivision 4, shall be returned to 
87.13 	the housing pool for reallocation, unless the cancellation occurs after the last Monday in 
87.14 	November 2008, or after the last Monday in November 2009, if the temporary increase in 
87.15 	the annual volume is made available for calendar year 2009, in which case the canceled 
87.16 	allocation is allocated to the agency; and
87.17 	(4) any bonding authority attributable to the temporary increase in the annual 
87.18 	volume cap that has not been allocated on December 1, 2008, or on December 1, 2009, if 
87.19 	the temporary increase in the annual volume is made available for calendar year 2009, is 
87.20 	allocated to the agency.
87.21 		Subd. 5.Single-family housing programs. (a) Bonding authority reserved in the 
87.22 	housing pool for single-family housing programs under subdivision 3 is available for 
87.23 	single-family housing programs for cities that applied in January 2008, and received an 
87.24 	allocation under Minnesota Statutes, section 474A.061, subdivision 2a, in 2008. If the 
87.25 	temporary increase in the annual volume is made available for calendar year 2009, the 
87.26 	bonding authority reserved in the housing pool for single-family housing programs under 
87.27 	subdivision 3 is available for single-family housing programs for cities that applied in 
87.28 	January 2009, and received an allocation under Minnesota Statutes, section 474A.061, 
87.29 	subdivision 2a, in 2009. The agency shall receive an allocation for mortgage bonds 
87.30 	pursuant to this subdivision. For a period of time determined by the agency, the agency 
87.31 	may accept applications from the cities for the volume cap.
87.32 	(b) The agency may issue bonds on behalf of participating cities. The agency shall 
87.33 	request an allocation from the commissioner for all applicants and the commissioner 
87.34 	shall allocate the requested amount to the agency. Allocations shall be awarded by the 
87.35 	commissioner through the last Monday in November 2008 for applications received by 
87.36 	4:30 p.m. on the Monday of the week preceding an allocation. If the temporary increase in 
88.1 	the annual volume is made available for calendar year 2009, the commissioner shall award 
88.2 	allocations through the last Monday in November 2009 for applications received by 4:30 
88.3 	p.m. on the Monday of the week preceding an allocation.
88.4 	Allocations must be made for each loan on a first-come, first-served basis among 
88.5 	the cities. The agency shall submit an application fee under Minnesota Statutes, section 
88.6 	474A.03, subdivision 4, and an application deposit equal to two percent of the requested 
88.7 	allocation to the commissioner when requesting an allocation from the housing pool 
88.8 	under this subdivision. After awarding an allocation and receiving a notice of issuance 
88.9 	for mortgage bonds issued on behalf of the participating cities, the commissioner shall 
88.10 	transfer the application deposit to the agency.
88.11 	(c) Total allocations from the housing pool for single-family housing programs 
88.12 	under this subdivision may not exceed 31 percent of the allocation to the housing pool 
88.13 	under subdivision 3 until November 1, 2008. If the temporary increase in the annual 
88.14 	volume is made available for calendar year 2009, the total allocations from the housing 
88.15 	pool for single-family housing programs under this subdivision may not exceed 31 percent 
88.16 	of the allocation to the housing pool under subdivision 3 until November 1, 2009.
88.17 	(d) An allocation awarded to the agency for mortgage bonds under this subdivision 
88.18 	may be carried forward by the agency as provided in subdivision 6.
88.19 		Subd. 6.Carryforward. Any issuer that receives an allocation under this section 
88.20 	may carry forward the allocation to the extent permitted by federal tax law. The provisions 
88.21 	of Minnesota Statutes, section 474A.04, subdivision 1a, do not apply to the carryforward.

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

88.23 	ARTICLE 6
88.24 	PROPERTY TAXES

88.25 	Section 1. Minnesota Statutes 2006, section 126C.41, subdivision 2, is amended to read:
88.26 		Subd. 2.Retired employee health benefits. A district may levy an amount up to the 
88.27 	amount the district is required by the collective bargaining agreement in effect on March 
88.28 	30, 1992, to pay for health insurance or unreimbursed medical expenses for licensed 
88.29 	and nonlicensed employees who have terminated services in the employing district and 
88.30 	withdrawn from active teaching service or other active service, as applicable, before July 
88.31 	1, 1992 1998, if a sunset clause is in effect for the current collective bargaining agreement. 
88.32 	The total amount of the levy each year may not exceed $600,000.

88.33 	EFFECTIVE DATE. This section is effective for taxes payable in 2009 and 
88.34 	thereafter.

89.1 	Sec. 2. Minnesota Statutes 2006, section 270C.85, subdivision 2, is amended to read:
89.2 		Subd. 2.Powers and duties. The commissioner shall have and exercise the 
89.3 	following powers and duties in administering the property tax laws.
89.4 	(a) Confer with, advise, and give the necessary instructions and directions to local 
89.5 	assessors and local boards of review throughout the state as to their duties under the 
89.6 	laws of the state.
89.7 	(b) Direct proceedings, actions, and prosecutions to be instituted to enforce the 
89.8 	laws relating to the liability and punishment of public officers and officers and agents of 
89.9 	corporations for failure or negligence to comply with the provisions of the property tax 
89.10 	laws, and cause complaints to be made against local assessors, members of boards of 
89.11 	equalization, members of boards of review, or any other assessing or taxing officer, to the 
89.12 	proper authority, for their removal from office for misconduct or negligence of duty.
89.13 	(c) Require county attorneys to assist in the commencement of prosecutions in 
89.14 	actions or proceedings for removal, forfeiture, and punishment, for violation of the 
89.15 	property tax laws in their respective districts or counties.
89.16 	(d) Require town, city, county, and other public officers to report information as to 
89.17 	the assessment of property, and such other information as may be needful in the work of 
89.18 	the commissioner, in such form as the commissioner may prescribe.
89.19 	(e) Transmit to the governor, on or before the third Monday in December of each 
89.20 	even-numbered year, and to each member of the legislature, on or before November 
89.21 	15 of each even-numbered year, the report of the department for the preceding years, 
89.22 	showing all the taxable property subject to the property tax laws and the value of the 
89.23 	same, in tabulated form.
89.24 	(f) Inquire into the methods of assessment and taxation and ascertain whether the 
89.25 	assessors faithfully discharge their duties.
89.26 	(g) Assist local assessors in determining the estimated market value of industrial 
89.27 	special-use property. For purposes of this paragraph, "industrial special-use property" 
89.28 	means property that:
89.29 	(1) is designed and equipped for a particular type of industry;
89.30 	(2) is not easily adapted to some other use due to the unique nature of the facilities;
89.31 	(3) has facilities totaling at least 75,000 square feet in size; and
89.32 	(4) has a total estimated market value of $10,000,000 or greater based on the 
89.33 	assessor's preliminary determination.

89.34 	EFFECTIVE DATE. This section is effective for assessment year 2009 and 
89.35 	thereafter, for taxes payable in 2010 and thereafter.

90.1 	Sec. 3. Minnesota Statutes 2006, section 272.02, subdivision 55, is amended to read:
90.2 		Subd. 55.Electric generation facility; personal property. Notwithstanding 
90.3 	subdivision 9, clause (a), attached machinery and other personal property which is part of 
90.4 	an electric generating facility that meets the requirements of this subdivision is exempt. 
90.5 	At the time of construction, the facility must (i) be designated as an innovative energy 
90.6 	project as defined in section 216B.1694, (ii) be within a tax relief area as defined in 
90.7 	section 273.134, (iii) have access to existing railroad infrastructure within less than three 
90.8 	miles, (iv) have received by resolution approval from the governing body of the county 
90.9 	and township or city in which the proposed facility is to be located for the exemption 
90.10 	of personal property under this subdivision, and (v) be designed to host at least 500 
90.11 	megawatts of electrical generation.
90.12 	Construction of the first 500 megawatts of the facility must be commenced after 
90.13 	January 1, 2006, and before January 1, 2010 2012. Construction of up to an additional 750 
90.14 	megawatts of generation must be commenced before January 1, 2015. Property eligible 
90.15 	for this exemption does not include electric transmission lines and interconnections or gas 
90.16 	pipelines and interconnections appurtenant to the property or the facility. To qualify for an 
90.17 	exemption under this subdivision, the owner of the electric generation facility must have 
90.18 	an agreement with the host county, township or city, and school district, for payment in 
90.19 	lieu of personal property taxes to the host county, township or city, and school district.

90.20 	Sec. 4. Minnesota Statutes 2006, section 272.02, subdivision 84, is amended to read:
90.21 		Subd. 84.Electric generation facility; personal property. Notwithstanding 
90.22 	subdivision 9, clause (a), attached machinery and other personal property which is part 
90.23 	of a 10.3 megawatt run-of-the-river hydroelectric generation facility and that meets the 
90.24 	requirements of this subdivision is exempt. At the time of construction, the facility must:
90.25 	(1) utilize between 12 and 16 turbine generators at a dam site existing on March 
90.26 	31, 1994;
90.27 	(2) be located on land within 3,000 feet of a 13.8 kilovolt distribution substation; and
90.28 	(3) be eligible to receive a renewable energy production incentive payment under 
90.29 	section 216C.41.
90.30 	Construction of the facility must be commenced after April 30, 2006, and before 
90.31 	January 1, 2009 2011. Property eligible for this exemption does not include electric 
90.32 	transmission lines and interconnections or gas pipelines and interconnections appurtenant 
90.33 	to the property or the facility.

91.1 	Sec. 5. Minnesota Statutes 2006, section 272.02, is amended by adding a subdivision 
91.2 	to read:
91.3 		Subd. 88.Fergus Falls historical zone. (a) Property located in the area of the 
91.4 	campus of the former state regional treatment center in the city of Fergus Falls, including 
91.5 	the five buildings and associated land that were acquired by the city prior to January 1, 
91.6 	2007, is exempt from ad valorem taxes levied under chapter 275.
91.7 	(b) The exemption applies for 15 calendar years from the date specified by resolution 
91.8 	of the governing body of the city of Fergus Falls. For the final three assessment years of 
91.9 	the duration limit, the exemption applies to the following percentages of estimated market 
91.10 	value of the property:
91.11 	(1) for the third to the last assessment year of the duration, 75 percent;
91.12 	(2) for the second to the last assessment year of the duration, 50 percent; and
91.13 	(3) for the last assessment  year of the duration, 25 percent.

91.14 	EFFECTIVE DATE. This section is effective for property taxes payable in 2009 
91.15 	and thereafter.

91.16 	Sec. 6. Minnesota Statutes 2006, section 272.02, is amended by adding a subdivision 
91.17 	to read:
91.18 		Subd. 89.Electric generation facility; personal property. (a) Notwithstanding 
91.19 	subdivision 9, paragraph (a), attached machinery and other personal property which is 
91.20 	part of a simple-cycle combustion-turbine electric generation facility that exceeds 150 
91.21 	megawatts of installed capacity and that meets the requirements of this subdivision is 
91.22 	exempt. At the time of construction, the facility must:
91.23 	(1) utilize natural gas as a primary fuel;
91.24 	(2) be owned by an electric generation and transmission cooperative;
91.25 	(3) be located within one mile of an existing 16-inch natural gas pipeline and a 
91.26 	69-kilovolt and a 230-kilovolt high-voltage electric transmission line;
91.27 	(4) be designed to provide peaking, emergency backup, or contingency services;
91.28 	(5) have received a certificate of need under section 216B.243 demonstrating 
91.29 	demand for its capacity; and
91.30 	(6) have received by resolution the approval from the governing bodies of the county 
91.31 	and the city in which the proposed facility is to be located for the exemption of personal 
91.32 	property under this subdivision.
91.33 	(b) Construction of the facility must be commenced after January 1, 2008, and 
91.34 	before January 1, 2012. Property eligible for this exemption does not include electric 
92.1 	transmission lines and interconnections or gas pipelines and interconnections appurtenant 
92.2 	to the property or the facility.

92.3 	EFFECTIVE DATE. This section is effective for the 2008 assessment payable in 
92.4 	2009 and thereafter.

92.5 	Sec. 7. [272.0213] LEASED SEASONAL-RECREATIONAL LAND.
92.6 	A county board may elect, by resolution, to exempt from taxation, including the 
92.7 	tax under section 273.19, qualified lands. "Qualified lands" for purposes of this section 
92.8 	means property that:
92.9 	(1) is owned by a county, city, town, the state, or the federal governments;
92.10 	(2) is rented by the entity for noncommercial seasonal-recreational or noncommercial 
92.11 	seasonal-recreational residential use; and
92.12 	(3) was rented for the purposes specified in clause (2) and was exempt from taxation 
92.13 	for property taxes payable in 2008.

92.14 	EFFECTIVE DATE. This section is effective beginning for taxes payable in 2009.

92.15 	Sec. 8. [273.0645] COMMISSIONER REVIEW OF LOCAL ASSESSMENT 
92.16 	PRACTICES.
92.17 	The commissioner of revenue must review the assessment practices in a taxing 
92.18 	jurisdiction if requested in writing by a qualifying number of property owners in that 
92.19 	taxing jurisdiction. The request must be signed by the greater of:
92.20 	(1) ten percent of the registered voters who voted in the last general election; or
92.21 	(2) five property owners.
92.22 	The request must identify the city, town, or county and describe why a review is 
92.23 	sought for that taxing jurisdiction. The commissioner must conduct the review in a 
92.24 	reasonable amount of time and report the findings to the county board of the affected 
92.25 	county, to the affected city council or town board, if the review is for a specific city or 
92.26 	town, and to the property owner designated in the request as the person to receive the 
92.27 	report on behalf of all the property owners who signed the request. The commissioner 
92.28 	must also provide the report electronically to all property owners who signed the request 
92.29 	and provided an e-mail address in order to receive the report electronically.

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

92.31 	Sec. 9. Minnesota Statutes 2006, section 273.11, subdivision 14a, is amended to read:
93.1 		Subd. 14a.Vacant land platted on or after August 1, 2001; located in 
93.2 	metropolitan counties. (a) Except as provided in subdivision 14c, all land platted on or 
93.3 	after August 1, 2001, located in a metropolitan county, and not improved with a permanent 
93.4 	structure, shall be assessed as provided in this subdivision. The assessor shall determine 
93.5 	the market value of each individual lot based upon the highest and best use of the property 
93.6 	as unplatted land. In establishing the market value of the property, the assessor shall 
93.7 	consider the sale price of the unplatted land or comparable sales of unplatted land of 
93.8 	similar use and similar availability of public utilities.
93.9 	(b) The market value determined in paragraph (a) shall be increased as follows for 
93.10 	each of the three assessment years immediately following the final approval of the plat: 
93.11 	one-third of the difference between the property's unplatted market value as determined 
93.12 	under paragraph (a) and the market value based upon the highest and best use of the land 
93.13 	as platted property shall be added in each of the three subsequent assessment years.
93.14 	(c) Any increase in market value after the first assessment year following the plat's 
93.15 	final approval shall be added to the property's market value in the next assessment year. 
93.16 	Notwithstanding paragraph (b), if the property is sold or transferred, or construction 
93.17 	begins before the expiration of the three years in paragraph (b), that lot shall be eligible 
93.18 	for revaluation in the next assessment year. The market value of a platted lot determined 
93.19 	under this subdivision shall not exceed the value of that lot based upon the highest and 
93.20 	best use of the property as platted land.
93.21 	(d) For purposes of this section, "metropolitan county" means the counties of Anoka, 
93.22 	Carver, Dakota, Hennepin, Ramsey, Scott, and Washington.

93.23 	EFFECTIVE DATE. This section is effective for taxes payable in 2010 and 
93.24 	thereafter.

93.25 	Sec. 10. Minnesota Statutes 2006, section 273.11, subdivision 14b, is amended to read:
93.26 		Subd. 14b.Vacant land platted on or after August 1, 2001; located in 
93.27 	nonmetropolitan counties. (a) All land platted on or after August 1, 2001, located in a 
93.28 	nonmetropolitan county, and not improved with a permanent structure, shall be assessed 
93.29 	as provided in this subdivision. The assessor shall determine the market value of each 
93.30 	individual lot based upon the highest and best use of the property as unplatted land. In 
93.31 	establishing the market value of the property, the assessor shall consider the sale price 
93.32 	of the unplatted land or comparable sales of unplatted land of similar use and similar 
93.33 	availability of public utilities.
93.34 	(b) The market value determined in paragraph (a) shall be increased as follows for 
93.35 	each of the seven assessment years immediately following the final approval of the plat: 
94.1 	one-seventh of the difference between the property's unplatted market value as determined 
94.2 	under paragraph (a) and the market value based upon the highest and best use of the land 
94.3 	as platted property shall be added in each of the seven subsequent assessment years.
94.4 	(c) Any increase in market value after the first assessment year following the plat's 
94.5 	final approval shall be added to the property's market value in the next assessment year. 
94.6 	Notwithstanding paragraph (b), if the property is sold or transferred, or construction 
94.7 	begins before the expiration of the seven years in paragraph (b), that lot shall be eligible 
94.8 	for revaluation in the next assessment year. The market value of a platted lot determined 
94.9 	under this subdivision shall not exceed the value of that lot based upon the highest and 
94.10 	best use of the property as platted land.

94.11 	EFFECTIVE DATE. This section is effective for taxes payable in 2010 and 
94.12 	thereafter.

94.13 	Sec. 11. Minnesota Statutes 2006, section 273.11, is amended by adding a subdivision 
94.14 	to read:
94.15 		Subd. 14c.Certain vacant land platted on or after August 1, 2001; located 
94.16 	in metropolitan county. (a) All land platted on or after August 1, 2001, located in a 
94.17 	metropolitan county and not improved with a structure shall be eligible for the phase-in 
94.18 	assessment schedule under this subdivision, provided the property (i) is classified 
94.19 	homestead under section 273.13, subdivision 22 or 23, in the assessment year prior to the 
94.20 	year the initial platting begins on the property; (ii) has been owned or part-owned by the 
94.21 	same person for the ten consecutive years prior to the initial platting; and (iii) remains 
94.22 	under the same ownership in the current assessment year.
94.23 	(b) Based upon the assessor's records, the assessor shall obtain the estimated market 
94.24 	value of each individual lot based upon the highest and best use of the property as unplatted 
94.25 	land for the assessment year that the property was platted. In establishing the market value 
94.26 	of the property, the assessor shall have considered the sale price of the unplatted land or 
94.27 	comparable sales of unplatted land of similar use and similar availability of public utilities.
94.28 	(c) To the market value determined in paragraph (b) shall be added one-seventh 
94.29 	of the difference between the property's unplatted market value as determined under 
94.30 	paragraph (b) and the market value based upon the highest and best use of the land as 
94.31 	platted property in the current year, multiplied by the number of assessment years since 
94.32 	the property was platted, in each of the subsequent assessment years.
94.33 	(d) Notwithstanding paragraph (c), if the property is sold or transferred, or 
94.34 	construction begins before the expiration of the phase-in in paragraph (c), that lot shall 
94.35 	be eligible for revaluation in the next assessment year. The market value of a platted lot 
95.1 	determined under this subdivision shall not exceed the value of that lot based upon the 
95.2 	highest and best use of the property as platted land.
95.3 	(e) Any owner of eligible property platted before July 1, 2008, must file an 
95.4 	application with the assessor in order to receive the phase-in under this subdivision for the 
95.5 	remainder of the seven-year period. The application must be filed before July 1 in order 
95.6 	for the property to be eligible for the current year's assessment. The commissioner shall 
95.7 	prescribe a uniform application form and instructions.
95.8 	(f) For purposes of this section, "metropolitan county" means the counties of Anoka, 
95.9 	Carver, Dakota, Hennepin, Ramsey, Scott, and Washington.

95.10 	EFFECTIVE DATE. This section is effective for taxes payable in 2009 and 
95.11 	thereafter, except that the portion of paragraph (d) referring to a lot that is sold or 
95.12 	transferred is effective for taxes payable in 2010 and thereafter.

95.13 	Sec. 12. Minnesota Statutes 2006, section 273.111, subdivision 3, as amended by Laws 
95.14 	2008, chapter 154, article 13, section 26, is amended to read:
95.15 		Subd. 3. Requirements. (a) Real estate consisting of ten acres or more or a nursery 
95.16 	or greenhouse, and qualifying for classification as class 1b, 2a, or 2b under section 273.13, 
95.17 	shall be entitled to valuation and tax deferment under this section only if it is primarily 
95.18 	devoted to agricultural use, and meets the qualifications in subdivision 6, and either: 
95.19 	(1) is the homestead of the owner, or of a surviving spouse, child, or sibling of the 
95.20 	owner or is real estate which is farmed with the real estate which contains the homestead 
95.21 	property; or 
95.22 	(2) has been in possession of the applicant, the applicant's spouse, parent, or sibling, 
95.23 	or any combination thereof, for a period of at least seven years prior to application for 
95.24 	benefits under the provisions of this section, or is real estate which is farmed with the 
95.25 	real estate which qualifies under this clause and is within four townships or cities or 
95.26 	combination thereof from the qualifying real estate; or 
95.27 	(3) is the homestead of a shareholder in a family farm corporation as defined in 
95.28 	section 500.24, notwithstanding the fact that legal title to the real estate may be held in 
95.29 	the name of the family farm corporation an individual who is part of an entity described 
95.30 	in paragraph (b), clause (1), (2), or (3); or 
95.31 	(4) is in the possession of a nursery or greenhouse or an entity owned by a proprietor, 
95.32 	partnership, or corporation which also owns the nursery or greenhouse operations on the 
95.33 	parcel or parcels, provided that only the acres used to produce nursery stock qualify 
95.34 	for treatment under this section. 
96.1 	(b) Valuation of real estate under this section is limited to parcels the ownership of 
96.2 	which is in noncorporate entities owned by individuals  except for: 
96.3 	(1) a family farm corporations organized pursuant to entity or authorized farm entity 
96.4 	regulated under  section 500.24; and
96.5 	(2) a poultry entity other than a limited liability entity in which the majority of the 
96.6 	members, partners, or shareholders are related and at least one of the members, partners, 
96.7 	or shareholders either resides on the land or actively operates the land; and
96.8 	(3) corporations that derive 80 percent or more of their gross receipts from the 
96.9 	wholesale or retail sale of horticultural or nursery stock. 
96.10 	The terms in this paragraph have the meanings given in section 500.24, where 
96.11 	applicable.
96.12 	(c) Land that previously qualified for tax deferment under this section and no longer 
96.13 	qualifies because it is not primarily used for agricultural purposes but would otherwise 
96.14 	qualify under subdivisions Minnesota Statutes 2006, section 273.111, subdivision 3 and 6, 
96.15 	 for a period of at least three years will not be required to make payment of the previously 
96.16 	deferred taxes, notwithstanding the provisions of subdivision 9. Sale of the land prior to 
96.17 	the expiration of the three-year period requires payment of deferred taxes as follows: sale 
96.18 	in the year the land no longer qualifies requires payment of the current year's deferred 
96.19 	taxes plus payment of deferred taxes for the two prior years; sale during the second year 
96.20 	the land no longer qualifies requires payment of the current year's deferred taxes plus 
96.21 	payment of the deferred taxes for the prior year; and sale during the third year the land 
96.22 	no longer qualifies requires payment of the current year's deferred taxes. Deferred taxes 
96.23 	shall be paid even if the land qualifies pursuant to subdivision 11a. When such property is 
96.24 	sold or no longer qualifies under this paragraph, or at the end of the three-year period, 
96.25 	whichever comes first, all deferred special assessments plus interest are payable in equal 
96.26 	installments spread over the time remaining until the last maturity date of the bonds issued 
96.27 	to finance the improvement for which the assessments were levied. If the bonds have 
96.28 	matured, the deferred special assessments plus interest are payable within 90 days. The 
96.29 	provisions of section 429.061, subdivision 2, apply to the collection of these installments. 
96.30 	Penalties are not imposed on any such special assessments if timely paid. 
96.31 	(d) Land that is enrolled in the reinvest in Minnesota program under sections 
96.32 	103F.501 to 103F.535, the federal Conservation Reserve Program as contained in Public 
96.33 	Law 99-198, or a similar state or federal conservation program does not qualify for 
96.34 	valuation and assessment deferral under this section. This paragraph applies to land that 
96.35 	has not qualified under this section for taxes payable in 2009 or previous years.

97.1 	EFFECTIVE DATE. This section is effective for taxes payable in 2010 and 
97.2 	thereafter.

97.3 	Sec. 13. Minnesota Statutes 2006, section 273.111, is amended by adding a subdivision 
97.4 	to read:
97.5 		Subd. 3a.Property no longer eligible for deferment. (a) Real estate receiving 
97.6 	the tax deferment under this section for assessment year 2008, but that does not qualify 
97.7 	for the 2009 assessment year due to changes in qualification requirements under this act, 
97.8 	shall continue to qualify until any part of the land is sold, transferred, or subdivided, 
97.9 	provided that the property continues to meet the requirements of Minnesota Statutes 2006, 
97.10 	section 273.111, subdivision 3.
97.11 	(b) When property assessed under this subdivision is withdrawn from the program or 
97.12 	becomes ineligible, the property shall be subject to additional taxes, in the amount equal 
97.13 	to the average difference between the taxes determined in accordance with subdivision 
97.14 	4, and the amount determined under subdivision 5, for the current year and the two 
97.15 	preceding years, multiplied by (1) three, in the case of class 2a property under section 
97.16 	273.13, subdivision 23, or any property withdrawn before January 2, 2009, or (2) seven, in 
97.17 	the case of property withdrawn after January 2, 2009, that is not class 2a property. The 
97.18 	number of years used as the multiplier must not exceed the number of years during which 
97.19 	the property was subject to this section. The amount determined under subdivision 5 shall 
97.20 	not be greater than it would have been had the actual bona fide sale price of the real 
97.21 	property at an arm's-length transaction been used in lieu of the market value determined 
97.22 	under subdivision 5. The additional taxes shall be extended against the property on the 
97.23 	tax list for the current year, provided that no interest or penalties shall be levied on the 
97.24 	additional taxes if timely paid.

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

97.26 	Sec. 14. Minnesota Statutes 2006, section 273.111, subdivision 4, is amended to read:
97.27 		Subd. 4.Determination of value. (a) The value of any real estate described 
97.28 	in subdivision 3 shall upon timely application by the owner, in the manner provided 
97.29 	in subdivision 8, be determined solely with reference to its appropriate agricultural 
97.30 	classification and value notwithstanding sections 272.03, subdivision 8, and 273.11. In 
97.31 	determining the value for ad valorem tax purposes, the assessor shall use sales data for 
97.32 	agricultural lands located outside the seven metropolitan counties having similar soil 
97.33 	types, number of degree days, and other similar agricultural characteristics. Furthermore, 
97.34 	the assessor shall not consider any added values resulting from nonagricultural factors. 
98.1 	In order to account for the presence of nonagricultural influences that may affect the value 
98.2 	of agricultural land, the commissioner of revenue shall develop a fair and uniform method 
98.3 	of determining agricultural values for each county in the state that are consistent with this 
98.4 	subdivision. The commissioner shall annually assign the resulting values to each county, 
98.5 	and these values shall be used as the basis for determining the agricultural value for all 
98.6 	properties in the county qualifying for tax deferment under this section.
98.7 	(b) In the case of property qualifying for tax deferment only under subdivision 3a, 
98.8 	the value shall be based on the value in effect for assessment year 2008, multiplied by 
98.9 	the ratio of the total taxable market value of all property in the county for the current 
98.10 	assessment year divided by the total taxable market value of all property in the county 
98.11 	for assessment year 2008.

98.12 	EFFECTIVE DATE. This section is effective for assessment year 2009 and 
98.13 	thereafter.

98.14 	Sec. 15. Minnesota Statutes 2006, section 273.111, subdivision 8, is amended to read:
98.15 		Subd. 8.Application. Application for deferment of taxes and assessment under this 
98.16 	section shall be filed by May 1 of the year prior to the year in which the taxes are payable. 
98.17 	Any application filed hereunder and granted shall continue in effect for subsequent years 
98.18 	until the property no longer qualifies. Such The application shall must be filed with the 
98.19 	assessor of the taxing district in which the real property is located on such the form as 
98.20 	may be prescribed by the commissioner of revenue. The assessor may require proof by 
98.21 	affidavit or otherwise that the property qualifies under subdivisions subdivision 3 and 6
98.22 	and may require the applicant to provide a copy of the appropriate schedule or form 
98.23 	showing farm income that is attested to by the applicant as having been included in the 
98.24 	most recently filed federal income tax return of the applicant.

98.25 	EFFECTIVE DATE. This section is effective for applications filed after May 
98.26 	1, 2008.

98.27 	Sec. 16. Minnesota Statutes 2006, section 273.111, subdivision 9, is amended to read:
98.28 		Subd. 9.Additional taxes. When real property which is being, or has been valued 
98.29 	and assessed under this section no longer qualifies under subdivisions subdivision 3 and 6, 
98.30 	the portion no longer qualifying shall be subject to additional taxes, in the amount equal to 
98.31 	the difference between the taxes determined in accordance with subdivision 4, and the 
98.32 	amount determined under subdivision 5. Provided, however, that the amount determined 
98.33 	under subdivision 5 shall not be greater than it would have been had the actual bona fide 
99.1 	sale price of the real property at an arm's-length transaction been used in lieu of the market 
99.2 	value determined under subdivision 5. Such additional taxes shall be extended against 
99.3 	the property on the tax list for the current year, provided, however, that no interest or 
99.4 	penalties shall be levied on such additional taxes if timely paid, and provided further, that 
99.5 	such additional taxes shall only be levied with respect to the last three years that the said 
99.6 	property has been valued and assessed under this section.

99.7 	EFFECTIVE DATE. This section is effective for deferred taxes payable in 2009 
99.8 	and thereafter.

99.9 	Sec. 17. Minnesota Statutes 2006, section 273.111, subdivision 11, is amended to read:
99.10 		Subd. 11.Special local assessments. The payment of special local assessments 
99.11 	levied after June 1, 1967, for improvements made to any real property described in 
99.12 	subdivision 3 together with the interest thereon shall, on timely application as provided 
99.13 	in subdivision 8, be deferred as long as such property meets the conditions contained in 
99.14 	subdivisions subdivision 3 and 6 or 3a or is transferred to an agricultural preserve under 
99.15 	sections 473H.02 to 473H.17. If special assessments against the property have been 
99.16 	deferred pursuant to this subdivision, the governmental unit shall file with the county 
99.17 	recorder in the county in which the property is located a certificate containing the legal 
99.18 	description of the affected property and of the amount deferred. When such property 
99.19 	no longer qualifies under subdivisions subdivision 3 and 6 or 3a, all deferred special 
99.20 	assessments plus interest shall be payable in equal installments spread over the time 
99.21 	remaining until the last maturity date of the bonds issued to finance the improvement 
99.22 	for which the assessments were levied. If the bonds have matured, the deferred special 
99.23 	assessments plus interest shall be payable within 90 days. The provisions of section 
99.24 	429.061, subdivision 2, apply to the collection of these installments. Penalty shall not be 
99.25 	levied on any such special assessments if timely paid. 

99.26 	EFFECTIVE DATE. This section is effective for deferred taxes payable in 2009 
99.27 	and thereafter.

99.28 	Sec. 18. Minnesota Statutes 2006, section 273.111, subdivision 11a, is amended to read:
99.29 		Subd. 11a.Continuation of tax treatment upon sale. When real property 
99.30 	qualifying under subdivisions subdivision 3 and 6 is sold, no additional taxes or deferred 
99.31 	special assessments plus interest shall be extended against the property provided the 
99.32 	property continues to qualify pursuant to subdivisions subdivision 3 and 6, and provided 
99.33 	the new owner files an application for continued deferment within 30 days after the sale.
100.1 	For purposes of meeting the income requirements of subdivision 6, the property 
100.2 	purchased shall be considered in conjunction with other qualifying property owned by 
100.3 	the purchaser.

100.4 	EFFECTIVE DATE. This section is effective for deferred taxes payable in 2009 
100.5 	and thereafter.

100.6 	Sec. 19. Minnesota Statutes 2006, section 273.111, subdivision 14, is amended to read:
100.7 		Subd. 14.Applicability of special assessment provisions. (a) This section shall 
100.8 	apply to special local assessments levied after July 1, 1967, and payable in the years 
100.9 	thereafter, but shall not apply to any special assessments levied at any time by a county 
100.10 	or district court under the provisions of chapter 116A or by a watershed district under 
100.11 	chapter 103D.
100.12 	(b) For special assessments levied by a watershed district under chapter 103D before 
100.13 	June 1, 2008, this section is effective only for real property initially qualifying for tax 
100.14 	deferment after May 31, 2008. For special assessments by a watershed district under 
100.15 	chapter 103D levied after May 31, 2008, this section is effective for all real property 
100.16 	qualifying for tax deferment under this section.

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

100.18 	Sec. 20. Minnesota Statutes 2006, section 273.111, is amended by adding a subdivision 
100.19 	to read:
100.20 		Subd. 17.Implementation of program. This section must be applied to eligible 
100.21 	properties by all county assessors, beginning no later than assessments for taxes levied 
100.22 	in 2009, payable in 2010, and thereafter, unless the commissioner of revenue determines 
100.23 	that a county is unable to comply with this requirement, in which case the county must 
100.24 	implement it for taxes levied in 2010, payable in 2011, and thereafter.

100.25 	Sec. 21. [273.1115] AGGREGATE RESOURCE PRESERVATION PROPERTY 
100.26 	TAX LAW.
100.27 		Subdivision 1.Definitions. For purposes of this section, "commercial aggregate 
100.28 	deposit" and "actively mined" have the meanings given them in section 273.13, 
100.29 	subdivision 23, paragraph (l).
100.30 		Subd. 2.Requirement. Real estate is entitled to valuation under this section only if 
100.31 	all of the following requirements are met:
101.1 	(1) the property is classified 1a, 1b, 2a, or 2b property under section 273.13, 
101.2 	subdivisions 22 and 23;
101.3 	(2) the property is at least ten contiguous acres, when the application is filed under 
101.4 	subdivision 3;
101.5 	(3) the owner has filed a completed application for deferment as specified in 
101.6 	subdivision 3 with the county assessor in the county in which the property is located;
101.7 	(4) there are no delinquent taxes on the property; and
101.8 	(5) a covenant on the land restricts its use as provided in subdivision 3, clause (4).
101.9 		Subd. 3.Application. Application for valuation deferment under this section 
101.10 	must be filed by May 1 of the assessment year. Any application filed and granted 
101.11 	continues in effect for subsequent years until the property no longer qualifies, provided 
101.12 	that supplemental affidavits under subdivision 8 are timely filed. The application must 
101.13 	be filed with the assessor of the county in which the real property is located on such 
101.14 	form as may be prescribed by the commissioner of revenue. The application must be 
101.15 	executed and acknowledged in the manner required by law to execute and acknowledge a 
101.16 	deed and must contain at least the following information and any other information the 
101.17 	commissioner deems necessary:
101.18 	(1) the legal description of the area;
101.19 	(2) the name and address of owner;
101.20 	(3) a copy of the affidavit filed under section 273.13, subdivision 23, paragraph 
101.21 	(l), when property is classified as:
101.22 	(i) 1b under section 273.13, subdivision 22, paragraph (b);
101.23 	(ii) 2a under section 273.13, subdivision 23;
101.24 	(iii) 2b under section 273.13, subdivision 23; or
101.25 	(iv) 2e under section 273.13, subdivision 23, paragraph (l).
101.26 	The application must include a similar document with the same information as 
101.27 	contained in the affidavit under section 273.13, subdivision 23, paragraph (l); and
101.28 	(4) a statement of proof from the owner that the land contains a restrictive covenant 
101.29 	limiting its use for the property's surface to that which exists on the date of the application 
101.30 	and limiting its future use to the preparation and removal of the commercial aggregate 
101.31 	deposit under its surface. To qualify under this clause, the covenant must be binding on 
101.32 	the owner or the owner's successor or assignee, and run with the land, except as provided 
101.33 	in subdivision 5 allowing for the cancellation of the covenant under certain conditions.
101.34 		Subd. 4.Determination of value. Upon timely application by the owner as provided 
101.35 	in subdivision 3, notwithstanding sections 272.03, subdivision 8, and 273.11, the value of 
101.36 	any qualifying land described in subdivision 3 must be valued as if it were agricultural 
102.1 	property, using a per acre valuation equal to the current assessment year's average per acre 
102.2 	valuation of agricultural land in the county. The assessor shall not consider any additional 
102.3 	value resulting from potential alternative and future uses of the property. The buildings 
102.4 	located on the land shall be valued by the assessor in the normal manner.
102.5 		Subd. 5.Cancellation of covenant. The covenant required under subdivision 
102.6 	3 may be canceled in two ways:
102.7 	(1) by the owner beginning with the next subsequent assessment year provided 
102.8 	that the additional taxes as determined under subdivision 7 are paid by the owner at the 
102.9 	time of cancellation; or
102.10 	(2) by the city or town in which the property is located beginning with the next 
102.11 	subsequent assessment year, if the city council or town board:
102.12 	(i) changes the conditional use of the property;
102.13 	(ii) revokes the mining permit; or
102.14 	(iii) changes the zoning to disallow mining.
102.15 	No additional taxes are imposed on the property under this clause.
102.16 		Subd. 6.County termination. Within two years of the effective date of this section, 
102.17 	a county may, following notice and public hearing, terminate application of this section 
102.18 	in the county. The termination is effective upon adoption of a resolution of the county 
102.19 	board. A county has 60 days from receipt of the first application for enrollment under 
102.20 	this section to notify the applicant and any subsequent applicants of the county's intent 
102.21 	to begin the process of terminating application of this section in the county. The county 
102.22 	must act on the termination within six months. Upon termination by a vote of the county 
102.23 	board, all applications received prior to and during notification of intent to terminate shall 
102.24 	be deemed void. If the county board does not act on the termination within six months of 
102.25 	notification, all applications for valuation for deferment received shall be deemed eligible 
102.26 	for consideration to be enrolled under this section. Following this initial 60-day grace 
102.27 	period, a termination applies prospectively and does not affect property enrolled under this 
102.28 	section prior to the termination date. A county may reauthorize application of this section 
102.29 	by a resolution of the county board revoking the termination.
102.30 		Subd. 7.Additional taxes. When real property which has been valued and assessed 
102.31 	under this section no longer qualifies, the portion of the land classified under subdivision 
102.32 	2, clause (1), is subject to additional taxes. The additional tax amount is determined by:
102.33 	(1) computing the difference between (i) the current year's taxes determined in 
102.34 	accordance with subdivision 4, and (ii) an amount as determined by the assessor based 
102.35 	upon the property's current year's estimated market value of like real estate at its highest 
102.36 	and best use and the appropriate local tax rate; and
103.1 	(2) multiplying the amount determined in clause (1) by the number of years the 
103.2 	land was in the program under this section. The current year's estimated market value as 
103.3 	determined by the assessor must not exceed the market value that would result if the 
103.4 	property was sold in an arms-length transaction and must not be greater than it would have 
103.5 	been had the actual bona fide sale price of the property been used in lieu of that market 
103.6 	value. The additional taxes must be extended against the property on the tax list for the 
103.7 	current year, except that interest or penalties must not be levied on these additional taxes if 
103.8 	timely paid. The additional tax under this subdivision must not be imposed on that portion 
103.9 	of the property which has actively been mined and has been removed from the program 
103.10 	based upon the supplemental affidavits filed under subdivision 8.
103.11 		Subd. 8.Supplemental affidavits; mining activity on land. When any portion 
103.12 	of the property begins to be actively mined, the owner must file a supplemental affidavit 
103.13 	within 60 days from the day any aggregate is removed stating the number of acres of the 
103.14 	property that is actively being mined. The acres actively being mined shall be (1) valued 
103.15 	and classified under section 273.13, subdivision 24, in the next subsequent assessment 
103.16 	year, and (2) removed from the aggregate resource preservation property tax program 
103.17 	under this section. The additional taxes under subdivision 7 must not be imposed on the 
103.18 	acres that are actively being mined and have been removed from the program under this 
103.19 	section. Copies of the original affidavit and all supplemental affidavits must be filed 
103.20 	with the county assessor, the local zoning administrator, and the Department of Natural 
103.21 	Resources, Division of Land and Minerals. A supplemental affidavit must be filed each 
103.22 	time a subsequent portion of the property is actively mined, provided that the minimum 
103.23 	acreage change is five acres, even if the actual mining activity constitutes less than five 
103.24 	acres. Failure to file the affidavits timely shall result in the property losing its valuation 
103.25 	deferment under this section, and additional taxes must be imposed as calculated under 
103.26 	subdivision 7.
103.27 		Subd. 9.Lien. The additional tax imposed by this section is a lien upon the property 
103.28 	assessed to the same extent and for the same duration as other taxes imposed upon 
103.29 	property within this state and, when collected, must be distributed in the manner provided 
103.30 	by law for the collection and distribution of other property taxes.
103.31 		Subd. 10.Continuation of tax treatment upon sale. When real property qualifying 
103.32 	under subdivision 2 is sold, additional taxes must not be extended against the property 
103.33 	if the property continues to qualify under subdivision 2, and the new owner files an 
103.34 	application with the assessor for continued deferment within 30 days after the sale.

103.35 	EFFECTIVE DATE. This section is effective for taxes levied in 2009, payable 
103.36 	in 2010, and thereafter, except that for the 2009 assessment year, the application date 
104.1 	under subdivision 5 shall be September 1, 2009, and subdivision 6 is effective the day 
104.2 	following final enactment.

104.3 	Sec. 22. [273.113] TAX CREDIT FOR PROPERTY IN PROPOSED BOVINE 
104.4 	TUBERCULOSIS MODIFIED ACCREDITED ZONE.
104.5 		Subdivision 1.Definition. For the purposes of this section, the following terms 
104.6 	have the meanings given to them:
104.7 	(1) "proposed bovine tuberculosis modified accredited zone" means the modified 
104.8 	accredited zone proposed by the Board of Animal Health under section 35.244; and
104.9 	(2) "located within" means that the herd is kept in the area for at least a part of 
104.10 	calendar year 2007.
104.11 		Subd. 2.Eligibility; amount of credit. Agricultural land classified under section 
104.12 	273.13, subdivision 23, located within a proposed bovine tuberculosis modified accredited 
104.13 	zone is eligible for a property tax credit equal to the property tax on the parcel where the 
104.14 	herd had been located, excluding any tax attributable to residential structures. To begin to 
104.15 	qualify for the tax credit, the owner shall file an application with the county by December 
104.16 	1 of the levy year. The credit must be given for each subsequent taxes payable year until 
104.17 	the credit terminates under subdivision 4. The assessor shall indicate the amount of the 
104.18 	property tax reduction on the property tax statement of each taxpayer receiving a credit 
104.19 	under this section. The credit paid pursuant to this section shall be deducted from the tax 
104.20 	due on the property as provided in section 273.1393.
104.21 		Subd. 3.Reimbursement for lost revenue. The county auditor shall certify to the 
104.22 	commissioner of revenue, as part of the abstracts of tax lists required to be filed with 
104.23 	the commissioner under section 275.29, the amount of tax lost to the county from the 
104.24 	property tax credit under subdivision 2. Any prior year adjustments must also be certified 
104.25 	in the abstracts of tax lists. The commissioner of revenue shall review the certifications to 
104.26 	determine their accuracy. The commissioner may make the changes in the certification 
104.27 	that are considered necessary or return a certification to the county auditor for corrections. 
104.28 	The commissioner shall reimburse each taxing district for the taxes lost. The payments 
104.29 	must be made at the time provided in section 473H.10 for payment to taxing jurisdictions 
104.30 	in the same proportion that the ad valorem tax is distributed. The amount necessary to 
104.31 	make the reimbursements under this section is annually appropriated from the general 
104.32 	fund to the commissioner of revenue.
104.33 		Subd. 4.Termination of credit. The credits provided under this section cease to be 
104.34 	available beginning with taxes payable in the year following the date when the Board of 
104.35 	Animal Health has certified that the state is free of bovine tuberculosis.

105.1 	Sec. 23. Minnesota Statutes 2006, section 273.121, as amended by Laws 2008, chapter 
105.2 	154, article 13, section 28, is amended to read:
105.3 	273.121 VALUATION OF REAL PROPERTY, NOTICE. 
105.4 		Subdivision 1.Notice. Any county assessor or city assessor having the powers of a 
105.5 	county assessor, valuing or classifying taxable real property shall in each year notify those 
105.6 	persons whose property is to be included on the assessment roll that year if the person's 
105.7 	address is known to the assessor, otherwise the occupant of the property. The notice shall 
105.8 	be in writing and shall be sent by ordinary mail at least ten days before the meeting of 
105.9 	the local board of appeal and equalization under section 274.01 or the review process 
105.10 	established under section 274.13, subdivision 1c. Upon written request by the owner of the 
105.11 	property, the assessor may send the notice in electronic form or by electronic mail instead 
105.12 	of on paper or by ordinary mail. It shall contain: (1) the market value for the current and 
105.13 	prior assessment, (2) the limited market value under section 273.11, subdivision 1a, for 
105.14 	the current and prior assessment, (3) the qualifying amount of any improvements under 
105.15 	section 273.11, subdivision 16, for the current assessment, (4) the market value subject 
105.16 	to taxation after subtracting the amount of any qualifying improvements for the current 
105.17 	assessment, (5) the classification of the property for the current and prior assessment, 
105.18 	(6) a note that if the property is homestead and at least 45 years old, improvements 
105.19 	made to the property may be eligible for a valuation exclusion under section 273.11, 
105.20 	subdivision 16, (7) the assessor's office address, and (8) the dates, places, and times set for 
105.21 	the meetings of the local board of appeal and equalization, the review process established 
105.22 	under section 274.13, subdivision 1c, and the county board of appeal and equalization. 
105.23 	The commissioner of revenue shall specify the form of the notice. The assessor shall 
105.24 	attach to the assessment roll a statement that the notices required by this section have been 
105.25 	mailed. Any assessor who is not provided sufficient funds from the assessor's governing 
105.26 	body to provide such notices, may make application to the commissioner of revenue 
105.27 	to finance such notices. The commissioner of revenue shall conduct an investigation 
105.28 	and, if satisfied that the assessor does not have the necessary funds, issue a certification 
105.29 	to the commissioner of finance of the amount necessary to provide such notices. The 
105.30 	commissioner of finance shall issue a warrant for such amount and shall deduct such 
105.31 	amount from any state payment to such county or municipality. The necessary funds to 
105.32 	make such payments are hereby appropriated. Failure to receive the notice shall in no way 
105.33 	affect the validity of the assessment, the resulting tax, the procedures of any board of 
105.34 	review or equalization, or the enforcement of delinquent taxes by statutory means. 
106.1 		Subd. 2.Availability of data. The notice must state where the information on 
106.2 	the property is available, the times when the information may be viewed by the public, 
106.3 	and the county's Web site address.

106.4 	EFFECTIVE DATE. This section is effective for notices prepared in 2009 and 
106.5 	thereafter.

106.6 	Sec. 24. Minnesota Statutes 2006, section 273.124, subdivision 1, is amended to read:
106.7 		Subdivision 1.General rule. (a) Residential real estate that is occupied and used 
106.8 	for the purposes of a homestead by its owner, who must be a Minnesota resident, is 
106.9 	a residential homestead.
106.10 	Agricultural land, as defined in section 273.13, subdivision 23, that is occupied and 
106.11 	used as a homestead by its owner, who must be a Minnesota resident, is an agricultural 
106.12 	homestead.
106.13 	Dates for establishment of a homestead and homestead treatment provided to 
106.14 	particular types of property are as provided in this section.
106.15 	Property held by a trustee under a trust is eligible for homestead classification if the 
106.16 	requirements under this chapter are satisfied.
106.17 	The assessor shall require proof, as provided in subdivision 13, of the facts upon 
106.18 	which classification as a homestead may be determined. Notwithstanding any other law, 
106.19 	the assessor may at any time require a homestead application to be filed in order to verify 
106.20 	that any property classified as a homestead continues to be eligible for homestead status. 
106.21 	Notwithstanding any other law to the contrary, the Department of Revenue may, upon 
106.22 	request from an assessor, verify whether an individual who is requesting or receiving 
106.23 	homestead classification has filed a Minnesota income tax return as a resident for the most 
106.24 	recent taxable year for which the information is available.
106.25 	When there is a name change or a transfer of homestead property, the assessor may 
106.26 	reclassify the property in the next assessment unless a homestead application is filed to 
106.27 	verify that the property continues to qualify for homestead classification.
106.28 	(b) For purposes of this section, homestead property shall include property which 
106.29 	is used for purposes of the homestead but is separated from the homestead by a road, 
106.30 	street, lot, waterway, or other similar intervening property. The term "used for purposes 
106.31 	of the homestead" shall include but not be limited to uses for gardens, garages, or other 
106.32 	outbuildings commonly associated with a homestead, but shall not include vacant land 
106.33 	held primarily for future development. In order to receive homestead treatment for 
106.34 	the noncontiguous property, the owner must use the property for the purposes of the 
106.35 	homestead, and must apply to the assessor, both by the deadlines given in subdivision 
107.1 	9. After initial qualification for the homestead treatment, additional applications for 
107.2 	subsequent years are not required.
107.3 	(c) Residential real estate that is occupied and used for purposes of a homestead by a 
107.4 	relative of the owner is a homestead but only to the extent of the homestead treatment 
107.5 	that would be provided if the related owner occupied the property. For purposes of this 
107.6 	paragraph and paragraph (g), "relative" means a parent, stepparent, child, stepchild, 
107.7 	grandparent, grandchild, brother, sister, uncle, aunt, nephew, or niece. This relationship 
107.8 	may be by blood or marriage. Property that has been classified as seasonal residential 
107.9 	recreational property at any time during which it has been owned by the current owner or 
107.10 	spouse of the current owner will not be reclassified as a homestead unless it is occupied as 
107.11 	a homestead by the owner; this prohibition also applies to property that, in the absence of 
107.12 	this paragraph, would have been classified as seasonal residential recreational property at 
107.13 	the time when the residence was constructed. Neither the related occupant nor the owner 
107.14 	of the property may claim a property tax refund under chapter 290A for a homestead 
107.15 	occupied by a relative. In the case of a residence located on agricultural land, only the 
107.16 	house, garage, and immediately surrounding one acre of land shall be classified as a 
107.17 	homestead under this paragraph, except as provided in paragraph (d).
107.18 	(d) Agricultural property that is occupied and used for purposes of a homestead by 
107.19 	a relative of the owner, is a homestead, only to the extent of the homestead treatment 
107.20 	that would be provided if the related owner occupied the property, and only if all of the 
107.21 	following criteria are met:
107.22 	(1) the relative who is occupying the agricultural property is a son, daughter, brother, 
107.23 	sister, grandson, granddaughter, father, or mother of the owner of the agricultural property 
107.24 	or a son, daughter, brother, sister, grandson, or granddaughter of the spouse of the owner 
107.25 	of the agricultural property;
107.26 	(2) the owner of the agricultural property must be a Minnesota resident;
107.27 	(3) the owner of the agricultural property must not receive homestead treatment on 
107.28 	any other agricultural property in Minnesota; and
107.29 	(4) the owner of the agricultural property is limited to only one agricultural 
107.30 	homestead per family under this paragraph.
107.31 	Neither the related occupant nor the owner of the property may claim a property 
107.32 	tax refund under chapter 290A for a homestead occupied by a relative qualifying under 
107.33 	this paragraph. For purposes of this paragraph, "agricultural property" means the house, 
107.34 	garage, other farm buildings and structures, and agricultural land.
108.1 	Application must be made to the assessor by the owner of the agricultural property to 
108.2 	receive homestead benefits under this paragraph. The assessor may require the necessary 
108.3 	proof that the requirements under this paragraph have been met.
108.4 	(e) In the case of property owned by a property owner who is married, the assessor 
108.5 	must not deny homestead treatment in whole or in part if only one of the spouses occupies 
108.6 	the property and the other spouse is absent due to: (1) marriage dissolution proceedings, 
108.7 	(2) legal separation, (3) employment or self-employment in another location, or (4) other 
108.8 	personal circumstances causing the spouses to live separately, not including an intent to 
108.9 	obtain two homestead classifications for property tax purposes. To qualify under clause 
108.10 	(3), the spouse's place of employment or self-employment must be at least 50 miles distant 
108.11 	from the other spouse's place of employment, and the homesteads must be at least 50 miles 
108.12 	distant from each other. Homestead treatment, in whole or in part, shall not be denied to 
108.13 	the owner's spouse who previously occupied the residence with the owner if the absence 
108.14 	of the owner is due to one of the exceptions provided in this paragraph.
108.15 	(f) The assessor must not deny homestead treatment in whole or in part if:
108.16 	(1) in the case of a property owner who is not married, the owner is absent due to 
108.17 	residence in a nursing home, boarding care facility, or an elderly assisted living facility 
108.18 	property as defined in section 273.13, subdivision 25a, and the property is not otherwise 
108.19 	occupied; or
108.20 	(2) in the case of a property owner who is married, the owner or the owner's spouse 
108.21 	or both are absent due to residence in a nursing home, boarding care facility, or an elderly 
108.22 	assisted living facility property as defined in section 273.13, subdivision 25a, and the 
108.23 	property is not occupied or is occupied only by the owner's spouse.
108.24 	(g) If an individual is purchasing property with the intent of claiming it as a 
108.25 	homestead and is required by the terms of the financing agreement to have a relative 
108.26 	shown on the deed as a co-owner, the assessor shall allow a full homestead classification. 
108.27 	This provision only applies to first-time purchasers, whether married or single, or to a 
108.28 	person who had previously been married and is purchasing as a single individual for the 
108.29 	first time. The application for homestead benefits must be on a form prescribed by the 
108.30 	commissioner and must contain the data necessary for the assessor to determine if full 
108.31 	homestead benefits are warranted.
108.32 	(h) If residential or agricultural real estate is occupied and used for purposes of a 
108.33 	homestead by a child of a deceased owner and the property is subject to jurisdiction of 
108.34 	probate court, the child shall receive relative homestead classification under paragraph (c) 
108.35 	or (d) to the same extent they would be entitled to it if the owner was still living, until 
109.1 	the probate is completed. For purposes of this paragraph, "child" includes a relationship 
109.2 	by blood or by marriage.
109.3 	(i) If a single-family home, duplex, or triplex classified as either residential 
109.4 	homestead or agricultural homestead is also used to provide licensed child care, the 
109.5 	portion of the property used for licensed child care must be classified as a part of the 
109.6 	homestead property.

109.7 	EFFECTIVE DATE. This section is effective for taxes payable in 2009 and 
109.8 	thereafter.

109.9 	Sec. 25. Minnesota Statutes 2007 Supplement, section 273.124, subdivision 14, as 
109.10 	amended by Laws 2008, chapter 154, article 2, section 7, is amended to read:
109.11 		Subd. 14. Agricultural homesteads; special provisions.  (a) Real estate of less than 
109.12 	ten acres that is the homestead of its owner must be classified as class 2a under section 
109.13 	273.13, subdivision 23, paragraph (a), if: 
109.14 	(1) the parcel on which the house is located is contiguous on at least two sides to (i) 
109.15 	agricultural land, (ii) land owned or administered by the United States Fish and Wildlife 
109.16 	Service, or (iii) land administered by the Department of Natural Resources on which in 
109.17 	lieu taxes are paid under sections 477A.11 to 477A.14; 
109.18 	(2) its owner also owns a noncontiguous parcel of agricultural land that is at least 
109.19 	20 acres; 
109.20 	(3) the noncontiguous land is located not farther than four townships or cities, or a 
109.21 	combination of townships or cities from the homestead; and 
109.22 	(4) the agricultural use value of the noncontiguous land and farm buildings is equal 
109.23 	to at least 50 percent of the market value of the house, garage, and one acre of land. 
109.24 	Homesteads initially classified as class 2a under the provisions of this paragraph shall 
109.25 	remain classified as class 2a, irrespective of subsequent changes in the use of adjoining 
109.26 	properties, as long as the homestead remains under the same ownership, the owner owns a 
109.27 	noncontiguous parcel of agricultural land that is at least 20 acres, and the agricultural use 
109.28 	value qualifies under clause (4). Homestead classification under this paragraph is limited 
109.29 	to property that qualified under this paragraph for the 1998 assessment. 
109.30 	(b)(i) Agricultural property shall be classified as the owner's homestead, to the same 
109.31 	extent as other agricultural homestead property, if all of the following criteria are met: 
109.32 	(1) the property consists of at least 40 acres including undivided government lots 
109.33 	and correctional 40's; 
109.34 	(2) the owner, the owner's spouse, the son or daughter of the owner or owner's 
109.35 	spouse, the brother or sister of the owner or owner's spouse, or the grandson or 
110.1 	granddaughter of the owner or the owner's spouse, is actively farming the agricultural 
110.2 	property, either on the person's own behalf as an individual or on behalf of a partnership 
110.3 	operating a family farm, family farm corporation, joint family farm venture, or limited 
110.4 	liability company of which the person is a partner, shareholder, or member; 
110.5 	(3) both the owner of the agricultural property and the person who is actively 
110.6 	farming the agricultural property under clause (2), are Minnesota residents; 
110.7 	(4) neither the owner nor the spouse of the owner claims another agricultural 
110.8 	homestead in Minnesota; and 
110.9 	(5) neither the owner nor the person actively farming the property lives farther 
110.10 	than four townships or cities, or a combination of four townships or cities, from the 
110.11 	agricultural property, except that if the owner or the owner's spouse is required to live in 
110.12 	employer-provided housing, the owner or owner's spouse, whichever is actively farming 
110.13 	the agricultural property, may live more than four townships or cities, or combination of 
110.14 	four townships or cities from the agricultural property. 
110.15 	The relationship under this paragraph may be either by blood or marriage. 
110.16 	(ii) Real property held by a trustee under a trust is eligible for agricultural homestead 
110.17 	classification under this paragraph if the qualifications in clause (i) are met, except that 
110.18 	"owner" means the grantor of the trust. 
110.19 	(iii) Property containing the residence of an owner who owns qualified property 
110.20 	under clause (i) shall be classified as part of the owner's agricultural homestead, if that 
110.21 	property is also used for noncommercial storage or drying of agricultural crops. 
110.22 	(c) Noncontiguous land shall be included as part of a homestead under section 
110.23 	273.13, subdivision 23, paragraph (a), only if the homestead is classified as class 2a 
110.24 	and the detached land is located in the same township or city, or not farther than four 
110.25 	townships or cities or combination thereof from the homestead. Any taxpayer of these 
110.26 	noncontiguous lands must notify the county assessor that the noncontiguous land is part of 
110.27 	the taxpayer's homestead, and, if the homestead is located in another county, the taxpayer 
110.28 	must also notify the assessor of the other county. 
110.29 	(d) Agricultural land used for purposes of a homestead and actively farmed by a 
110.30 	person holding a vested remainder interest in it must be classified as a homestead under 
110.31 	section 273.13, subdivision 23, paragraph (a). If agricultural land is classified class 2a, 
110.32 	any other dwellings on the land used for purposes of a homestead by persons holding 
110.33 	vested remainder interests who are actively engaged in farming the property, and up to 
110.34 	one acre of the land surrounding each homestead and reasonably necessary for the use of 
110.35 	the dwelling as a home, must also be assessed class 2a. 
111.1 	(e) Agricultural land and buildings that were class 2a homestead property under 
111.2 	section 273.13, subdivision 23, paragraph (a), for the 1997 assessment shall remain 
111.3 	classified as agricultural homesteads for subsequent assessments if: 
111.4 	(1) the property owner abandoned the homestead dwelling located on the agricultural 
111.5 	homestead as a result of the April 1997 floods; 
111.6 	(2) the property is located in the county of Polk, Clay, Kittson, Marshall, Norman, 
111.7 	or Wilkin; 
111.8 	(3) the agricultural land and buildings remain under the same ownership for the 
111.9 	current assessment year as existed for the 1997 assessment year and continue to be used 
111.10 	for agricultural purposes; 
111.11 	(4) the dwelling occupied by the owner is located in Minnesota and is within 30 
111.12 	miles of one of the parcels of agricultural land that is owned by the taxpayer; and 
111.13 	(5) the owner notifies the county assessor that the relocation was due to the 1997 
111.14 	floods, and the owner furnishes the assessor any information deemed necessary by the 
111.15 	assessor in verifying the change in dwelling. Further notifications to the assessor are not 
111.16 	required if the property continues to meet all the requirements in this paragraph and any 
111.17 	dwellings on the agricultural land remain uninhabited. 
111.18 	(f) Agricultural land and buildings that were class 2a homestead property under 
111.19 	section 273.13, subdivision 23, paragraph (a), for the 1998 assessment shall remain 
111.20 	classified agricultural homesteads for subsequent assessments if: 
111.21 	(1) the property owner abandoned the homestead dwelling located on the agricultural 
111.22 	homestead as a result of damage caused by a March 29, 1998, tornado; 
111.23 	(2) the property is located in the county of Blue Earth, Brown, Cottonwood, 
111.24 	LeSueur, Nicollet, Nobles, or Rice; 
111.25 	(3) the agricultural land and buildings remain under the same ownership for the 
111.26 	current assessment year as existed for the 1998 assessment year; 
111.27 	(4) the dwelling occupied by the owner is located in this state and is within 50 miles 
111.28 	of one of the parcels of agricultural land that is owned by the taxpayer; and 
111.29 	(5) the owner notifies the county assessor that the relocation was due to a March 29, 
111.30 	1998, tornado, and the owner furnishes the assessor any information deemed necessary by 
111.31 	the assessor in verifying the change in homestead dwelling. For taxes payable in 1999, the 
111.32 	owner must notify the assessor by December 1, 1998. Further notifications to the assessor 
111.33 	are not required if the property continues to meet all the requirements in this paragraph 
111.34 	and any dwellings on the agricultural land remain uninhabited. 
111.35 	(g) Agricultural property of a family farm corporation, joint family farm venture, 
111.36 	family farm limited liability company, or partnership operating a family farm as described 
112.1 	under subdivision 8 shall be classified homestead, to the same extent as other agricultural 
112.2 	homestead property, if all of the following criteria are met: 
112.3 	(1) the property consists of at least 40 acres including undivided government lots 
112.4 	and correctional 40's; 
112.5 	(2) a shareholder, member, or partner of that entity is actively farming the 
112.6 	agricultural property; 
112.7 	(3) that shareholder, member, or partner who is actively farming the agricultural 
112.8 	property is a Minnesota resident; 
112.9 	(4) neither that shareholder, member, or partner, nor the spouse of that shareholder, 
112.10 	member, or partner claims another agricultural homestead in Minnesota; and 
112.11 	(5) that shareholder, member, or partner does not live farther than four townships or 
112.12 	cities, or a combination of four townships or cities, from the agricultural property. 
112.13 	Homestead treatment applies under this paragraph for property leased to a family 
112.14 	farm corporation, joint farm venture, limited liability company, or partnership operating a 
112.15 	family farm if legal title to the property is in the name of an individual who is a member, 
112.16 	shareholder, or partner in the entity. 
112.17 	(h) To be eligible for the special agricultural homestead under this subdivision, an 
112.18 	initial full application must be submitted to the county assessor where the property is 
112.19 	located. Owners and the persons who are actively farming the property shall be required 
112.20 	to complete only a one-page abbreviated version of the application in each subsequent 
112.21 	year provided that none of the following items have changed since the initial application: 
112.22 	(1) the day-to-day operation, administration, and financial risks remain the same; 
112.23 	(2) the owners and the persons actively farming the property continue to live within 
112.24 	the four townships or city criteria and are Minnesota residents; 
112.25 	(3) the same operator of the agricultural property is listed with the Farm Service 
112.26 	Agency; 
112.27 	(4) a Schedule F or equivalent income tax form was filed for the most recent year; 
112.28 	(5) the property's acreage is unchanged; and 
112.29 	(6) none of the property's acres have been enrolled in a federal or state farm program 
112.30 	since the initial application. 
112.31 	The owners and any persons who are actively farming the property must include 
112.32 	the appropriate Social Security numbers, and sign and date the application. If any of the 
112.33 	specified information has changed since the full application was filed, the owner must 
112.34 	notify the assessor, and must complete a new application to determine if the property 
112.35 	continues to qualify for the special agricultural homestead. The commissioner of revenue 
112.36 	shall prepare a standard reapplication form for use by the assessors. 
113.1 	(i) Agricultural land and buildings that were class 2a homestead property under 
113.2 	section 273.13, subdivision 23, paragraph (a), for the 2007 assessment shall remain 
113.3 	classified agricultural homesteads for subsequent assessments if: 
113.4 	(1) the property owner abandoned the homestead dwelling located on the agricultural 
113.5 	homestead as a result of damage caused by the August 2007 floods; 
113.6 	(2) the property is located in the county of Dodge, Fillmore, Houston, Olmsted, 
113.7 	Steele, Wabasha, or Winona; 
113.8 	(3) the agricultural land and buildings remain under the same ownership for the 
113.9 	current assessment year as existed for the 2007 assessment year; 
113.10 	(4) the dwelling occupied by the owner is located in this state and is within 50 miles 
113.11 	of one of the parcels of agricultural land that is owned by the taxpayer; and 
113.12 	(5) the owner notifies the county assessor that the relocation was due to the August 
113.13 	2007 floods, and the owner furnishes the assessor any information deemed necessary by 
113.14 	the assessor in verifying the change in homestead dwelling. For taxes payable in 2009, the 
113.15 	owner must notify the assessor by December 1, 2008. Further notifications to the assessor 
113.16 	are not required if the property continues to meet all the requirements in this paragraph 
113.17 	and any dwellings on the agricultural land remain uninhabited. 

113.18 	EFFECTIVE DATE. This section is effective for taxes payable in 2009 and 
113.19 	thereafter.

113.20 	Sec. 26. Minnesota Statutes 2006, section 273.13, subdivision 23, as amended by Laws 
113.21 	2008, chapter 154, article 2, section 12, is amended to read:
113.22 		Subd. 23. Class 2. (a) Class 2a property is agricultural land including any 
113.23 	improvements An agricultural homestead consists of class 2a agricultural land that is 
113.24 	homesteaded, along with any class 2b rural vacant land that is contiguous to the class 
113.25 	2a land under the same ownership. The market value of the house and garage and 
113.26 	immediately surrounding one acre of land has the same class rates as class 1a or 1b
113.27 	property under subdivision 22. The value of the remaining land including improvements 
113.28 	up to the first tier valuation limit of agricultural homestead property has a net class rate of 
113.29 	0.55 0.5 percent of market value. The remaining property over the first tier has a class rate 
113.30 	of one percent of market value. For purposes of this subdivision, the "first tier valuation 
113.31 	limit of agricultural homestead property" and "first tier" means the limit certified under 
113.32 	section 273.11, subdivision 23. 
113.33 	(b) Class 2a agricultural land consists of parcels of property, or portions thereof, that 
113.34 	are agricultural land and buildings. Class 2a property has a net class rate of one percent of 
113.35 	market value, unless it is part of an agricultural homestead under paragraph (a). Class 2a 
114.1 	property may contain property that would otherwise be classified as 2b, including but not 
114.2 	limited to sloughs, wooded wind shelters, acreage abutting ditches, and other similar land 
114.3 	impractical for the assessor to value separately from the rest of the property.
114.4 	An assessor may classify the part of a parcel described in this subdivision that is used 
114.5 	for agricultural purposes as class 2a and the remainder in the class appropriate to its use.
114.6 	(c) Class 2b property is (1) rural vacant land consists of parcels of property, 
114.7 	or portions thereof, that are unplatted  real estate, rural in character and not used for 
114.8 	agricultural purposes, including land used exclusively for growing trees for timber, 
114.9 	lumber, and wood and wood products; (2) real estate, that is not improved with a structure 
114.10 	and is used exclusively for growing trees for timber, lumber, and wood and wood products, 
114.11 	if the owner has participated or is participating in a cost-sharing program for afforestation, 
114.12 	reforestation, or timber stand improvement on that particular property, administered or 
114.13 	coordinated by the commissioner of natural resources; (3) real estate that is nonhomestead 
114.14 	agricultural land; or (4) a landing area or public access area of a privately owned public 
114.15 	use airport. The presence of a minor, ancillary nonresidential structure as defined by the 
114.16 	commissioner of revenue does not disqualify the property from classification under this 
114.17 	paragraph. Any parcel of 20 acres or more improved with a structure that is not a minor, 
114.18 	ancillary nonresidential structure must be split-classified, and ten acres must be assigned 
114.19 	to the split parcel containing the structure. Class 2b property has a net class rate of one 
114.20 	percent of market value, except that unplatted property described in clause (1) or (2) has 
114.21 	a net class rate of .65 percent if it consists unless it is part of an agricultural homestead 
114.22 	under paragraph (a), or qualifies as class 2c under paragraph (d).
114.23 	(d) Class 2c managed forest land consists  of no less than ten 20 and no more than 
114.24 	1,920 acres and statewide per taxpayer that is being managed under a forest management 
114.25 	plan that meets the requirements of chapter 290C, but is not enrolled in the sustainable 
114.26 	forest resource management incentive program. It has a class rate of .65 percent, provided 
114.27 	that the owner of the property must apply to the assessor annually to receive the reduced 
114.28 	class rate and provide the information required by the assessor to verify that the property 
114.29 	qualifies for the reduced rate. The commissioner of natural resources must concur that the 
114.30 	land is qualified. The commissioner of natural resources shall annually provide county 
114.31 	assessors verification information on a timely basis.
114.32 	(c) (e) Agricultural land as used in this section means contiguous acreage of ten 
114.33 	acres or more, used during the preceding year for agricultural purposes. "Agricultural 
114.34 	purposes" as used in this section means the raising or, cultivation, drying, or storage of 
114.35 	agricultural products for sale, or the storage of machinery or equipment used in support 
114.36 	of agricultural production by the same farm entity. For a property to be classified as 
115.1 	agricultural based only on the drying or storage of agricultural products, the products 
115.2 	being dried or stored must have been produced by the same farm entity as the entity 
115.3 	operating the drying or storage facility. "Agricultural purposes" also includes enrollment 
115.4 	in the Reinvest in Minnesota program under sections 103F.501 to 103F.535 or the federal 
115.5 	Conservation Reserve Program as contained in Public Law 99-198 or a similar state 
115.6 	or federal conservation program if the property was classified as agricultural (i) under 
115.7 	this subdivision for the assessment year 2002 or (ii) in the year prior to its enrollment. 
115.8 	Contiguous acreage on the same parcel, or contiguous acreage on an immediately adjacent 
115.9 	parcel under the same ownership, may also qualify as agricultural land, but only if it 
115.10 	is pasture, timber, waste, unusable wild land, or land included in state or federal farm 
115.11 	programs. Agricultural classification for property shall be determined excluding the 
115.12 	house, garage, and immediately surrounding one acre of land, and shall not be based 
115.13 	upon the market value of any residential structures on the parcel or contiguous parcels 
115.14 	under the same ownership. 
115.15 	(d) (f) Real estate of less than ten acres, excluding the house, garage, and 
115.16 	immediately surrounding one acre of land,of less than ten acres which is exclusively and
115.17 	 or intensively used for raising or cultivating agricultural products, shall be considered as 
115.18 	agricultural land. To qualify under this paragraph, property that includes a residential 
115.19 	structure must be used intensively for one of the following purposes:
115.20 	(i) for drying or storage of grain or storage of machinery or equipment used to 
115.21 	support agricultural activities on other parcels of property operated by the same farming 
115.22 	entity;
115.23 	(ii) as a nursery, provided that only those acres used to produce nursery stock are 
115.24 	considered agricultural land;
115.25 	(iii) for livestock or poultry confinement, provided that land that is used only for 
115.26 	pasturing and grazing does not qualify; or
115.27 	(iv) for market farming; for purposes of this paragraph, "market farming" means the 
115.28 	cultivation of one or more fruits or vegetables or production of animal or other agricultural 
115.29 	products for sale to local markets by the farmer or an organization with which the farmer 
115.30 	is affiliated. 
115.31 	(g) Land shall be classified as agricultural even if all or a portion of the agricultural 
115.32 	use of that property is the leasing to, or use by another person for agricultural purposes. 
115.33 	Classification under this subdivision is not determinative for qualifying under 
115.34 	section 273.111. 
116.1 	(h) The property classification under this section supersedes, for property tax 
116.2 	purposes only, any locally administered agricultural policies or land use restrictions that 
116.3 	define minimum or maximum farm acreage. 
116.4 	(e) (i) The term "agricultural products" as used in this subdivision includes 
116.5 	production for sale of: 
116.6 	(1) livestock, dairy animals, dairy products, poultry and poultry products, fur-bearing 
116.7 	animals, horticultural and nursery stock, fruit of all kinds, vegetables, forage, grains, 
116.8 	bees, and apiary products by the owner; 
116.9 	(2) fish bred for sale and consumption if the fish breeding occurs on land zoned 
116.10 	for agricultural use; 
116.11 	(3) the commercial boarding of horses if the boarding is done in conjunction with 
116.12 	raising or cultivating agricultural products as defined in clause (1); 
116.13 	(4) property which is owned and operated by nonprofit organizations used for 
116.14 	equestrian activities, excluding racing; 
116.15 	(5) game birds and waterfowl bred and raised for use on a shooting preserve licensed 
116.16 	under section 97A.115; 
116.17 	(6) insects primarily bred to be used as food for animals; 
116.18 	(7) trees, grown for sale as a crop, including short rotation woody crops, and not 
116.19 	sold for timber, lumber, wood, or wood products; and 
116.20 	(8) maple syrup taken from trees grown by a person licensed by the Minnesota 
116.21 	Department of Agriculture under chapter 28A as a food processor. 
116.22 	(f) (j) If a parcel used for agricultural purposes is also used for commercial or 
116.23 	industrial purposes, including but not limited to: 
116.24 	(1) wholesale and retail sales; 
116.25 	(2) processing of raw agricultural products or other goods; 
116.26 	(3) warehousing or storage of processed goods; and 
116.27 	(4) office facilities for the support of the activities enumerated in clauses (1), (2), 
116.28 	and (3), 
116.29 	the assessor shall classify the part of the parcel used for agricultural purposes as class 
116.30 	1b, 2a, or 2b, whichever is appropriate, and the remainder in the class appropriate to its 
116.31 	use. The grading, sorting, and packaging of raw agricultural products for first sale is 
116.32 	considered an agricultural purpose. A greenhouse or other building where horticultural 
116.33 	or nursery products are grown that is also used for the conduct of retail sales must be 
116.34 	classified as agricultural if it is primarily used for the growing of horticultural or nursery 
116.35 	products from seed, cuttings, or roots and occasionally as a showroom for the retail sale of 
117.1 	those products. Use of a greenhouse or building only for the display of already grown 
117.2 	horticultural or nursery products does not qualify as an agricultural purpose. 
117.3 	The assessor shall determine and list separately on the records the market value of 
117.4 	the homestead dwelling and the one acre of land on which that dwelling is located. If any 
117.5 	farm buildings or structures are located on this homesteaded acre of land, their market 
117.6 	value shall not be included in this separate determination. 
117.7 	(g) (k) Class 2d airport landing area consists of a landing area or public access area 
117.8 	of a privately owned public use airport. It has a class rate of one percent of market value.
117.9 	To qualify for classification under this paragraph (b), clause (4), a privately owned public 
117.10 	use airport must be licensed as a public airport under section 360.018. For purposes of this
117.11 	paragraph (b), clause (4), "landing area" means that part of a privately owned public use 
117.12 	airport properly cleared, regularly maintained, and made available to the public for use by 
117.13 	aircraft and includes runways, taxiways, aprons, and sites upon which are situated landing 
117.14 	or navigational aids. A landing area also includes land underlying both the primary surface 
117.15 	and the approach surfaces that comply with all of the following: 
117.16 	(i) the land is properly cleared and regularly maintained for the primary purposes of 
117.17 	the landing, taking off, and taxiing of aircraft; but that portion of the land that contains 
117.18 	facilities for servicing, repair, or maintenance of aircraft is not included as a landing area; 
117.19 	(ii) the land is part of the airport property; and 
117.20 	(iii) the land is not used for commercial or residential purposes. 
117.21 	The land contained in a landing area under this paragraph (b), clause (4), must be described 
117.22 	and certified by the commissioner of transportation. The certification is effective until it 
117.23 	is modified, or until the airport or landing area no longer meets the requirements of this 
117.24 	paragraph (b), clause (4). For purposes of this paragraph (b), clause (4), "public access 
117.25 	area" means property used as an aircraft parking ramp, apron, or storage hangar, or an 
117.26 	arrival and departure building in connection with the airport. 
117.27 	(l) Class 2e consists of land with a commercial aggregate deposit that is not actively 
117.28 	being mined and is not otherwise classified as class 2a or 2b. It has a class rate of one 
117.29 	percent of market value. To qualify for classification under this paragraph, the property 
117.30 	must be at least ten contiguous acres in size and the owner of the property must record with 
117.31 	the county recorder of the county in which the property is located an affidavit containing:
117.32 	(1) a legal description of the property;
117.33 	(2) a disclosure that the property contains a commercial aggregate deposit that is not 
117.34 	actively being mined but is present on the entire parcel enrolled;
117.35 	(3) documentation that the conditional use under the county or local zoning 
117.36 	ordinance of this property is for mining; and
118.1 	(4) documentation that a permit has been issued by the local unit of government 
118.2 	or the mining activity is allowed under local ordinance. The disclosure must include a 
118.3 	statement from a registered professional geologist, engineer, or soil scientist delineating 
118.4 	the deposit and certifying that it is a commercial aggregate deposit.
118.5 	For purposes of this section and section 273.1115, "commercial aggregate deposit" 
118.6 	means a deposit that will yield crushed stone or sand and gravel that is suitable for use 
118.7 	as a construction aggregate; and "actively mined" means the removal of top soil and 
118.8 	overburden in preparation for excavation or excavation of a commercial deposit.
118.9 	(m) When any portion of the property under this subdivision or subdivision 22 
118.10 	begins to be actively mined, the owner must file a supplemental affidavit within 60 days 
118.11 	from the day any aggregate is removed stating the number of acres of the property that is 
118.12 	actively being mined. The acres actively being mined must be (1) valued and classified 
118.13 	under subdivision 24 in the next subsequent assessment year, and (2) removed from the 
118.14 	aggregate resource preservation property tax program under section 273.1115, if the 
118.15 	land was enrolled in that program. Copies of the original affidavit and all supplemental 
118.16 	affidavits must be filed with the county assessor, the local zoning administrator, and the 
118.17 	Department of Natural Resources, Division of Land and Minerals. A supplemental 
118.18 	affidavit must be filed each time a subsequent portion of the property is actively mined, 
118.19 	provided that the minimum acreage change is five acres, even if the actual mining activity 
118.20 	constitutes less than five acres.

118.21 	EFFECTIVE DATE. The portions of this section reducing the agricultural class 
118.22 	rate, expanding the definition of "agricultural purposes" in paragraph (e) and "agricultural 
118.23 	products" in paragraph (h), and relating to managed forest land in paragraph (d), are 
118.24 	effective for taxes payable in 2009 and thereafter. The remainder of the section is effective 
118.25 	for taxes payable in 2010 and thereafter.

118.26 	Sec. 27. Minnesota Statutes 2006, section 273.13, subdivision 25, as amended by Laws 
118.27 	2008, chapter 154, article 2, section 13, is amended to read:
118.28 		Subd. 25. Class 4. (a) Class 4a is residential real estate containing four or more 
118.29 	units and used or held for use by the owner or by the tenants or lessees of the owner 
118.30 	as a residence for rental periods of 30 days or more, excluding property qualifying for 
118.31 	class 4d. Class 4a also includes hospitals licensed under sections 144.50 to 144.56, other 
118.32 	than hospitals exempt under section 272.02, and contiguous property used for hospital 
118.33 	purposes, without regard to whether the property has been platted or subdivided. The 
118.34 	market value of class 4a property has a class rate of 1.25 percent. 
118.35 	(b) Class 4b includes: 
119.1 	(1) residential real estate containing less than four units that does not qualify as class 
119.2 	4bb, other than seasonal residential recreational property; 
119.3 	(2) manufactured homes not classified under any other provision; 
119.4 	(3) a dwelling, garage, and surrounding one acre of property on a nonhomestead 
119.5 	farm classified under subdivision 23, paragraph (b) containing two or three units; and 
119.6 	(4) unimproved property that is classified residential as determined under subdivision 
119.7 	33. 
119.8 	The market value of class 4b property has a class rate of 1.25 percent. 
119.9 	(c) Class 4bb includes: 
119.10 	(1) nonhomestead residential real estate containing one unit, other than seasonal 
119.11 	residential recreational property; and 
119.12 	(2) a single family dwelling, garage, and surrounding one acre of property on a 
119.13 	nonhomestead farm classified under subdivision 23, paragraph (b). 
119.14 	Class 4bb property has the same class rates as class 1a property under subdivision 22. 
119.15 	Property that has been classified as seasonal residential recreational property at 
119.16 	any time during which it has been owned by the current owner or spouse of the current 
119.17 	owner does not qualify for class 4bb. 
119.18 	(d) Class 4c property includes: 
119.19 	(1) except as provided in subdivision 22, paragraph (c), or subdivision 23, paragraph 
119.20 	(b), clause (1), real and personal property devoted to temporary and seasonal residential 
119.21 	occupancy for recreation purposes, including real and personal property devoted to 
119.22 	temporary and seasonal residential occupancy for recreation purposes and not devoted to 
119.23 	commercial purposes for more than 250 days in the year preceding the year of assessment. 
119.24 	For purposes of this clause, property is devoted to a commercial purpose on a specific 
119.25 	day if any portion of the property is used for residential occupancy, and a fee is charged 
119.26 	for residential occupancy. Class 4c property must contain three or more rental units. A 
119.27 	"rental unit" is defined as a cabin, condominium, townhouse, sleeping room, or individual 
119.28 	camping site equipped with water and electrical hookups for recreational vehicles. Class 
119.29 	4c property must provide recreational activities such as renting ice fishing houses, boats 
119.30 	and motors, snowmobiles, downhill or cross-country ski equipment; provide marina 
119.31 	services, launch services, or guide services; or sell bait and fishing tackle. A camping 
119.32 	pad offered for rent by a property that otherwise qualifies for class 4c is also class 4c 
119.33 	regardless of the term of the rental agreement, as long as the use of the camping pad 
119.34 	does not exceed 250 days. In order for a property to be classified as class 4c, seasonal 
119.35 	residential recreational for commercial purposes under this clause, at least 40 percent of 
119.36 	the annual gross lodging receipts related to the property must be from business conducted 
120.1 	during 90 consecutive days and either (i) at least 60 percent of all paid bookings by 
120.2 	lodging guests during the year must be for periods of at least two consecutive nights; or 
120.3 	(ii) at least 20 percent of the annual gross receipts must be from charges for rental of fish 
120.4 	houses, boats and motors, snowmobiles, downhill or cross-country ski equipment, or 
120.5 	charges for marina services, launch services, and guide services, or the sale of bait and 
120.6 	fishing tackle. For purposes of this determination, a paid booking of five or more nights 
120.7 	shall be counted as two bookings. Class 4c also includes commercial use real property 
120.8 	used exclusively for recreational purposes in conjunction with class 4c property devoted 
120.9 	to temporary and seasonal residential occupancy for recreational purposes, up to a total of 
120.10 	two acres, provided the property is not devoted to commercial recreational use for more 
120.11 	than 250 days in the year preceding the year of assessment and is located within two 
120.12 	miles of the class 4c property with which it is used. Owners of real and personal property 
120.13 	devoted to temporary and seasonal residential occupancy for recreation purposes and all 
120.14 	or a portion of which was devoted to commercial purposes for not more than 250 days in 
120.15 	the year preceding the year of assessment desiring classification as class 4c, must submit a 
120.16 	declaration to the assessor designating the cabins or units occupied for 250 days or less in 
120.17 	the year preceding the year of assessment by January 15 of the assessment year. Those 
120.18 	cabins or units and a proportionate share of the land on which they are located must be 
120.19 	designated class 4c as otherwise provided. The remainder of the cabins or units and 
120.20 	a proportionate share of the land on which they are located will be designated as class 
120.21 	3a. The owner of property desiring designation as class 4c property must provide guest 
120.22 	registers or other records demonstrating that the units for which class 4c designation is 
120.23 	sought were not occupied for more than 250 days in the year preceding the assessment if 
120.24 	so requested. The portion of a property operated as a (1) restaurant, (2) bar, (3) gift shop, 
120.25 	(4) conference center or meeting room, and (5) other nonresidential facility operated on a 
120.26 	commercial basis not directly related to temporary and seasonal residential occupancy for 
120.27 	recreation purposes does not qualify for class 4c; 
120.28 	(2) qualified property used as a golf course if: 
120.29 	(i) it is open to the public on a daily fee basis. It may charge membership fees or 
120.30 	dues, but a membership fee may not be required in order to use the property for golfing, 
120.31 	and its green fees for golfing must be comparable to green fees typically charged by 
120.32 	municipal courses; and 
120.33 	(ii) it meets the requirements of section 273.112, subdivision 3, paragraph (d). 
120.34 	A structure used as a clubhouse, restaurant, or place of refreshment in conjunction 
120.35 	with the golf course is classified as class 3a property; 
121.1 	(3) real property up to a maximum of three acres of land owned and used by a 
121.2 	nonprofit community service oriented organization and that is not used for residential 
121.3 	purposes on either a temporary or permanent basis, qualifies for class 4c provided that 
121.4 	it meets either of the following: 
121.5 	(i) the property is not used for a revenue-producing activity for more than six days 
121.6 	in the calendar year preceding the year of assessment; or 
121.7 	(ii) the organization makes annual charitable contributions and donations at least 
121.8 	equal to the property's previous year's property taxes and the property is allowed to be 
121.9 	used for public and community meetings or events for no charge, as appropriate to the 
121.10 	size of the facility. 
121.11 	For purposes of this clause, 
121.12 	(A) "charitable contributions and donations" has the same meaning as lawful 
121.13 	gambling purposes under section 349.12, subdivision 25, excluding those purposes 
121.14 	relating to the payment of taxes, assessments, fees, auditing costs, and utility payments; 
121.15 	(B) "property taxes" excludes the state general tax; 
121.16 	(C) a "nonprofit community service oriented organization" means any corporation, 
121.17 	society, association, foundation, or institution organized and operated exclusively for 
121.18 	charitable, religious, fraternal, civic, or educational purposes, and which is exempt from 
121.19 	federal income taxation pursuant to section 501(c)(3), (10), or (19) of the Internal Revenue 
121.20 	Code of 1986, as amended through December 31, 1990; and 
121.21 	(D) "revenue-producing activities" shall include but not be limited to property or that 
121.22 	portion of the property that is used as an on-sale intoxicating liquor or 3.2 percent malt 
121.23 	liquor establishment licensed under chapter 340A, a restaurant open to the public, bowling 
121.24 	alley, a retail store, gambling conducted by organizations licensed under chapter 349, an 
121.25 	insurance business, or office or other space leased or rented to a lessee who conducts a 
121.26 	for-profit enterprise on the premises. 
121.27 	Any portion of the property qualifying under item (i) which is used for revenue-producing 
121.28 	activities for more than six days in the calendar year preceding the year of assessment 
121.29 	shall be assessed as class 3a. The use of the property for social events open exclusively 
121.30 	to members and their guests for periods of less than 24 hours, when an admission is 
121.31 	not charged nor any revenues are received by the organization shall not be considered a 
121.32 	revenue-producing activity. 
121.33 	The organization shall maintain records of its charitable contributions and donations 
121.34 	and of public meetings and events held on the property and make them available upon 
121.35 	request any time to the assessor to ensure eligibility. An organization meeting the 
121.36 	requirement under item (ii) must file an application by May 1 with the assessor for 
122.1 	eligibility for the current year's assessment. The commissioner shall prescribe a uniform 
122.2 	application form and instructions; 
122.3 	(4) postsecondary student housing of not more than one acre of land that is owned by 
122.4 	a nonprofit corporation organized under chapter 317A and is used exclusively by a student 
122.5 	cooperative, sorority, or fraternity for on-campus housing or housing located within two 
122.6 	miles of the border of a college campus; 
122.7 	(5) manufactured home parks as defined in section 327.14, subdivision 3; 
122.8 	(6) real property that is actively and exclusively devoted to indoor fitness, health, 
122.9 	social, recreational, and related uses, is owned and operated by a not-for-profit corporation, 
122.10 	and is located within the metropolitan area as defined in section 473.121, subdivision 2; 
122.11 	(7) a leased or privately owned noncommercial aircraft storage hangar not exempt 
122.12 	under section 272.01, subdivision 2, and the land on which it is located, provided that: 
122.13 	(i) the land is on an airport owned or operated by a city, town, county, Metropolitan 
122.14 	Airports Commission, or group thereof; and 
122.15 	(ii) the land lease, or any ordinance or signed agreement restricting the use of the 
122.16 	leased premise, prohibits commercial activity performed at the hangar. 
122.17 	If a hangar classified under this clause is sold after June 30, 2000, a bill of sale must 
122.18 	be filed by the new owner with the assessor of the county where the property is located 
122.19 	within 60 days of the sale; 
122.20 	(8) a privately owned noncommercial aircraft storage hangar not exempt under 
122.21 	section 272.01, subdivision 2, and the land on which it is located, provided that: 
122.22 	(i) the land abuts a public airport; and 
122.23 	(ii) the owner of the aircraft storage hangar provides the assessor with a signed 
122.24 	agreement restricting the use of the premises, prohibiting commercial use or activity 
122.25 	performed at the hangar; and 
122.26 	(9) residential real estate, a portion of which is used by the owner for homestead 
122.27 	purposes, and that is also a place of lodging, if all of the following criteria are met: 
122.28 	(i) rooms are provided for rent to transient guests that generally stay for periods 
122.29 	of 14 or fewer days; 
122.30 	(ii) meals are provided to persons who rent rooms, the cost of which is incorporated 
122.31 	in the basic room rate; 
122.32 	(iii) meals are not provided to the general public except for special events on fewer 
122.33 	than seven days in the calendar year preceding the year of the assessment; and 
122.34 	(iv) the owner is the operator of the property.
122.35 	The market value subject to the 4c classification under this clause is limited to five rental 
122.36 	units. Any rental units on the property in excess of five, must be valued and assessed as 
123.1 	class 3a. The portion of the property used for purposes of a homestead by the owner must 
123.2 	be classified as class 1a property under subdivision 22.; and
123.3 	(10) real property up to a maximum of three acres and operated as a restaurant 
123.4 	as defined under section 157.15, subdivision 12, provided it: (A) is located on a lake 
123.5 	as defined under section 103G.005, subdivision 15, paragraph (a), clause (3); and (B) 
123.6 	is either devoted to commercial purposes for not more than 250 consecutive days, or 
123.7 	receives at least 60 percent of its annual gross receipts from business conducted during 
123.8 	four consecutive months. Gross receipts from the sale of alcoholic beverages must be 
123.9 	included in determining the property's qualification under subitem (B). The property's 
123.10 	primary business must be as a restaurant and not as a bar. Gross receipts from gift shop 
123.11 	sales located on the premises must be excluded. Owners of real property desiring 4c 
123.12 	classification under this clause must submit an annual declaration to the assessor by 
123.13 	February 1 of the current assessment year, based on the property's relevant information for 
123.14 	the preceding assessment year. 
123.15 	Class 4c property has a class rate of 1.5 percent of market value, except that (i) each 
123.16 	parcel of seasonal residential recreational property not used for commercial purposes has 
123.17 	the same class rates as class 4bb property, (ii) manufactured home parks assessed under 
123.18 	clause (5) have the same class rate as class 4b property, (iii) commercial-use seasonal 
123.19 	residential recreational property has a class rate of one percent for the first $500,000 of 
123.20 	market value, and 1.25 percent for the remaining market value, (iv) the market value of 
123.21 	property described in clause (4) has a class rate of one percent, (v) the market value 
123.22 	of property described in clauses (2) and, (6), and (10) has a class rate of 1.25 percent, 
123.23 	and (vi) that portion of the market value of property in clause (9) qualifying for class 4c 
123.24 	property has a class rate of 1.25 percent. 
123.25 	(e) Class 4d property is qualifying low-income rental housing certified to the assessor 
123.26 	by the Housing Finance Agency under section 273.128, subdivision 3. If only a portion 
123.27 	of the units in the building qualify as low-income rental housing units as certified under 
123.28 	section 273.128, subdivision 3, only the proportion of qualifying units to the total number 
123.29 	of units in the building qualify for class 4d. The remaining portion of the building shall be 
123.30 	classified by the assessor based upon its use. Class 4d also includes the same proportion of 
123.31 	land as the qualifying low-income rental housing units are to the total units in the building. 
123.32 	For all properties qualifying as class 4d, the market value determined by the assessor must 
123.33 	be based on the normal approach to value using normal unrestricted rents. 
123.34 	Class 4d property has a class rate of 0.75 percent. 

124.1 	EFFECTIVE DATE. This section is effective for taxes payable in 2009 and 
124.2 	thereafter, except that for the 2008 assessment year, the declaration to the assessor shall be 
124.3 	September 1, 2008.

124.4 	Sec. 28. Minnesota Statutes 2006, section 273.13, subdivision 33, is amended to read:
124.5 		Subd. 33.Classification of unimproved property. (a) All real property that is not 
124.6 	improved with a structure must be classified according to its current use.
124.7 	(b) Except as provided in subdivision 23, paragraph (c), real property that is not 
124.8 	improved with a structure and for which there is no identifiable current use must be 
124.9 	classified according to its highest and best use permitted under the local zoning ordinance. 
124.10 	If the ordinance permits more than one use, the land must be classified according to the 
124.11 	highest and best use permitted under the ordinance. If no such ordinance exists, the 
124.12 	assessor shall consider the most likely potential use of the unimproved land based upon 
124.13 	the use made of surrounding land or land in proximity to the unimproved land.

124.14 	EFFECTIVE DATE. This section is effective for taxes payable in 2010 and 
124.15 	thereafter.

124.16 	Sec. 29. Minnesota Statutes 2006, section 273.1384, subdivision 2, is amended to read:
124.17 		Subd. 2.Agricultural homestead market value credit. Property classified as class 
124.18 	2a agricultural homestead under section 273.13, subdivision 23, paragraph (a), is eligible 
124.19 	for an agricultural credit. The credit is computed using the property's agricultural credit 
124.20 	market value, defined for this purpose as the property's class 2a market value excluding 
124.21 	the market value of the house, garage, and immediately surrounding one acre of land. The 
124.22 	credit is equal to 0.3 percent of the first $115,000 of the property's agricultural credit 
124.23 	market value minus .05 percent of the property's agricultural credit market value in excess 
124.24 	of $115,000, subject to a maximum reduction of $115. In the case of property that is 
124.25 	classified in as part as class 2a agricultural homestead and in part as class 2b nonhomestead 
124.26 	farm land solely because not all the owners occupy or farm the property, not all the owners 
124.27 	have qualifying relatives occupying or farming the property, or solely because not all the 
124.28 	spouses of owners occupy the property, the credit must be initially computed as if that 
124.29 	nonhomestead agricultural land was also classified as class 2a agricultural homestead and 
124.30 	then prorated to the owner-occupant's percentage of ownership.

124.31 	EFFECTIVE DATE. This section is effective for taxes payable in 2010 and 
124.32 	thereafter.

125.1 	Sec. 30. Minnesota Statutes 2007 Supplement, section 273.1393, is amended to read:
125.2 	273.1393 COMPUTATION OF NET PROPERTY TAXES.
125.3 	Notwithstanding any other provisions to the contrary, "net" property taxes are 
125.4 	determined by subtracting the credits in the order listed from the gross tax:
125.5 	(1) disaster credit as provided in sections 273.1231 to 273.1235; 
125.6 	(2) powerline credit as provided in section 273.42; 
125.7 	(3) agricultural preserves credit as provided in section 473H.10; 
125.8 	(4) enterprise zone credit as provided in section 469.171; 
125.9 	(5) disparity reduction credit;
125.10 	(6) conservation tax credit as provided in section 273.119; 
125.11 	(7) homestead and agricultural credits as provided in section 273.1384; 
125.12 	(8) taconite homestead credit as provided in section 273.135; and
125.13 	(9) supplemental homestead credit as provided in section 273.1391; and
125.14 	(10) the bovine tuberculosis zone credit, as provided in section 273.113. 
125.15 	The combination of all property tax credits must not exceed the gross tax amount.

125.16 	EFFECTIVE DATE. This section is effective for taxes payable in 2009 and 
125.17 	thereafter.

125.18 	Sec. 31. Minnesota Statutes 2006, section 273.19, subdivision 1, is amended to read:
125.19 		Subdivision 1.Tax-exempt property; lease. Except as provided in subdivision 3 or 
125.20 	4, tax-exempt property held under a lease for a term of at least one year, and not taxable 
125.21 	under section 272.01, subdivision 2, or under a contract for the purchase thereof, shall be 
125.22 	considered, for all purposes of taxation, as the property of the person holding it. In this 
125.23 	subdivision, "tax-exempt property" means property owned by the United States, the state, 
125.24 	a school, or any religious, scientific, or benevolent society or institution, incorporated 
125.25 	or unincorporated, or any corporation whose property is not taxed in the same manner 
125.26 	as other property. This subdivision does not apply to property exempt from taxation 
125.27 	under section 272.01, subdivision 2, paragraph (b), clauses (2), (3), and (4), or to property 
125.28 	exempt from taxation under section 272.0213. 

125.29 	EFFECTIVE DATE. This section is effective for taxes payable in 2009 and 
125.30 	thereafter.

125.31 	Sec. 32. Minnesota Statutes 2006, section 274.14, is amended to read:
125.32 	274.14 LENGTH OF SESSION; RECORD.
126.1 	The board may meet on any ten consecutive meeting days in June, after the second 
126.2 	Friday in June. The actual meeting dates must be contained on the valuation notices 
126.3 	mailed to each property owner in the county as provided in section 273.121. For this 
126.4 	purpose, "meeting days" is defined as any day of the week excluding Saturday and Sunday.
126.5 	At the board's discretion, "meeting days" may include Saturday. No action taken by the 
126.6 	county board of review after June 30 is valid, except for corrections permitted in sections 
126.7 	273.01 and 274.01. The county auditor shall keep an accurate record of the proceedings 
126.8 	and orders of the board. The record must be published like other proceedings of county 
126.9 	commissioners. A copy of the published record must be sent to the commissioner of 
126.10 	revenue, with the abstract of assessment required by section 274.16.
126.11 	For counties that conduct either regular board of review meetings or open book 
126.12 	meetings, at least one of the meeting days must include a meeting that does not end 
126.13 	before 7:00 p.m. For counties that require taxpayer appointments for the board of review, 
126.14 	appointments must include some available times that extend until at least 7:00 p.m. The 
126.15 	county may have a Saturday meeting in lieu of, or in addition to, the extended meeting 
126.16 	times under this paragraph.

126.17 	EFFECTIVE DATE. This section is effective for assessment year 2009 and 
126.18 	thereafter.

126.19 	Sec. 33. Minnesota Statutes 2006, section 275.065, is amended by adding a subdivision 
126.20 	to read:
126.21 		Subd. 1d.Failure to certify proposed levy.  If a taxing authority fails to certify 
126.22 	its proposed levy by the due dates specified under subdivisions 1, 1a, and 1c, the county 
126.23 	auditor shall use the authority's previous year's final levy under section 275.07, subdivision 
126.24 	1, for purposes of determining its proposed property tax notices and public advertisements 
126.25 	under this section. 

126.26 	EFFECTIVE DATE. This section is effective for notices prepared in 2008, for 
126.27 	property taxes payable in 2009 and thereafter.

126.28 	Sec. 34. Minnesota Statutes 2006, section 275.065, subdivision 8, is amended to read:
126.29 		Subd. 8.Hearing. Notwithstanding any other provision of law, Ramsey County, 
126.30 	the city of St. Paul, and Independent School District No. 625 are authorized to and shall 
126.31 	hold their initial public hearing jointly. The hearing must be held on during the week of
126.32 	the second Tuesday of December each year. The advertisement required in subdivision 
127.1 	5a may be a joint advertisement. The hearing is otherwise subject to the requirements 
127.2 	of this section.
127.3 	Ramsey County is authorized to hold an additional initial hearing or hearings as 
127.4 	provided under this section, provided that any additional hearings must not conflict 
127.5 	with the initial or continuation hearing dates of the other taxing districts. However, if 
127.6 	Ramsey County elects not to hold such additional initial hearing or hearings, the joint 
127.7 	initial hearing required by this subdivision must be held in a St. Paul location convenient 
127.8 	to residents of Ramsey County.

127.9 	EFFECTIVE DATE. This section is effective for proposed notices and hearings 
127.10 	held in 2008 and thereafter.

127.11 	Sec. 35. Minnesota Statutes 2006, section 282.08, is amended to read:
127.12 	282.08 APPORTIONMENT OF PROCEEDS TO TAXING DISTRICTS.
127.13 	The net proceeds from the sale or rental of any parcel of forfeited land, or from the 
127.14 	sale of products from the forfeited land, must be apportioned by the county auditor to the 
127.15 	taxing districts interested in the land, as follows:
127.16 	(1) the portion required to pay any amounts included in the appraised value 
127.17 	under section 282.01, subdivision 3, as representing increased value due to any public 
127.18 	improvement made after forfeiture of the parcel to the state, but not exceeding the amount 
127.19 	certified by the clerk of the municipality appropriate governmental authority must be 
127.20 	apportioned to the municipal governmental subdivision entitled to it;
127.21 	(2) the portion required to pay any amount included in the appraised value under 
127.22 	section 282.019, subdivision 5, representing increased value due to response actions 
127.23 	taken after forfeiture of the parcel to the state, but not exceeding the amount of expenses 
127.24 	certified by the Pollution Control Agency or the commissioner of agriculture, must be 
127.25 	apportioned to the agency or the commissioner of agriculture and deposited in the fund 
127.26 	from which the expenses were paid;
127.27 	(3) the portion of the remainder required to discharge any special assessment 
127.28 	chargeable against the parcel for drainage or other purpose whether due or deferred at 
127.29 	the time of forfeiture, must be apportioned to the municipal governmental subdivision 
127.30 	entitled to it; and
127.31 	(4) any balance must be apportioned as follows:
127.32 	(i) The county board may annually by resolution set aside no more than 30 percent 
127.33 	of the receipts remaining to be used for forest development on tax-forfeited land and 
127.34 	dedicated memorial forests, to be expended under the supervision of the county board. It 
128.1 	must be expended only on projects improving the health and management of the forest 
128.2 	resource.
128.3 	(ii) The county board may annually by resolution set aside no more than 20 percent 
128.4 	of the receipts remaining to be used for the acquisition and maintenance of county parks 
128.5 	or recreational areas as defined in sections 398.31 to 398.36, to be expended under the 
128.6 	supervision of the county board.
128.7 	(iii) Any balance remaining must be apportioned as follows: county, 40 percent; 
128.8 	town or city, 20 percent; and school district, 40 percent, provided, however, that in 
128.9 	unorganized territory that portion which would have accrued to the township must be 
128.10 	administered by the county board of commissioners.

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

128.12 	Sec. 36. Minnesota Statutes 2006, section 298.75, subdivision 1, as amended by Laws 
128.13 	2008, chapter 154, article 8, section 15, is amended to read:
128.14 		Subdivision 1. Definitions. Except as may otherwise be provided, the following 
128.15 	words, when used in this section, shall have the meanings herein ascribed to them. 
128.16 	(a) "Aggregate material" means: 
128.17 	(1) nonmetallic natural mineral aggregate including, but not limited to sand, silica 
128.18 	sand, gravel, crushed rock, limestone, granite, and borrow, but only if the borrow is 
128.19 	transported on a public road, street, or highway, provided that nonmetallic aggregate 
128.20 	material does not include dimension stone and dimension granite; and 
128.21 	(2) taconite tailings, crushed rock, and architectural or dimension stone and 
128.22 	dimension granite removed from a taconite mine or the site of a previously operated 
128.23 	taconite mine. 
128.24 	Aggregate material must be measured or weighed after it has been extracted from 
128.25 	the pit, quarry, or deposit. 
128.26 	(b) "Person" means any individual, firm, partnership, corporation, organization, 
128.27 	trustee, association, or other entity. 
128.28 	(c) "Operator" means any person engaged in the business of removing aggregate 
128.29 	material from the surface or subsurface of the soil, for the purpose of sale, either directly 
128.30 	or indirectly, through the use of the aggregate material in a marketable product or service. 
128.31 	(d) "Extraction site" means a pit, quarry, or deposit containing aggregate material 
128.32 	and any contiguous property to the pit, quarry, or deposit which is used by the operator for 
128.33 	stockpiling the aggregate material. 
129.1 	(e) "Importer" means any person who buys aggregate material produced excavated
129.2 	from a county not listed in paragraph (f) or another state and causes the aggregate material 
129.3 	to be imported into a county in this state which imposes a tax on aggregate material. 
129.4 	(f) "County" means the counties of Pope, Stearns, Benton, Sherburne, Carver, Scott, 
129.5 	Dakota, Le Sueur, Kittson, Marshall, Pennington, Red Lake, Polk, Norman, Mahnomen, 
129.6 	Clay, Becker, Carlton, St. Louis, Rock, Murray, Wilkin, Big Stone, Sibley, Hennepin, 
129.7 	Washington, Chisago, and Ramsey. County also means any other county whose board 
129.8 	has voted after a public hearing to impose the tax under this section and has notified the 
129.9 	commissioner of revenue of the imposition of the tax. 
129.10 	(g) "Borrow" means granular borrow, consisting of durable particles of gravel and 
129.11 	sand, crushed quarry or mine rock, crushed gravel or stone, or any combination thereof, 
129.12 	the ratio of the portion passing the (#200) sieve divided by the portion passing the (1 inch) 
129.13 	sieve may not exceed 20 percent by mass. 

129.14 	EFFECTIVE DATE. This section is effective January 1, 2009.

129.15 	Sec. 37. Minnesota Statutes 2006, section 298.75, subdivision 2, is amended to read:
129.16 		Subd. 2.Tax imposed. (a) A county that imposes the aggregate production tax shall 
129.17 	impose upon every importer and operator a production tax up to ten centsof 21.5 cents per 
129.18 	cubic yard or up to seven15 cents per ton of aggregate material removedexcavated in the 
129.19 	county except that the county board may decide not to impose this tax if it determines 
129.20 	that in the previous year operators removed less than 20,000 tons or 14,000 cubic yards of 
129.21 	aggregate material from that county. The tax shall not be imposed on aggregate material 
129.22 	produced excavated in the county whenuntil the aggregate material is transported from 
129.23 	the extraction site or sold, whichever occurs first. When aggregate material is stored in a 
129.24 	stockpile within the state of Minnesota and a public highway, road or street is not used 
129.25 	for transporting the aggregate material, the tax shall not be imposed until either when the 
129.26 	aggregate material is sold, or when it is transported from the stockpile site, or when it is 
129.27 	used from the stockpile, whichever occurs first.
129.28 	(b) A county that imposes the aggregate production tax under paragraph (a) shall 
129.29 	impose upon every importer a production tax of 21.5 cents per cubic yard or 15 cents per 
129.30 	ton of aggregate material imported into the county. The tax shall be imposed when the 
129.31 	aggregate material is imported from the extraction site or sold. When imported aggregate 
129.32 	material is stored in a stockpile within the state of Minnesota and a public highway, road, 
129.33 	or street is not used for transporting the aggregate material, the tax shall be imposed either 
129.34 	when the aggregate material is sold, when it is transported from the stockpile site, or when 
130.1 	it is used from the stockpile, whichever occurs first. The tax shall be imposed on an 
130.2 	importer when the aggregate material is imported into the county that imposes the tax.
130.3 	(c) If the aggregate material is transported directly from the extraction site to a 
130.4 	waterway, railway, or another mode of transportation other than a highway, road or street, 
130.5 	the tax imposed by this section shall be apportioned equally between the county where the 
130.6 	aggregate material is extracted and the county to which the aggregate material is originally 
130.7 	transported. If that destination is not located in Minnesota, then the county where the 
130.8 	aggregate material was extracted shall receive all of the proceeds of the tax.
130.9 	(d) A county, city, or town that receives revenue under this section is prohibited 
130.10 	from imposing any additional host community fees on aggregate production within that 
130.11 	county, city, or town.

130.12 	EFFECTIVE DATE. This section is effective January 1, 2009.

130.13 	Sec. 38. Minnesota Statutes 2006, section 298.75, subdivision 6, is amended to read:
130.14 		Subd. 6.Penalties; removal of aggregate if previous tax not paid; false report.
 130.15 	It is a misdemeanor for any operator or importer to remove aggregate material from a 
130.16 	pit, quarry, or deposit or for any importer to import aggregate material unless all taxes 
130.17 	due under this section for theall previous reporting periodperiods have been paid or 
130.18 	objections thereto have been filed pursuant to subdivision 4.
130.19 	It is a misdemeanor for the operator or importer who is required to file a report to file 
130.20 	a false report with intent to evade the tax.

130.21 	EFFECTIVE DATE. This section is effective January 1, 2009.

130.22 	Sec. 39. Minnesota Statutes 2006, section 298.75, subdivision 7, as amended by Laws 
130.23 	2008, chapter 154, article 8, section 17, is amended to read:
130.24 		Subd. 7. Proceeds of taxes. (a) All money collected as taxes under this section 
130.25 	on aggregate material as defined in subdivision 1, paragraph (a), clause (1), shall be 
130.26 	deposited in the county treasury and credited as follows, for expenditure by the county 
130.27 	board: according to this subdivision.
130.28 	(b) The county auditor may retain an annual administrative fee of up to five percent 
130.29 	of the total taxes collected in any year.
130.30 	(c) The balance of the taxes, after any deduction under paragraph (b), shall be 
130.31 	credited as follows:
130.32 	(a) Sixty (1) 42.5 percent to the county road and bridge fund for expenditure for the 
130.33 	maintenance, construction and reconstruction of roads, highways and bridges; 
131.1 	(b) Thirty (2) 42.5 percent to the road and bridge fund of those towns as determined 
131.2 	by the county board and to the general fund or other designated fund of those cities as 
131.3 	determined by the county board of the city or town in which the mine is located, or to the 
131.4 	county, if the mine is located in an unorganized town, to be expended for maintenance, 
131.5 	construction and reconstruction of roads, highways and bridges; and 
131.6 	(c) Ten (3) 15 percent to a special reserve fund which is hereby established, for 
131.7 	expenditure for the restoration of abandoned pits, quarries, or deposits located upon public 
131.8 	and tax forfeited lands within the county. 
131.9 	If there are no abandoned pits, quarries or deposits located upon public or tax 
131.10 	forfeited lands within the county, this portion of the tax shall be deposited in the county 
131.11 	road and bridge fund for expenditure for the maintenance, construction and reconstruction 
131.12 	of roads, highways and bridges used for any other unmet reclamation need or for 
131.13 	conservation or other environmental needs. 

131.14 	EFFECTIVE DATE. This section is effective January 1, 2009.

131.15 	Sec. 40. Minnesota Statutes 2006, section 365.243, is amended by adding a subdivision 
131.16 	to read:
131.17 		Subd. 3.Levy for first responder association. A county board may annually levy 
131.18 	taxes on property located within the area of unorganized territory to which a first responder 
131.19 	or fire protection association provides first responder services. By July 1 of the levy year, 
131.20 	the association must certify to the county board the area of the unorganized township to 
131.21 	which the association will provide first responder services during the following calendar 
131.22 	year. The proceeds of the levy must be distributed to the association.

131.23 	EFFECTIVE DATE. This section is effective for taxes payable in 2009 and 
131.24 	thereafter.

131.25 	Sec. 41. Minnesota Statutes 2006, section 365A.095, as amended by Laws 2008, 
131.26 	chapter 154, article 10, section 8, is amended to read:
131.27 	365A.095 PETITION FOR REMOVAL OF DISTRICT; PROCEDURE; 
131.28 	REFUND OF SURPLUS. 
131.29 		Subdivision 1. Petition; procedure. A petition signed by at least 75 percent of the 
131.30 	property owners in the territory of the subordinate service district requesting the removal 
131.31 	of the district may be presented to the town board. Within 30 days after the town board 
131.32 	receives the petition, the town clerk shall determine the validity of the signatures on 
131.33 	the petition. If the requisite number of signatures are certified as valid, the town board 
132.1 	must hold a public hearing on the petitioned matter. Within 30 days after the end of 
132.2 	the hearing, the town board must decide whether to discontinue the subordinate service 
132.3 	district, continue as it is, or take some other action with respect to it. 
132.4 		Subd. 2. Bonds Option to refund surplus. If obligations have been issued for the 
132.5 	benefit of the subordinate service district, the rates, charges, and tax levies, if any, continue 
132.6 	until the obligations and any obligations issued to refund them have been paid in full.If the 
132.7 	district is removed under subdivision 1, after all outstanding obligations of the district 
132.8 	have been paid in full, the town board may vote to refund any surplus tax revenue or 
132.9 	service charge, or any part of it, collected from the district under section 365A.08. The 
132.10 	refund must be distributed equally to the owners of any property within the discontinued 
132.11 	district that were charged the extra tax or service fee during the most recent tax year for 
132.12 	which the tax or service fee was imposed. Any surplus not refunded under this section 
132.13 	must be transferred to the town's general fund.

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

132.15 	Sec. 42. Minnesota Statutes 2006, section 429.101, subdivision 1, is amended to read:
132.16 		Subdivision 1.Ordinances. (a) In addition to any other method authorized by 
132.17 	law or charter, the governing body of any municipality may provide for the collection 
132.18 	of unpaid special charges as a special assessment against the property benefited for all 
132.19 	or any part of the cost of:
132.20 	(1) snow, ice, or rubbish removal from sidewalks;
132.21 	(2) weed elimination from streets or private property;
132.22 	(3) removal or elimination of public health or safety hazards from private property, 
132.23 	excluding any structure included under the provisions of sections 463.15 to 463.26; 
132.24 	(4) installation or repair of water service lines, street sprinkling or other dust 
132.25 	treatment of streets;
132.26 	(5) the trimming and care of trees and the removal of unsound trees from any street;
132.27 	(6) the treatment and removal of insect infested or diseased trees on private property, 
132.28 	the repair of sidewalks and alleys;
132.29 	(7) the operation of a street lighting system;
132.30 	(8) the operation and maintenance of a fire protection or a pedestrian skyway system;
132.31 	(9) reinspections which find noncompliance after the due date for compliance with 
132.32 	an order to correct inspections relating to a municipal housing maintenance code violation;
132.33 	(10) the recovery of any disbursements under section 504B.445, subdivision 4, 
132.34 	clause (5), including disbursements for payment of utility bills and other services, even if 
133.1 	provided by a third party, necessary to remedy violations as described in section 504B.445, 
133.2 	subdivision 4, clause (2); or 
133.3 	(11) [Repealed, 2004 c 275 s 5]
133.4 	as a special assessment against the property benefited.
133.5 	(12) the recovery of delinquent vacant building registration fees under a municipal 
133.6 	program designed to identify and register vacant buildings.
133.7 	(b) The council may by ordinance adopt regulations consistent with this section to 
133.8 	make this authority effective, including, at the option of the council, provisions for placing 
133.9 	primary responsibility upon the property owner or occupant to do the work personally 
133.10 	(except in the case of street sprinkling or other dust treatment, alley repair, tree trimming, 
133.11 	care, and removal or the operation of a street lighting system) upon notice before the work 
133.12 	is undertaken, and for collection from the property owner or other person served of the 
133.13 	charges when due before unpaid charges are made a special assessment.

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

133.15 	Sec. 43. Minnesota Statutes 2006, section 469.1813, subdivision 8, is amended to read:
133.16 		Subd. 8.Limitation on abatements. In any year, the total amount of property 
133.17 	taxes abated by a political subdivision under this section may not exceed (1) ten percent 
133.18 	of the current levy net tax capacity of the political subdivision for the taxes payable year 
133.19 	to which the abatement applies, or (2) $200,000, whichever is greater. The limit under 
133.20 	this subdivision does not apply to:
133.21 	(i) an uncollected abatement from a prior year that is added to the abatement levy; or
133.22 	(ii) a taxpayer whose real and personal property is subject to valuation under 
133.23 	Minnesota Rules, chapter 8100.

133.24 	EFFECTIVE DATE. This section is effective for abatement resolutions approved 
133.25 	after the day following final enactment.

133.26 	Sec. 44. Laws 2008, chapter 154, article 2, section 11, the effective date, is amended to 
133.27 	read:

133.28 	EFFECTIVE DATE. The amendments of this section to paragraph (b) and to the 
133.29 	class rate decrease and the market value increase of the first tier of class 1c homestead 
133.30 	resorts are effective for taxes payable in 2009 and thereafter. The rest of this section is 
133.31 	effective for taxes payable in 2010 and thereafter.

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

134.1 	Sec. 45. Laws 2008, chapter 154, article 2, section 27, is amended to read:
134.2 	[360.0427] TAX LEVY MAY BE CERTIFIED BY AN AIRPORT 
134.3 	AUTHORITY. 
134.4 	In any year in which it imposes Imposition of a property tax levy under sections 
134.5 	275.065 to 275.07, which requires an affirmative vote of at least two-thirds of the members 
134.6 	of the authority, an airport authority must submit its proposed levy to the governing body 
134.7 	of the municipality that contains the airport. The municipal governing body may approve 
134.8 	or modify the amount of the levy, and, when it has determined the amount, the authority 
134.9 	must certify to the auditor of the county where the airport is located the amount to be 
134.10 	levied on all taxable property within the boundaries of the airport authority. 

134.11 	EFFECTIVE DATE. This section is effective for taxes payable in 2009 and 
134.12 	thereafter.

134.13 	Sec. 46. WHITE COMMUNITY HOSPITAL DISTRICT.
 134.14 		Subdivision 1.Authorized. Notwithstanding the contiguity requirement in 
134.15 	Minnesota Statutes, section 447.31, subdivision 2, any two or more of the following cities 
134.16 	and towns in St. Louis County may establish by resolution of their respective governing 
134.17 	bodies the White Community Hospital District: the cities of Aurora, Biwabik, and Hoyt 
134.18 	Lakes, and the towns of Biwabik, White, and Colvin. The proposed resolution to establish 
134.19 	the hospital district must be published and is subject to referendum as provided in section 
134.20 	447.31, subdivision 2.
134.21 		Subd. 2.Powers; may make grants. (a) Except as otherwise provided in this 
134.22 	section, the White Community Hospital District shall be organized and have the powers 
134.23 	and duties provided in Minnesota Statutes, sections 447.31, except subdivisions 2, 5, and 
134.24 	6; 447.32, subdivisions 5, 7, and 9; 447.345; 447.37; and 447.38.
134.25 	(b) The hospital district may levy taxes as provided in this section to provide funding 
134.26 	to make grants to the White Community Hospital and any affiliated health care facility or 
134.27 	provider for any purpose authorized for hospital districts in Minnesota Statutes, sections 
134.28 	447.31 to 447.38, except 447.331. A grant must not be made under this section until the 
134.29 	governing body of the White Community Hospital, and any of its affiliated health care 
134.30 	facilities or providers receiving a grant, have entered into a written agreement with the 
134.31 	hospital district board stating that the governing body will comply with and is subject to 
134.32 	all provisions of the Minnesota open meeting law in Minnesota Statutes, chapter 13D.
134.33 		Subd. 3.Annexation; detachment. Once the hospital district is established, any 
134.34 	other city, town, or unorganized area in St. Louis County may join the hospital district 
135.1 	in the same manner provided in subdivision 1 for establishment of the hospital district. 
135.2 	A city, town, or unorganized area that is a member of the hospital district may detach 
135.3 	from the district in the same manner as it may join. An annexation to or detachment 
135.4 	from the hospital district is effective for taxes payable in the following calendar year if 
135.5 	the resolution is adopted, or in the case of an unorganized area the petition submitted 
135.6 	to the county auditor, before July 1 of the levy year. A resolution adopted or petition 
135.7 	submitted after July 1 of any year is effective for the taxes payable the year following 
135.8 	the next levy year.
135.9 		Subd. 4.Unorganized areas. An unorganized area in St. Louis County shall 
135.10 	become a member of the hospital district if at least 51 percent of the residents of the 
135.11 	unorganized area signed a petition submitted to the hospital district board and the county 
135.12 	auditor requesting to participate in the hospital district.
135.13 		Subd. 5.Hospital district board. The hospital district shall be governed by a 
135.14 	hospital board composed of one member of each participating city and town's governing 
135.15 	body, appointed by the governing body. If the hospital district only has two members, 
135.16 	each member city or town shall appoint two board members. The hospital district board 
135.17 	must appoint from among its members a chair, clerk, treasurer, and any other officers the 
135.18 	board deems necessary or useful. The St. Louis County Board of Commissioners shall 
135.19 	appoint a resident of any unorganized area that is participating in the hospital district. All 
135.20 	board members serve at the pleasure of the respective appointing authorities.
135.21 		Subd. 6.No compensation; expenses.  Board members shall serve without 
135.22 	compensation but shall be eligible for per diem and expenses provided by, and at the 
135.23 	discretion of, their respective appointing authorities.
135.24 		Subd. 7.Operating tax levy. The hospital district board may levy a tax as 
135.25 	provided in Minnesota Statutes, section 447.34, except as provided in this subdivision. 
135.26 	If the hospital district board levies it must be a uniform tax rate levied against the net 
135.27 	tax capacity of all taxable properties located within each participating city, town, or 
135.28 	unorganized area. The maximum amount that may be levied in the hospital district must 
135.29 	not exceed 0.066088 percent of the fully taxable market value of all taxable properties 
135.30 	located within each participating city, town, or unorganized area.
135.31 	Any tax levied by the hospital district is in addition to all other taxes levied on the 
135.32 	property, including taxes levied for any other hospital purpose by a participating city 
135.33 	or town. The levy must be disregarded in the calculation of all other rate or per capita 
135.34 	levy limitations imposed by law.

135.35 	EFFECTIVE DATE; NO LOCAL APPROVAL. This section is effective the 
135.36 	day following final enactment without local approval under Minnesota Statutes, section 
136.1 	645.023, subdivision 1, paragraph (a), for taxes levied in 2008, payable in 2009, and 
136.2 	thereafter.

136.3 	Sec. 47. VADNAIS LAKE AREA WATER MANAGEMENT ORGANIZATION; 
136.4 	STORM SEWER UTILITY FEES.
 136.5 	Notwithstanding any other law to the contrary and pursuant to joint powers 
136.6 	agreements authorized under Minnesota Statutes, sections 103B.211 and 471.59, the 
136.7 	Vadnais Lake Area Water Management Organization may certify to the county auditor any 
136.8 	fees or charges imposed by the organization under Minnesota Statutes, section 103B.211 
136.9 	or 444.075, and the parcels on which the charges are imposed. The county auditor shall 
136.10 	extend the charges on the property tax statements. The amounts must be certified by 
136.11 	November 30 to appear on statements for taxes payable in the following year. The charges, 
136.12 	if not paid, become delinquent and are subject to the same penalties, the same rate of 
136.13 	interest, and become a lien upon the property in the same manner, as real property taxes. 
136.14 	The charges shall be paid to the Vadnais Lake Area Water Management Organization by 
136.15 	the county auditor in the same manner and at the same time as property taxes. The county 
136.16 	auditor may charge the Vadnais Lake Area Water Management Organization a fee in the 
136.17 	amount necessary to recover the costs of administering the charges.

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

136.19 	Sec. 48. CITY OF BROOKLYN CENTER; PARTICIPATION IN CRIME-FREE 
136.20 	MULTIHOUSING PROGRAM.
 136.21 	(a) In addition to the requirements of Minnesota Statutes, section 273.128, if 
136.22 	property located in the city of Brooklyn Center qualifies under paragraph (b), the owners 
136.23 	or managers must complete the three phases of the city's crime-free multihousing program 
136.24 	and the qualifying property must be annually certified by the police as participating 
136.25 	in the program. If a qualifying property is not certified within one year after it is first 
136.26 	determined to be a qualifying property under paragraph (b), or does not annually maintain 
136.27 	its certification in the program, the city shall notify the property owner that the qualifying 
136.28 	property must comply with the requirements of this section to maintain its classification 
136.29 	as class 4d property. If a qualifying property is not in compliance within one year after 
136.30 	receiving the notice from the city, the city shall issue a second notice and require the 
136.31 	owners to enter into a plan to achieve compliance within one year. If, upon expiration 
136.32 	of the one-year time period, the qualifying property has not been certified by the police 
136.33 	as completing the program, the city shall notify the commissioner of the Housing 
136.34 	Finance Agency and the commissioner shall remove the property from the list of class 4d 
137.1 	properties certified to the assessor under Minnesota Statutes, section 273.128, subdivision 
137.2 	3. Once removed from the list, the property is not eligible for class 4d classification until 
137.3 	it complies with this section and its compliance has been certified to the Housing Finance 
137.4 	Agency by the city. Certification to the Housing Finance Agency must be made by May 
137.5 	15 to be effective for taxes payable in the following year.
137.6 	(b) A property is a qualifying property for purposes of this section's requirements if 
137.7 	it satisfies each of the following requirements:
137.8 	(1) the city offers a crime-free multihousing program through its city police;
137.9 	(2) over the preceding three-year period, the number of police calls to the property 
137.10 	exceeded the city's average number of calls for multiunit rental properties for the period 
137.11 	by at least 25 percent, adjusted for the number of rental units;
137.12 	(3) the police department has requested, in writing, the owners or managers of the 
137.13 	property to enroll in the crime-free multihousing program and the owners or managers 
137.14 	refused or failed to enroll within 60 days after the request, or failed to complete phases 
137.15 	one and three within 90 days and all three phases of the program within a one-year time 
137.16 	period; and
137.17 	(4) the governing body of the city, by resolution, determines the property is a 
137.18 	qualifying property under clauses (1) to (3).
137.19 	(c) Calls for police or emergency assistance in response to domestic abuse or 
137.20 	medical assistance shall not be counted toward the number of calls in paragraph (b), clause 
137.21 	(2). For purposes of this section, "domestic abuse" has the meaning given in Minnesota 
137.22 	Statutes, section 518B.01, subdivision 2.
137.23 	(d) Low-income qualifying rental housing property classified as class 4d property 
137.24 	for taxes payable in 2008 must meet the requirements of this section by May 15, 2011, in 
137.25 	order to retain the classification for taxes payable in 2012.
137.26 	(e) Provided that the city utilizes the crime-free multihousing program under this 
137.27 	section, on or before January 1, 2017, the city shall make a report to the chairs of the house 
137.28 	of representatives and senate tax committees describing the effectiveness of the program.

137.29 	EFFECTIVE DATE; LOCAL APPROVAL. This section is effective the day after 
137.30 	compliance by the governing body of the city of Brooklyn Center and its chief clerical 
137.31 	officer with Minnesota Statutes, section 645.021, subdivisions 2 and 3. This section 
137.32 	expires after taxes payable in 2017.

137.33 	Sec. 49. ASSESSMENT OF PROPERTIES OF PURELY PUBLIC CHARITIES.
 137.34 		Subdivision 1.Application. (a) To facilitate a review by the 2009 legislature of 
137.35 	the property tax exemption for property of nonprofit organizations as purely public 
138.1 	charities and the development of standards and criteria for the tax status of these facilities, 
138.2 	this section:
138.3 	(1) requires the commissioner of revenue to conduct an analysis of standards applied 
138.4 	to determine the tax status of these organizations; and 
138.5 	(2) prohibits changes in assessment practices and policies regarding the property of 
138.6 	these organizations.
138.7 	(b) The purpose of this study is to allow the legislature to evaluate whether the 
138.8 	judicially established rules and the assessment practices and policies in applying those 
138.9 	rules to determine the tax status of these properties ensure that public benefits are, at 
138.10 	least, commensurate with the costs of the exemption. The legislature does not intend, in 
138.11 	requiring this study, to indicate an intention to expand or to narrow the existing rules for 
138.12 	exempting institutions of purely public charity.
138.13 		Subd. 2.Report by commissioner of revenue. (a) The commissioner of revenue 
138.14 	shall survey all county assessors on: 
138.15 	(1) the tax status of property of institutions of purely public charity located in the 
138.16 	state, including detail on the type of organization and the use of the property; and
138.17 	(2) their practices and policies in determining the tax status of property of institutions 
138.18 	of purely public charity, including the extent to which the assessment practices and 
138.19 	policies require the institutions to provide goods or services at free or below market prices 
138.20 	and on the treatment of government payments.
138.21 	(b) The commissioner shall report the findings to the chairs of the house and senate 
138.22 	committees with jurisdiction over taxation by February 1, 2009.
138.23 		Subd. 3.Moratorium on changes in assessment practices. (a) An assessor 
138.24 	may not change the current practices or policies used generally in assessing property 
138.25 	of institutions of purely public charities.
138.26 	(b) An assessor may not change the assessment of the taxable status of an existing 
138.27 	property of an organization of purely public charity, unless the change is made as a result of 
138.28 	a change in ownership, occupancy or use of the facility, or to correct an error. For currently 
138.29 	taxable properties, the assessor may change the estimated market value of the property.
138.30 	(c) This subdivision expires on the earlier of:
138.31 	(1) the enactment of legislation establishing criteria for the property taxation of 
138.32 	purely public charities; or
138.33 	(2) adjournment of the 2009 regular legislative session to a date in calendar year 
138.34 	2010.

138.35 	EFFECTIVE DATE. This section is effective for the 2008 assessment, taxes 
138.36 	payable in 2009.

139.1 	Sec. 50. FEDERAL AUDIT; SCHOOL DISTRICT LEVY.
 139.2 		Subdivision 1.Calculation. The commissioner of education must calculate the total 
139.3 	amount of revenue that each school district and intermediate school district needs to 
139.4 	replace federal funds that have been disallowed resulting from the settlement of an audit 
139.5 	by the federal Office of Inspector General of Local Collaborative Time Study school-based 
139.6 	services claimed in Minnesota.
139.7 		Subd. 2.Levy. A school district may levy a property tax for taxes payable in 2009, 
139.8 	2010, and 2011 only, not to exceed one-third of the amount calculated in subdivision 1 in 
139.9 	each year. A school district that is a member of an intermediate school district may include 
139.10 	in its levy authority under this subdivision the proportionate share of the intermediate 
139.11 	school district's loss calculated under subdivision. One-half of the levy for taxes payable 
139.12 	in 2009 shall be recognized in fiscal year 2009.

139.13 	EFFECTIVE DATE. This section is effective for taxes payable in 2009 and 
139.14 	thereafter.

139.15 	Sec. 51. COMFORT LAKE-FOREST LAKE WATERSHED DISTRICT.
 139.16 	Notwithstanding any law to the contrary, the Comfort Lake-Forest Lake Watershed 
139.17 	District established under Minnesota Statutes, chapter 103D, shall be considered a 
139.18 	watershed management organization as defined in Minnesota Statutes, section 103B.205, 
139.19 	subdivision 13. The Comfort Lake-Forest Lake Watershed District shall manage or plan 
139.20 	for the management of surface water within the watershed district boundary in Chisago 
139.21 	and Washington Counties as it existed on April 1, 2008, through the authorities contained 
139.22 	in Minnesota Statutes, sections 103B.205 to 103B.255 and chapter 103D.

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

139.24 	Sec. 52.  REPEALER.
 139.25 	(a) Minnesota Statutes 2006, section 272.027, subdivision 3, is repealed.
139.26 	(b) Minnesota Statutes 2006, section 273.11, subdivision 14, is repealed.
139.27 	(c) Minnesota Statutes 2006, section 273.111, subdivision 6, is repealed.

139.28 	EFFECTIVE DATE. Paragraphs (a) and (b) are effective for taxes payable in 2009 
139.29 	and thereafter. Paragraph (c) is effective for taxes payable in 2010 and thereafter.

140.1 	ARTICLE 7
140.2 	SALES AND USE TAXES

140.3 	Section 1. Minnesota Statutes 2006, section 297A.67, subdivision 28, is amended to 
140.4 	read:
140.5 		Subd. 28.Ambulance supplies, parts, and equipment. The following sales to or 
140.6 	use by an ambulance service licensed under section 144E.10 are exempt: 
140.7 	(1) supplies and equipment used to provide medical care; and
140.8 	(2) repair and replacement parts for ambulances and vehicles equipped and 
140.9 	specifically intended for emergency response.

140.10 	EFFECTIVE DATE. This section is effective for sales and purchases made after 
140.11 	June 30, 2008.

140.12 	Sec. 2. Minnesota Statutes 2007 Supplement, section 297A.70, subdivision 3, is 
140.13 	amended to read:
140.14 		Subd. 3.Sales of certain goods and services to government. (a) The following 
140.15 	sales to or use by the specified governments and political subdivisions of the state are 
140.16 	exempt:
140.17 	(1) repair and replacement parts for emergency rescue vehicles, fire trucks, and 
140.18 	fire apparatus to a political subdivision;
140.19 	(2) machinery and equipment, except for motor vehicles, used directly for mixed 
140.20 	municipal solid waste management services at a solid waste disposal facility as defined in 
140.21 	section 115A.03, subdivision 10; 
140.22 	(3) chore and homemaking services to a political subdivision of the state to be 
140.23 	provided to elderly or disabled individuals;
140.24 	(4) telephone services to the  Office of Enterprise Technology that are used to provide 
140.25 	telecommunications services through the enterprise technology revolving fund;
140.26 	(5) firefighter personal protective equipment as defined in paragraph (b), if purchased 
140.27 	or authorized by and for the use of an organized fire department, fire protection district, or 
140.28 	fire company regularly charged with the responsibility of providing fire protection to the 
140.29 	state or a political subdivision;
140.30 	(6) bullet-resistant body armor that provides the wearer with ballistic and trauma 
140.31 	protection, if purchased by a law enforcement agency of the state or a political subdivision 
140.32 	of the state, or a licensed peace officer, as defined in section 626.84, subdivision 1; 
140.33 	(7) motor vehicles purchased or leased by political subdivisions of the state if the 
140.34 	vehicles are exempt from registration under section 168.012, subdivision 1, paragraph (b), 
141.1 	exempt from taxation under section 473.448, or exempt from the motor vehicle sales tax 
141.2 	under section 297B.03, clause (12); 
141.3 	(8) equipment designed to process, dewater, and recycle biosolids for wastewater 
141.4 	treatment facilities of political subdivisions, and materials incidental to installation of 
141.5 	that equipment; 
141.6 	(9) sales to a town of gravel and of machinery, equipment, and accessories, except 
141.7 	motor vehicles, used exclusively for road and bridge maintenance, and leases by a town of 
141.8 	motor vehicles exempt from tax under section 297B.03, clause (10); and
141.9 	(10) the removal of trees, bushes, or shrubs for the construction and maintenance 
141.10 	of roads, trails, or firebreaks when purchased by an agency of the state or a political 
141.11 	subdivision of the state; and
141.12 	(11) purchases by the Metropolitan Council or the Department of Transportation of 
141.13 	vehicles and repair parts to equip operations provided for in section 174.90, including, but 
141.14 	not limited to, the Northstar Corridor Rail project.
141.15 	(b) For purposes of this subdivision, "firefighters personal protective equipment" 
141.16 	means helmets, including face shields, chin straps, and neck liners; bunker coats and 
141.17 	pants, including pant suspenders; boots; gloves; head covers or hoods; wildfire jackets; 
141.18 	protective coveralls; goggles; self-contained breathing apparatus; canister filter masks; 
141.19 	personal alert safety systems; spanner belts; optical or thermal imaging search devices; 
141.20 	and all safety equipment required by the Occupational Safety and Health Administration.
141.21 	(c) For purchases of items listed in paragraph (a), clause (11), the tax must be 
141.22 	imposed and collected as if the rate under section 297A.62, subdivision 1, applied and 
141.23 	then refunded in the manner provided in section 297A.75.

141.24 	EFFECTIVE DATE. This section is effective retroactively for sales and purchases 
141.25 	made after December 31, 2006.

141.26 	Sec. 3. Minnesota Statutes 2006, section 297A.70, subdivision 8, is amended to read:
141.27 		Subd. 8.Regionwide public safety radio communication system; products and 
141.28 	services. Products and services including, but not limited to, end user equipment used 
141.29 	for construction, ownership, operation, maintenance, and enhancement of the backbone 
141.30 	system of the regionwide public safety radio communication system established under 
141.31 	sections 403.21 to 403.34 403.40, are exempt. For purposes of this subdivision, backbone 
141.32 	system is defined in section 403.21, subdivision 9. This subdivision is effective for 
141.33 	purchases, sales, storage, use, or consumption for use in the first and second phases of the 
141.34 	system, as defined in section 403.21, subdivisions 3, 10, and 11, and that portion of the 
141.35 	third phase of the system that is located in the southeast district of the State Patrol and 
142.1 	the counties of Benton, Sherburne, Stearns, and Wright, and that portion of the system 
142.2 	that is located in Itasca County.

142.3 	EFFECTIVE DATE. This section is effective for sales and purchases made after 
142.4 	June 30, 2008.

142.5 	Sec. 4. Minnesota Statutes 2006, section 297A.71, subdivision 23, is amended to read:
142.6 		Subd. 23.Construction materials for qualified low-income housing projects. (a) 
142.7 	Purchases of materials and supplies used or consumed in and equipment incorporated into 
142.8 	the construction, improvement, or expansion of qualified low-income housing projects are 
142.9 	exempt from the tax imposed under this chapter if the owner of the qualified low-income 
142.10 	housing project is:
142.11 	(1) the public housing agency or housing and redevelopment authority of a political 
142.12 	subdivision;
142.13 	(2) an entity exercising the powers of a housing and redevelopment authority within 
142.14 	a political subdivision;
142.15 	(3) a limited partnership in which the sole or managing general partner is an 
142.16 	authority under clause (1) or an entity under clause (2) or (4);
142.17 	(4) a nonprofit corporation subject to the provisions of chapter 317A, and qualifying 
142.18 	under section 501(c)(3) or 501(c)(4) of the Internal Revenue Code of 1986, as amended; or
142.19 	(5) an owner entity, as defined in Code of Federal Regulations, title 24, part 941.604, 
142.20 	for a qualified low-income housing project described in paragraph (b), clause (5).
142.21 	This exemption applies regardless of whether the purchases are made by the owner 
142.22 	of the facility or a contractor.
142.23 	(b) For purposes of this exemption, "qualified low-income housing project" means:
142.24 	(1) a housing or mixed use project in which at least 20 percent of the residential units 
142.25 	are qualifying low-income rental housing units as defined in section 273.126; 
142.26 	(2) a federally assisted low-income housing project financed by a mortgage insured 
142.27 	or held by the United States Department of Housing and Urban Development under 
142.28 	United States Code, title 12, section 1701s, 1715l(d)(3), 1715l(d)(4), or 1715z-1; United 
142.29 	States Code, title 42, section 1437f; the Native American Housing Assistance and 
142.30 	Self-Determination Act, United States Code, title 25, section 4101 et seq.; or any similar 
142.31 	successor federal low-income housing program;
142.32 	(3) a qualified low-income housing project as defined in United States Code, title 
142.33 	26, section 42(g), meeting all of the requirements for a low-income housing credit under 
142.34 	section 42 of the Internal Revenue Code regardless of whether the project actually applies 
142.35 	for or receives a low-income housing credit;
143.1 	(4) a project that will be operated in compliance with Internal Revenue Service 
143.2 	revenue procedure 96-32; or
143.3 	(5) a housing or mixed use project in which all or a portion of the residential units 
143.4 	are subject to the requirements of section 5 of the United States Housing Act of 1937.
143.5 	(c) For a project, a portion of which is not used for low-income housing units, 
143.6 	the amount of purchases that are exempt under this subdivision must be determined by 
143.7 	multiplying the total purchases, as specified in paragraph (a), by the ratio of:
143.8 	(1) the total gross square footage of units subject to the income limits under section 
143.9 	273.126, the financing for the project, the federal low-income housing tax credit, revenue 
143.10 	procedure 96-32, or section 5 of the United States Housing Act of 1937, as applicable 
143.11 	to the project; and 
143.12 	(2) the total gross square footage of all units in the project.
143.13 	(d) The tax must be imposed and collected as if the rate under section 297A.62, 
143.14 	subdivision 1, applied, and then refunded in the manner provided in section 297A.75. 

143.15 	EFFECTIVE DATE. This section is effective for sales and purchases made after 
143.16 	June 30, 2009.

143.17 	Sec. 5. Minnesota Statutes 2006, section 297A.71, is amended by adding a subdivision 
143.18 	to read:
143.19 		Subd. 40.Construction materials; Central Corridor light rail transit. Materials 
143.20 	and supplies used or consumed in, and equipment incorporated into, the construction 
143.21 	or improvement of the Central Corridor light rail transit line and associated facilities 
143.22 	including, but not limited to, stations, park-and-ride facilities, and maintenance facilities, 
143.23 	are exempt. The tax must be imposed and collected as if the rate under section 297A.62, 
143.24 	subdivision 1, applied and then refunded in the manner provided in section 297A.75. 
143.25 	Refunds must not be applied for or issued until after July 1, 2009.

143.26 	EFFECTIVE DATE. This section is effective for sales and purchases made after 
143.27 	June 30, 2008.

143.28 	Sec. 6. Minnesota Statutes 2006, section 297A.75, is amended to read:
143.29 	297A.75 REFUND; APPROPRIATION.
143.30 		Subdivision 1.Tax collected. The tax on the gross receipts from the sale of the 
143.31 	following exempt items must be imposed and collected as if the sale were taxable and the 
143.32 	rate under section 297A.62, subdivision 1, applied. The exempt items include:
143.33 	(1) capital equipment exempt under section 297A.68, subdivision 5;
144.1 	(2) building materials for an agricultural processing facility exempt under section 
144.2 	297A.71, subdivision 13;
144.3 	(3) building materials for mineral production facilities exempt under section 
144.4 	297A.71, subdivision 14;
144.5 	(4) building materials for correctional facilities under section 297A.71, subdivision 
144.6 	3;
144.7 	(5) building materials used in a residence for disabled veterans exempt under section 
144.8 	297A.71, subdivision 11;
144.9 	(6) elevators and building materials exempt under section 297A.71, subdivision 12;
144.10 	(7) building materials for the Long Lake Conservation Center exempt under section 
144.11 	297A.71, subdivision 17;
144.12 	(8) materials, supplies, fixtures, furnishings, and equipment for a county law 
144.13 	enforcement and family service center under section 297A.71, subdivision 26;
144.14 	(9) materials and supplies for qualified low-income housing under section 297A.71, 
144.15 	subdivision 23; 
144.16 	(10) materials, supplies, and equipment for municipal electric utility facilities under 
144.17 	section 297A.71, subdivision 35;
144.18 	(11) equipment and materials used for the generation, transmission, and distribution 
144.19 	of electrical energy and an aerial camera package exempt under section 297A.68, 
144.20 	subdivision 37; and
144.21 	(12) tangible personal property and taxable services and construction materials, 
144.22 	supplies, and equipment exempt under section 297A.68, subdivision 41; 
144.23 	(13) commuter rail vehicle and repair parts under section 297A.70, subdivision 
144.24 	3, clause (11); and
144.25 	(14) materials, supplies, and equipment for construction or improvement of projects 
144.26 	and facilities under section 297A.71, subdivision 40.
144.27 		Subd. 2.Refund; eligible persons. Upon application on forms prescribed by the 
144.28 	commissioner, a refund equal to the tax paid on the gross receipts of the exempt items 
144.29 	must be paid to the applicant. Only the following persons may apply for the refund:
144.30 	(1) for subdivision 1, clauses (1) to (3), the applicant must be the purchaser;
144.31 	(2) for subdivision 1, clauses (4), (7), and (8), the applicant must be the governmental 
144.32 	subdivision;
144.33 	(3) for subdivision 1, clause (5), the applicant must be the recipient of the benefits 
144.34 	provided in United States Code, title 38, chapter 21;
144.35 	(4) for subdivision 1, clause (6), the applicant must be the owner of the homestead 
144.36 	property;
145.1 	(5) for subdivision 1, clause (9), the owner of the qualified low-income housing 
145.2 	project; 
145.3 	(6) for subdivision 1, clause (10), the applicant must be a municipal electric utility or 
145.4 	a joint venture of municipal electric utilities; and
145.5 	(7) for subdivision 1, clauses (11) and (12), the owner of the qualifying business; and
145.6 	(8) for subdivision 1, clauses (13) and (14), the applicant must be the governmental 
145.7 	entity that owns or contracts for the project or facility.
145.8 		Subd. 3.Application. (a) The application must include sufficient information 
145.9 	to permit the commissioner to verify the tax paid. If the tax was paid by a contractor, 
145.10 	subcontractor, or builder, under subdivision 1, clause (4), (5), (6), (7), (8), (9), (10), 
145.11 	(11), or (12), (13), or (14), the contractor, subcontractor, or builder must furnish to the 
145.12 	refund applicant a statement including the cost of the exempt items and the taxes paid on 
145.13 	the items unless otherwise specifically provided by this subdivision. The provisions of 
145.14 	sections 289A.40 and 289A.50 apply to refunds under this section.
145.15 	(b) An applicant may not file more than two applications per calendar year for 
145.16 	refunds for taxes paid on capital equipment exempt under section 297A.68, subdivision 5.
145.17 	(c) Total refunds for purchases of items in section 297A.71, subdivision 40, must not 
145.18 	exceed $5,000,000 in fiscal years 2010 and 2011. Applications for refunds for purchases 
145.19 	of items in sections 297A.70, subdivision 3, paragraph (a), clause (11), and 297A.71, 
145.20 	subdivision 40, must not be filed until after June 30, 2009.
145.21 		Subd. 4.Interest. Interest must be paid on the refund at the rate in section 270C.405
145.22 	from 90 days after the refund claim is filed with the commissioner for taxes paid under 
145.23 	subdivision 1.
145.24 		Subd. 5.Appropriation. The amount required to make the refunds is annually 
145.25 	appropriated to the commissioner.

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

145.27 	Sec. 7. Minnesota Statutes 2006, section 297A.99, subdivision 1, as amended by Laws 
145.28 	2008, chapter 152, article 4, section 1, is amended to read:
145.29 		Subdivision 1. Authorization; scope. (a) A political subdivision of this state may 
145.30 	impose a general sales tax (1) under section 297A.992, (2) under section 297A.993, 
145.31 	(3) if permitted by special law enacted prior to May 20, 2008, or (4) if the political 
145.32 	subdivision enacted and imposed the tax before the effective date of section 477A.016 and 
145.33 	its predecessor provision. 
145.34 	(b) This section governs the imposition of a general sales tax by the political 
145.35 	subdivision. The provisions of this section preempt the provisions of any special law: 
146.1 	(1) enacted before June 2, 1997, or 
146.2 	(2) enacted on or after June 2, 1997, that does not explicitly exempt the special law 
146.3 	provision from this section's rules by reference. 
146.4 	(c) This section does not apply to or preempt a sales tax on motor vehicles or a 
146.5 	special excise tax on motor vehicles.
146.6 	(d) Until after May 31, 2010, a political subdivision may not advertise, promote, 
146.7 	expend funds, or hold a referendum to support imposing a local option sales tax unless 
146.8 	it is for extension of an existing tax or the tax was authorized by a special law enacted 
146.9 	prior to May 20, 2008.

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

146.11 	Sec. 8. Minnesota Statutes 2006, section 297B.03, is amended to read:
146.12 	297B.03 EXEMPTIONS.
146.13 	There is specifically exempted from the provisions of this chapter and from 
146.14 	computation of the amount of tax imposed by it the following:
146.15 	(1) purchase or use, including use under a lease purchase agreement or installment 
146.16 	sales contract made pursuant to section 465.71, of any motor vehicle by the United States 
146.17 	and its agencies and instrumentalities and by any person described in and subject to the 
146.18 	conditions provided in section 297A.67, subdivision 11; 
146.19 	(2) purchase or use of any motor vehicle by any person who was a resident of 
146.20 	another state or country at the time of the purchase and who subsequently becomes a 
146.21 	resident of Minnesota, provided the purchase occurred more than 60 days prior to the date 
146.22 	such person began residing in the state of Minnesota and the motor vehicle was registered 
146.23 	in the person's name in the other state or country;
146.24 	(3) purchase or use of any motor vehicle by any person making a valid election to be 
146.25 	taxed under the provisions of section 297A.90; 
146.26 	(4) purchase or use of any motor vehicle previously registered in the state of 
146.27 	Minnesota when such transfer constitutes a transfer within the meaning of section 118, 
146.28 	331, 332, 336, 337, 338, 351, 355, 368, 721, 731, 1031, 1033, or 1563(a) of the Internal 
146.29 	Revenue Code of 1986, as amended through December 31, 1999;
146.30 	(5) purchase or use of any vehicle owned by a resident of another state and leased 
146.31 	to a Minnesota-based private or for-hire carrier for regular use in the transportation of 
146.32 	persons or property in interstate commerce provided the vehicle is titled in the state of 
146.33 	the owner or secured party, and that state does not impose a sales tax or sales tax on 
146.34 	motor vehicles used in interstate commerce;
147.1 	(6) purchase or use of a motor vehicle by a private nonprofit or public educational 
147.2 	institution for use as an instructional aid in automotive training programs operated by the 
147.3 	institution. "Automotive training programs" includes motor vehicle body and mechanical 
147.4 	repair courses but does not include driver education programs;
147.5 	(7) purchase of a motor vehicle for use as an ambulance by an ambulance service 
147.6 	licensed under section 144E.10; 
147.7 	(8) purchase of a motor vehicle by or for a public library, as defined in section 
147.8 	134.001, subdivision 2, as a bookmobile or library delivery vehicle; 
147.9 	(9) purchase of a ready-mixed concrete truck;
147.10 	(10) purchase or use of a motor vehicle by a town for use exclusively for road 
147.11 	maintenance, including snowplows and dump trucks, but not including automobiles, 
147.12 	vans, or pickup trucks;
147.13 	(11) purchase or use of a motor vehicle by a corporation, society, association, 
147.14 	foundation, or institution organized and operated exclusively for charitable, religious, 
147.15 	or educational purposes, except a public school, university, or library, but only if the 
147.16 	vehicle is:
147.17 	(i) a truck, as defined in section 168.011, a bus, as defined in section 168.011, or a 
147.18 	passenger automobile, as defined in section 168.011, if the automobile is designed and 
147.19 	used for carrying more than nine persons including the driver; and 
147.20 	(ii) intended to be used primarily to transport tangible personal property or 
147.21 	individuals, other than employees, to whom the organization provides service in 
147.22 	performing its charitable, religious, or educational purpose;
147.23 	(12) purchase of a motor vehicle for use by a transit provider exclusively to provide 
147.24 	transit service is exempt if the transit provider is either (i) receiving financial assistance or 
147.25 	reimbursement under section 174.24 or 473.384, or (ii) operating under section 174.29, 
147.26 	473.388, or 473.405; 
147.27 	(13) purchase or use of a motor vehicle by a qualified business, as defined in section 
147.28 	469.310, located in a job opportunity building zone, if the motor vehicle is principally 
147.29 	garaged in the job opportunity building zone and is primarily used as part of or in direct 
147.30 	support of the person's operations carried on in the job opportunity building zone. The 
147.31 	exemption under this clause applies to sales, if the purchase was made and delivery 
147.32 	received during the duration of the job opportunity building zone. The exemption under 
147.33 	this clause also applies to any local sales and use tax.; and
147.34 	(14) purchase of a leased vehicle by the lessee who was a participant in a 
147.35 	lease-to-own program from a charitable organization that is:
147.36 	(i) described in section 501(c)(3) of the Internal Revenue Code; and
148.1 	(ii) licensed as a motor vehicle lessor under section 168.27, subdivision 4.

148.2 	EFFECTIVE DATE. This section is effective for sales and purchases made after 
148.3 	June 30, 2008.

148.4 	Sec. 9. Laws 1991, chapter 291, article 8, section 27, subdivision 3, as amended by 
148.5 	Laws 1998, chapter 389, article 8, section 28, is amended to read:
148.6 		Subd. 3. Use of revenues. Revenues received from taxes authorized by subdivisions 
148.7 	1 and 2 shall be used by the city to pay the cost of collecting the tax and to pay all or a 
148.8 	portion of the expenses of constructing and operatingimproving facilities as part of an 
148.9 	urban revitalization project in downtown Mankato known as Riverfront 2000. Authorized 
148.10 	expenses include, but are not limited to, acquiring property and paying relocation expenses 
148.11 	related to the development of Riverfront 2000 and related facilities, and securing or paying 
148.12 	debt service on bonds or other obligations issued to finance the construction of Riverfront 
148.13 	2000 and related facilities. For purposes of this section, "Riverfront 2000 and related 
148.14 	facilities" means a civic-convention center, an arena, a riverfront park, a technology center 
148.15 	and related educational facilities, and all publicly owned real or personal property that 
148.16 	the governing body of the city determines will be necessary to facilitate the use of these 
148.17 	facilities, including but not limited to parking, skyways, pedestrian bridges, lighting, and 
148.18 	landscaping. It also includes the performing arts theatre and the Southern Minnesota 
148.19 	Women's Hockey Exposition Center, attached to the Mankato Civic Center for use by 
148.20 	Minnesota State University, Mankato.

148.21 	EFFECTIVE DATE. This section is effective the day after the governing body of 
148.22 	the city of Mankato and its chief clerical officer comply with Minnesota Statutes, section 
148.23 	645.021, subdivisions 2 and 3, and after compliance with section 15.

148.24 	Sec. 10. Laws 1991, chapter 291, article 8, section 27, subdivision 4, as amended by 
148.25 	Laws 2005, First Special Session chapter 3, article 5, section 25, is amended to read:
148.26 		Subd. 4. Expiration of taxing authority and expenditure limitation. The 
148.27 	authority granted by subdivisions 1 and 2 to the city to impose a sales tax and an excise 
148.28 	tax shall expire on December 31, 2015, unless sufficient revenues are not available to 
148.29 	defease any bonds or obligations issued to finance construction of Riverfront 2000 and 
148.30 	related facilities. If sufficient funds are not available to defease the bonds, the tax expires
148.31 	December 31, 2018, but all revenues from taxes imposed after December 31, 2015, must 
148.32 	be used to defease the bonds. The city may, by ordinance, terminate the tax at an earlier 
148.33 	date 2022. 

149.1 	EFFECTIVE DATE. This section is effective the day after the governing body of 
149.2 	the city of Mankato and its chief clerical officer comply with Minnesota Statutes, section 
149.3 	645.021, subdivisions 2 and 3, and after compliance with section 16.

149.4 	Sec. 11. Laws 1998, chapter 389, article 8, section 45, subdivision 3, is amended to 
149.5 	read:
149.6 		Subd. 3. Use of revenues. Revenues received from the taxes authorized under 
149.7 	subdivision 1 must be used for sanitary sewer separation, wastewater treatment, water 
149.8 	system improvements, and harbor refuge development projects. 

149.9 	EFFECTIVE DATE. This section is effective the day following final enactment, 
149.10 	upon compliance by the city of Two Harbors with Minnesota Statutes, section 645.021, 
149.11 	subdivision 3.

149.12 	Sec. 12. Laws 1999, chapter 243, article 4, section 18, subdivision 1, is amended to 
149.13 	read:
149.14 		Subdivision 1.Sales and use tax. Notwithstanding Minnesota Statutes, section 
149.15 	297A.48, subdivision 1a,477A.016, or any other provision of law, ordinance, or city 
149.16 	charter, if approved by the city voters at the first municipal general election held after the 
149.17 	date of final enactment of this act or at a special election held November 2, 1999, the city 
149.18 	of Proctor may impose by ordinance a sales and use tax of up to one-half of one percent 
149.19 	for the purposes specified in subdivision 3. The provisions of Minnesota Statutes, section 
149.20 	297A.48 297A.99, govern the imposition, administration, collection, and enforcement of 
149.21 	the tax authorized under this subdivision.

149.22 	Sec. 13. Laws 1999, chapter 243, article 4, section 18, subdivision 3, is amended to 
149.23 	read:
149.24 		Subd. 3.Use of revenues. (a) Revenues received from taxes authorized by 
149.25 	subdivisions 1 and 2 must be used by the city to pay the cost of collecting the taxes and to 
149.26 	pay for construction and improvement of the following city facilities:
149.27 	(1) streets; and 
149.28 	(2) constructing and equipping the Proctor community activity center.
149.29 	Authorized expenses include, but are not limited to, acquiring property, paying 
149.30 	construction and operating expenses related to the development of an authorized facility, 
149.31 	and paying debt service on bonds or other obligations, including lease obligations, issued 
149.32 	to finance the construction, expansion, or improvement of an authorized facility. The 
149.33 	capital expenses for all projects authorized under this paragraph that may be paid with 
150.1 	these taxes is limited to $3,600,000, plus an amount equal to the costs related to issuance 
150.2 	of the bonds.
150.3 	(b) Additional revenues received from taxes authorized by subdivision 1, may be 
150.4 	used by the city to pay for the following capital improvement projects: public utilities, 
150.5 	including water, sanitary sewer, storm sewer, and electric; sidewalks; bikeways and trails; 
150.6 	and parks and recreation.

150.7 	EFFECTIVE DATE. This section is effective the day following final enactment, 
150.8 	upon compliance by the city of Proctor with Minnesota Statutes, section 645.021, 
150.9 	subdivision 3.

150.10 	Sec. 14. Laws 1999, chapter 243, article 4, section 18, subdivision 4, is amended to 
150.11 	read:
150.12 		Subd. 4.Bonding authority. (a) The city may issue bonds under Minnesota 
150.13 	Statutes, chapter 475, to finance the capital expenditure and improvement projects 
150.14 	described in subdivision 3. An election to approve the bonds under Minnesota Statutes, 
150.15 	section 475.58, is not required.
150.16 	(b) The issuance of bonds under this subdivision is not subject to Minnesota Statutes, 
150.17 	sections 275.60 and 279.61 275.61.
150.18 	(c) The bonds are not included in computing any debt limitation applicable to the 
150.19 	city, and the levy of taxes under Minnesota Statutes, section 475.61, to pay principal of 
150.20 	and interest on the bonds is not subject to any levy limitation.
150.21 	(d) For projects described in subdivision 3, paragraph (a), the aggregate principal 
150.22 	amount of bonds, plus the aggregate of the taxes used directly to pay eligible capital 
150.23 	expenditures and improvements, may not exceed $3,600,000, plus an amount equal to 
150.24 	the costs related to issuance of the bonds, including interest on the bonds. For projects 
150.25 	described in subdivision 3, paragraph (b), the aggregate principal amount of bonds may 
150.26 	not exceed $7,200,000, plus an amount equal to the costs related to issuance of the bonds, 
150.27 	including interest on the bonds.
150.28 	(e) The sales and use and excise taxes authorized in this section may be pledged to 
150.29 	and used for the payment of the bonds and any bonds issued to refund them only if the 
150.30 	bonds and any refunding bonds are general obligations of the city.

150.31 	EFFECTIVE DATE. This section is effective the day following final enactment, 
150.32 	upon compliance by the city of Proctor with Minnesota Statutes, section 645.021, 
150.33 	subdivision 3.

151.1 	Sec. 15. CITY OF MANKATO; REVERSE REFERENDUM REQUIRED.
 151.2 	If the Mankato city council intends to extend the local sales tax and modify the use 
151.3 	of revenues from the tax, authorized under sections 9 and 10, it shall pass a resolution 
151.4 	stating the intent. The resolution must be published for two successive weeks in the 
151.5 	official newspaper of the city or, if there is no official newspaper, in a newspaper of general 
151.6 	circulation in the city, together with a notice fixing a date for a public hearing on the 
151.7 	matter. The hearing must be held at least two weeks but not more than four weeks after the 
151.8 	first publication of the resolution. Following the public hearing, the city may determine 
151.9 	to take no further action or adopt a resolution confirming its intention to exercise the 
151.10 	authority. That resolution must also be published in the official newspaper of the city or, if 
151.11 	there is no official newspaper, in a newspaper of general circulation in the city. If within 
151.12 	30 days after publication of the resolution a petition signed by voters equal in number to 
151.13 	ten percent of the votes cast in the city in the last general election requesting a vote on the 
151.14 	proposed resolution is filed with the county auditor, the resolution is not effective until it 
151.15 	has been submitted to the voters at a general or special election and a majority of votes 
151.16 	cast on the question of approving the resolution are in the affirmative. The commissioner 
151.17 	of revenue shall prepare a suggested form of question to be presented at the election. This 
151.18 	section applies notwithstanding any city charter provision to the contrary.

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

151.20 	Sec. 16. CITY OF MANKATO, LOCAL TAXES AUTHORIZED.
 151.21 		Subdivision 1.Food and beverage tax authorized. Notwithstanding Minnesota 
151.22 	Statutes, section 477A.016, or any ordinance, city charter, or other provision of law, the 
151.23 	city of Mankato may, by ordinance, impose a sales tax of up to one percent on the gross 
151.24 	receipts on all sales of food and beverages by a restaurant or place of refreshment, as 
151.25 	defined by resolution of the city, that are located within the city. For purposes of this 
151.26 	section, "food and beverages" include retail on-sale of intoxicating liquor and fermented 
151.27 	malt beverages.
151.28 		Subd. 2.Entertainment tax. Notwithstanding Minnesota Statutes, section 
151.29 	477A.016, or any ordinance, city charter, or other provision of law, the city of Mankato 
151.30 	may, by ordinance, impose a tax of up to one percent on the gross receipts on admissions to 
151.31 	an entertainment event located within the city. For purposes of this section "entertainment 
151.32 	event" means any event for which persons pay money in order to be admitted to the 
151.33 	premises and to be entertained including, but not limited to, theaters, concerts, and 
151.34 	sporting events.
152.1 		Subd. 3.Use of proceeds from authorized taxes. The proceeds of any tax imposed 
152.2 	under subdivisions 1 and 2 shall be used by the city to pay all or a portion of the expenses 
152.3 	of operation and maintenance of the Riverfront 2000 and related facilities, including a 
152.4 	performing arts theatre and the Southern Minnesota Women's Hockey Exposition Center, 
152.5 	attached to the Mankato Civic Center for use by Minnesota State University, Mankato. 
152.6 	Authorized expenses include securing or paying debt service on bonds or other obligations 
152.7 	issued to finance the construction of the facilities.
152.8 		Subd. 4.Collection, administration, and enforcement. If the city desires, it may 
152.9 	enter into an agreement with the commissioner of revenue to administer, collect, and 
152.10 	enforce the taxes authorized under subdivisions 1 and 2. If the commissioner agrees 
152.11 	to collect the tax, the provisions of Minnesota Statutes, section 297A.99, related to 
152.12 	collection, administration, and enforcement apply.

152.13 	EFFECTIVE DATE. This section is effective the day after the governing body of 
152.14 	the city of Mankato and its chief clerical officer comply with Minnesota Statutes, section 
152.15 	645.021, subdivisions 2 and 3.

152.16 	Sec. 17. COOK COUNTY; LODGING AND ADMISSIONS TAXES.
 152.17 		Subdivision 1.Lodging tax. Notwithstanding Minnesota Statutes, section 
152.18 	477A.016, or any other provision of law, ordinance, or city charter, the Board of 
152.19 	Commissioners of Cook County may impose, by ordinance, a tax of up to one percent on 
152.20 	the gross receipts subject to the lodging tax under Minnesota Statutes, section 469.190. 
152.21 	This tax is in addition to any tax imposed under Minnesota Statutes, section 469.190, and 
152.22 	the total tax imposed under that section and this provision must not exceed four percent. 
152.23 		Subd. 2.Admissions and recreation tax. Notwithstanding Minnesota Statutes, 
152.24 	section 477A.016, or any other provision of law, ordinance, or city charter, the Board of 
152.25 	Commissioners of Cook County may impose, by ordinance, a tax of up to three percent on 
152.26 	admissions to entertainment and recreational facilities and rental of recreation equipment. 
152.27 		Subd. 3.Use of taxes. The taxes imposed in subdivisions 1 and 2 must be used 
152.28 	to fund a new Cook County Event and Visitors Bureau as established by the Board of 
152.29 	Commissioners of Cook County. The Board of Commissioners of Cook County must 
152.30 	annually review the budget of the Cook County Event and Visitors Bureau. The event and 
152.31 	visitors bureau may not receive revenues raised from the taxes imposed in subdivisions 1 
152.32 	and 2 until the board of commissioners approves the annual budget.
152.33 		Subd. 4.Termination. The taxes imposed in subdivisions 1 and 2 terminate 15 
152.34 	years after they are first imposed.

153.1 	EFFECTIVE DATE. This section is effective for sales and purchases after June 
153.2 	30, 2008.

153.3 	Sec. 18. COOK COUNTY; TAXES AUTHORIZED.
 153.4 		Subdivision 1.Sales and use tax. Notwithstanding Minnesota Statutes, section 
153.5 	477A.016, or any other provision of law, ordinance, or city charter, if approved by the 
153.6 	voters at a general or special election held before December 31, 2009, Cook County 
153.7 	may impose by ordinance a sales and use tax of up to one percent for the purposes 
153.8 	specified in subdivision 2. Except as otherwise provided in this section, the provisions 
153.9 	of Minnesota Statutes, section 297A.99, govern the imposition of the tax authorized 
153.10 	under this subdivision.
153.11 		Subd. 2.Use of revenues. Revenues received from the tax authorized by 
153.12 	subdivision 1 must be used by Cook County to pay the costs of collecting the tax and 
153.13 	to pay for the following projects:
153.14 	(1) construction and improvements to a county community center and recreation 
153.15 	area, including, but not limited to, improvements and additions to the skateboard park, 
153.16 	hockey rink, ball fields, community center addition, county parking area, tennis courts, 
153.17 	and all associated improvements; and
153.18 	(2) construction and improvements to the Grand Marais Public Library.
153.19 	Authorized expenses include, but are not limited to, paying construction expenses related 
153.20 	to these improvements, and paying debt service on bonds or other obligations issued to 
153.21 	finance acquisition and construction of these improvements. The total amount of revenues 
153.22 	from the taxes in subdivision 1 that may be used to fund these projects is $14,000,000 
153.23 	plus any associated bond costs.
153.24 		Subd. 3.Bonding authority. Cook County may issue bonds under Minnesota 
153.25 	Statutes, chapter 475, to pay capital and administrative expenses for the projects authorized 
153.26 	in subdivision 2, in an amount that does not exceed $14,000,000. An election to approve 
153.27 	the bonds under Minnesota Statutes, section 475.58, is not required. The issuance of bonds 
153.28 	under this subdivision is not subject to Minnesota Statutes, sections 275.60 and 275.61. 
153.29 	The debt represented by the bonds is not included in computing any debt limitation 
153.30 	applicable to the county, and any levy of taxes under Minnesota Statutes, section 475.61, 
153.31 	to pay principal and interest on the bonds is not subject to any levy limitation.
153.32 		Subd. 4.Termination of tax. The tax imposed under subdivision 1 expires at the 
153.33 	later of (1) 20 years or (2) when the county board determines that the amount of revenues 
153.34 	received is sufficient to pay for the principal and interest on any bonds or obligation 
153.35 	issued to finance the projects in subdivision 2. Any funds remaining after completion of 
154.1 	the projects and retirement or redemption of the bonds may be placed in the general fund 
154.2 	of the county. The tax imposed under subdivision 1 may expire at an earlier time if the 
154.3 	county board so determines by ordinance.

154.4 	EFFECTIVE DATE. This section is effective the day after the governing body of 
154.5 	Cook County and its chief clerical officer timely comply with Minnesota Statutes, section 
154.6 	645.021, subdivisions 2 and 3.

154.7 	Sec. 19. CITY OF CLEARWATER; TAXES AUTHORIZED.
 154.8 		Subdivision 1.Sales and use tax. Notwithstanding Minnesota Statutes, section 
154.9 	477A.016, or any other provision of law, ordinance, or city charter, pursuant to the 
154.10 	approval of the voters on November 7, 2006, the city of Clearwater may impose by 
154.11 	ordinance a sales and use tax of up to one-half of one percent for the purposes specified in 
154.12 	subdivision 2. Except as otherwise provided in this section, the provisions of Minnesota 
154.13 	Statutes, section 297A.99, govern the imposition, administration, collection, and 
154.14 	enforcement of the tax authorized under this subdivision.
154.15 		Subd. 2.Excise tax authorized. Notwithstanding Minnesota Statutes, section 
154.16 	477A.016, or any other provision of law, ordinance, or city charter, the city of Clearwater 
154.17 	may impose by ordinance, for the purposes specified in subdivision 3, an excise tax of up 
154.18 	to $20 per motor vehicle, as defined by ordinance, purchased or acquired from any person 
154.19 	engaged within the city in the business of selling motor vehicles at retail.
154.20 		Subd. 3.Use of revenues. The proceeds of the tax imposed under this section shall 
154.21 	be used to pay for the costs of acquisition, construction, improvement, and development 
154.22 	of a pedestrian bridge, and land and buildings for a community and recreation center. The 
154.23 	total amount of revenues from the taxes in subdivisions 1 and 2 that may be used to fund 
154.24 	these projects is $12,000,000 plus any associated bond costs.
154.25 		Subd. 4.Bonding authority. The city of Clearwater may issue bonds in an amount 
154.26 	not to exceed $12,000,000 under Minnesota Statutes, chapter 475, to finance the capital 
154.27 	expenditures and improvements authorized by the referendum under subdivision 1. An 
154.28 	election to approve the bonds under Minnesota Statutes, section 475.59, is not required. 
154.29 	The issuance of bonds under this subdivision is not subject to Minnesota Statutes, section 
154.30 	275.60 or 275.61. The debt represented by the bonds must not be included in computing 
154.31 	any debt limitations applicable to the city, and the levy of taxes required by Minnesota 
154.32 	Statutes, section 475.61, to pay the principal or any interest on the bonds must not be 
154.33 	subject to any levy limitation.
154.34 		Subd. 5.Termination of tax. The tax authorized under subdivision 1 terminates at 
154.35 	the earlier of (1) 20 years after the date of initial imposition of the tax, or (2) when the 
155.1 	city council determines that sufficient funds have been raised from the tax to finance the 
155.2 	capital and administrative costs of the improvements described in subdivision 3, plus the 
155.3 	additional amount needed to pay the costs related to issuance of bonds under subdivision 
155.4 	4, including interest on the bonds. Any funds remaining after completion of the projects 
155.5 	specified in subdivision 3 and retirement or redemption of the bonds in subdivision 4 may 
155.6 	be placed in the general fund of the city. The tax imposed under subdivision 1 may expire 
155.7 	at an earlier time if the city so determines by ordinance.

155.8 	EFFECTIVE DATE. This section is effective the day after compliance by the 
155.9 	governing body of the city of Clearwater with Minnesota Statutes, section 645.021, 
155.10 	subdivisions 2 and 3.

155.11 	Sec. 20. CITY OF NORTH MANKATO; TAXES AUTHORIZED.
 155.12 		Subdivision 1.Sales and use tax authorized. Notwithstanding Minnesota Statutes, 
155.13 	section 477A.016, or any other provision of law, ordinance, or city charter, pursuant to 
155.14 	the approval of the voters on November 7, 2006, the city of North Mankato may impose 
155.15 	by ordinance a sales and use tax of one-half of one percent for the purposes specified 
155.16 	in subdivision 2. The provisions of Minnesota Statutes, section 297A.99, govern the 
155.17 	imposition, administration, collection, and enforcement of the taxes authorized under 
155.18 	this subdivision. 
155.19 		Subd. 2.Use of revenues. Revenues received from the tax authorized by 
155.20 	subdivision 1 must be used to pay all or part of the capital costs of the following projects: 
155.21 	(1) the local share of the Trunk Highway 14/County State-Aid Highway 41 
155.22 	interchange project; 
155.23 	(2) development of regional parks and hiking and biking trails;
155.24 	(3) expansion of the North Mankato Taylor Library;
155.25 	(4) riverfront redevelopment; and
155.26 	(5) lake improvement projects.
155.27 	The total amount of revenues from the tax in subdivision 1 that may be used to fund 
155.28 	these projects is $6,000,000 plus any associated bond costs.
155.29 		Subd. 3.Bonds. (a) The city of North Mankato, pursuant to the approval of the 
155.30 	voters at the November 7, 2006 referendum authorizing the imposition of the taxes in 
155.31 	this section, may issue bonds under Minnesota Statutes, chapter 475, to pay capital and 
155.32 	administrative expenses for the projects described in subdivision 2, in an amount that 
155.33 	does not exceed $6,000,000. A separate election to approve the bonds under Minnesota 
155.34 	Statutes, section 475.58, is not required.
156.1 	(b) The debt represented by the bonds is not included in computing any debt 
156.2 	limitation applicable to the city, and any levy of taxes under Minnesota Statutes, section 
156.3 	475.61, to pay principal and interest on the bonds is not subject to any levy limitation.
156.4 		Subd. 4.Termination of taxes. The tax imposed under subdivision 1 expires 
156.5 	when the city council determines that the amount of revenues received from the taxes 
156.6 	to pay for the projects under subdivision 2 first equals or exceeds $6,000,000 plus the 
156.7 	additional amount needed to pay the costs related to issuance of bonds under subdivision 
156.8 	3, including interest on the bonds. Any funds remaining after completion of the projects 
156.9 	and retirement or redemption of the bonds shall be placed in a capital facilities and 
156.10 	equipment replacement fund of the city. The tax imposed under subdivision 1 may expire 
156.11 	at an earlier time if the city so determines by ordinance. 

156.12 	EFFECTIVE DATE. This section is effective the day after compliance by the 
156.13 	governing body of the city of North Mankato with Minnesota Statutes, section 645.021, 
156.14 	subdivision 3.

156.15 	Sec. 21. CITY OF WINONA; TAXES AUTHORIZED.
 156.16 		Subdivision 1.Sales and use tax. Notwithstanding Minnesota Statutes, section 
156.17 	477A.016, or any other provision of law, ordinance, or city charter, if approved by the 
156.18 	voters at a general or special election held before December 31, 2009, the city of Winona 
156.19 	may impose by ordinance a sales and use tax of up to one-half of one percent for the 
156.20 	purpose specified in subdivision 2. Except as otherwise provided in this section, the 
156.21 	provisions of Minnesota Statutes, section 297A.99, govern the imposition, administration, 
156.22 	collection, and enforcement of the tax authorized under this subdivision.
156.23 		Subd. 2.Use of revenues. The proceeds of the tax imposed under this section shall 
156.24 	be used to pay the city-borne costs for the construction of a street connection from the city 
156.25 	of Winona to Minnesota marked State Highways 61 and 43. The construction will provide 
156.26 	access to the city's newly built industrial park and additional access to a hospital. The total 
156.27 	amount of revenues from the tax in subdivision 1 that may be used to fund this project is 
156.28 	$8,000,000 plus any associated bond costs.
156.29 		Subd. 3.Bonding authority. The city of Winona may issue bonds in an amount 
156.30 	not to exceed $8,000,000 under Minnesota Statutes, chapter 475, to finance the capital 
156.31 	expenditures under subdivision 2. An election to approve the bonds under Minnesota 
156.32 	Statutes, section 475.58, is not required. The issuance of bonds under this subdivision is 
156.33 	not subject to Minnesota Statutes, section 275.60 or 275.61. The debt represented by the 
156.34 	bonds must not be included in computing any debt limitations applicable to the city, and 
157.1 	the levy of taxes required by Minnesota Statutes, section 475.61, to pay the principal or 
157.2 	any interest on the bonds must not be subject to any levy limitation.
157.3 		Subd. 4.Termination of tax. The tax authorized under subdivision 1 terminates 
157.4 	at the earlier of: (1) five years after the date of initial imposition of the tax; or (2) when 
157.5 	the city council determines that sufficient funds have been raised from the tax to finance 
157.6 	the capital and administrative costs of the project described in subdivision 2, plus the 
157.7 	additional amount needed to pay the costs related to issuance of bonds under subdivision 
157.8 	3, including interest on the bonds. Any funds remaining after completion of the project 
157.9 	specified in subdivision 2 and retirement or redemption of the bonds in subdivision 3 may 
157.10 	be placed in the general fund of the city. The tax imposed under subdivision 1 may expire 
157.11 	at an earlier time if the city so determines by ordinance.

157.12 	EFFECTIVE DATE. This section is effective the day after compliance by 
157.13 	the governing body of the city of Winona with Minnesota Statutes, section 645.021, 
157.14 	subdivisions 2 and 3.

157.15 	Sec. 22.  REPEALER.
 157.16 	Laws 2005, First Special Session chapter 3, article 5, section 24, is repealed.

157.17 	EFFECTIVE DATE. This section is effective upon enactment of section 9.

157.18 	ARTICLE 8
157.19 	JUNE ACCELERATED TAX PAYMENTS

157.20 	Section 1. Minnesota Statutes 2006, section 289A.20, subdivision 4, as amended by 
157.21 	Laws 2008, chapter 154, article 6, section 1, is amended to read:
157.22 		Subd. 4. Sales and use tax. (a) The taxes imposed by chapter 297A are due and 
157.23 	payable to the commissioner monthly on or before the 20th day of the month following the 
157.24 	month in which the taxable event occurred, or following another reporting period as the 
157.25 	commissioner prescribes or as allowed under section 289A.18, subdivision 4, paragraph 
157.26 	(f) or (g), except that use taxes due on an annual use tax return as provided under section 
157.27 	289A.11, subdivision 1, are payable by April 15 following the close of the calendar year. 
157.28 	(b) A vendor having a liability of $120,000 or more during a fiscal year ending June 
157.29 	30 must remit the June liability for the next year in the following manner: 
157.30 	(1) Two business days before June 30 of the year, the vendor must remit 80 90
157.31 	percent of the estimated June liability to the commissioner. 
157.32 	(2) On or before August 20 of the year, the vendor must pay any additional amount 
157.33 	of tax not remitted in June. 
158.1 	(c) A vendor having a liability of: 
158.2 	(1) $20,000 or more in the fiscal year ending June 30, 2005; or 
158.3 	(2) $10,000 or more in the fiscal year ending June 30, 2006, and fiscal years 
158.4 	thereafter, 
158.5 	must remit all liabilities on returns due for periods beginning in the subsequent calendar 
158.6 	year by electronic means on or before the 20th day of the month following the month in 
158.7 	which the taxable event occurred, or on or before the 20th day of the month following the 
158.8 	month in which the sale is reported under section 289A.18, subdivision 4, except for 80 90
158.9 	percent of the estimated June liability, which is due two business days before June 30. The 
158.10 	remaining amount of the June liability is due on August 20. 

158.11 	EFFECTIVE DATE. This section is effective beginning with June 2009 tax 
158.12 	liabilities.

158.13 	Sec. 2. Minnesota Statutes 2006, section 289A.60, subdivision 15, as amended by 
158.14 	Laws 2008, chapter 154, article 6, section 2, is amended to read:
158.15 		Subd. 15. Accelerated payment of June sales tax liability; penalty for 
158.16 	underpayment. For payments made after December 31, 2006, if a vendor is required by 
158.17 	law to submit an estimation of June sales tax liabilities and 80 90 percent payment by a 
158.18 	certain date, the vendor shall pay a penalty equal to ten percent of the amount of actual 
158.19 	June liability required to be paid in June less the amount remitted in June. The penalty 
158.20 	must not be imposed, however, if the amount remitted in June equals the lesser of 80 90
158.21 	percent of the preceding May's liability or 80 90 percent of the average monthly liability 
158.22 	for the previous calendar year. 

158.23 	EFFECTIVE DATE. This section is effective beginning with June 2009 tax 
158.24 	liabilities.

158.25 	Sec. 3. Minnesota Statutes 2006, section 297F.09, subdivision 10, as amended by Laws 
158.26 	2008, chapter 154, article 6, section 3, is amended to read:
158.27 		Subd. 10. Accelerated tax payment; cigarette or tobacco products distributor.
 158.28 	A cigarette or tobacco products distributor having a liability of $120,000 or more during a 
158.29 	fiscal year ending June 30, shall remit the June liability for the next year in the following 
158.30 	manner: 
158.31 	(a) Two business days before June 30 of the year, the distributor shall remit the 
158.32 	actual May liability and 80 90 percent of the estimated June liability to the commissioner 
158.33 	and file the return in the form and manner prescribed by the commissioner. 
159.1 	(b) On or before August 18 of the year, the distributor shall submit a return showing 
159.2 	the actual June liability and pay any additional amount of tax not remitted in June. A 
159.3 	penalty is imposed equal to ten percent of the amount of June liability required to be paid 
159.4 	in June, less the amount remitted in June. However, the penalty is not imposed if the 
159.5 	amount remitted in June equals the lesser of: 
159.6 	(1) 80 90 percent of the actual June liability; or 
159.7 	(2) 80 90 percent of the preceding May's liability. 

159.8 	EFFECTIVE DATE. This section is effective beginning with June 2009 tax 
159.9 	liabilities.

159.10 	Sec. 4. Minnesota Statutes 2006, section 297G.09, subdivision 9, as amended by Laws 
159.11 	2008, chapter 154, article 6, section 4, is amended to read:
159.12 		Subd. 9. Accelerated tax payment; penalty. A person liable for tax under this 
159.13 	chapter having a liability of $120,000 or more during a fiscal year ending June 30, shall 
159.14 	remit the June liability for the next year in the following manner: 
159.15 	(a) Two business days before June 30 of the year, the taxpayer shall remit the actual 
159.16 	May liability and 80 90 percent of the estimated June liability to the commissioner and file 
159.17 	the return in the form and manner prescribed by the commissioner. 
159.18 	(b) On or before August 18 of the year, the taxpayer shall submit a return showing 
159.19 	the actual June liability and pay any additional amount of tax not remitted in June. A 
159.20 	penalty is imposed equal to ten percent of the amount of June liability required to be paid 
159.21 	in June less the amount remitted in June. However, the penalty is not imposed if the 
159.22 	amount remitted in June equals the lesser of: 
159.23 	(1) 80 90 percent of the actual June liability; or 
159.24 	(2) 80 90 percent of the preceding May liability. 

159.25 	EFFECTIVE DATE. This section is effective beginning with June 2009 tax 
159.26 	liabilities.

159.27 	ARTICLE 9
159.28 	SPECIAL TAXES

159.29 	Section 1. Minnesota Statutes 2006, section 163.051, subdivision 1, is amended to read:
159.30 		Subdivision 1.Tax authorized. (a) Except as provided in paragraph (b), the board 
159.31 	of commissioners of each metropolitan county is authorized to levy a wheelage tax of $5 
159.32 	for the year 1972 and each subsequent year thereafter by resolution on each motor vehicle, 
159.33 	except motorcycles as defined in section 169.01, subdivision 4, whichthat is kept in such 
160.1 	county when not in operation and whichthat is subject to annual registration and taxation 
160.2 	under chapter 168. The board may provide by resolution for collection of the wheelage 
160.3 	tax by county officials or it may request that the tax be collected by the state registrar of 
160.4 	motor vehicles, and the state registrar of motor vehicles shall collect such tax on behalf 
160.5 	of the county if requested, as provided in subdivision 2. 
160.6 	(b) The following vehicles are exempt from the wheelage tax: 
160.7 	(1) motorcycles, as defined in section 169.01, subdivision 4; 
160.8 	(2) motorized bicycles, as defined in section 169.01, subdivision 4a; 
160.9 	(3) electric-assisted bicycles, as defined in section 169.01, subdivision 4b; and 
160.10 	(4) motorized foot scooters, as defined in section 169.01, subdivision 4c. 

160.11 	Sec. 2. Minnesota Statutes 2006, section 168.012, subdivision 1, is amended to read:
160.12 		Subdivision 1.Vehicles exempt from tax, fees, or plate display. (a) The following 
160.13 	vehicles are exempt from the provisions of this chapter requiring payment of tax and 
160.14 	registration fees, except as provided in subdivision 1c:
160.15 	(1) vehicles owned and used solely in the transaction of official business by the 
160.16 	federal government, the state, or any political subdivision;
160.17 	(2) vehicles owned and used exclusively by educational institutions and used solely 
160.18 	in the transportation of pupils to and from those institutions;
160.19 	(3) vehicles used solely in driver education programs at nonpublic high schools;
160.20 	(4) vehicles owned by nonprofit charities and used exclusively to transport disabled 
160.21 	persons for charitable, religious, or educational purposes;
160.22 	(5) vehicles owned by nonprofit charities and used exclusively for disaster response 
160.23 	and related activities;
160.24 	(5) ambulances (6) vehicles owned by ambulance services licensed under section 
160.25 	144E.10, the general appearance of which is unmistakable that are equipped and 
160.26 	specifically intended for emergency response or providing ambulance services; and
160.27 	(6)(7) vehicles owned by a commercial driving school licensed under section 
160.28 	171.34, or an employee of a commercial driving school licensed under section 171.34, and 
160.29 	the vehicle is used exclusively for driver education and training.
160.30 	(b) Vehicles owned by the federal government, municipal fire apparatuses including 
160.31 	fire-suppression support vehicles, police patrols, and ambulances, the general appearance 
160.32 	of which is unmistakable, are not required to register or display number plates.
160.33 	(c) Unmarked vehicles used in general police work, liquor investigations, or arson 
160.34 	investigations, and passenger automobiles, pickup trucks, and buses owned or operated by 
160.35 	the Department of Corrections, must be registered and must display appropriate license 
161.1 	number plates, furnished by the registrar at cost. Original and renewal applications for 
161.2 	these license plates authorized for use in general police work and for use by the Department 
161.3 	of Corrections must be accompanied by a certification signed by the appropriate chief of 
161.4 	police if issued to a police vehicle, the appropriate sheriff if issued to a sheriff's vehicle, 
161.5 	the commissioner of corrections if issued to a Department of Corrections vehicle, or the 
161.6 	appropriate officer in charge if issued to a vehicle of any other law enforcement agency. 
161.7 	The certification must be on a form prescribed by the commissioner and state that the 
161.8 	vehicle will be used exclusively for a purpose authorized by this section.
161.9 	(d) Unmarked vehicles used by the Departments of Revenue and Labor and Industry, 
161.10 	fraud unit, in conducting seizures or criminal investigations must be registered and must 
161.11 	display passenger vehicle classification license number plates, furnished at cost by the 
161.12 	registrar. Original and renewal applications for these passenger vehicle license plates 
161.13 	must be accompanied by a certification signed by the commissioner of revenue or the 
161.14 	commissioner of labor and industry. The certification must be on a form prescribed by 
161.15 	the commissioner and state that the vehicles will be used exclusively for the purposes 
161.16 	authorized by this section.
161.17 	(e) Unmarked vehicles used by the Division of Disease Prevention and Control of the 
161.18 	Department of Health must be registered and must display passenger vehicle classification 
161.19 	license number plates. These plates must be furnished at cost by the registrar. Original 
161.20 	and renewal applications for these passenger vehicle license plates must be accompanied 
161.21 	by a certification signed by the commissioner of health. The certification must be on a 
161.22 	form prescribed by the commissioner and state that the vehicles will be used exclusively 
161.23 	for the official duties of the Division of Disease Prevention and Control.
161.24 	(f) Unmarked vehicles used by staff of the Gambling Control Board in gambling 
161.25 	investigations and reviews must be registered and must display passenger vehicle 
161.26 	classification license number plates. These plates must be furnished at cost by the 
161.27 	registrar. Original and renewal applications for these passenger vehicle license plates must 
161.28 	be accompanied by a certification signed by the board chair. The certification must be on a 
161.29 	form prescribed by the commissioner and state that the vehicles will be used exclusively 
161.30 	for the official duties of the Gambling Control Board.
161.31 	(g) All other motor vehicles must be registered and display tax-exempt number 
161.32 	plates, furnished by the registrar at cost, except as provided in subdivision 1c. All 
161.33 	vehicles required to display tax-exempt number plates must have the name of the state 
161.34 	department or political subdivision, nonpublic high school operating a driver education 
161.35 	program, or licensed commercial driving school, plainly displayed on both sides of the 
161.36 	vehicle; except that each state hospital and institution for persons who are mentally ill 
162.1 	and developmentally disabled may have one vehicle without the required identification 
162.2 	on the sides of the vehicle, and county social service agencies may have vehicles used 
162.3 	for child and vulnerable adult protective services without the required identification on 
162.4 	the sides of the vehicle. This identification must be in a color giving contrast with that 
162.5 	of the part of the vehicle on which it is placed and must endure throughout the term of 
162.6 	the registration. The identification must not be on a removable plate or placard and must 
162.7 	be kept clean and visible at all times; except that a removable plate or placard may be 
162.8 	utilized on vehicles leased or loaned to a political subdivision or to a nonpublic high 
162.9 	school driver education program.

162.10 	Sec. 3. Minnesota Statutes 2006, section 168.012, is amended by adding a subdivision 
162.11 	to read:
162.12 		Subd. 2c.Spotter trucks. Spotter trucks, as defined in section 169.01, subdivision 
162.13 	7a, must not be taxed as motor vehicles using the public streets and highways, and are 
162.14 	exempt from the provisions of this chapter.

162.15 	EFFECTIVE DATE. This section is effective the day following final enactment 
162.16 	and expires June 30, 2013.

162.17 	Sec. 4. Minnesota Statutes 2006, section 168.013, subdivision 1f, is amended to read:
162.18 		Subd. 1f.Bus; commuter van. (a) On all intercity buses, the tax during each 
162.19 	the first two years of vehicle life shall be based on the gross weight of the vehicle and 
162.20 	graduated according to the following schedule:

162.21		Gross Weight of Vehicle ........Tax 
	
162.22		Under 6,000 lbs.  ........$125 
	
162.23		6,000 to 8,000 lbs., incl.  ........125 
	
162.24		8,001 to 10,000 lbs., incl.  ........125 
	
162.25		10,001 to 12,000 lbs., incl.  ........150 
	
162.26		12,001 to 14,000 lbs., incl.  ........190 
	
162.27		14,001 to 16,000 lbs., incl.  ........210 
	
162.28		16,001 to 18,000 lbs., incl.  ........225 
	
162.29		18,001 to 20,000 lbs., incl.  ........260 
	
162.30		20,001 to 22,000 lbs., incl.  ........300 
	
162.31		22,001 to 24,000 lbs., incl.  ........350 
	
162.32		24,001 to 26,000 lbs., incl.  ........400 
	
162.33		26,001 to 28,000 lbs., incl.  ........450 
	
162.34		28,001 to 30,000 lbs., incl.  ........500 
	
162.35		30,001 and over ........550 
	
163.1 	(b) During each of the third and fourth years of vehicle life, the tax shall be 75 
163.2 	percent of the foregoing scheduled tax; during the fifth year of vehicle life, the tax shall be 
163.3 	50 percent of the foregoing scheduled tax; during the sixth year of vehicle life, the tax 
163.4 	shall be 37-1/2 percent of the foregoing scheduled tax; and during the seventh and each 
163.5 	succeeding year of vehicle life, the tax shall be 25 percent of the foregoing scheduled tax; 
163.6 	provided that the annual tax paid in any year of its life for an intercity bus shall be not less 
163.7 	than $175 for a vehicle of over 25 passenger seating capacity and not less than $125 for a 
163.8 	vehicle of 25 passenger and less seating capacity.
163.9 	(c) On all intracity buses operated by an auto transportation company in the business 
163.10 	of transporting persons for compensation as a common carrier and operating within the 
163.11 	limits of cities having populations in excess of 200,000 inhabitants, the tax during each 
163.12 	year of the vehicle life of each such bus shall be $40; on all of such intracity buses operated 
163.13 	in cities having a population of less than 200,000 and more than 70,000 inhabitants, the 
163.14 	tax during each year of vehicle life of each bus shall be $10; and on all of such intracity 
163.15 	buses operating in cities having a population of less than 70,000 inhabitants, the tax during 
163.16 	each year of vehicle life of each bus shall be $2.
163.17 	(d) On all other buses and commuter vans, as defined in section  168.126, the tax 
163.18 	during each of the first three years of the vehicle life shall be based on the gross weight of 
163.19 	the vehicle and graduated according to the following schedule: Where the gross weight 
163.20 	of the vehicle is 6,000 pounds or less, $25. Where the gross weight of the vehicle is 
163.21 	more than 6,000 pounds, and not more than 8,000 pounds, the tax shall be $25 plus an 
163.22 	additional tax of $5 per ton for the ton or major portion in excess of 6,000 pounds. Where 
163.23 	the gross weight of the vehicle is more than 8,000 pounds, and not more than 20,000 
163.24 	pounds, the tax shall be $30 plus an additional tax of $10 per ton for each ton or major 
163.25 	portion in excess of 8,000 pounds. Where the gross weight of the vehicle is more than 
163.26 	20,000 pounds and not more than 24,000 pounds, the tax shall be $90 plus an additional 
163.27 	tax of $15 per ton for each ton or major portion in excess of 20,000 pounds. Where the 
163.28 	gross weight of the vehicle is more than 24,000 pounds and not more than 28,000 pounds, 
163.29 	the tax shall be $120 plus an additional tax of $25 per ton for each ton or major portion 
163.30 	in excess of 24,000 pounds. Where the gross weight of the vehicle is more than 28,000 
163.31 	pounds, the tax shall be $170 plus an additional tax of $30 per ton for each ton or major 
163.32 	portion in excess of 28,000 pounds. 
163.33 	(e) During the fourth and succeeding years of vehicle life, the tax shall be 80 percent 
163.34 	of the foregoing scheduled tax but in no event less than $20 per vehicle.

163.35 	Sec. 5. Minnesota Statutes 2006, section 168A.03, subdivision 1, is amended to read:
164.1 		Subdivision 1.No certificate issued. The registrar shall not issue a certificate of 
164.2 	title for:
164.3 	(1) a vehicle owned by the United States;
164.4 	(2) a vehicle owned by a nonresident and not required by law to be registered in 
164.5 	this state;
164.6 	(3) a vehicle owned by a nonresident and regularly engaged in the interstate 
164.7 	transportation of persons or property for which a currently effective certificate of title 
164.8 	has been issued in another state;
164.9 	(4) a vehicle moved solely by animal power;
164.10 	(5) an implement of husbandry;
164.11 	(6) special mobile equipment;
164.12 	(7) a self-propelled wheelchair or invalid tricycle;
164.13 	(8) a trailer (i) having a gross weight of 4,000 pounds or less unless a secured party 
164.14 	holds an interest in the trailer or a certificate of title was previously issued by this state or 
164.15 	any other state or (ii) designed primarily for agricultural purposes except a recreational 
164.16 	vehicle or a manufactured home, both as defined in section 168.011, subdivisions 8 and 25; 
164.17 	(9) a snowmobile.; and
164.18 	(10) a spotter truck, as defined in section 169.01, subdivision 7a.

164.19 	EFFECTIVE DATE. This section is effective the day following final enactment 
164.20 	and expires June 30, 2013.

164.21 	Sec. 6. Minnesota Statutes 2006, section 169.01, is amended by adding a subdivision 
164.22 	to read:
164.23 		Subd. 7a.Spotter truck. "Spotter truck" means a truck-tractor with a manufacturer's 
164.24 	certificate of origin "not for on road use" specification, used exclusively for staging or 
164.25 	shuttling trailers in the course of a truck freight operation or freight shipping operation.

164.26 	EFFECTIVE DATE. This section is effective the day following final enactment 
164.27 	and expires June 30, 2013.

164.28 	Sec. 7. [169.228] SPOTTER TRUCKS.
164.29 	Notwithstanding any other law, a spotter truck may be operated on public streets 
164.30 	and highways if:
164.31 	(1) the operator has the appropriate class of driver's license;
164.32 	(2) the vehicle complies with the size, weight, and load restrictions under this 
164.33 	chapter;
165.1 	(3) the vehicle meets all inspection requirements under section 169.781; and
165.2 	(4) the vehicle is operated within (i) a zone of two air miles from the truck freight 
165.3 	operation or freight shipping operation where the vehicle is housed, or (ii) directly to and 
165.4 	from a repair shop, service station, or fueling station for the purpose of repair, servicing, 
165.5 	or refueling.

165.6 	EFFECTIVE DATE. This section is effective the day following final enactment 
165.7 	and expires June 30, 2013.

165.8 	Sec. 8. Minnesota Statutes 2006, section 169.781, subdivision 1, as amended by Laws 
165.9 	2008, chapter 287, article 1, section 48, is amended to read:
165.10 		Subdivision 1. Definitions. For purposes of sections 169.781 to 169.783: 
165.11 	(a) "Commercial motor vehicle": 
165.12 	(1) means a motor vehicle or combination of motor vehicles used to transport 
165.13 	passengers or property if the motor vehicle: 
165.14 	(i) has a gross vehicle weight of more than 26,000 pounds; 
165.15 	(ii) is a vehicle in a combination of more than 26,000 pounds; 
165.16 	(iii) is a bus; or 
165.17 	(iv) is of any size and is used in the transportation of hazardous materials that are 
165.18 	required to be placarded under Code of Federal Regulations, title 49, parts 100-185; and
165.19 	(2) does not include (i) a school bus or Head Start bus displaying a certificate under 
165.20 	section 169.451, or (ii) a bus operated by the Metropolitan Council or by a local transit 
165.21 	commission created in chapter 458A.; and
165.22 	(3) a spotter truck.
165.23 	(b) "Commissioner" means the commissioner of public safety. 
165.24 	(c) "Owner" means a person who owns, or has control, under a lease of more than 30 
165.25 	days' duration, of one or more commercial motor vehicles. 

165.26 	Sec. 9. Minnesota Statutes 2006, section 169.781, subdivision 2, as amended by Laws 
165.27 	2008, chapter 287, article 1, section 48, is amended to read:
165.28 		Subd. 2. Inspection required. (a) It is unlawful for a person to operate or permit 
165.29 	the operation of: 
165.30 	(1) a commercial motor vehicle registered in Minnesota or a spotter truck; or 
165.31 	(2) special mobile equipment as defined in section 168.011, subdivision 22, and 
165.32 	which is self-propelled, if it is mounted on a commercial motor vehicle chassis, 
165.33 	in violation of the requirements of paragraph (b). 
166.1 	(b) A vehicle described in paragraph (a): 
166.2 	(1) must display a valid safety inspection decal issued by an inspector certified 
166.3 	by the commissioner; or 
166.4 	(2) must carry (i) proof that the vehicle complies with federal motor vehicle 
166.5 	inspection requirements for vehicles in interstate commerce, and (ii) a certificate of 
166.6 	compliance with federal requirements issued by the commissioner under subdivision 9. 

166.7 	EFFECTIVE DATE. This section is effective the day following final enactment 
166.8 	and expires June 30, 2013.

166.9 	Sec. 10. Minnesota Statutes 2006, section 383A.80, subdivision 4, is amended to read:
166.10 		Subd. 4.Expiration. The authority to impose the tax under this section expires 
166.11 	January 1, 2008 2013.

166.12 	EFFECTIVE DATE. This section is effective the day following final enactment 
166.13 	and the tax may be imposed on or after that date.

166.14 	Sec. 11. Minnesota Statutes 2006, section 383A.81, subdivision 1, is amended to read:
166.15 		Subdivision 1.Creation. An environmental response fund is created for the 
166.16 	purposes specified in this section. The taxes imposed by section 383A.80 must be 
166.17 	deposited in the fund. The board of county commissioners shall administer the fund either 
166.18 	as a county board, or a housing and redevelopment authority, or a regional rail authority. 

166.19 	Sec. 12. Minnesota Statutes 2006, section 383A.81, subdivision 2, is amended to read:
166.20 		Subd. 2.Uses of fund. (a) The fund created in subdivision 1 must be used for 
166.21 	the following purposes:
166.22 	(1) acquisition through purchase or condemnation of lands or property which are 
166.23 	polluted or contaminated with hazardous substances;
166.24 	(2) paying the costs associated with indemnifying or holding harmless the 
166.25 	entity taking title to lands or property from any liability arising out of the ownership, 
166.26 	remediation, or use of the land or property;
166.27 	(3) paying for the costs of remediating the acquired land or property; or
166.28 	(4) paying the costs associated with remediating lands or property which are polluted 
166.29 	or contaminated with hazardous substances; or
166.30 	(5) paying for the costs associated with improving the property for economic 
166.31 	development, recreational, housing, transportation or rail traffic.
167.1 	(b) No more than three percent of the fund may be used each year for the costs 
167.2 	of administration.

167.3 	Sec. 13. Minnesota Statutes 2006, section 383B.80, subdivision 4, is amended to read:
167.4 		Subd. 4.Expiration. The authority to impose the tax under this section expires 
167.5 	January 1, 2008 2013.

167.6 	EFFECTIVE DATE. This section is effective the day following final enactment 
167.7 	and the tax may be imposed on or after that date.

167.8 	Sec. 14. Minnesota Statutes 2006, section 383B.81, subdivision 2, is amended to read:
167.9 		Subd. 2.Uses of fund. (a) The fund created in subdivision 1 must be used for 
167.10 	the following purposes:
167.11 	(1) acquisition through purchase or condemnation of lands or property which are 
167.12 	polluted or contaminated with hazardous substances;
167.13 	(2) paying the costs associated with indemnifying or holding harmless the 
167.14 	entity taking title to lands or property from any liability arising out of the ownership, 
167.15 	remediation, or use of the land or property;
167.16 	(3) paying for the costs of remediating the acquired land or property;
167.17 	(4) paying the costs associated with remediating lands or property which are polluted 
167.18 	or contaminated with hazardous substances; or
167.19 	(5) paying for the costs associated with improving the property for economic 
167.20 	development, recreational, housing, transportation or rail traffic.
167.21 	(b) No more than three percent of the fund may be used each year for the costs 
167.22 	of administration.

167.23 	ARTICLE 10
167.24 	MINERALS

167.25 	Section 1. Minnesota Statutes 2006, section 298.01, is amended by adding a 
167.26 	subdivision to read:
167.27 		Subd. 9.Other iron bearing material. "Other iron bearing material" means the 
167.28 	material described in section 298.405.

167.29 	Sec. 2. Minnesota Statutes 2006, section 298.22, subdivision 2, is amended to read:
167.30 		Subd. 2.Iron Range Resources and Rehabilitation Board. There is hereby 
167.31 	created the Iron Range Resources and Rehabilitation Board, consisting of 13 members, 
168.1 	five of whom are state senators appointed by the Subcommittee on Committees of the 
168.2 	Rules Committee of the senate, and five of whom are representatives, appointed by the 
168.3 	speaker of the house of representatives. The remaining members shall be appointed one 
168.4 	each by the senate majority leader, the speaker of the house of representatives, and the 
168.5 	governor and must be nonlegislators who reside in a taconite assistance area as defined in 
168.6 	section 273.1341. The members shall be appointed in January of every odd-numbered 
168.7 	year, except that the initial nonlegislator members shall be appointed by July 1, 1999, and 
168.8 	shall serve until January of the next odd-numbered year. Vacancies on the board shall be 
168.9 	filled in the same manner as the original members were chosen. At least a majority of 
168.10 	the legislative members of the board shall be elected from state senatorial or legislative 
168.11 	districts in which over 50 percent of the residents reside within a taconite assistance area 
168.12 	as defined in section 273.1341. All expenditures and projects made by the commissioner 
168.13 	of Iron Range resources and rehabilitation shall be consistent with the priorities 
168.14 	established in subdivision 8 and shall first be submitted to the Iron Range Resources and 
168.15 	Rehabilitation Board for approval by a majority of the board of expenditures and projects 
168.16 	for rehabilitation purposes as provided by this section, and the method, manner, and time 
168.17 	of payment of all funds proposed to be disbursed shall be first approved or disapproved by 
168.18 	the board. The board shall biennially make its report to the governor and the legislature on 
168.19 	or before November 15 of each even-numbered year. The expenses of the board shall be 
168.20 	paid by the state from the funds raised pursuant to this section. Members of the board who 
168.21 	are legislators may be reimbursed for expenses in the manner provided in sections 3.099, 
168.22 	subdivision 1, and 3.101, and may receive per diem payments during the interims between 
168.23 	legislative sessions in the manner provided in section 3.099, subdivision 1. Members of 
168.24 	the board who are not legislators may receive per diem payments and be reimbursed for 
168.25 	expenses at the lowest rate provided for legislative members.

168.26 	Sec. 3. Minnesota Statutes 2006, section 298.22, subdivision 5a, as added by Laws 
168.27 	2008, chapter 154, article 8, section 3, is amended to read:
168.28 		Subd. 5a. Forest trust. The commissioner, upon the affirmative vote of a majority 
168.29 	of the members of the board, may purchase forest lands in the taconite assistance area 
168.30 	defined in under section 273.1341 with funds specifically authorized for the purchase. The 
168.31 	acquired forest lands must be held in trust for the benefit of the citizens of the taconite 
168.32 	assistance area as the Iron Range Miners' Memorial Forest. The forest trust lands shall 
168.33 	be managed and developed for recreation and economic development purposes. The 
168.34 	commissioner, upon the affirmative vote of a majority of the members of the board, may 
168.35 	sell forest lands purchased under this subdivision if the board finds that the sale advances 
169.1 	the purposes of the trust. Proceeds derived from the management or sale of the lands and 
169.2 	from the sale of timber or removal of gravel or other minerals from these forest lands shall 
169.3 	be deposited into an Iron Range Miners' Memorial Forest account that is established within 
169.4 	the state financial accounts. Funds may be expended from the account upon approval of a 
169.5 	majority of the members of the board to purchase, manage, administer, convey interests 
169.6 	in, and improve the forest lands. By majority vote of the members of the board, money in 
169.7 	the Iron Range Miners' Memorial Forest account may be transferred into the corpus of the 
169.8 	Douglas J. Johnson economic protection trust fund established under sections 298.291
169.9 	to 298.294. The property acquired under the authority granted by this subdivision and 
169.10 	income derived from the property or the operation or management of the property are 
169.11 	exempt from taxation by the state or its political subdivisions while held by the forest trust. 

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

169.13 	Sec. 4. Minnesota Statutes 2006, section 298.22, is amended by adding a subdivision 
169.14 	to read:
169.15 		Subd. 12.Data classification. Data collected by the commissioner on any 
169.16 	application to determine the eligibility of an applicant for any loan or equity investment 
169.17 	made from funds that are available to the commissioner under this section or otherwise 
169.18 	by law, and to assess or monitor the applicant's or recipient's default risk or to collect 
169.19 	payments owed are: (1) private data on individuals as defined in section 13.02, subdivision 
169.20 	12; and (2) nonpublic data as defined in section 13.02, subdivision 9. The names of the 
169.21 	recipients of the financial assistance and the amounts of financial assistance are public data.

169.22 	Sec. 5. Minnesota Statutes 2007 Supplement, section 298.227, is amended to read:
169.23 	298.227 TACONITE ECONOMIC DEVELOPMENT FUND.
169.24 	(a) An amount equal to that distributed pursuant to each taconite producer's taxable 
169.25 	production and qualifying sales under section 298.28, subdivision 9a, shall be held by 
169.26 	the Iron Range Resources and Rehabilitation Board in a separate taconite economic 
169.27 	development fund for each taconite and direct reduced ore producer. Money from the 
169.28 	fund for each producer shall be released by the commissioner after review by a joint 
169.29 	committee consisting of an equal number of representatives of the salaried employees and 
169.30 	the nonsalaried production and maintenance employees of that producer. The District 11 
169.31 	director of the United States Steelworkers of America, on advice of each local employee 
169.32 	president, shall select the employee members. In nonorganized operations, the employee 
169.33 	committee shall be elected by the nonsalaried production and maintenance employees. 
170.1 	The review must be completed no later than six months after the producer presents a 
170.2 	proposal for expenditure of the funds to the committee. The funds held pursuant to this 
170.3 	section may be released only for workforce development and associated public facility 
170.4 	improvement, or for acquisition of plant and stationary mining equipment and facilities 
170.5 	for the producer or for research and development in Minnesota on new mining, or 
170.6 	taconite, iron, or steel production technology, but only if the producer provides a matching 
170.7 	expenditure to be used for the same purpose of at least 50 percent of the distribution 
170.8 	based on 14.7 cents per ton beginning with distributions in 2002. Effective for proposals 
170.9 	for expenditures of money from the fund beginning May 26, 2007, the commissioner 
170.10 	may not release the funds before the next scheduled meeting of the board. If the board 
170.11 	rejects a proposed expenditure, the funds must be deposited in the Taconite Environmental 
170.12 	Protection Fund under sections 298.222 to 298.225. If a producer uses money which has 
170.13 	been released from the fund prior to May 26, 2007 to procure haulage trucks, mobile 
170.14 	equipment, or mining shovels, and the producer removes the piece of equipment from 
170.15 	the taconite tax relief area defined in section 273.134 within ten years from the date of 
170.16 	receipt of the money from the fund, a portion of the money granted from the fund must 
170.17 	be repaid to the taconite economic development fund. The portion of the money to be 
170.18 	repaid is 100 percent of the grant if the equipment is removed from the taconite tax relief 
170.19 	area within 12 months after receipt of the money from the fund, declining by ten percent 
170.20 	for each of the subsequent nine years during which the equipment remains within the 
170.21 	taconite tax relief area. If a taconite production facility is sold after operations at the 
170.22 	facility had ceased, any money remaining in the fund for the former producer may be 
170.23 	released to the purchaser of the facility on the terms otherwise applicable to the former 
170.24 	producer under this section. If a producer fails to provide matching funds for a proposed 
170.25 	expenditure within six months after the commissioner approves release of the funds, 
170.26 	the funds are available for release to another producer in proportion to the distribution 
170.27 	provided and under the conditions of this section. Any portion of the fund which is not 
170.28 	released by the commissioner within two years one year of its deposit in the fund shall be 
170.29 	divided between the taconite environmental protection fund created in section 298.223
170.30 	and the Douglas J. Johnson economic protection trust fund created in section 298.292 for 
170.31 	placement in their respective special accounts. Two-thirds of the unreleased funds shall be 
170.32 	distributed to the taconite environmental protection fund and one-third to the Douglas J. 
170.33 	Johnson economic protection trust fund. 
170.34 	(b) Notwithstanding the requirements of paragraph (a), setting the amount of 
170.35 	distributions and the review process, an amount equal to ten cents per taxable ton of 
170.36 	production in 2007, for distribution in 2008 only, that would otherwise be distributed 
171.1 	under paragraph (a), may be used for a loan for the cost of construction of a biomass 
171.2 	energy facility. This amount must be deducted from the distribution under paragraph 
171.3 	(a) for which a matching expenditure by the producer is not required. The granting of 
171.4 	the loan is subject to approval by the Iron Range Resources and Rehabilitation Board; 
171.5 	interest must be payable on the loan at the rate prescribed in section 298.2213, subdivision 
171.6 	3. Repayments of the loan and interest must be deposited in the northeast Minnesota 
171.7 	economic development fund established in section 298.2213. If a loan is not made under 
171.8 	this paragraph by July 1, 2009, the amount that had been made available for the loan under 
171.9 	this paragraph must be transferred to the northeast Minnesota economic development 
171.10 	fund. Money distributed in 2008 to the fund established under this section that exceeds ten 
171.11 	cents per ton is available to qualifying producers under paragraph (a) on a pro rata basis.
171.12 	If 2008 H.F. No. 1812 is enacted and includes a provision that amends this section 
171.13 	in a manner that is different from the amendment in this section, the amendment in this 
171.14 	section supersedes the amendment in 2008 H.F. No. 1812, notwithstanding section 645.26.

171.15 	EFFECTIVE DATE. The section is effective the day following final enactment.

171.16 	Sec. 6. Minnesota Statutes 2006, section 298.24, subdivision 1, as amended by Laws 
171.17 	2008, chapter 154, article 8, section 5, is amended to read:
171.18 		Subdivision 1.Imposed; calculation. (a) For concentrate produced in 2001, 2002, 
171.19 	and 2003, there is imposed upon taconite and iron sulphides, and upon the mining and 
171.20 	quarrying thereof, and upon the production of iron ore concentrate therefrom, and upon 
171.21 	the concentrate so produced, a tax of $2.103 per gross ton of merchantable iron ore 
171.22 	concentrate produced therefrom. For concentrates produced in 2005, the tax rate is the 
171.23 	same rate imposed for concentrates produced in 2004. For concentrates produced in 2009 
171.24 	and subsequent years, the tax is also imposed upon other iron bearing material.
171.25 	(b) For concentrates produced in 2006 and subsequent years, the tax rate shall be 
171.26 	equal to the preceding year's tax rate plus an amount equal to the preceding year's tax rate 
171.27 	multiplied by the percentage increase in the implicit price deflator from the fourth quarter 
171.28 	of the second preceding year to the fourth quarter of the preceding year. "Implicit price 
171.29 	deflator" means the implicit price deflator for the gross domestic product prepared by the 
171.30 	Bureau of Economic Analysis of the United States Department of Commerce.
171.31 	(c) On concentrates produced in 1997 and thereafter, An additional tax is imposed 
171.32 	equal to three cents per gross ton of merchantable iron ore concentrate for each one 
171.33 	percent that the iron content of the product exceeds 72 percent, when dried at 212 degrees 
171.34 	Fahrenheit.
172.1 	(d) The tax on taconite and iron sulphides shall be imposed on the average of the 
172.2 	production for the current year and the previous two years. The rate of the tax imposed 
172.3 	will be the current year's tax rate. This clause shall not apply in the case of the closing 
172.4 	of a taconite facility if the property taxes on the facility would be higher if this clause 
172.5 	and section 298.25 were not applicable. The tax on other iron bearing material shall be 
172.6 	imposed on the current year production.
172.7 	(e) If the tax or any part of the tax imposed by this subdivision is held to be 
172.8 	unconstitutional, a tax of $2.103 per gross ton of merchantable iron ore concentrate 
172.9 	produced shall be imposed.
172.10 	(f) Consistent with the intent of this subdivision to impose a tax based upon the 
172.11 	weight of merchantable iron ore concentrate, the commissioner of revenue may indirectly 
172.12 	determine the weight of merchantable iron ore concentrate included in fluxed pellets by 
172.13 	subtracting the weight of the limestone, dolomite, or olivine derivatives or other basic 
172.14 	flux additives included in the pellets from the weight of the pellets. For purposes of this 
172.15 	paragraph, "fluxed pellets" are pellets produced in a process in which limestone, dolomite, 
172.16 	olivine, or other basic flux additives are combined with merchantable iron ore concentrate. 
172.17 	No subtraction from the weight of the pellets shall be allowed for binders, mineral and 
172.18 	chemical additives other than basic flux additives, or moisture.
172.19 	(g)(1) Notwithstanding any other provision of this subdivision, for the first two years 
172.20 	of a plant's commercial production of direct reduced ore from ore mined in this state, no 
172.21 	tax is imposed under this section. As used in this paragraph, "commercial production" is 
172.22 	production of more than 50,000 tons of direct reduced ore in the current year or in any 
172.23 	prior year, "noncommercial production" is production of 50,000 tons or less of direct 
172.24 	reduced ore in any year, and "direct reduced ore" is ore that results in a product that has an 
172.25 	iron content of at least 75 percent. For the third year of a plant's commercial production of 
172.26 	direct reduced ore, the rate to be applied to direct reduced ore is 25 percent of the rate 
172.27 	otherwise determined under this subdivision. For the fourth commercial production year, 
172.28 	the rate is 50 percent of the rate otherwise determined under this subdivision; for the fifth 
172.29 	commercial production year, the rate is 75 percent of the rate otherwise determined under 
172.30 	this subdivision; and for all subsequent commercial production years, the full rate is 
172.31 	imposed.
172.32 	(2) Subject to clause (1), production of direct reduced ore in this state is subject to 
172.33 	the tax imposed by this section, but if that production is not produced by a producer of 
172.34 	taconite or, iron sulfides, or other iron bearing material, the production of taconite or,
172.35 	iron sulfides, or other iron bearing material, that is consumed in the production of direct 
173.1 	reduced iron in this state is not subject to the tax imposed by this section on taconite or,
173.2 	iron sulfides, or other iron bearing material.
173.3 	(3) Notwithstanding any other provision of this subdivision, no tax is imposed 
173.4 	on direct reduced ore under this section during the facility's noncommercial production 
173.5 	of direct reduced ore. The taconite or iron sulphides consumed in the noncommercial 
173.6 	production of direct reduced ore is subject to the tax imposed by this section on taconite 
173.7 	and iron sulphides. Three-year average production of direct reduced ore does not 
173.8 	include production of direct reduced ore in any noncommercial year. Three-year average 
173.9 	production for a direct reduced ore facility that has noncommercial production is the 
173.10 	average of the commercial production of direct reduced ore for the current year and the 
173.11 	previous two commercial years.
173.12 	(4) This paragraph applies only to plants for which all environmental permits have 
173.13 	been obtained and construction has begun before July 1, 2008.

173.14 	EFFECTIVE DATE. This section is effective for production in 2009 and thereafter, 
173.15 	except that the amendment to paragraph (g) is effective the day following final enactment.

173.16 	Sec. 7. Minnesota Statutes 2006, section 298.25, as amended by Laws 2008, chapter 
173.17 	154, article 8, section 6, is amended to read:
173.18 	298.25 TAXES ADDITIONAL TO OCCUPATION TAX; IN LIEU OF OTHER 
173.19 	TAXES. 
173.20 	The taxes imposed under section 298.24 shall be in addition to the occupation tax 
173.21 	imposed upon the business of mining and producing iron ore. Except as herein otherwise 
173.22 	provided, such taxes shall be in lieu of all other taxes upon such taconite, iron sulphides, 
173.23 	and direct reduced ore, and other iron bearing material or the lands in which they are 
173.24 	contained, or upon the mining or quarrying thereof, or the production of concentrate or 
173.25 	direct reduced ore therefrom, or upon the concentrate or direct reduced ore produced, 
173.26 	or upon the machinery, equipment, tools, supplies and buildings used in such mining, 
173.27 	quarrying or production, or upon the lands occupied by, or used in connection with, such 
173.28 	mining, quarrying or production facilities. If electric or steam power for the mining, 
173.29 	transportation or concentration of such taconite, concentrates or, direct reduced ore, or 
173.30 	other iron bearing material produced therefrom is generated in plants principally devoted 
173.31 	to the generation of power for such purposes, the plants in which such power is generated 
173.32 	and all machinery, equipment, tools, supplies, transmission and distribution lines used in 
173.33 	the generation and distribution of such power, shall not be considered to be machinery, 
173.34 	equipment, tools, supplies and buildings used in the mining, quarrying, or production of 
174.1 	taconite, taconite concentrates or direct reduced ore within the meaning of this section, 
174.2 	and shall be subject to general property taxation. Nothing herein shall prevent in this 
174.3 	section prevents the assessment and taxation under the general property tax law of:
174.4 	(1) the surface of reserve land containing taconite or other iron bearing material 
174.5 	and not occupied by such facilities or used in connection therewith with them at the 
174.6 	value thereof of the land without regard to the taconite or, iron sulphides therein, nor the 
174.7 	assessment and taxation of, or other iron bearing materials in the land;
174.8 	(2) merchantable iron ore or other minerals, or iron-bearing materials other than 
174.9 	taconite or iron sulphides in such the lands in the manner provided by law, nor the 
174.10 	assessment and taxation of;
174.11 	(3) facilities used in producing sulphur or sulphur products from iron sulphide 
174.12 	concentrates, or in refining such sulphur products, under the general property tax laws. 
174.13 	Nothing herein shall except from general taxation or from taxation as provided by other 
174.14 	laws; or
174.15 	(4) any property used for residential or townsite purposes, including utility services 
174.16 	thereto to that property.
174.17 	 This section does not provide an exemption from general property taxation for ore 
174.18 	docks even if located at the site of a taconite production facility. 

174.19 	EFFECTIVE DATE. This section is effective for production in 2009 and thereafter.

174.20 	Sec. 8. Minnesota Statutes 2006, section 298.28, subdivision 3, is amended to read:
174.21 		Subd. 3.Cities; towns. (a) 12.5 cents per taxable ton, less any amount distributed 
174.22 	under subdivision 8, and paragraph (b), must be allocated to the taconite municipal aid 
174.23 	account to be distributed as provided in section 298.282. 
174.24 	(b) An amount must be allocated to towns or cities that is annually certified by 
174.25 	the county auditor of a county containing a taconite tax relief area as defined in section 
174.26 	273.134, paragraph (b), within which there is (1) an organized township if, as of January 
174.27 	2, 1982, more than 75 percent of the assessed valuation of the township consists of iron 
174.28 	ore or (2) a city if, as of January 2, 1980, more than 75 percent of the assessed valuation 
174.29 	of the city consists of iron ore. 
174.30 	(c) The amount allocated under paragraph (b) will be the portion of a township's or 
174.31 	city's certified levy equal to the proportion of (1) the difference between 50 percent of 
174.32 	January 2, 1982, assessed value in the case of a township and 50 percent of the January 2, 
174.33 	1980, assessed value in the case of a city and its current assessed value to (2) the sum of 
174.34 	its current assessed value plus the difference determined in (1), provided that the amount 
174.35 	distributed shall not exceed $55 per capita in the case of a township or $75 per capita in 
175.1 	the case of a city. For purposes of this limitation, population will be determined according 
175.2 	to the 1980 decennial census conducted by the United States Bureau of the Census. If the 
175.3 	current assessed value of the township exceeds 50 percent of the township's January 2, 
175.4 	1982, assessed value, or if the current assessed value of the city exceeds 50 percent of the 
175.5 	city's January 2, 1980, assessed value, this paragraph shall not apply. For purposes of this 
175.6 	paragraph, "assessed value," when used in reference to years other than 1980 or 1982, 
175.7 	means the appropriate net tax capacities multiplied by 10.2.
175.8 	(d) In addition to other distributions under this subdivision, three cents per taxable 
175.9 	ton for distributions in 2009 must be allocated for distribution to towns that are entirely 
175.10 	located within the taconite tax relief area defined in section 273.134, paragraph (b). 
175.11 	For distribution in 2010 and subsequent years, the three-cent amount must be annually 
175.12 	increased in the same proportion as the increase in the implicit price deflator as provided 
175.13 	in section 298.24, subdivision 1. The amount available under this paragraph will be 
175.14 	distributed to eligible towns on a per capita basis, provided that no town may receive more 
175.15 	than $50,000 in any year under this paragraph. Any amount of the distribution that exceeds 
175.16 	the $50,000 limitation for a town under this paragraph must be redistributed on a per 
175.17 	capita basis among the other eligible towns, to whose distributions do not exceed $50,000.

175.18 	EFFECTIVE DATE. This section is effective for distributions in 2009 and 
175.19 	thereafter.

175.20 	Sec. 9. Minnesota Statutes 2006, section 298.28, subdivision 9d, as added by Laws 
175.21 	2008, chapter 154, article 8, section 9, is amended to read:
175.22 		Subd. 9d. Iron Range higher education account. Two Five cents per taxable ton 
175.23 	must be allocated to the Iron Range Resources and Rehabilitation Board to be deposited 
175.24 	in an Iron Range higher education account that is hereby created, to be used for higher 
175.25 	education programs conducted at educational institutions in the taconite assistance area 
175.26 	defined in section 273.1341. The Iron Range Higher Education committee under section 
175.27 	298.2214 and the Iron Range Resources and Rehabilitation Board must approve all 
175.28 	expenditures from the account. 

175.29 	EFFECTIVE DATE. This section is effective for production in 2007, distributions 
175.30 	in 2008, and thereafter.

175.31 	Sec. 10. Minnesota Statutes 2006, section 298.28, subdivision 12, is amended to read:
175.32 		Subd. 12.Estimates. On or before October 10 of each calendar year each 
175.33 	producer of taconite or, iron sulphides, and other iron-bearing material subject to taxation 
176.1 	under section 298.24(, hereinafter called referred to as "taxpayer"), shall file with the 
176.2 	commissioner of revenue an estimate of the amount of tax which that would be payable by 
176.3 	such the taxpayer under said the law for such the calendar year; provided such that the 
176.4 	 estimate shall be in an amount not less than the amount due on the mining and production 
176.5 	of concentrates up to September 30 of said the year plus the amount becoming due 
176.6 	because of probable production between September 30 and December 31 of said the year, 
176.7 	less any credit allowable as provided in subdivision 13. The commissioner of revenue 
176.8 	shall annually on or before October 10 report an estimated distribution amount to each 
176.9 	taxing district and the officers with whom such report is so filed shall use the amount so 
176.10 	indicated as being distributable to each taxing district in computing the permissible tax 
176.11 	levy of such the county or city in the year in which such the estimate is made, and payable 
176.12 	in the next ensuing calendar year, except that one cent per taxable ton of the amount 
176.13 	distributed under subdivision 5, paragraph (d), shall not be deducted in calculating the 
176.14 	permissible levy. In any calendar year in which a general property tax levy has been 
176.15 	made, if the taxes distributable to any such county or city are greater than the amount 
176.16 	estimated by the commissioner to be paid to any such the county or city in such that
176.17 	year, the excess of such the distribution shall be held in a special fund by the county or 
176.18 	city and shall not be expended until the succeeding calendar year, and shall be included 
176.19 	in computing the permissible levies of suchthe county or city payable in such year. If 
176.20 	the amounts distributable to any such the  county or city after final determination by the 
176.21 	commissioner of revenue under this section are less than the amounts by which a taxing 
176.22 	district's levies were reduced pursuant to this section, such the county or city may issue 
176.23 	certificates of indebtedness in the amount of the shortage, and may include in its next tax 
176.24 	levy an amount sufficient to pay such the certificates of indebtedness and interest thereon, 
176.25 	or, if no certificates were issued, an amount equal to such the shortage. 

176.26 	EFFECTIVE DATE. This section is effective for production in 2009 and thereafter.

176.27 	Sec. 11. Minnesota Statutes 2006, section 298.292, subdivision 2, as amended by Laws 
176.28 	2008, chapter 154, article 8, section 11, is amended to read:
176.29 		Subd. 2. Use of money. Money in the Douglas J. Johnson economic protection trust 
176.30 	fund may be used for the following purposes: 
176.31 	(1) to provide loans, loan guarantees, interest buy-downs and other forms of 
176.32 	participation with private sources of financing, but a loan to a private enterprise shall be 
176.33 	for a principal amount not to exceed one-half of the cost of the project for which financing 
176.34 	is sought, and the rate of interest on a loan to a private enterprise shall be no less than the 
176.35 	lesser of eight percent or an interest rate three percentage points less than a full faith 
177.1 	and credit obligation of the United States government of comparable maturity, at the 
177.2 	time that the loan is approved; 
177.3 	(2) to fund reserve accounts established to secure the payment when due of the 
177.4 	principal of and interest on bonds issued pursuant to section 298.2211; 
177.5 	(3) to pay in periodic payments or in a lump sum payment any or all of the interest 
177.6 	on bonds issued pursuant to chapter 474 for the purpose of constructing, converting, 
177.7 	or retrofitting heating facilities in connection with district heating systems or systems 
177.8 	utilizing alternative energy sources; 
177.9 	(4) to invest in a venture capital fund or enterprise that will provide capital to other 
177.10 	entities that are engaging in, or that will engage in, projects or programs that have the 
177.11 	purposes set forth in subdivision 1. No investments may be made in a venture capital fund 
177.12 	or enterprise unless at least two other unrelated investors make investments of at least 
177.13 	$500,000 in the venture capital fund or enterprise, and the investment by the Douglas 
177.14 	J. Johnson economic protection trust fund may not exceed the amount of the largest 
177.15 	investment by an unrelated investor in the venture capital fund or enterprise. For purposes 
177.16 	of this subdivision, an "unrelated investor" is a person or entity that is not related to 
177.17 	the entity in which the investment is made or to any individual who owns more than 40 
177.18 	percent of the value of the entity, in any of the following relationships: spouse, parent, 
177.19 	child, sibling, employee, or owner of an interest in the entity that exceeds ten percent of 
177.20 	the value of all interests in it. For purposes of determining the limitations under this 
177.21 	clause, the amount of investments made by an investor other than the Douglas J. Johnson 
177.22 	economic protection trust fund is the sum of all investments made in the venture capital 
177.23 	fund or enterprise during the period beginning one year before the date of the investment 
177.24 	by the Douglas J. Johnson economic protection trust fund; and 
177.25 	(5) to purchase forest land in the taconite assistance area defined in section 273.1341
177.26 	to be held and managed as a public trust for the benefit of the area for the purposes 
177.27 	authorized in section 298.22, subdivision 5a. Property purchased under this section may 
177.28 	be sold by the commissioner upon approval by a majority vote of the board. The net 
177.29 	proceeds must be deposited in the trust fund for the purposes and uses of this section.
177.30 	Money from the trust fund shall be expended only in or for the benefit of the taconite 
177.31 	assistance area defined in section 273.1341. 

177.32 	Sec. 12. Minnesota Statutes 2006, section 298.405, subdivision 1, is amended to read:
177.33 		Subdivision 1.Imposition of tax Definition. In any year in which Iron bearing 
177.34 	material other than taconite and semitaconite as defined by law, having not more than 46.5 
178.1 	percent natural iron content on the average, is subject to taxation under section 298.24. 
178.2 	The tax under that section applies to material that is:
178.3 	(1) produced from any 40 acre tract or governmental lot, but not from more than 
178.4 	three such tracts or lots by an individual producer, is finer than or is ground to 90 percent 
178.5 	passing 20 mesh and is; and
178.6 	(2) treated in Minnesota for the purpose of separating the iron particles from silica, 
178.7 	alumina, or other detrimental compounds or elements unless used in a direct reduction 
178.8 	process, and is treated in Minnesota:
178.9 	(a) (i) by either electrostatic separation, roasting and magnetic separation, or 
178.10 	flotation or;
178.11 	(b) (ii) by a direct reduction process or;
178.12 	(c) (iii) by any combination of such processes; or
178.13 	(d) (iv) by any other process or method not presently employed in gravity separation 
178.14 	plants employing only crushing, screening, washing, jigging, heavy media separation, 
178.15 	spirals, cyclones, drying or any combination thereof, the production of such ore shall 
178.16 	be taxed in the manner and at the rates provided for the taxation of semitaconite under 
178.17 	section 298.35 provided that the
178.18 	amount of concentrates or final product so produced each year from any one 40 acre 
178.19 	tract or governmental lotexceeds 100,000 tons orexceeds 25,000 tons from any one 
178.20 	40 acre tract or governmental lot where the average phosphorus content exceeds .125 
178.21 	percent dry analysis or .10 percent sulphur dry analysis. Such tax shall be in addition to 
178.22 	the occupation and royalty taxes but shall be in lieu of all other taxes upon the said 40 
178.23 	acre tract or governmental lot, the iron ore contained therein, the concentrates produced, 
178.24 	and the mining and beneficiating facilities used in such production. The determination 
178.25 	as to what materials will qualify under this law will be made by the commissioner of 
178.26 	revenue who may use the services of the Ore Estimate Division of the University of 
178.27 	Minnesota, Department of Civil and Mineral Engineering, which is hereby established 
178.28 	as a technical consultant to the commissioner for the purposes of this section. The tax 
178.29 	imposed shall be collected, paid, and the proceeds thereof distributed in the same manner 
178.30 	and at the same time as the tax imposed upon semitaconite by section 298.35 is collected, 
178.31 	paid, and distributed. 

178.32 	Sec. 13. Laws 2008, chapter 154, article 8, section 14, the effective date, is amended to 
178.33 	read:

178.34 	EFFECTIVE DATE. This section is effective for distributions made in 2008 2007
178.35 	and thereafter.

179.1 	Sec. 14. ELECTRIC GENERATING PLANTS IN TACONITE TAX RELIEF 
179.2 	AREAS.
 179.3 	For purposes of definitions of "taconite tax relief area" and "taconite assistance area" 
179.4 	in Minnesota Statutes, sections 273.134, 273.1341, and related laws, the elimination 
179.5 	of the property tax exemption for certain electric generating plants under Laws 2008, 
179.6 	chapter 154, article 8, section 6, does not change the status of any electric generating plant 
179.7 	qualifying as a taconite facility.

179.8 	Sec. 15. 2008 DISTRIBUTIONS ONLY.
 179.9 	For distribution in 2008 only, a special fund is established to receive 11.4 cents 
179.10 	per ton that otherwise would be allocated under Minnesota Statutes, section 298.28, 
179.11 	subdivision 6. If sufficient funds are not available under Minnesota Statutes, section 
179.12 	298.28, subdivision 6, to make the payments required under this section and under 
179.13 	Minnesota Statutes, section 298.28, subdivision 6, the remaining amount needed to total 
179.14 	11.4 cents per ton may be taken from funds available under Minnesota Statutes, section 
179.15 	298.28, subdivision 9. If 2008 H.F. No. 1812 is enacted and includes a provision that 
179.16 	distributes funds that would otherwise be allocated under Minnesota Statutes, section 
179.17 	298.28, subdivision 6, in a manner different from the distribution required in this section, 
179.18 	the distribution in this section supersedes the distribution set in 2008 H.F. No. 1812 
179.19 	notwithstanding Minnesota Statutes, section 645.26. The following amounts are allocated 
179.20 	to St. Louis County acting as the fiscal agent for the recipients for the following specified 
179.21 	purposes:
179.22 	(1) two cents per ton must be paid to the Hibbing Economic Development Authority 
179.23 	to retire bonds and for economic development purposes;
179.24 	(2) one cent per ton must be divided among and paid in equal shares to each of the 
179.25 	board of St. Louis County School District No. 2142, the board of Ely School District No. 
179.26 	696, the board of Mountain Iron-Buhl School District No. 712, and the board of Virginia 
179.27 	School District No. 706 for each to study the potential for and impact of consolidation 
179.28 	and streamlining the operations of their school districts;
179.29 	(3) 0.25 cent per ton must be paid to the city of Grand Rapids, for industrial park 
179.30 	work;
179.31 	(4) 0.65 cent per ton must be paid to the city of Aitkin, for sewer and water for 
179.32 	housing projects;
179.33 	(5) 0.5 cent per ton must be paid to the city of Crosby, for well and water tower 
179.34 	infrastructure;
180.1 	(6) 0.5 cent per ton must be paid to the city of Two Harbors, for well and water 
180.2 	tower infrastructure;
180.3 	(7) 1.5 cents per ton must be paid to the city of Silver Bay to pay for health and 
180.4 	safety and maintenance improvements at a former elementary school building that is 
180.5 	currently owned by the city, to be used for economic development purposes;
180.6 	(8) 1.5 cents per ton must be paid to St. Louis County to extend water and sewer 
180.7 	lines from the city of Chisholm to the St. Louis County fairgrounds;
180.8 	(9) 1.5 cents per ton must be paid to the White Community Hospital for debt 
180.9 	restructuring;
180.10 	(10) 0.5 cent per ton must be paid to the city of Keewatin for street, sewer, and 
180.11 	water improvements;
180.12 	(11) 0.5 cent per ton must be paid to the city of Calumet for street, sewer, and water 
180.13 	improvements; and
180.14 	(12) one cent per ton must be paid to Breitung township for sewer and water 
180.15 	extensions associated with the development of a state park, provided that if a new state 
180.16 	park is not established in Breitung township by July 1, 2009, the money provided in 
180.17 	this clause must be transferred to the northeast Minnesota economic development fund 
180.18 	established in Minnesota Statutes, section 298.2213.

180.19 	Sec. 16.  REPEALER.
 180.20 	Minnesota Statutes 2006, section 298.405, subdivisions 2, 3, and 4, are repealed.

180.21 	ARTICLE 11
180.22 	FEDERAL UPDATE

180.23 	Section 1. Minnesota Statutes 2006, section 272.02, subdivision 13, is amended to read:
180.24 		Subd. 13.Emergency shelters for victims of domestic abuse. Property used in 
180.25 	a continuous program to provide emergency shelter for victims of domestic abuse is 
180.26 	exempt, provided the organization that owns and sponsors the shelter is exempt from 
180.27 	federal income taxation pursuant to section 501(c)(3) of the Internal Revenue Code 
180.28 	of 1986, as amended through December 31, 1992, notwithstanding the fact that the 
180.29 	sponsoring organization receives funding under Section 8 of the United States Housing 
180.30 	Act of 1937, as amended.

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

180.32 	Sec. 2. Minnesota Statutes 2006, section 272.02, subdivision 20, is amended to read:
181.1 		Subd. 20.Transitional housing facilities. Transitional housing facilities are 
181.2 	exempt. "Transitional housing facility" means a facility that meets the following 
181.3 	requirements. (i) It provides temporary housing to individuals, couples, or families. (ii) 
181.4 	It has the purpose of reuniting families and enabling parents or individuals to obtain 
181.5 	self-sufficiency, advance their education, get job training, or become employed in jobs 
181.6 	that provide a living wage. (iii) It provides support services such as child care, work 
181.7 	readiness training, and career development counseling; and a self-sufficiency program 
181.8 	with periodic monitoring of each resident's progress in completing the program's goals. 
181.9 	(iv) It provides services to a resident of the facility for at least three months but no longer 
181.10 	than three years, except residents enrolled in an educational or vocational institution or job 
181.11 	training program. These residents may receive services during the time they are enrolled 
181.12 	but in no event longer than four years. (v) It is owned and operated or under lease from a 
181.13 	unit of government or governmental agency under a property disposition program and 
181.14 	operated by one or more organizations exempt from federal income tax under section 
181.15 	501(c)(3) of the Internal Revenue Code of 1986, as amended through December 31, 
181.16 	1992. This exemption applies notwithstanding the fact that the sponsoring organization 
181.17 	receives financing by a direct federal loan or federally insured loan or a loan made by the 
181.18 	Minnesota Housing Finance Agency under the provisions of either Title II of the National 
181.19 	Housing Act, as amended, or the Minnesota Housing Finance Agency Law of 1971, 
181.20 	chapter 462A, or rules promulgated by the agency pursuant to it, and notwithstanding the 
181.21 	fact that the sponsoring organization receives funding under Section 8 of the United 
181.22 	States Housing Act of 1937, as amended.

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

181.24 	Sec. 3. Minnesota Statutes 2006, section 272.02, subdivision 21, is amended to read:
181.25 		Subd. 21.Property used to provide computing resources to University of 
181.26 	Minnesota. Real and personal property, including leasehold or other personal property 
181.27 	interests, is exempt if it is owned and operated by a corporation of which more than 50 
181.28 	percent of the total voting power of the stock of the corporation is owned collectively by: 
181.29 	(i) the Board of Regents of the University of Minnesota, (ii) the University of Minnesota 
181.30 	Foundation, an organization exempt from federal income taxation under section 501(c)(3) 
181.31 	of the Internal Revenue Code of 1986, as amended through December 31, 1992, and (iii) 
181.32 	a corporation organized under chapter 317A, which by its articles of incorporation is 
181.33 	prohibited from providing pecuniary gain to any person or entity other than the regents 
181.34 	of the University of Minnesota; which property is used primarily to manage or provide 
182.1 	goods, services, or facilities utilizing or relating to large-scale advanced scientific 
182.2 	computing resources to the regents of the University of Minnesota and others.

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

182.4 	Sec. 4. Minnesota Statutes 2006, section 272.02, subdivision 27, is amended to read:
182.5 		Subd. 27.Superior National Forest; recreational property for use by disabled 
182.6 	veterans. Real and personal property is exempt if it is located in the Superior National 
182.7 	Forest, and owned or leased and operated by a nonprofit organization that is exempt 
182.8 	from federal income taxation under section 501(c)(3) of the Internal Revenue Code of 
182.9 	1986, as amended through December 31, 1992, and primarily used to provide recreational 
182.10 	opportunities for disabled veterans and their families.

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

182.12 	Sec. 5. Minnesota Statutes 2006, section 272.02, subdivision 31, is amended to read:
182.13 		Subd. 31.Business incubator property. Property owned by a nonprofit charitable 
182.14 	organization that qualifies for tax exemption under section 501(c)(3) of the Internal 
182.15 	Revenue Code of 1986, as amended through December 31, 1997, that is intended to be 
182.16 	used as a business incubator in a high-unemployment county, is exempt. As used in this 
182.17 	subdivision, a "business incubator" is a facility used for the development of nonretail 
182.18 	businesses, offering access to equipment, space, services, and advice to the tenant 
182.19 	businesses, for the purpose of encouraging economic development, diversification, and 
182.20 	job creation in the area served by the organization, and "high-unemployment county" is a 
182.21 	county that had an average annual unemployment rate of 7.9 percent or greater in 1997. 
182.22 	Property that qualifies for the exemption under this subdivision is limited to no more than 
182.23 	two contiguous parcels and structures that do not exceed in the aggregate 40,000 square 
182.24 	feet. This exemption expires after taxes payable in 2011.

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

182.26 	Sec. 6. Minnesota Statutes 2006, section 272.02, subdivision 49, is amended to read:
182.27 		Subd. 49.Agricultural historical society property. Property is exempt from 
182.28 	taxation if it is owned by a nonprofit charitable or educational organization that qualifies 
182.29 	for exemption under section 501(c)(3) of the Internal Revenue Code of 1986, as amended 
182.30 	through December 31, 2000, and meets the following criteria:
182.31 	(1) the property is primarily used for storing and exhibiting tools, equipment, and 
182.32 	artifacts useful in providing an understanding of local or regional agricultural history. 
183.1 	Primary use is determined each year based on the number of days the property is used 
183.2 	solely for storage and exhibition purposes;
183.3 	(2) the property is limited to a maximum of 20 acres per owner per county, but 
183.4 	includes the land and any taxable structures, fixtures, and equipment on the land;
183.5 	(3) the property is not used for a revenue-producing activity for more than ten days 
183.6 	in each calendar year; and
183.7 	(4) the property is not used for residential purposes on either a temporary or 
183.8 	permanent basis.

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

183.10 	Sec. 7. Minnesota Statutes 2006, section 272.03, subdivision 3, is amended to read:
183.11 		Subd. 3.Construction of terms. For the purposes of chapters 270 to 284, unless a 
183.12 	different meaning is indicated by the context, the words, phrases, and terms defined in 
183.13 	subdivisions 4 to 11 shall this section have the meanings given them.

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

183.15 	Sec. 8. Minnesota Statutes 2006, section 272.03, is amended by adding a subdivision 
183.16 	to read:
183.17 		Subd. 13.Internal Revenue Code. Unless specifically defined otherwise, "Internal 
183.18 	Revenue Code" means the Internal Revenue Code as defined in section 289A.02, 
183.19 	subdivision 7.

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

183.21 	Sec. 9. [273.105] INTERNAL REVENUE CODE.
183.22 	Unless specifically defined otherwise, for purposes of this chapter, "Internal Revenue 
183.23 	Code" means the Internal Revenue Code as defined in section 289A.02, subdivision 7.

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

183.25 	Sec. 10. Minnesota Statutes 2006, section 273.11, subdivision 8, is amended to read:
183.26 		Subd. 8.Limited equity cooperative apartments. For the purposes of this 
183.27 	subdivision, the terms defined in this subdivision have the meanings given them.
183.28 	A "limited equity cooperative" is a corporation organized under chapter 308A or 
183.29 	308B, which has as its primary purpose the provision of housing and related services to 
183.30 	its members which meets one of the following criteria with respect to the income of its 
184.1 	members: (1) a minimum of 75 percent of members must have incomes at or less than 
184.2 	90 percent of area median income, (2) a minimum of 40 percent of members must have 
184.3 	incomes at or less than 60 percent of area median income, or (3) a minimum of 20 percent 
184.4 	of members must have incomes at or less than 50 percent of area median income. For 
184.5 	purposes of this clause, "member income" shall mean the income of a member existing at 
184.6 	the time the member acquires cooperative membership, and median income shall mean 
184.7 	the St. Paul-Minneapolis metropolitan area median income as determined by the United 
184.8 	States Department of Housing and Urban Development. It must also meet the following 
184.9 	requirements:
184.10 	(a) The articles of incorporation set the sale price of occupancy entitling cooperative 
184.11 	shares or memberships at no more than a transfer value determined as provided in the 
184.12 	articles. That value may not exceed the sum of the following:
184.13 	(1) the consideration paid for the membership or shares by the first occupant of the 
184.14 	unit, as shown in the records of the corporation;
184.15 	(2) the fair market value, as shown in the records of the corporation, of any 
184.16 	improvements to the real property that were installed at the sole expense of the member 
184.17 	with the prior approval of the board of directors;
184.18 	(3) accumulated interest, or an inflation allowance not to exceed the greater of a ten 
184.19 	percent annual noncompounded increase on the consideration paid for the membership or 
184.20 	share by the first occupant of the unit, or the amount that would have been paid on that 
184.21 	consideration if interest had been paid on it at the rate of the percentage increase in the 
184.22 	revised Consumer Price Index for All Urban Consumers for the Minneapolis-St. Paul 
184.23 	metropolitan area prepared by the United States Department of Labor, provided that the 
184.24 	amount determined pursuant to this clause may not exceed $500 for each year or fraction 
184.25 	of a year the membership or share was owned; plus
184.26 	(4) real property capital contributions shown in the records of the corporation to 
184.27 	have been paid by the transferor member and previous holders of the same membership, 
184.28 	or of separate memberships that had entitled occupancy to the unit of the member 
184.29 	involved. These contributions include contributions to a corporate reserve account the 
184.30 	use of which is restricted to real property improvements or acquisitions, contributions to 
184.31 	the corporation which are used for real property improvements or acquisitions, and the 
184.32 	amount of principal amortized by the corporation on its indebtedness due to the financing 
184.33 	of real property acquisition or improvement or the averaging of principal paid by the 
184.34 	corporation over the term of its real property-related indebtedness.
184.35 	(b) The articles of incorporation require that the board of directors limit the purchase 
184.36 	price of stock or membership interests for new member-occupants or resident shareholders 
185.1 	to an amount which does not exceed the transfer value for the membership or stock as 
185.2 	defined in clause (a).
185.3 	(c) The articles of incorporation require that the total distribution out of capital to a 
185.4 	member shall not exceed that transfer value.
185.5 	(d) The articles of incorporation require that upon liquidation of the corporation any 
185.6 	assets remaining after retirement of corporate debts and distribution to members will 
185.7 	be conveyed to a charitable organization described in section 501(c)(3) of the Internal 
185.8 	Revenue Code of 1986, as amended through December 31, 1992, or a public agency.
185.9 	A "limited equity cooperative apartment" is a dwelling unit owned by a limited 
185.10 	equity cooperative.
185.11 	"Occupancy entitling cooperative share or membership" is the ownership interest 
185.12 	in a cooperative organization which entitles the holder to an exclusive right to occupy a 
185.13 	dwelling unit owned or leased by the cooperative.
185.14 	For purposes of taxation, the assessor shall value a unit owned by a limited equity 
185.15 	cooperative at the lesser of its market value or the value determined by capitalizing the net 
185.16 	operating income of a comparable apartment operated on a rental basis at the capitalization 
185.17 	rate used in valuing comparable buildings that are not limited equity cooperatives. If a 
185.18 	cooperative fails to operate in accordance with the provisions of clauses (a) to (d), the 
185.19 	property shall be subject to additional property taxes in the amount of the difference 
185.20 	between the taxes determined in accordance with this subdivision for the last ten years that 
185.21 	the property had been assessed pursuant to this subdivision and the amount that would 
185.22 	have been paid if the provisions of this subdivision had not applied to it. The additional 
185.23 	taxes, plus interest at the rate specified in section 549.09, shall be extended against the 
185.24 	property on the tax list for the current year.

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

185.26 	Sec. 11. Minnesota Statutes 2006, section 273.124, subdivision 6, is amended to read:
185.27 		Subd. 6.Leasehold cooperatives. When one or more dwellings or one or more 
185.28 	buildings which each contain several dwelling units is owned by a nonprofit corporation 
185.29 	subject to the provisions of chapter 317A and qualifying under section 501(c)(3) or 
185.30 	501(c)(4) of the Internal Revenue Code of 1986, as amended through December 31, 
185.31 	1990, or a limited partnership which corporation or partnership operates the property in 
185.32 	conjunction with a cooperative association, and has received public financing, homestead 
185.33 	treatment may be claimed by the cooperative association on behalf of the members of 
185.34 	the cooperative for each dwelling unit occupied by a member of the cooperative. The 
185.35 	cooperative association must provide the assessor with the Social Security numbers of 
186.1 	those members. To qualify for the treatment provided by this subdivision, the following 
186.2 	conditions must be met:
186.3 	(a) the cooperative association must be organized under chapter 308A or 308B and 
186.4 	all voting members of the board of directors must be resident tenants of the cooperative 
186.5 	and must be elected by the resident tenants of the cooperative;
186.6 	(b) the cooperative association must have a lease for occupancy of the property for a 
186.7 	term of at least 20 years, which permits the cooperative association, while not in default on 
186.8 	the lease, to participate materially in the management of the property, including material 
186.9 	participation in establishing budgets, setting rent levels, and hiring and supervising a 
186.10 	management agent;
186.11 	(c) to the extent permitted under state or federal law, the cooperative association 
186.12 	must have a right under a written agreement with the owner to purchase the property if the 
186.13 	owner proposes to sell it; if the cooperative association does not purchase the property it is 
186.14 	offered for sale, the owner may not subsequently sell the property to another purchaser at 
186.15 	a price lower than the price at which it was offered for sale to the cooperative association 
186.16 	unless the cooperative association approves the sale;
186.17 	(d) a minimum of 40 percent of the cooperative association's members must have 
186.18 	incomes at or less than 60 percent of area median gross income as determined by the 
186.19 	United States Secretary of Housing and Urban Development under section 142(d)(2)(B) 
186.20 	of the Internal Revenue Code of 1986, as amended through December 31, 1991. For 
186.21 	purposes of this clause, "member income" means the income of a member existing at the 
186.22 	time the member acquires cooperative membership;
186.23 	(e) if a limited partnership owns the property, it must include as the managing 
186.24 	general partner a nonprofit organization operating under the provisions of chapter 317A 
186.25 	and qualifying under section 501(c)(3) or 501(c)(4) of the Internal Revenue Code of 1986, 
186.26 	as amended through December 31, 1990, and the limited partnership agreement must 
186.27 	provide that the managing general partner have sufficient powers so that it materially 
186.28 	participates in the management and control of the limited partnership;
186.29 	(f) prior to becoming a member of a leasehold cooperative described in this 
186.30 	subdivision, a person must have received notice that (1) describes leasehold cooperative 
186.31 	property in plain language, including but not limited to the effects of classification 
186.32 	under this subdivision on rents, property taxes and tax credits or refunds, and operating 
186.33 	expenses, and (2) states that copies of the articles of incorporation and bylaws of the 
186.34 	cooperative association, the lease between the owner and the cooperative association, a 
186.35 	sample sublease between the cooperative association and a tenant, and, if the owner is a 
186.36 	partnership, a copy of the limited partnership agreement, can be obtained upon written 
187.1 	request at no charge from the owner, and the owner must send or deliver the materials 
187.2 	within seven days after receiving any request;
187.3 	(g) if a dwelling unit of a building was occupied on the 60th day prior to the date on 
187.4 	which the unit became leasehold cooperative property described in this subdivision, the 
187.5 	notice described in paragraph (f) must have been sent by first class mail to the occupant of 
187.6 	the unit at least 60 days prior to the date on which the unit became leasehold cooperative 
187.7 	property. For purposes of the notice under this paragraph, the copies of the documents 
187.8 	referred to in paragraph (f) may be in proposed version, provided that any subsequent 
187.9 	material alteration of those documents made after the occupant has requested a copy 
187.10 	shall be disclosed to any occupant who has requested a copy of the document. Copies of 
187.11 	the articles of incorporation and certificate of limited partnership shall be filed with the 
187.12 	secretary of state after the expiration of the 60-day period unless the change to leasehold 
187.13 	cooperative status does not proceed;
187.14 	(h) the county attorney of the county in which the property is located must certify to 
187.15 	the assessor that the property meets the requirements of this subdivision;
187.16 	(i) the public financing received must be from at least one of the following sources:
187.17 	(1) tax increment financing proceeds used for the acquisition or rehabilitation of the 
187.18 	building or interest rate write-downs relating to the acquisition of the building;
187.19 	(2) government issued bonds exempt from taxes under section 103 of the Internal 
187.20 	Revenue Code of 1986, as amended through December 31, 1991, the proceeds of which 
187.21 	are used for the acquisition or rehabilitation of the building;
187.22 	(3) programs under section 221(d)(3), 202, or 236, of Title II of the National 
187.23 	Housing Act;
187.24 	(4) rental housing program funds under Section 8 of the United States Housing Act 
187.25 	of 1937, as amended, or the market rate family graduated payment mortgage program 
187.26 	funds administered by the Minnesota Housing Finance Agency that are used for the 
187.27 	acquisition or rehabilitation of the building;
187.28 	(5) low-income housing credit under section 42 of the Internal Revenue Code of 
187.29 	1986, as amended through December 31, 1991;
187.30 	(6) public financing provided by a local government used for the acquisition or 
187.31 	rehabilitation of the building, including grants or loans from (i) federal community 
187.32 	development block grants; (ii) HOME block grants; or (iii) residential rental bonds issued 
187.33 	under chapter 474A; or
187.34 	(7) other rental housing program funds provided by the Minnesota Housing Finance 
187.35 	Agency for the acquisition or rehabilitation of the building;
188.1 	(j) at the time of the initial request for homestead classification or of any transfer of 
188.2 	ownership of the property, the governing body of the municipality in which the property is 
188.3 	located must hold a public hearing and make the following findings:
188.4 	(1) that the granting of the homestead treatment of the apartment's units will 
188.5 	facilitate safe, clean, affordable housing for the cooperative members that would otherwise 
188.6 	not be available absent the homestead designation;
188.7 	(2) that the owner has presented information satisfactory to the governing body 
188.8 	showing that the savings garnered from the homestead designation of the units will be 
188.9 	used to reduce tenant's rents or provide a level of furnishing or maintenance not possible 
188.10 	absent the designation; and
188.11 	(3) that the requirements of paragraphs (b), (d), and (i) have been met.
188.12 	Homestead treatment must be afforded to units occupied by members of the 
188.13 	cooperative association and the units must be assessed as provided in subdivision 3, 
188.14 	provided that any unit not so occupied shall be classified and assessed pursuant to the 
188.15 	appropriate class. No more than three acres of land may, for assessment purposes, 
188.16 	be included with each dwelling unit that qualifies for homestead treatment under this 
188.17 	subdivision.
188.18 	When dwelling units no longer qualify under this subdivision, the current owner 
188.19 	must notify the assessor within 60 days. Failure to notify the assessor within 60 days shall 
188.20 	result in the loss of benefits under this subdivision for taxes payable in the year that the 
188.21 	failure is discovered. For these purposes, "benefits under this subdivision" means the 
188.22 	difference in the net tax capacity of the units which no longer qualify as computed under 
188.23 	this subdivision and as computed under the otherwise applicable law, times the local tax 
188.24 	rate applicable to the building for that taxes payable year. Upon discovery of a failure to 
188.25 	notify, the assessor shall inform the auditor of the difference in net tax capacity for the 
188.26 	building or buildings in which units no longer qualify, and the auditor shall calculate the 
188.27 	benefits under this subdivision. Such amount, plus a penalty equal to 100 percent of that 
188.28 	amount, shall then be demanded of the building's owner. The property owner may appeal 
188.29 	the county's determination by serving copies of a petition for review with county officials 
188.30 	as provided in section 278.01 and filing a proof of service as provided in section 278.01
188.31 	with the Minnesota Tax Court within 60 days of the date of the notice from the county. 
188.32 	The appeal shall be governed by the Tax Court procedures provided in chapter 271, for 
188.33 	cases relating to the tax laws as defined in section 271.01, subdivision 5; disregarding 
188.34 	sections 273.125, subdivision 5, and 278.03, but including section 278.05, subdivision 2. 
188.35 	If the amount of the benefits under this subdivision and penalty are not paid within 60 
188.36 	days, and if no appeal has been filed, the county auditor shall certify the amount of the 
189.1 	benefit and penalty to the succeeding year's tax list to be collected as part of the property 
189.2 	taxes on the affected buildings.

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

189.4 	Sec. 12. Minnesota Statutes 2006, section 273.128, subdivision 1, as amended by Laws 
189.5 	2008, chapter 154, article 2, section 10, is amended to read:
189.6 		Subdivision 1. Requirement. Low-income rental property classified as class 4d 
189.7 	under section 273.13, subdivision 25, is entitled to valuation under this section if at least 20 
189.8 	percent of the units in the rental housing property meet any of the following qualifications: 
189.9 	(1) the units are subject to a housing assistance payments contract under Section 8 
189.10 	of the United States Housing Act of 1937, as amended; 
189.11 	(2) the units are rent-restricted and income-restricted units of a qualified low-income 
189.12 	housing project receiving tax credits under section 42(g) of the Internal Revenue Code 
189.13 	of 1986, as amended; 
189.14 	(3) the units are financed by the Rural Housing Service of the United States 
189.15 	Department of Agriculture and receive payments under the rental assistance program 
189.16 	pursuant to section 521(a) of the Housing Act of 1949, as amended; or 
189.17 	(4) the units are subject to rent and income restrictions under the terms of financial 
189.18 	assistance provided to the rental housing property by the federal government or the 
189.19 	state of Minnesota, or a local unit of government, as evidenced by a document recorded 
189.20 	against the property. 
189.21 	The restrictions must require assisted units to be occupied by residents whose 
189.22 	household income at the time of initial occupancy does not exceed 60 percent of the 
189.23 	greater of area or state median income, adjusted for family size, as determined by the 
189.24 	United States Department of Housing and Urban Development. The restriction must also 
189.25 	require the rents for assisted units to not exceed 30 percent of 60 percent of the greater of 
189.26 	area or state median income, adjusted for family size, as determined by the United States 
189.27 	Department of Housing and Urban Development. 

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

189.29 	Sec. 13. Minnesota Statutes 2006, section 273.13, subdivision 25, as amended by Laws 
189.30 	2008, chapter 154, article 2, section 13, is amended to read:
189.31 		Subd. 25. Class 4. (a) Class 4a is residential real estate containing four or more 
189.32 	units and used or held for use by the owner or by the tenants or lessees of the owner 
189.33 	as a residence for rental periods of 30 days or more, excluding property qualifying for 
190.1 	class 4d. Class 4a also includes hospitals licensed under sections 144.50 to 144.56, other 
190.2 	than hospitals exempt under section 272.02, and contiguous property used for hospital 
190.3 	purposes, without regard to whether the property has been platted or subdivided. The 
190.4 	market value of class 4a property has a class rate of 1.25 percent. 
190.5 	(b) Class 4b includes: 
190.6 	(1) residential real estate containing less than four units that does not qualify as class 
190.7 	4bb, other than seasonal residential recreational property; 
190.8 	(2) manufactured homes not classified under any other provision; 
190.9 	(3) a dwelling, garage, and surrounding one acre of property on a nonhomestead 
190.10 	farm classified under subdivision 23, paragraph (b) containing two or three units; and 
190.11 	(4) unimproved property that is classified residential as determined under subdivision 
190.12 	33. 
190.13 	The market value of class 4b property has a class rate of 1.25 percent. 
190.14 	(c) Class 4bb includes: 
190.15 	(1) nonhomestead residential real estate containing one unit, other than seasonal 
190.16 	residential recreational property; and 
190.17 	(2) a single family dwelling, garage, and surrounding one acre of property on a 
190.18 	nonhomestead farm classified under subdivision 23, paragraph (b). 
190.19 	Class 4bb property has the same class rates as class 1a property under subdivision 22. 
190.20 	Property that has been classified as seasonal residential recreational property at 
190.21 	any time during which it has been owned by the current owner or spouse of the current 
190.22 	owner does not qualify for class 4bb. 
190.23 	(d) Class 4c property includes: 
190.24 	(1) except as provided in subdivision 22, paragraph (c), or subdivision 23, paragraph 
190.25 	(b), clause (1), real and personal property devoted to temporary and seasonal residential 
190.26 	occupancy for recreation purposes, including real and personal property devoted to 
190.27 	temporary and seasonal residential occupancy for recreation purposes and not devoted to 
190.28 	commercial purposes for more than 250 days in the year preceding the year of assessment. 
190.29 	For purposes of this clause, property is devoted to a commercial purpose on a specific 
190.30 	day if any portion of the property is used for residential occupancy, and a fee is charged 
190.31 	for residential occupancy. Class 4c property must contain three or more rental units. A 
190.32 	"rental unit" is defined as a cabin, condominium, townhouse, sleeping room, or individual 
190.33 	camping site equipped with water and electrical hookups for recreational vehicles. Class 
190.34 	4c property must provide recreational activities such as renting ice fishing houses, boats 
190.35 	and motors, snowmobiles, downhill or cross-country ski equipment; provide marina 
190.36 	services, launch services, or guide services; or sell bait and fishing tackle. A camping 
191.1 	pad offered for rent by a property that otherwise qualifies for class 4c is also class 4c 
191.2 	regardless of the term of the rental agreement, as long as the use of the camping pad 
191.3 	does not exceed 250 days. In order for a property to be classified as class 4c, seasonal 
191.4 	residential recreational for commercial purposes, at least 40 percent of the annual gross 
191.5 	lodging receipts related to the property must be from business conducted during 90 
191.6 	consecutive days and either (i) at least 60 percent of all paid bookings by lodging guests 
191.7 	during the year must be for periods of at least two consecutive nights; or (ii) at least 20 
191.8 	percent of the annual gross receipts must be from charges for rental of fish houses, boats 
191.9 	and motors, snowmobiles, downhill or cross-country ski equipment, or charges for marina 
191.10 	services, launch services, and guide services, or the sale of bait and fishing tackle. For 
191.11 	purposes of this determination, a paid booking of five or more nights shall be counted as 
191.12 	two bookings. Class 4c also includes commercial use real property used exclusively 
191.13 	for recreational purposes in conjunction with class 4c property devoted to temporary 
191.14 	and seasonal residential occupancy for recreational purposes, up to a total of two acres, 
191.15 	provided the property is not devoted to commercial recreational use for more than 250 
191.16 	days in the year preceding the year of assessment and is located within two miles of the 
191.17 	class 4c property with which it is used. Owners of real and personal property devoted 
191.18 	to temporary and seasonal residential occupancy for recreation purposes and all or a 
191.19 	portion of which was devoted to commercial purposes for not more than 250 days in the 
191.20 	year preceding the year of assessment desiring classification as class 4c, must submit a 
191.21 	declaration to the assessor designating the cabins or units occupied for 250 days or less in 
191.22 	the year preceding the year of assessment by January 15 of the assessment year. Those 
191.23 	cabins or units and a proportionate share of the land on which they are located must be 
191.24 	designated class 4c as otherwise provided. The remainder of the cabins or units and 
191.25 	a proportionate share of the land on which they are located will be designated as class 
191.26 	3a. The owner of property desiring designation as class 4c property must provide guest 
191.27 	registers or other records demonstrating that the units for which class 4c designation is 
191.28 	sought were not occupied for more than 250 days in the year preceding the assessment if 
191.29 	so requested. The portion of a property operated as a (1) restaurant, (2) bar, (3) gift shop, 
191.30 	(4) conference center or meeting room, and (5) other nonresidential facility operated on a 
191.31 	commercial basis not directly related to temporary and seasonal residential occupancy for 
191.32 	recreation purposes does not qualify for class 4c; 
191.33 	(2) qualified property used as a golf course if: 
191.34 	(i) it is open to the public on a daily fee basis. It may charge membership fees or 
191.35 	dues, but a membership fee may not be required in order to use the property for golfing, 
192.1 	and its green fees for golfing must be comparable to green fees typically charged by 
192.2 	municipal courses; and 
192.3 	(ii) it meets the requirements of section 273.112, subdivision 3, paragraph (d). 
192.4 	A structure used as a clubhouse, restaurant, or place of refreshment in conjunction 
192.5 	with the golf course is classified as class 3a property; 
192.6 	(3) real property up to a maximum of three acres of land owned and used by a 
192.7 	nonprofit community service oriented organization and that is not used for residential 
192.8 	purposes on either a temporary or permanent basis, qualifies for class 4c provided that 
192.9 	it meets either of the following: 
192.10 	(i) the property is not used for a revenue-producing activity for more than six days 
192.11 	in the calendar year preceding the year of assessment; or 
192.12 	(ii) the organization makes annual charitable contributions and donations at least 
192.13 	equal to the property's previous year's property taxes and the property is allowed to be 
192.14 	used for public and community meetings or events for no charge, as appropriate to the 
192.15 	size of the facility. 
192.16 	For purposes of this clause, 
192.17 	(A) "charitable contributions and donations" has the same meaning as lawful 
192.18 	gambling purposes under section 349.12, subdivision 25, excluding those purposes 
192.19 	relating to the payment of taxes, assessments, fees, auditing costs, and utility payments; 
192.20 	(B) "property taxes" excludes the state general tax; 
192.21 	(C) a "nonprofit community service oriented organization" means any corporation, 
192.22 	society, association, foundation, or institution organized and operated exclusively for 
192.23 	charitable, religious, fraternal, civic, or educational purposes, and which is exempt from 
192.24 	federal income taxation pursuant to section 501(c)(3), (10), or (19) of the Internal Revenue 
192.25 	Code of 1986, as amended through December 31, 1990; and 
192.26 	(D) "revenue-producing activities" shall include but not be limited to property or that 
192.27 	portion of the property that is used as an on-sale intoxicating liquor or 3.2 percent malt 
192.28 	liquor establishment licensed under chapter 340A, a restaurant open to the public, bowling 
192.29 	alley, a retail store, gambling conducted by organizations licensed under chapter 349, an 
192.30 	insurance business, or office or other space leased or rented to a lessee who conducts a 
192.31 	for-profit enterprise on the premises. 
192.32 	Any portion of the property qualifying under item (i) which is used for revenue-producing 
192.33 	activities for more than six days in the calendar year preceding the year of assessment 
192.34 	shall be assessed as class 3a. The use of the property for social events open exclusively 
192.35 	to members and their guests for periods of less than 24 hours, when an admission is 
193.1 	not charged nor any revenues are received by the organization shall not be considered a 
193.2 	revenue-producing activity. 
193.3 	The organization shall maintain records of its charitable contributions and donations 
193.4 	and of public meetings and events held on the property and make them available upon 
193.5 	request any time to the assessor to ensure eligibility. An organization meeting the 
193.6 	requirement under item (ii) must file an application by May 1 with the assessor for 
193.7 	eligibility for the current year's assessment. The commissioner shall prescribe a uniform 
193.8 	application form and instructions; 
193.9 	(4) postsecondary student housing of not more than one acre of land that is owned by 
193.10 	a nonprofit corporation organized under chapter 317A and is used exclusively by a student 
193.11 	cooperative, sorority, or fraternity for on-campus housing or housing located within two 
193.12 	miles of the border of a college campus; 
193.13 	(5) manufactured home parks as defined in section 327.14, subdivision 3; 
193.14 	(6) real property that is actively and exclusively devoted to indoor fitness, health, 
193.15 	social, recreational, and related uses, is owned and operated by a not-for-profit corporation, 
193.16 	and is located within the metropolitan area as defined in section 473.121, subdivision 2; 
193.17 	(7) a leased or privately owned noncommercial aircraft storage hangar not exempt 
193.18 	under section 272.01, subdivision 2, and the land on which it is located, provided that: 
193.19 	(i) the land is on an airport owned or operated by a city, town, county, Metropolitan 
193.20 	Airports Commission, or group thereof; and 
193.21 	(ii) the land lease, or any ordinance or signed agreement restricting the use of the 
193.22 	leased premise, prohibits commercial activity performed at the hangar. 
193.23 	If a hangar classified under this clause is sold after June 30, 2000, a bill of sale must 
193.24 	be filed by the new owner with the assessor of the county where the property is located 
193.25 	within 60 days of the sale; 
193.26 	(8) a privately owned noncommercial aircraft storage hangar not exempt under 
193.27 	section 272.01, subdivision 2, and the land on which it is located, provided that: 
193.28 	(i) the land abuts a public airport; and 
193.29 	(ii) the owner of the aircraft storage hangar provides the assessor with a signed 
193.30 	agreement restricting the use of the premises, prohibiting commercial use or activity 
193.31 	performed at the hangar; and 
193.32 	(9) residential real estate, a portion of which is used by the owner for homestead 
193.33 	purposes, and that is also a place of lodging, if all of the following criteria are met: 
193.34 	(i) rooms are provided for rent to transient guests that generally stay for periods 
193.35 	of 14 or fewer days; 
194.1 	(ii) meals are provided to persons who rent rooms, the cost of which is incorporated 
194.2 	in the basic room rate; 
194.3 	(iii) meals are not provided to the general public except for special events on fewer 
194.4 	than seven days in the calendar year preceding the year of the assessment; and 
194.5 	(iv) the owner is the operator of the property. 
194.6 	The market value subject to the 4c classification under this clause is limited to five rental 
194.7 	units. Any rental units on the property in excess of five, must be valued and assessed as 
194.8 	class 3a. The portion of the property used for purposes of a homestead by the owner must 
194.9 	be classified as class 1a property under subdivision 22. 
194.10 	Class 4c property has a class rate of 1.5 percent of market value, except that (i) each 
194.11 	parcel of seasonal residential recreational property not used for commercial purposes has 
194.12 	the same class rates as class 4bb property, (ii) manufactured home parks assessed under 
194.13 	clause (5) have the same class rate as class 4b property, (iii) commercial-use seasonal 
194.14 	residential recreational property has a class rate of one percent for the first $500,000 of 
194.15 	market value, and 1.25 percent for the remaining market value, (iv) the market value of 
194.16 	property described in clause (4) has a class rate of one percent, (v) the market value of 
194.17 	property described in clauses (2) and (6) has a class rate of 1.25 percent, and (vi) that 
194.18 	portion of the market value of property in clause (9) qualifying for class 4c property 
194.19 	has a class rate of 1.25 percent. 
194.20 	(e) Class 4d property is qualifying low-income rental housing certified to the assessor 
194.21 	by the Housing Finance Agency under section 273.128, subdivision 3. If only a portion 
194.22 	of the units in the building qualify as low-income rental housing units as certified under 
194.23 	section 273.128, subdivision 3, only the proportion of qualifying units to the total number 
194.24 	of units in the building qualify for class 4d. The remaining portion of the building shall be 
194.25 	classified by the assessor based upon its use. Class 4d also includes the same proportion of 
194.26 	land as the qualifying low-income rental housing units are to the total units in the building. 
194.27 	For all properties qualifying as class 4d, the market value determined by the assessor must 
194.28 	be based on the normal approach to value using normal unrestricted rents. 
194.29 	Class 4d property has a class rate of 0.75 percent. 

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

194.31 	Sec. 14. Minnesota Statutes 2006, section 287.20, subdivision 3a, is amended to read:
194.32 		Subd. 3a.Designated transfer. "Designated transfer" means any of the following:
194.33 	(1) a transfer between (i) an entity owned by a sole owner, and (ii) that sole owner;
195.1 	(2) a transfer between (i) an entity in which a husband, a wife, or both are the sole 
195.2 	owners, and (ii) the husband, wife, or both;
195.3 	(3) a transfer between (i) an entity with multiple co-owners, and (ii) all of the 
195.4 	co-owners, so long as each of the co-owners maintains the same percentage ownership 
195.5 	interest in the transferred real property, whether directly or through ownership of a 
195.6 	percentage of the entity;
195.7 	(4) a transfer between (i) a revocable trust, and (ii) the grantor or grantors of the 
195.8 	revocable trust; or
195.9 	(5) a transfer of substantially all of the assets of one or more entities pursuant to a 
195.10 	reorganization, as defined in section 287.20, subdivision 9.
195.11 	For purposes of this definition of designated transfer, an interest in an entity that is 
195.12 	owned, directly or indirectly, by or for another entity shall be considered as being owned 
195.13 	proportionately by or for the owners of the other entity under provisions similar to those 
195.14 	of section 267(c)(1) and (5) of the Internal Revenue Code of 1986, as amended through 
195.15 	December 31, 2004.

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

195.17 	Sec. 15. Minnesota Statutes 2006, section 287.20, subdivision 9, is amended to read:
195.18 		Subd. 9.Reorganization. "Reorganization" means the transfer of substantially all 
195.19 	of the assets of a corporation, a limited liability company, or a partnership not in the usual 
195.20 	or regular course of business if at the time of the transfer the transfer qualifies as: (i) a 
195.21 	corporate reorganization under section 368(a) of the Internal Revenue Code of 1986, as 
195.22 	amended through December 31, 2004; or (ii) a transfer from a partnership to another 
195.23 	partnership when the transferee is treated as a continuation of the transferor under section 
195.24 	708 of the Internal Revenue Code of 1986, as amended through December 31, 2004.

195.25 	Sec. 16. Minnesota Statutes 2006, section 287.20, is amended by adding a subdivision 
195.26 	to read:
195.27 		Subd. 10.Internal Revenue Code. Unless specifically defined otherwise, "Internal 
195.28 	Revenue Code" means the Internal Revenue Code as defined in section 289A.02, 
195.29 	subdivision 7.

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

195.31 	Sec. 17. Minnesota Statutes 2006, section 295.53, subdivision 4a, is amended to read:
196.1 		Subd. 4a.Credit for research. (a) In addition to the exemptions allowed under 
196.2 	subdivision 1, a hospital or health care provider may claim an annual credit against the 
196.3 	total amount of tax, if any, the hospital or health care provider owes for that calendar year 
196.4 	under sections 295.50 to 295.57. The credit shall equal 2.5 percent of revenues for patient 
196.5 	services used to fund expenditures for qualifying research conducted by an allowable 
196.6 	research program. The amount of the credit shall not exceed the tax liability of the hospital 
196.7 	or health care provider under sections 295.50 to 295.57. 
196.8 	(b) For purposes of this subdivision, the following requirements apply:
196.9 	(1) expenditures must be for program costs of qualifying research conducted by 
196.10 	an allowable research program;
196.11 	(2) an allowable research program must be a formal program of medical and health 
196.12 	care research conducted by an entity which is exempt under section 501(c)(3) of the 
196.13 	Internal Revenue Code of 1986 as defined in section 289A.02, subdivision 7, or is owned 
196.14 	and operated under authority of a governmental unit;
196.15 	(3) qualifying research must:
196.16 	(A) be approved in writing by the governing body of the hospital or health care 
196.17 	provider which is taking the deduction under this subdivision;
196.18 	(B) have as its purpose the development of new knowledge in basic or applied 
196.19 	science relating to the diagnosis and treatment of conditions affecting the human body;
196.20 	(C) be subject to review by individuals with expertise in the subject matter of the 
196.21 	proposed study but who have no financial interest in the proposed study and are not 
196.22 	involved in the conduct of the proposed study; and
196.23 	(D) be subject to review and supervision by an institutional review board operating 
196.24 	in conformity with federal regulations if the research involves human subjects or 
196.25 	an institutional animal care and use committee operating in conformity with federal 
196.26 	regulations if the research involves animal subjects. Research expenses are not exempt if 
196.27 	the study is a routine evaluation of health care methods or products used in a particular 
196.28 	setting conducted for the purpose of making a management decision. Costs of clinical 
196.29 	research activities paid directly for the benefit of an individual patient are excluded from 
196.30 	this exemption. Basic research in fields including biochemistry, molecular biology, and 
196.31 	physiology are also included if such programs are subject to a peer review process.
196.32 	(c) No credit shall be allowed under this subdivision for any revenue received by the 
196.33 	hospital or health care provider in the form of a grant, gift, or otherwise, whether from a 
196.34 	government or nongovernment source, on which the tax liability under section 295.52 is 
196.35 	not imposed. 
197.1 	(d) The taxpayer shall apply for the credit under this section on the annual return 
197.2 	under section 295.55, subdivision 5. 
197.3 	(e) Beginning September 1, 2001, if the actual or estimated amount paid under 
197.4 	this section for the calendar year exceeds $2,500,000, the commissioner of finance shall 
197.5 	determine the rate of the research credit for the following calendar year to the nearest 
197.6 	one-half percent so that refunds paid under this section will most closely equal $2,500,000. 
197.7 	The commissioner of finance shall publish in the State Register by October 1 of each year 
197.8 	the rate of the credit for the following calendar year. A determination under this section 
197.9 	is not subject to the rulemaking provisions of chapter 14.

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

197.11 	Sec. 18. Minnesota Statutes 2006, section 296A.16, subdivision 2, is amended to read:
197.12 		Subd. 2.Fuel used in other vehicle; claim for refund. Any person who buys and 
197.13 	uses gasoline for a qualifying purpose other than use in motor vehicles, snowmobiles 
197.14 	except as provided in clause (2), or motorboats, or special fuel for a qualifying purpose 
197.15 	other than use in licensed motor vehicles, and who paid the tax directly or indirectly 
197.16 	through the amount of the tax being included in the price of the gasoline or special fuel, or 
197.17 	otherwise, shall be reimbursed and repaid the amount of the tax paid upon filing with the 
197.18 	commissioner a claim for refund in the form and manner prescribed by the commissioner, 
197.19 	and containing the information the commissioner shall require. By signing any such claim 
197.20 	which is false or fraudulent, the applicant shall be subject to the penalties provided in this 
197.21 	chapter for knowingly making a false claim. The claim shall set forth the total amount 
197.22 	of the gasoline so purchased and used by the applicant other than in motor vehicles, or 
197.23 	special fuel purchased and used by the applicant other than in licensed motor vehicles, 
197.24 	and shall state when and for what purpose it was used. When a claim contains an error 
197.25 	in computation or preparation, the commissioner is authorized to adjust the claim in 
197.26 	accordance with the evidence shown on the claim or other information available to the 
197.27 	commissioner. The commissioner, on being satisfied that the claimant is entitled to the 
197.28 	payments, shall approve the claim and transmit it to the commissioner of finance. The 
197.29 	words "gasoline" or "special fuel" as used in this subdivision do not include aviation 
197.30 	gasoline or special fuel for aircraft. Gasoline or special fuel bought and used for a 
197.31 	"qualifying purpose" means:
197.32 	(1) Gasoline or special fuel used in carrying on a trade or business, used on a farm 
197.33 	situated in Minnesota, and used for a farming purpose. "Farm" and "farming purpose" 
197.34 	have the meanings given them in section 6420(c)(2), (3), and (4) of the Internal Revenue 
198.1 	Code of 1986, as amended through December 31, 1997 as defined in section 289A.02, 
198.2 	subdivision 7.
198.3 	(2) Gasoline or special fuel used for off-highway business use.
198.4 	(i) "Off-highway business use" means any use off the public highway by a person in 
198.5 	that person's trade, business, or activity for the production of income.
198.6 	(ii) Off-highway business use includes use of a passenger snowmobile off the public 
198.7 	highways as part of the operations of a resort as defined in section 157.15, subdivision 11; 
198.8 	and use of gasoline or special fuel to operate a power takeoff unit on a vehicle, but not 
198.9 	including fuel consumed during idling time. 
198.10 	(iii) Off-highway business use does not include use as a fuel in a motor vehicle 
198.11 	which, at the time of use, is registered or is required to be registered for highway use under 
198.12 	the laws of any state or foreign country; or use of a licensed motor vehicle fuel tank in lieu 
198.13 	of a separate storage tank for storing fuel to be used for a qualifying purpose, as defined in 
198.14 	this section. Fuel purchased to be used for a qualifying purpose cannot be placed in the 
198.15 	fuel tank of a licensed motor vehicle and must be stored in a separate supply tank.
198.16 	(3) Gasoline or special fuel placed in the fuel tanks of new motor vehicles, 
198.17 	manufactured in Minnesota, and shipped by interstate carrier to destinations in other 
198.18 	states or foreign countries.

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

198.20 	Sec. 19. Minnesota Statutes 2006, section 297A.61, subdivision 22, is amended to read:
198.21 		Subd. 22.Internal Revenue Code. Unless specifically provided otherwise, 
198.22 	"Internal Revenue Code" means the Internal Revenue Code of 1986, as amended through 
198.23 	December 31, 2000 as defined in section 289A.02, subdivision 7.

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

198.25 	Sec. 20. Minnesota Statutes 2006, section 297B.01, subdivision 7, is amended to read:
198.26 		Subd. 7.Sale, sells, selling, purchase, purchased, or acquired. (a) "Sale," "sells," 
198.27 	"selling," "purchase," "purchased," or "acquired" means any transfer of title of any motor 
198.28 	vehicle, whether absolutely or conditionally, for a consideration in money or by exchange 
198.29 	or barter for any purpose other than resale in the regular course of business.
198.30 	(b) Any motor vehicle utilized by the owner only by leasing such vehicle to others 
198.31 	or by holding it in an effort to so lease it, and which is put to no other use by the owner 
198.32 	other than resale after such lease or effort to lease, shall be considered property purchased 
198.33 	for resale.
199.1 	(c) The terms also shall include any transfer of title or ownership of a motor vehicle 
199.2 	by other means, for or without consideration, except that these terms shall not include:
199.3 	(1) the acquisition of a motor vehicle by inheritance from or by bequest of, a 
199.4 	decedent who owned it;
199.5 	(2) the transfer of a motor vehicle which was previously licensed in the names of 
199.6 	two or more joint tenants and subsequently transferred without monetary consideration to 
199.7 	one or more of the joint tenants;
199.8 	(3) the transfer of a motor vehicle by way of gift between individuals, or gift 
199.9 	from a limited used vehicle dealer licensed under section 168.27, subdivision 4a, to an 
199.10 	individual, when the transfer is with no monetary or other consideration or expectation 
199.11 	of consideration and the parties to the transfer submit an affidavit to that effect at the 
199.12 	time the title transfer is recorded; 
199.13 	(4) the voluntary or involuntary transfer of a motor vehicle between a husband and 
199.14 	wife in a divorce proceeding; or
199.15 	(5) the transfer of a motor vehicle by way of a gift to an organization that is exempt 
199.16 	from federal income taxation under section 501(c)(3) of the Internal Revenue Code, as 
199.17 	amended through December 31, 1996, when the motor vehicle will be used exclusively for 
199.18 	religious, charitable, or educational purposes.

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

199.20 	Sec. 21. Minnesota Statutes 2006, section 297B.01, is amended by adding a 
199.21 	subdivision to read:
199.22 		Subd. 10.Internal Revenue Code. Unless specifically defined otherwise, "Internal 
199.23 	Revenue Code" means the Internal Revenue Code as defined in section 289A.02, 
199.24 	subdivision 7.

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

199.26 	Sec. 22. Minnesota Statutes 2006, section 297B.03, is amended to read:
199.27 	297B.03 EXEMPTIONS.
199.28 	There is specifically exempted from the provisions of this chapter and from 
199.29 	computation of the amount of tax imposed by it the following:
199.30 	(1) purchase or use, including use under a lease purchase agreement or installment 
199.31 	sales contract made pursuant to section 465.71, of any motor vehicle by the United States 
199.32 	and its agencies and instrumentalities and by any person described in and subject to the 
199.33 	conditions provided in section 297A.67, subdivision 11; 
200.1 	(2) purchase or use of any motor vehicle by any person who was a resident of 
200.2 	another state or country at the time of the purchase and who subsequently becomes a 
200.3 	resident of Minnesota, provided the purchase occurred more than 60 days prior to the date 
200.4 	such person began residing in the state of Minnesota and the motor vehicle was registered 
200.5 	in the person's name in the other state or country;
200.6 	(3) purchase or use of any motor vehicle by any person making a valid election to be 
200.7 	taxed under the provisions of section 297A.90; 
200.8 	(4) purchase or use of any motor vehicle previously registered in the state of 
200.9 	Minnesota when such transfer constitutes a transfer within the meaning of section 118, 
200.10 	331, 332, 336, 337, 338, 351, 355, 368, 721, 731, 1031, 1033, or 1563(a) of the Internal 
200.11 	Revenue Code of 1986, as amended through December 31, 1999;
200.12 	(5) purchase or use of any vehicle owned by a resident of another state and leased 
200.13 	to a Minnesota-based private or for-hire carrier for regular use in the transportation of 
200.14 	persons or property in interstate commerce provided the vehicle is titled in the state of 
200.15 	the owner or secured party, and that state does not impose a sales tax or sales tax on 
200.16 	motor vehicles used in interstate commerce;
200.17 	(6) purchase or use of a motor vehicle by a private nonprofit or public educational 
200.18 	institution for use as an instructional aid in automotive training programs operated by the 
200.19 	institution. "Automotive training programs" includes motor vehicle body and mechanical 
200.20 	repair courses but does not include driver education programs;
200.21 	(7) purchase of a motor vehicle for use as an ambulance by an ambulance service 
200.22 	licensed under section 144E.10; 
200.23 	(8) purchase of a motor vehicle by or for a public library, as defined in section 
200.24 	134.001, subdivision 2, as a bookmobile or library delivery vehicle; 
200.25 	(9) purchase of a ready-mixed concrete truck;
200.26 	(10) purchase or use of a motor vehicle by a town for use exclusively for road 
200.27 	maintenance, including snowplows and dump trucks, but not including automobiles, 
200.28 	vans, or pickup trucks;
200.29 	(11) purchase or use of a motor vehicle by a corporation, society, association, 
200.30 	foundation, or institution organized and operated exclusively for charitable, religious, 
200.31 	or educational purposes, except a public school, university, or library, but only if the 
200.32 	vehicle is:
200.33 	(i) a truck, as defined in section 168.011, a bus, as defined in section 168.011, or a 
200.34 	passenger automobile, as defined in section 168.011, if the automobile is designed and 
200.35 	used for carrying more than nine persons including the driver; and 
201.1 	(ii) intended to be used primarily to transport tangible personal property or 
201.2 	individuals, other than employees, to whom the organization provides service in 
201.3 	performing its charitable, religious, or educational purpose;
201.4 	(12) purchase of a motor vehicle for use by a transit provider exclusively to provide 
201.5 	transit service is exempt if the transit provider is either (i) receiving financial assistance or 
201.6 	reimbursement under section 174.24 or 473.384, or (ii) operating under section 174.29, 
201.7 	473.388, or 473.405; 
201.8 	(13) purchase or use of a motor vehicle by a qualified business, as defined in section 
201.9 	469.310, located in a job opportunity building zone, if the motor vehicle is principally 
201.10 	garaged in the job opportunity building zone and is primarily used as part of or in direct 
201.11 	support of the person's operations carried on in the job opportunity building zone. The 
201.12 	exemption under this clause applies to sales, if the purchase was made and delivery 
201.13 	received during the duration of the job opportunity building zone. The exemption under 
201.14 	this clause also applies to any local sales and use tax. 

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

201.16 	Sec. 23. Minnesota Statutes 2006, section 297F.01, subdivision 8, is amended to read:
201.17 		Subd. 8.Internal Revenue Code. Unless specifically defined otherwise, "Internal 
201.18 	Revenue Code" means the Internal Revenue Code of 1986, as amended through December 
201.19 	31, 1996 as defined in section 289A.02, subdivision 7.

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

201.21 	Sec. 24. Minnesota Statutes 2006, section 297G.01, subdivision 9, is amended to read:
201.22 		Subd. 9.Internal Revenue Code. Unless specifically defined otherwise, "Internal 
201.23 	Revenue Code" means the Internal Revenue Code of 1986, as amended through December 
201.24 	31, 1996 as defined in section 289A.02, subdivision 7.

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

201.26 	Sec. 25. Minnesota Statutes 2006, section 297H.09, is amended to read:
201.27 	297H.09 BAD DEBTS.
201.28 	The remitter of the solid waste management tax may offset against the tax payable, 
201.29 	with respect to any reporting period, the amount of tax imposed by this chapter previously 
201.30 	remitted to the commissioner of revenue which qualified as a bad debt under section 
201.31 	166(a) of the Internal Revenue Code, as amended through December 31, 1993 defined 
202.1 	in section 289A.02, subdivision 7, during such reporting period, but only in proportion 
202.2 	to the portion of such debt which became uncollectable. This section applies only to 
202.3 	accrual basis remitters that remit tax before it is collected and to the extent they are 
202.4 	unable to collect the tax.

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

202.6 	ARTICLE 12
202.7 	DEPARTMENT INDIVIDUAL INCOME AND CORPORATE FRANCHISE TAXES

202.8 	Section 1. Minnesota Statutes 2006, section 289A.18, subdivision 1, as amended by 
202.9 	Laws 2008, chapter 154, article 11, section 5, is amended to read:
202.10 		Subdivision 1. Individual income, fiduciary income, corporate franchise, and 
202.11 	entertainment taxes; partnership and S corporation returns; information returns; 
202.12 	mining company returns. The returns required to be made under sections 289A.08 and 
202.13 	289A.12 must be filed at the following times: 
202.14 	(1) returns made on the basis of the calendar year must be filed on April 15 following 
202.15 	the close of the calendar year, except that returns of corporations must be filed on March 
202.16 	15 following the close of the calendar year; 
202.17 	(2) returns made on the basis of the fiscal year must be filed on the 15th day of the 
202.18 	fourth month following the close of the fiscal year, except that returns of corporations 
202.19 	must be filed on the 15th day of the third month following the close of the fiscal year; 
202.20 	(3) returns for a fractional part of a year must be filed on the 15th day of the fourth 
202.21 	month following the end of the month in which falls the last day of the period for which 
202.22 	the return is made, except that the returns of corporations must be filed on the 15th day of 
202.23 	the third month following the end of the tax year; or, in the case of a corporation which is 
202.24 	a member of a unitary group, the return of the corporation must be filed on the 15th day of 
202.25 	the third month following the end of the tax year of the unitary group in which falls the 
202.26 	last day of the period for which the return is made; 
202.27 	(4) in the case of a final return of a decedent for a fractional part of a year, the return 
202.28 	must be filed on the 15th day of the fourth month following the close of the 12-month 
202.29 	period that began with the first day of that fractional part of a year; 
202.30 	(5) in the case of the return of a cooperative association, returns must be filed on or 
202.31 	before the 15th day of the ninth month following the close of the taxable year; 
202.32 	(6) if a corporation has been divested from a unitary group and files a return for 
202.33 	a fractional part of a year in which it was a member of a unitary business that files a 
202.34 	combined report under section 290.34 290.17, subdivision 24, the divested corporation's 
203.1 	return must be filed on the 15th day of the third month following the close of the common 
203.2 	accounting period that includes the fractional year; 
203.3 	(7) returns of entertainment entities must be filed on April 15 following the close of 
203.4 	the calendar year; 
203.5 	(8) returns required to be filed under section 289A.08, subdivision 4, must be filed 
203.6 	on the 15th day of the fifth month following the close of the taxable year; 
203.7 	(9) returns of mining companies must be filed on May 1 following the close of the 
203.8 	calendar year; and 
203.9 	(10) returns required to be filed with the commissioner under section 289A.12, 
203.10 	subdivision 2 or 4 to 10, must be filed within 30 days after being demanded by the 
203.11 	commissioner. 

203.12 	EFFECTIVE DATE. This section is effective the day following final enactment 
203.13 	except that the change in clause (6) is effective for taxable years beginning after December 
203.14 	31, 2007.

203.15 	Sec. 2. Minnesota Statutes 2006, section 290.01, subdivision 6b, is amended to read:
203.16 		Subd. 6b.Foreign operating corporation. The term "foreign operating 
203.17 	corporation," when applied to a corporation, means a domestic corporation with the 
203.18 	following characteristics:
203.19 	(1) it is part of a unitary business at least one member of which is taxable in this state;
203.20 	(2) it is not a foreign sales corporation under section 922 of the Internal Revenue 
203.21 	Code, as amended through December 31, 1999, for the taxable year;
203.22 	(3)(i) the average of the percentages of its property and payrolls, including the pro 
203.23 	rata share of its unitary partnerships' property and payrolls, assigned to locations outside 
203.24 	the United States, where the United States includes the District of Columbia and excludes 
203.25 	the commonwealth of Puerto Rico and possessions of the United States, as determined 
203.26 	under section 290.191 or 290.20, is 80 percent or more; or (ii) it has in effect a valid 
203.27 	election under section 936 of the Internal Revenue Code; and
203.28 	(4) it has a minimum of $1,000,000 of payroll and $2,000,000 of property, as 
203.29 	determined under section 290.191 or 290.20, that are located outside the United States. If 
203.30 	the domestic corporation does not have payroll as determined under section 290.191 or 
203.31 	290.20, but it or its partnerships have paid $1,000,000 for work, performed directly for the 
203.32 	domestic corporation or the partnerships, outside the United States, then paragraph (3)(i) 
203.33 	shall not require payrolls to be included in the average calculation.

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

204.1 	Sec. 3. Minnesota Statutes 2006, section 290.068, subdivision 3, is amended to read:
204.2 		Subd. 3.Limitation; carryover. (a)(1) The credit for the taxable year shall not 
204.3 	exceed the liability for tax. "Liability for tax" for purposes of this section means the tax 
204.4 	imposed under this chapter section 290.06, subdivision 1, for the taxable year reduced by 
204.5 	the sum of the nonrefundable credits allowed under this chapter.
204.6 	(2) In the case of a corporation which is a partner in a partnership, the credit allowed 
204.7 	for the taxable year shall not exceed the lesser of the amount determined under clause (1) 
204.8 	for the taxable year or an amount (separately computed with respect to the corporation's 
204.9 	interest in the trade or business or entity) equal to the amount of tax attributable to that 
204.10 	portion of taxable income which is allocable or apportionable to the corporation's interest 
204.11 	in the trade or business or entity.
204.12 	(b) If the amount of the credit determined under this section for any taxable year 
204.13 	exceeds the limitation under clause (a), the excess shall be a research credit carryover to 
204.14 	each of the 15 succeeding taxable years. The entire amount of the excess unused credit for 
204.15 	the taxable year shall be carried first to the earliest of the taxable years to which the credit 
204.16 	may be carried and then to each successive year to which the credit may be carried. The 
204.17 	amount of the unused credit which may be added under this clause shall not exceed the 
204.18 	taxpayer's liability for tax less the research credit for the taxable year.

204.19 	EFFECTIVE DATE. This section is effective for taxable years beginning after 
204.20 	December 31, 2007.

204.21 	Sec. 4. Minnesota Statutes 2006, section 290.07, subdivision 1, is amended to read:
204.22 		Subdivision 1.Annual accounting period. Net income and taxable net income 
204.23 	shall be computed upon the basis of the taxpayer's annual accounting period. If a taxpayer 
204.24 	has no annual accounting period, or has one other than a fiscal year, as heretofore defined, 
204.25 	the net income and taxable net income shall be computed on the basis of the calendar year. 
204.26 	Taxpayers shall employ the same accounting period on which they report, or would be 
204.27 	required to report, their net income under the Internal Revenue Code. The commissioner 
204.28 	shall provide by rule for the determination of the accounting period for taxpayers who 
204.29 	file a combined report under section 290.34 290.17, subdivision 2 4, when members of 
204.30 	the group use different accounting periods for federal income tax purposes. Unless the 
204.31 	taxpayer changes its accounting period for federal purposes, the due date of the return 
204.32 	is not changed. 
204.33 	A taxpayer may change accounting periods only with the consent of the 
204.34 	commissioner. In case of any such change, the taxpayer shall pay a tax for the period 
205.1 	not included in either the taxpayer's former or newly adopted taxable year, computed as 
205.2 	provided in section 290.32. 

205.3 	EFFECTIVE DATE. This section is effective for taxable years beginning after 
205.4 	December 31, 2007.

205.5 	Sec. 5. Minnesota Statutes 2006, section 290.21, subdivision 4, is amended to read:
205.6 		Subd. 4.Dividends received from another corporation. (a)(1) Eighty percent 
205.7 	of dividends received by a corporation during the taxable year from another corporation, 
205.8 	in which the recipient owns 20 percent or more of the stock, by vote and value, not 
205.9 	including stock described in section 1504(a)(4) of the Internal Revenue Code when the 
205.10 	corporate stock with respect to which dividends are paid does not constitute the stock in 
205.11 	trade of the taxpayer or would not be included in the inventory of the taxpayer, or does not 
205.12 	constitute property held by the taxpayer primarily for sale to customers in the ordinary 
205.13 	course of the taxpayer's trade or business, or when the trade or business of the taxpayer 
205.14 	does not consist principally of the holding of the stocks and the collection of the income 
205.15 	and gains therefrom; and
205.16 	(2)(i) the remaining 20 percent of dividends if the dividends received are the stock in 
205.17 	an affiliated company transferred in an overall plan of reorganization and the dividend 
205.18 	is eliminated in consolidation under Treasury Department Regulation 1.1502-14(a), as 
205.19 	amended through December 31, 1989;
205.20 	(ii) the remaining 20 percent of dividends if the dividends are received from a 
205.21 	corporation which is subject to tax under section 290.36 and which is a member of an 
205.22 	affiliated group of corporations as defined by the Internal Revenue Code and the dividend 
205.23 	is eliminated in consolidation under Treasury Department Regulation 1.1502-14(a), as 
205.24 	amended through December 31, 1989, or is deducted under an election under section 
205.25 	243(b) of the Internal Revenue Code; or 
205.26 	(iii) the remaining 20 percent of the dividends if the dividends are received from a 
205.27 	property and casualty insurer as defined under section 60A.60, subdivision 8, which is a 
205.28 	member of an affiliated group of corporations as defined by the Internal Revenue Code 
205.29 	and either: (A) the dividend is eliminated in consolidation under Treasury Regulation 
205.30 	1.1502-14(a), as amended through December 31, 1989; or (B) the dividend is deducted 
205.31 	under an election under section 243(b) of the Internal Revenue Code. 
205.32 	(b) Seventy percent of dividends received by a corporation during the taxable year 
205.33 	from another corporation in which the recipient owns less than 20 percent of the stock, 
205.34 	by vote or value, not including stock described in section 1504(a)(4) of the Internal 
205.35 	Revenue Code when the corporate stock with respect to which dividends are paid does not 
206.1 	constitute the stock in trade of the taxpayer, or does not constitute property held by the 
206.2 	taxpayer primarily for sale to customers in the ordinary course of the taxpayer's trade or 
206.3 	business, or when the trade or business of the taxpayer does not consist principally of the 
206.4 	holding of the stocks and the collection of income and gain therefrom.
206.5 	(c) The dividend deduction provided in this subdivision shall be allowed only with 
206.6 	respect to dividends that are included in a corporation's Minnesota taxable net income 
206.7 	for the taxable year.
206.8 	The dividend deduction provided in this subdivision does not apply to a dividend 
206.9 	from a corporation which, for the taxable year of the corporation in which the distribution 
206.10 	is made or for the next preceding taxable year of the corporation, is a corporation exempt 
206.11 	from tax under section 501 of the Internal Revenue Code.
206.12 	The dividend deduction provided in this subdivision applies to the amount of 
206.13 	regulated investment company dividends only to the extent determined under section 
206.14 	854(b) of the Internal Revenue Code.
206.15 	The dividend deduction provided in this subdivision shall not be allowed with 
206.16 	respect to any dividend for which a deduction is not allowed under the provisions of 
206.17 	section 246(c) of the Internal Revenue Code.
206.18 	(d) If dividends received by a corporation that does not have nexus with Minnesota 
206.19 	under the provisions of Public Law 86-272 are included as income on the return of 
206.20 	an affiliated corporation permitted or required to file a combined report under section
206.21 	290.17, subdivision 4 or290.34, subdivision 2, then for purposes of this subdivision the 
206.22 	determination as to whether the trade or business of the corporation consists principally 
206.23 	of the holding of stocks and the collection of income and gains therefrom shall be made 
206.24 	with reference to the trade or business of the affiliated corporation having a nexus with 
206.25 	Minnesota. 
206.26 	(e) The deduction provided by this subdivision does not apply if the dividends are 
206.27 	paid by a FSC as defined in section 922 of the Internal Revenue Code.
206.28 	(f) If one or more of the members of the unitary group whose income is included on 
206.29 	the combined report received a dividend, the deduction under this subdivision for each 
206.30 	member of the unitary business required to file a return under this chapter is the product 
206.31 	of: (1) 100 percent of the dividends received by members of the group; (2) the percentage 
206.32 	allowed pursuant to paragraph (a) or (b); and (3) the percentage of the taxpayer's business 
206.33 	income apportionable to this state for the taxable year under section 290.191 or 290.20. 

206.34 	EFFECTIVE DATE. This section is effective for taxable years beginning after 
206.35 	December 31, 2007.

207.1 	Sec. 6. Minnesota Statutes 2006, section 290.92, subdivision 26, is amended to read:
207.2 		Subd. 26.Extension of withholding to certain payments where identifying 
207.3 	number not furnished or inaccurate. (a) If, in the case of any reportable payment, (1) 
207.4 	the payee fails to furnish the payee's Social Security account number to the payor, or
207.5 	(2) the payee is subject to federal backup withholding on the reportable payment under 
207.6 	section 3406 of the Internal Revenue Code, or (3) the commissioner notifies the payor that 
207.7 	the Social Security account number furnished by the payee is incorrect, then the payor 
207.8 	shall deduct and withhold from the payment a tax equal to the amount of the payment 
207.9 	multiplied by the highest rate used in determining the income tax liability of an individual 
207.10 	under section 290.06, subdivision 2c. 
207.11 	(b)(1) In the case of any failure described in clause (a)(1), clause (a) shall apply to 
207.12 	any reportable payment made by the payor during the period during which the Social 
207.13 	Security account number has not been furnished.
207.14 	(2) In any case where there is a notification described in clause (a)(2)(3), clause (a) 
207.15 	shall apply to any reportable payment made by the payor (i) after the close of the 30th 
207.16 	day after the day on which the payor received the notification, and (ii) before the payee 
207.17 	furnishes another Social Security account number.
207.18 	(3)(i) Unless the payor elects not to have this subparagraph apply with respect to 
207.19 	the payee, clause (a) shall also apply to any reportable payment made after the close of 
207.20 	the period described in paragraph (1) or (2) (as the case may be) and before the 30th 
207.21 	day after the close of the period.
207.22 	(ii) If the payor elects the application of this subparagraph with respect to the payee, 
207.23 	clause (a) shall also apply to any reportable payment made during the 30-day period 
207.24 	described in paragraph (2).
207.25 	(iii) The payor may elect a period shorter than the grace period set forth in 
207.26 	subparagraph (i) or (ii) as the case may be.
207.27 	(c) The provisions of section 3406 of the Internal Revenue Code shall apply and 
207.28 	shall govern when withholding shall be required and the definition of terms. The term 
207.29 	"reportable payment" shall include only those payments for personal services. No tax 
207.30 	shall be deducted or withheld under this subdivision with respect to any amount for 
207.31 	which withholding is otherwise required under this section. For purposes of this section, 
207.32 	payments which are subject to withholding under this subdivision shall be treated as if 
207.33 	they were wages paid by an employer to an employee and amounts deducted and withheld 
207.34 	under this subdivision shall be treated as if deducted and withheld under subdivision 2a.
207.35 	(d) Whenever the commissioner notifies a payor under this subdivision that the 
207.36 	Social Security account number furnished by any payee is incorrect, the commissioner 
208.1 	shall at the same time furnish a copy of the notice to the payor, and the payor shall 
208.2 	promptly furnish the copy to the payee. If the commissioner notifies a payor under this 
208.3 	subdivision that the Social Security account number furnished by any payee is incorrect 
208.4 	and the payee subsequently furnishes another Social Security account number to the 
208.5 	payor, the payor shall promptly notify the commissioner of the other Social Security 
208.6 	account number furnished.

208.7 	EFFECTIVE DATE. This section is effective for payments made after December 
208.8 	31, 2008.

208.9 	Sec. 7. Minnesota Statutes 2006, section 290.92, subdivision 31, as added by Laws 
208.10 	2008, chapter 154, article 3, section 8, is amended to read:
208.11 		Subd. 31. Payments to persons who are not employees. (a) For purposes of this 
208.12 	subdivision, "contractor" means a person carrying on a trade or business described in 
208.13 	industry code numbers 23 through 238990 of the North American Industry Classification 
208.14 	System. 
208.15 	(b) A contractor or a third-party bulk filer acting on behalf of a contractor, who 
208.16 	makes payments to an individual, carrying on a trade or business described in paragraph 
208.17 	(a) as a sole proprietorship, must deduct and withhold two percent of the payment as 
208.18 	Minnesota withholding tax when the amount the contractor paid to that individual during 
208.19 	the calendar year exceeds $600. 
208.20 	(c) A payment subject to withholding under this subdivision must be treated as if 
208.21 	the payment were a wage paid by an employer to an employee. The requirements in the 
208.22 	definitions of "employee" and "employer" in subdivision 1 relating to geographic location 
208.23 	apply in determining whether withholding tax applies under this subdivision, but without 
208.24 	regard to whether the contractor or the individual otherwise satisfy the definition of an 
208.25 	employer or an employee. Each recipient of a payment subject to withholding under this 
208.26 	subdivision must furnish the contractor with a statement of the recipient's name, address, 
208.27 	and Social Security account number. 

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

208.29 	Sec. 8.  REPEALER.
 208.30 	Minnesota Rules, part 8031.0100, subpart 3, is repealed effective the day following 
208.31 	final enactment.
208.32 	Minnesota Rules, part 8093.2100, is repealed effective the day following final 
208.33 	enactment.

209.1 	ARTICLE 13
209.2 	DEPARTMENT SALES AND USE TAXES

209.3 	Section 1. Minnesota Statutes 2006, section 289A.55, is amended by adding a 
209.4 	subdivision to read:
209.5 		Subd. 10.Relief for purchasers. A purchaser that meets the requirements of section 
209.6 	297A.995, subdivision 11, is relieved from the imposition of interest on tax and penalty.

209.7 	EFFECTIVE DATE. This section is effective for sales and purchases made after 
209.8 	December 31, 2008.

209.9 	Sec. 2. Minnesota Statutes 2006, section 289A.60, is amended by adding a subdivision 
209.10 	to read:
209.11 		Subd. 30.Relief for purchasers. A purchaser that meets the requirements of 
209.12 	section 297A.995, subdivision 11, is relieved from the imposition of penalty.

209.13 	EFFECTIVE DATE. This section is effective for sales and purchases made after 
209.14 	December 31, 2008.

209.15 	Sec. 3. Minnesota Statutes 2006, section 297A.61, subdivision 29, is amended to read:
209.16 		Subd. 29.State. Unless specifically provided otherwise, "state" means any state of 
209.17 	the United States, the Commonwealth of Puerto Rico, and the District of Columbia.

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

209.19 	Sec. 4. Minnesota Statutes 2006, section 297A.665, as amended by Laws 2008, chapter 
209.20 	154, article 12, section 20, is amended to read:
209.21 	297A.665 PRESUMPTION OF TAX; BURDEN OF PROOF. 
209.22 	(a) For the purpose of the proper administration of this chapter and to prevent 
209.23 	evasion of the tax, until the contrary is established, it is presumed that: 
209.24 	(1) all gross receipts are subject to the tax; and 
209.25 	(2) all retail sales for delivery in Minnesota are for storage, use, or other consumption 
209.26 	in Minnesota. 
209.27 	(b) The burden of proving that a sale is not a taxable retail sale is on the seller. 
209.28 	However, a seller is relieved of liability if: 
209.29 	(1) the seller obtains a fully completed exemption certificate or all the relevant 
209.30 	information required by section 297A.72, subdivision 2, at the time of the sale or within 
209.31 	90 days after the date of the sale; or 
210.1 	(2) if the seller has not obtained a fully completed exemption certificate or all the 
210.2 	relevant information required by section 297A.72, subdivision 2, within the time provided 
210.3 	in clause (1), within 120 days after a request for substantiation by the commissioner, 
210.4 	the seller either: 
210.5 	(i) obtains in good faith a fully completed exemption certificate or all the relevant 
210.6 	information required by section 297A.72, subdivision 2, from the purchaser; or 
210.7 	(ii) proves by other means that the transaction was not subject to tax. 
210.8 	(c) Notwithstanding paragraph (b), relief from liability does not apply to a seller who: 
210.9 	(1) fraudulently fails to collect the tax; or 
210.10 	(2) solicits purchasers to participate in the unlawful claim of an exemption. 
210.11 	(d) A certified service provider, as defined in section 297A.995, subdivision 2, is 
210.12 	relieved of liability under this section to the extent a seller who is its client is relieved of 
210.13 	liability.
210.14 	(d)(e) A purchaser of tangible personal property or any items listed in section 
210.15 	297A.63 that are shipped or brought to Minnesota by the purchaser has the burden 
210.16 	of proving that the property was not purchased from a retailer for storage, use, or 
210.17 	consumption in Minnesota. 

210.18 	EFFECTIVE DATE. This section is effective retroactively for sales and purchases 
210.19 	made after December 31, 2007.

210.20 	Sec. 5. Minnesota Statutes 2006, section 297A.67, subdivision 7, as amended by Laws 
210.21 	2008, chapter 154, article 12, section 26, is amended to read:
210.22 		Subd. 7. Drugs; medical devices. (a) Sales of the following drugs and medical 
210.23 	devices for human use are exempt: 
210.24 	(1) drugs for human use, including over-the-counter drugs; 
210.25 	(2) single-use finger-pricking devices for the extraction of blood and other single-use 
210.26 	devices and single-use diagnostic agents used in diagnosing, monitoring, or treating 
210.27 	diabetes; 
210.28 	(3) insulin and medical oxygen for human use, regardless of whether prescribed 
210.29 	or sold over the counter; 
210.30 	(4) prosthetic devices; 
210.31 	(5) durable medical equipment for home use only; 
210.32 	(6) mobility enhancing equipment; 
210.33 	(7) prescription corrective eyeglasses; and 
210.34 	(8) kidney dialysis equipment, including repair and replacement parts. 
210.35 	(b) For purposes of this subdivision: 
211.1 	(1) "Drug" means a compound, substance, or preparation, and any component of 
211.2 	a compound, substance, or preparation, other than food and food ingredients, dietary 
211.3 	supplements, or alcoholic beverages that is: 
211.4 	(i) recognized in the official United States Pharmacopoeia, official Homeopathic 
211.5 	Pharmacopoeia of the United States, or official National Formulary, and supplement 
211.6 	to any of them; 
211.7 	(ii) intended for use in the diagnosis, cure, mitigation, treatment, or prevention 
211.8 	of disease; or 
211.9 	(iii) intended to affect the structure or any function of the body. 
211.10 	(2) "Durable medical equipment" means equipment, including repair and 
211.11 	replacement parts, but not including mobility enhancing equipment, that: 
211.12 	(i) can withstand repeated use; 
211.13 	(ii) is primarily and customarily used to serve a medical purpose; 
211.14 	(iii) generally is not useful to a person in the absence of illness or injury; and 
211.15 	(iv) is not worn in or on the body. 
211.16 	For purposes of this clause, "repair and replacement parts" includes all components 
211.17 	or attachments used in conjunction with the durable medical equipment, but does not 
211.18 	include repair and replacement parts which are for single patient use only.
211.19 	(3) "Mobility enhancing equipment" means equipment, including repair and 
211.20 	replacement parts, but not including durable medical equipment, that: 
211.21 	(i) is primarily and customarily used to provide or increase the ability to move from 
211.22 	one place to another and that is appropriate for use either in a home or a motor vehicle; 
211.23 	(ii) is not generally used by persons with normal mobility; and 
211.24 	(iii) does not include any motor vehicle or equipment on a motor vehicle normally 
211.25 	provided by a motor vehicle manufacturer. 
211.26 	(4) "Over-the-counter drug" means a drug that contains a label that identifies the 
211.27 	product as a drug as required by Code of Federal Regulations, title 21, section 201.66. The 
211.28 	label must include a "drug facts" panel or a statement of the active ingredients with a list of 
211.29 	those ingredients contained in the compound, substance, or preparation. Over-the-counter 
211.30 	drugs do not include grooming and hygiene products, regardless of whether they otherwise 
211.31 	meet the definition. "Grooming and hygiene products" are soaps, cleaning solutions, 
211.32 	shampoo, toothpaste, mouthwash, antiperspirants, and suntan lotions and sunscreens. 
211.33 	(5) "Prescribed" and "prescription" means a direction in the form of an order, 
211.34 	formula, or recipe issued in any form of oral, written, electronic, or other means of 
211.35 	transmission by a duly licensed health care professional. 
212.1 	(6) "Prosthetic device" means a replacement, corrective, or supportive device, 
212.2 	including repair and replacement parts, worn on or in the body to: 
212.3 	(i) artificially replace a missing portion of the body; 
212.4 	(ii) prevent or correct physical deformity or malfunction; or 
212.5 	(iii) support a weak or deformed portion of the body. 
212.6 	Prosthetic device does not include corrective eyeglasses. 
212.7 	(7) "Kidney dialysis equipment" means equipment that: 
212.8 	(i) is used to remove waste products that build up in the blood when the kidneys are 
212.9 	not able to do so on their own; and 
212.10 	(ii) can withstand repeated use, including multiple use by a single patient, 
212.11 	notwithstanding the provisions of clause (2). 

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

212.13 	Sec. 6. Minnesota Statutes 2006, section 297A.995, subdivision 10, is amended to read:
212.14 		Subd. 10.Relief from certain liability. (a) Notwithstanding subdivision 9, sellers 
212.15 	and certified service providers are relieved from liability to the state for having charged 
212.16 	and collected the incorrect amount of sales or use tax resulting from the seller or certified 
212.17 	service provider (1) relying on erroneous data provided by this statethe commissioner 
212.18 	in the database files on tax rates, boundaries, or taxing jurisdiction assignments, or (2) 
212.19 	relying on erroneous data provided by the state in its taxability matrix concerning the 
212.20 	taxability of products and services.
212.21 	(b) Notwithstanding subdivision 9, sellers and certified service providers are 
212.22 	relieved from liability to the state for having charged and collected the incorrect amount 
212.23 	of sales or use tax resulting from the seller or certified service provider relying on the 
212.24 	certification by the commissioner as to the accuracy of a certified automated system as to 
212.25 	the taxability of product categories. The relief from liability provided by this paragraph 
212.26 	does not apply when the sellers or certified service providers have incorrectly classified 
212.27 	an item or transaction into a product category, unless the item or transaction within a 
212.28 	product category was approved by the commissioner or approved jointly by the states that 
212.29 	are signatories to the agreement. The sellers and certified service providers must revise a 
212.30 	classification within ten days after receipt of notice from the commissioner that an item or 
212.31 	transaction within a product category is incorrectly classified as to its taxability, or they 
212.32 	are not relieved from liability for the incorrect classification following the notification.

212.33 	EFFECTIVE DATE. This section is effective retroactively for sales and purchases 
212.34 	made after December 31, 2007.

213.1 	Sec. 7. Minnesota Statutes 2006, section 297A.995, is amended by adding a 
213.2 	subdivision to read:
213.3 		Subd. 11.Purchaser relief from certain liability. (a) Notwithstanding other 
213.4 	provisions in the law, a purchaser is relieved from liability resulting from having paid 
213.5 	the incorrect amount of sales or use tax if a purchaser, whether or not holding a direct 
213.6 	pay permit, or a purchaser's seller or certified service provider relied on erroneous data 
213.7 	provided by this state in the database files on tax rates, boundaries, taxing jurisdiction 
213.8 	assignments, or in the taxability matrix. After providing an address-based database for 
213.9 	assigning taxing jurisdictions and their associated rates, no relief for errors resulting from 
213.10 	the purchaser's reliance on a database using zip codes is allowed.
213.11 	(b) With respect to reliance on the taxability matrix provided by this state in 
213.12 	paragraph (a), relief is limited to erroneous classifications in the taxability matrix for 
213.13 	items included within the classifications as "taxable," "exempt," "included in sales 
213.14 	price," "excluded from sales price," "included in the definition," and "excluded from 
213.15 	the definition."

213.16 	EFFECTIVE DATE. This section is effective for sales and purchases made after 
213.17 	December 31, 2008.

213.18 	Sec. 8. Minnesota Statutes 2006, section 297A.995, is amended by adding a 
213.19 	subdivision to read:
213.20 		Subd. 12.Database files. For purposes of this section, "database files on tax rates, 
213.21 	boundaries, and taxing jurisdiction assignments" and the "taxability matrix" means those 
213.22 	databases and the taxability matrix required under the agreement.

213.23 	EFFECTIVE DATE. This section is effective retroactively for sales and purchases 
213.24 	made after December 31, 2007.

213.25 	ARTICLE 14
213.26 	DEPARTMENT SPECIAL TAXES AND FEES

213.27 	Section 1. Minnesota Statutes 2007 Supplement, section 115A.1314, subdivision 2, 
213.28 	is amended to read:
213.29 		Subd. 2.Creation of account; appropriations. (a) The electronic waste account 
213.30 	is established in the environmental fund. The commissioner of revenue must deposit 
213.31 	receipts from the fee established in subdivision 1 in the account. Any interest earned on 
213.32 	the account must be credited to the account. Money from other sources may be credited to 
213.33 	the account. Beginning in the second program year and continuing each program year 
214.1 	thereafter, as of the last day of each program year, the commissioner of revenue shall 
214.2 	determine the total amount of the variable fees that were collected. By July 15, 2009, and 
214.3 	each July 15 thereafter, the commissioner of the Pollution Control Agency shall inform 
214.4 	the commissioner of revenue of the amount necessary to operate the program in the new 
214.5 	program year. To the extent that the total fees collected by the commissioner of revenue in 
214.6 	connection with this section exceeds exceed the amount the commissioner of the Pollution 
214.7 	Control Agency determines necessary to operate the program for the new program 
214.8 	year, the commissioner of revenue shall refund on a pro rata basis, to all manufacturers 
214.9 	who paid any fees for the previous program year, the amount of fees collected by the 
214.10 	commissioner of revenue in excess of the amount necessary to operate the program for the 
214.11 	new program year. No individual refund is required of amounts of $100 or less for a fiscal 
214.12 	year. Manufacturers who report collections less than 50 percent of their obligation for the 
214.13 	previous program year are not eligible for a refund. Amounts not refunded pursuant to this 
214.14 	paragraph shall remain in the account. The commissioner of revenue shall issue refunds 
214.15 	by August 10. In lieu of issuing a refund, the commissioner of revenue may grant credit 
214.16 	against a manufacturer's variable fee due by September 1.
214.17 	(b) Until June 30, 2009, money in the account is annually appropriated to the 
214.18 	Pollution Control Agency:
214.19 	(1) for the purpose of implementing sections 115A.1312 to 115A.1330, including 
214.20 	transfer to the commissioner of revenue to carry out the department's duties under 
214.21 	section 115A.1320, subdivision 2, and transfer to the commissioner of administration for 
214.22 	responsibilities under section 115A.1324; and 
214.23 	(2) to the commissioner of the Pollution Control Agency to be distributed on a 
214.24 	competitive basis through contracts with counties outside the 11-county metropolitan 
214.25 	area, as defined in paragraph (c), and with private entities that collect for recycling 
214.26 	covered electronic devices in counties outside the 11-county metropolitan area, where the 
214.27 	collection and recycling is consistent with the respective county's solid waste plan, for 
214.28 	the purpose of carrying out the activities under sections 115A.1312 to 115A.1330. In 
214.29 	awarding competitive grants under this clause, the commissioner must give preference to 
214.30 	counties and private entities that are working cooperatively with manufacturers to help 
214.31 	them meet their recycling obligations under section 115A.1318, subdivision 1.
214.32 	(c) The 11-county metropolitan area consists of the counties of Anoka, Carver, 
214.33 	Chisago, Dakota, Hennepin, Isanti, Ramsey, Scott, Sherburne, Washington, and Wright.

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

215.1 	Sec. 2. Minnesota Statutes 2006, section 270C.56, subdivision 1, as amended by Laws 
215.2 	2008, chapter 154, article 15, section 7, is amended to read:
215.3 		Subdivision 1. Liability imposed. A person who, either singly or jointly with 
215.4 	others, has the control of, supervision of, or responsibility for filing returns or reports, 
215.5 	paying taxes, or collecting or withholding and remitting taxes and who fails to do so, or a 
215.6 	person who is liable under any other law, is liable for the payment of taxes, penalties, and 
215.7 	interest arising under chapters 295, 296A, 297A, 297F, and 297G, or sections 256.9658, 
215.8 	290.92, and 297E.02, and, for the taxes listed in this subdivision, the applicable penalties 
215.9 	for nonpayment under section 289A.60. 

215.10 	EFFECTIVE DATE. This section is effective for fees due after June 30, 2008.

215.11 	Sec. 3. Minnesota Statutes 2006, section 295.50, subdivision 4, is amended to read:
215.12 		Subd. 4.Health care provider. (a) "Health care provider" means:
215.13 	(1) a person whose health care occupation is regulated or required to be regulated by 
215.14 	the state of Minnesota furnishing any or all of the following goods or services directly to a 
215.15 	patient or consumer: medical, surgical, optical, visual, dental, hearing, nursing services, 
215.16 	drugs, laboratory, diagnostic or therapeutic services;
215.17 	(2) a person who provides goods and services not listed in clause (1) that qualify for 
215.18 	reimbursement under the medical assistance program provided under chapter 256B;
215.19 	(3) a staff model health plan company;
215.20 	(4) an ambulance service required to be licensed; or
215.21 	(5) a person who sells or repairs hearing aids and related equipment or prescription 
215.22 	eyewear.
215.23 	(b) Health care provider does not include:
215.24 	(1) hospitals; medical supplies distributors, except as specified under paragraph 
215.25 	(a), clause (5); nursing homes licensed under chapter 144A or licensed in any other 
215.26 	jurisdiction; wholesale drug distributors; pharmacies; surgical centers; bus and taxicab 
215.27 	transportation, or any other providers of transportation services other than ambulance 
215.28 	services required to be licensed; supervised living facilities for persons with developmental 
215.29 	disabilities, licensed under Minnesota Rules, parts 4665.0100 to 4665.9900; housing 
215.30 	with services establishments required to be registered under chapter 144D; board 
215.31 	and lodging establishments providing only custodial services that are licensed under 
215.32 	chapter 157 and registered under section 157.17 to provide supportive services or health 
215.33 	supervision services; adult foster homes as defined in Minnesota Rules, part 9555.5105; 
215.34 	day training and habilitation services for adults with developmental disabilities as defined 
216.1 	in section 252.41, subdivision 3; boarding care homes, as defined in Minnesota Rules, part 
216.2 	4655.0100; and adult day care centers as defined in Minnesota Rules, part 9555.9600; 
216.3 	(2) home health agencies as defined in Minnesota Rules, part 9505.0175, subpart 
216.4 	15; a person providing personal care services and supervision of personal care services 
216.5 	as defined in Minnesota Rules, part 9505.0335; a person providing private duty nursing 
216.6 	services as defined in Minnesota Rules, part 9505.0360; and home care providers required 
216.7 	to be licensed under chapter 144A;
216.8 	(3) a person who employs health care providers solely for the purpose of providing 
216.9 	patient services to its employees; and
216.10 	(4) an educational institution that employs health care providers solely for the 
216.11 	purpose of providing patient services to its students if the institution does not receive fee 
216.12 	for service payments or payments for extended coverage; and
216.13 	(5) a person who receives all payments for patient services from health care 
216.14 	providers, surgical centers, or hospitals for goods and services that are taxable to the 
216.15 	paying health care providers, surgical centers, or hospitals, as provided under section 
216.16 	295.53, subdivision 1, clause (3) or (4), or from a source of funds that is exempt from tax 
216.17 	under this chapter.

216.18 	EFFECTIVE DATE. Paragraph (b), clause (1), is effective the day following 
216.19 	final enactment. Paragraph (b), clause (5), is effective for payments received after June 
216.20 	30, 2008.

216.21 	Sec. 4. Minnesota Statutes 2006, section 295.52, subdivision 4, as amended by Laws 
216.22 	2008, chapter 154, article 14, section 5, is amended to read:
216.23 		Subd. 4. Use tax; prescriptionlegend  drugs. (a) A person that receives 
216.24 	prescriptionlegend  drugs for resale or use in Minnesota, other than from a wholesale drug 
216.25 	distributor that is subject to tax under subdivision 3, is subject to a tax equal to the price 
216.26 	paid to the wholesale drug distributorfor the legend drugs multiplied by the tax percentage 
216.27 	specified in this section. Liability for the tax is incurred when prescriptionlegend  drugs 
216.28 	are received or delivered in Minnesota by the person. 
216.29 	(b) A tax imposed under this subdivision does not apply to purchases by an 
216.30 	individual for personal consumption. 

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

216.32 	Sec. 5. Minnesota Statutes 2006, section 296A.07, subdivision 4, is amended to read:
217.1 		Subd. 4.Exemptions. The provisions of subdivision 1 do not apply to gasoline or 
217.2 	denatured ethanol purchased by:
217.3 	(1) a transit system or transit provider receiving financial assistance or 
217.4 	reimbursement under section 174.24, 256B.0625, subdivision 17, or 473.384; or
217.5 	(2) an ambulance service licensed under chapter 144E; or
217.6 	(3) a licensed distributor to be delivered to a terminal for use in blending.

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

217.8 	Sec. 6. Minnesota Statutes 2006, section 296A.08, subdivision 3, is amended to read:
217.9 		Subd. 3.Exemptions. The provisions of subdivisions 1 and 2 do not apply to 
217.10 	special fuel or alternative fuels purchased by:
217.11 	(1) a transit system or transit provider receiving financial assistance or 
217.12 	reimbursement under section 174.24, 256B.0625, subdivision 17, or 473.384; or
217.13 	(2) an ambulance service licensed under chapter 144E; or
217.14 	(3) a licensed distributor to be delivered to a terminal for use in blending.

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

217.16 	Sec. 7. Minnesota Statutes 2006, section 297F.21, subdivision 1, is amended to read:
217.17 		Subdivision 1.Contraband defined. The following are declared to be contraband 
217.18 	and therefore subject to civil and criminal penalties under this chapter:
217.19 	(a) Cigarette packages which do not have stamps affixed to them as provided in this 
217.20 	chapter, including but not limited to (i) packages with illegible stamps and packages with 
217.21 	stamps that are not complete or whole even if the stamps are legible, and (ii) all devices 
217.22 	for the vending of cigarettes in which packages as defined in item (i) are found, including 
217.23 	all contents contained within the devices.
217.24 	(b) A device for the vending of cigarettes and all packages of cigarettes, where the 
217.25 	device does not afford at least partial visibility of contents. Where any package exposed 
217.26 	to view does not carry the stamp required by this chapter, it shall be presumed that all 
217.27 	packages contained in the device are unstamped and contraband.
217.28 	(c) A device for the vending of cigarettes to which the commissioner or authorized 
217.29 	agents have been denied access for the inspection of contents. In lieu of seizure, the 
217.30 	commissioner or an agent may seal the device to prevent its use until inspection of 
217.31 	contents is permitted.
217.32 	(d) A device for the vending of cigarettes which does not carry the name and address 
217.33 	of the owner, plainly marked and visible from the front of the machine.
218.1 	(e) A device including, but not limited to, motor vehicles, trailers, snowmobiles, 
218.2 	airplanes, and boats used with the knowledge of the owner or of a person operating with 
218.3 	the consent of the owner for the storage or transportation of more than 5,000 cigarettes 
218.4 	which are contraband under this subdivision. When cigarettes are being transported in 
218.5 	the course of interstate commerce, or are in movement from either a public warehouse to 
218.6 	a distributor upon orders from a manufacturer or distributor, or from one distributor to 
218.7 	another, the cigarettes are not contraband, notwithstanding the provisions of clause (a).
218.8 	(f) A device including, but not limited to, motor vehicles, trailers, snowmobiles, 
218.9 	airplanes, and boats used with the knowledge of the owner, or of a person operating with 
218.10 	the consent of the owner, for the storage or transportation of untaxed tobacco products 
218.11 	intended for sale in Minnesota other than those in the possession of a licensed distributor 
218.12 	on or before the due date for payment of the tax under section 297F.09, subdivision 2. 
218.13 	(g) Cigarette packages or tobacco products obtained from an unlicensed seller.
218.14 	(h) Cigarette packages offered for sale or held as inventory in violation of section 
218.15 	297F.20, subdivision 7. 
218.16 	(i) Tobacco products on which the tax has not been paid by a licensed distributor.
218.17 	(j) Any cigarette packages or tobacco products offered for sale or held as inventory 
218.18 	for which there is not an invoice from a licensed seller as required under section 297F.13, 
218.19 	subdivision 4. 
218.20 	(k) Cigarette packages which have been imported into the United States in violation 
218.21 	of United States Code, title 26, section 5754. All cigarettes held in violation of that section 
218.22 	shall be presumed to have entered the United States after December 31, 1999, in the 
218.23 	absence of proof to the contrary.
218.24 	(l) Cigarettes subject to forfeiture under section 299F.854, subdivision 5, and 
218.25 	cigarette packaging and markings, including the cigarettes contained therein, which do not 
218.26 	meet the requirements under section 299F.853, paragraph (a).

218.27 	EFFECTIVE DATE. Property added in paragraph (l) of this section is contraband 
218.28 	effective December 1, 2008.

218.29 	Sec. 8. Minnesota Statutes 2006, section 297I.05, subdivision 12, is amended to read:
218.30 		Subd. 12.Other entities. (a) A tax is imposed equal to two percent of:
218.31 	(1) gross premiums less return premiums written for risks resident or located in 
218.32 	Minnesota by a risk retention group;
218.33 	(2) gross premiums less return premiums received by an attorney in fact acting 
218.34 	in accordance with chapter 71A;
219.1 	(3) gross premiums less return premiums received pursuant to assigned risk policies 
219.2 	and contracts of coverage under chapter 79;
219.3 	(4) the direct funded premium received by the reinsurance association under section 
219.4 	79.34 from self-insurers approved under section 176.181 and political subdivisions that 
219.5 	self-insure; and
219.6 	(5) gross premiums less return premiums received by a nonprofit health service plan 
219.7 	corporation authorized under chapter 62C; and
219.8 	(6) gross premiums less return premiums paid to an insurer other than a licensed 
219.9 	insurance company or a surplus lines licensee for coverage of risks resident or located in 
219.10 	Minnesota by a purchasing group or any members of the purchasing group to a broker or 
219.11 	agent for the purchasing group.
219.12 	(b) A tax is imposed on a joint self-insurance plan operating under chapter 60F. The 
219.13 	rate of tax is equal to two percent of the total amount of claims paid during the fund year, 
219.14 	with no deduction for claims wholly or partially reimbursed through stop-loss insurance.
219.15 	(c) A tax is imposed on a joint self-insurance plan operating under chapter 62H. 
219.16 	The rate of tax is equal to two percent of the total amount of claims paid during the 
219.17 	fund's fiscal year, with no deduction for claims wholly or partially reimbursed through 
219.18 	stop-loss insurance.
219.19 	(d) A tax is imposed equal to the tax imposed under section 297I.05, subdivision 5, 
219.20 	on the gross premiums less return premiums on all coverages received by an accountable 
219.21 	provider network or agents of an accountable provider network in Minnesota, in cash or 
219.22 	otherwise, during the year. 

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

219.24 	ARTICLE 15
219.25 	DEPARTMENT PROPERTY TAXES AND AIDS

219.26 	Section 1. Minnesota Statutes 2006, section 13.51, subdivision 3, is amended to read:
219.27 		Subd. 3.Data on income of individuals. Income information on individuals 
219.28 	collected and maintained by political subdivisions to determine eligibility of property for 
219.29 	class 4d under section 273.126 sections 273.128 and 273.13, is private data on individuals 
219.30 	as defined in section 13.02, subdivision 12. 

219.31 	EFFECTIVE DATE. This section is effective for data collected or maintained by 
219.32 	political subdivisions beginning the day following final enactment.

219.33 	Sec. 2. Minnesota Statutes 2006, section 13.585, subdivision 5, is amended to read:
220.1 		Subd. 5.Private data on individuals. Income information on individuals collected 
220.2 	and maintained by a housing agency to determine eligibility of property for class 4d 
220.3 	under sections 273.126 273.128 and 273.13, is private data on individuals as defined in 
220.4 	section 13.02, subdivision 12. The data may be disclosed to the county and local assessors 
220.5 	responsible for determining eligibility of the property for classification 4d. 

220.6 	EFFECTIVE DATE. This section is effective for data collected or maintained by a 
220.7 	housing agency beginning the day following final enactment.

220.8 	Sec. 3. Minnesota Statutes 2006, section 272.02, subdivision 38, is amended to read:
220.9 		Subd. 38.Conversion to exempt or taxable uses. (a) Any property, except 
220.10 	property taxed as personal property under section 273.125, that is exempt from taxation on 
220.11 	January 2 of any year which, due to sale or other reason, loses its exemption prior to July 1 
220.12 	of any year, shall be placed on the current assessment rolls for that year.
220.13 	The valuation shall be determined with respect to its value on January 2 of such 
220.14 	year. The classification shall be based upon the use to which the property was put by the 
220.15 	purchaser, or in the event the purchaser has not utilized the property by July 1, the intended 
220.16 	use of the property, determined by the county assessor, based upon all relevant facts.
220.17 	(b) Property, except property taxed as personal property under section 273.125, that 
220.18 	is subject to tax on January 2 that is acquired before July 1 of the year is exempt for that 
220.19 	assessment year if the property is to be used for an exempt purpose under subdivisions 2 
220.20 	to 8.
220.21 	(c) Property which forfeits to the state for nonpayment of real estate taxes on or 
220.22 	before December 31 in an assessment year, shall be removed from the assessment rolls for 
220.23 	that assessment year. Forfeited property that is repurchased, or sold at a public or private 
220.24 	sale, on or before December 31 of an assessment year shall be placed on the assessment 
220.25 	rolls for that year's assessment.

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

220.27 	Sec. 4. Minnesota Statutes 2007 Supplement, section 273.1231, subdivision 7, is 
220.28 	amended to read:
220.29 		Subd. 7. Reassessed market value.  "Reassessed market value" means the taxable 
220.30 	market value of the property established for the January 2 assessment in the year that the 
220.31 	disaster or destruction occurs, as adjusted by the county assessor or the commissioner of 
220.32 	revenue to reflect the loss in market value caused by the damage. As soon as practical, the 
220.33 	assessor or commissioner shall report the reassessed value to the county auditor.

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

221.2 	Sec. 5. Minnesota Statutes 2007 Supplement, section 273.1231, is amended by adding 
221.3 	a subdivision to read:
221.4 		Subd. 8.Utility property. "Utility property" means property appraised and 
221.5 	classified for tax purposes by the commissioner of revenue under sections 273.33 to 
221.6 	273.3711.

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

221.8 	Sec. 6. Minnesota Statutes 2007 Supplement, section 273.1232, subdivision 1, is 
221.9 	amended to read:
221.10 		Subdivision 1. Reassessments required.  For the purposes of sections 273.1231 
221.11 	to 273.1235, the county assessor must reassess all damaged property in a disaster or 
221.12 	emergency area, and the county assessor orexcept that the commissioner of revenue 
221.13 	as appropriate shall reassess all property for which an application is submitted to the 
221.14 	commissioner under section 273.1233 or 273.1235. As soon as practical, the assessor or 
221.15 	commissioner of revenue must report the reassessed value to the county auditor. 

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

221.17 	Sec. 7. Minnesota Statutes 2007 Supplement, section 273.1233, subdivision 1, is 
221.18 	amended to read:
221.19 		Subdivision 1. Abatement authorization.  (a) Notwithstanding section 375.192, 
221.20 	a county board may grant an abatement of net tax for homestead and nonhomestead 
221.21 	property under the provisions of this paragraph for taxes payable in the year in which 
221.22 	the destruction occurs if: 
221.23 	(1) the owner submits a written application to the county assessor as soon as 
221.24 	practical after the damage has occurred; 
221.25 	(2) the owner submits a written application to the county board as soon as practical 
221.26 	after the damage has occurred; and 
221.27 	(3) the county assessor determines that 50 percent or more of a homestead dwelling 
221.28 	or other building has been (i) unintentionally or accidentally destroyed, or (ii) destroyed 
221.29 	by arson or vandalism by someone other than the owner. 
221.30 	Abatements granted under this paragraph are not subject to approval by the 
221.31 	commissioner of revenue. 
222.1 	(b) Notwithstanding sections 270C.86 and 375.192, the commissioner of revenue 
222.2 	may grant an abatement of net tax for utility property that the commissioner is required by 
222.3 	law to appraise for taxes payable in the year in which the destruction occurs if: 
222.4 	(1) the owner submits a written application to the commissioner as soon as practical 
222.5 	after the damage has occurred; 
222.6 	(2) the owner forwards a copy of the written application to the county board as soon 
222.7 	as practical after the damage has occurred; and 
222.8 	(3) the commissioner determines that 50 percent or more of the property has been 
222.9 	(i) unintentionally or accidentally destroyed, or (ii) destroyed by arson or vandalism by 
222.10 	someone other than the owner. 
222.11 	Abatements granted under this paragraph are not subject to approval by the county 
222.12 	board of the county where the property is located. 

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

222.14 	Sec. 8. Minnesota Statutes 2007 Supplement, section 273.1233, subdivision 3, is 
222.15 	amended to read:
222.16 		Subd. 3. Reimbursement, levy, and appropriation.  (a) If the destruction occurs as 
222.17 	a result of a disaster or emergency and the property is located in a disaster or emergency 
222.18 	area, the county auditor shall certify the abatements granted under this section to the 
222.19 	commissioner of revenue for reimbursement to each taxing jurisdiction in which the 
222.20 	damaged property is located. The commissioner shall make the payments to the taxing 
222.21 	jurisdictions containing the property, other than school districts and the state, at the time 
222.22 	distributions are made under section 473H.10, subdivision 3. Reimbursements to school 
222.23 	districts shall be made as provided in section 273.1392. No reimbursement is to be paid 
222.24 	to the state treasury. 
222.25 	(b) Local taxing authorities may levy in the following year the amount of 
222.26 	unreimbursed tax dollars lost as a result of the reductions granted pursuant to this 
222.27 	subdivisionsection and sections 273.1234 and 273.1235 outside of any statutory 
222.28 	restriction as to levy amount or tax rate. 
222.29 	(c) There is annually appropriated from the general fund to the commissioner of 
222.30 	revenue an amount necessary to make the payments required by this section. 

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

223.1 	Sec. 9. Minnesota Statutes 2007 Supplement, section 273.1234, is amended to read:
223.2 	273.1234 TAX RELIEF FOR DESTROYED PROPERTY; HOMESTEAD 
223.3 	AND DISASTER CREDITS. 
223.4 		Subdivision 1. Credit provided.  The county auditor shall compute a credit for taxes 
223.5 	payable in the year following the year in which the damage or destruction occurred for 
223.6 	each reassessed homestead property within the county that is located within a disaster 
223.7 	or emergency area. The credit is equal to the difference in the net tax on the property 
223.8 	computed using the market value of the property established for the January 2 assessment 
223.9 	in the year in which the damage occurred and as computed using the reassessed value. 
223.10 		Subd. 2. Credit reimbursements.  The county auditor shall certify the credits 
223.11 	granted under this section to the commissioner of revenue for reimbursement to each 
223.12 	taxing jurisdiction in which the damaged property is located. The commissioner shall 
223.13 	make the payments to the taxing jurisdictions containing the property, other than 
223.14 	school districts and the state, at the time distributions are made under section 473H.10, 
223.15 	subdivision 3. Reimbursements to school districts shall be made as provided in section 
223.16 	273.1392. No reimbursement is to be paid to the state treasury.
223.17 		Subd. 3. Appropriation.  There is annually appropriated from the general fund 
223.18 	to the commissioner of revenue an amount necessary to make the payments required 
223.19 	by this section. 

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

223.21 	Sec. 10. Minnesota Statutes 2007 Supplement, section 273.1235, subdivision 1, 
223.22 	is amended to read:
223.23 		Subdivision 1. Credit provided.  The county board may grant a credit for taxes 
223.24 	payable in the year following the year in which the damage or destruction occurred 
223.25 	for: (1) homestead properties property that meets all the requirements under section 
223.26 	273.1233, subdivision 1, paragraph (a), but that do does not qualify for a credit under 
223.27 	section 273.1234, except that an application need only be submitted by the end of the 
223.28 	year in which the damage occurred; and (2) nonhomestead and utility property meeting 
223.29 	the requirements that meets all the requirements under section 273.1233, subdivision 1, 
223.30 	paragraph (b), except that an application need only be submitted by the end of the year 
223.31 	in which the damage occurred. 

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

224.1 	Sec. 11. Minnesota Statutes 2007 Supplement, section 273.1235, subdivision 3, 
224.2 	is amended to read:
224.3 		Subd. 3. Credit reimbursements.  The county auditor shall certify the credits 
224.4 	granted under this section for property within a disaster or emergency area to the 
224.5 	commissioner of revenue for reimbursement to each taxing jurisdiction in which the 
224.6 	damaged property is located. The commissioner shall make the payments to the taxing 
224.7 	jurisdictions containing the property, other than school districts and the state, at the time 
224.8 	distributions are made under section 473H.10, subdivision 3. Reimbursements to school 
224.9 	districts shall be made as provided in section 273.1392. No reimbursement is to be paid 
224.10 	to the state treasury. No reimbursement is to be made for credits to property not located 
224.11 	in a disaster or emergency area. 

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

224.13 	Sec. 12. Minnesota Statutes 2006, section 273.124, subdivision 13, as amended by 
224.14 	Laws 2008, chapter 154, article 13, section 29, is amended to read:
224.15 		Subd. 13. Homestead application. (a) A person who meets the homestead 
224.16 	requirements under subdivision 1 must file a homestead application with the county 
224.17 	assessor to initially obtain homestead classification. 
224.18 	(b) The format and contents of a uniform homestead application shall be prescribed 
224.19 	by the commissioner of revenue. The application must clearly inform the taxpayer that 
224.20 	this application must be signed by all owners who occupy the property or by the qualifying 
224.21 	relative and returned to the county assessor in order for the property to receive homestead 
224.22 	treatment. 
224.23 	(c) Every property owner applying for homestead classification must furnish to the 
224.24 	county assessor the Social Security number of each occupant who is listed as an owner 
224.25 	of the property on the deed of record, the name and address of each owner who does not 
224.26 	occupy the property, and the name and Social Security number of each owner's spouse who 
224.27 	occupies the property. The application must be signed by each owner who occupies the 
224.28 	property and by each owner's spouse who occupies the property, or, in the case of property 
224.29 	that qualifies as a homestead under subdivision 1, paragraph (c), by the qualifying relative. 
224.30 	If a property owner occupies a homestead, the property owner's spouse may not 
224.31 	claim another property as a homestead unless the property owner and the property owner's 
224.32 	spouse file with the assessor an affidavit or other proof required by the assessor stating that 
224.33 	the property qualifies as a homestead under subdivision 1, paragraph (e). 
224.34 	Owners or spouses occupying residences owned by their spouses and previously 
224.35 	occupied with the other spouse, either of whom fail to include the other spouse's name 
225.1 	and Social Security number on the homestead application or provide the affidavits or 
225.2 	other proof requested, will be deemed to have elected to receive only partial homestead 
225.3 	treatment of their residence. The remainder of the residence will be classified as 
225.4 	nonhomestead residential. When an owner or spouse's name and Social Security number 
225.5 	appear on homestead applications for two separate residences and only one application is 
225.6 	signed, the owner or spouse will be deemed to have elected to homestead the residence for 
225.7 	which the application was signed. 
225.8 	The Social Security numbers, state or federal tax returns or tax return information, 
225.9 	including the federal income tax schedule F required by this section, or affidavits or other 
225.10 	proofs of the property owners and spouses, and the federal income tax schedule F required 
225.11 	by this section, submitted under this or another section to support a claim for a property 
225.12 	tax homestead classification are private data on individuals as defined by section 13.02, 
225.13 	subdivision 12, but, notwithstanding that section, the private data may be disclosed to the 
225.14 	commissioner of revenue, or, for purposes of proceeding under the Revenue Recapture 
225.15 	Act to recover personal property taxes owing, to the county treasurer. 
225.16 	(d) If residential real estate is occupied and used for purposes of a homestead by a 
225.17 	relative of the owner and qualifies for a homestead under subdivision 1, paragraph (c), in 
225.18 	order for the property to receive homestead status, a homestead application must be filed 
225.19 	with the assessor. The Social Security number of each relative and spouse of a relative 
225.20 	occupying the property shall be required on the homestead application filed under this 
225.21 	subdivision. If a different relative of the owner subsequently occupies the property, the 
225.22 	owner of the property must notify the assessor within 30 days of the change in occupancy. 
225.23 	The Social Security number of a relative or relative's spouse occupying the property 
225.24 	is private data on individuals as defined by section 13.02, subdivision 12, but may be 
225.25 	disclosed to the commissioner of revenue, or, for the purposes of proceeding under the 
225.26 	Revenue Recapture Act to recover personal property taxes owing, to the county treasurer. 
225.27 	(e) The homestead application shall also notify the property owners that the 
225.28 	application filed under this section will not be mailed annually and that if the property 
225.29 	is granted homestead status for any assessment year, that same property shall remain 
225.30 	classified as homestead until the property is sold or transferred to another person, or 
225.31 	the owners, the spouse of the owner, or the relatives no longer use the property as their 
225.32 	homestead. Upon the sale or transfer of the homestead property, a certificate of value must 
225.33 	be timely filed with the county auditor as provided under section 272.115. Failure to 
225.34 	notify the assessor within 30 days that the property has been sold, transferred, or that the 
225.35 	owner, the spouse of the owner, or the relative is no longer occupying the property as a 
226.1 	homestead, shall result in the penalty provided under this subdivision and the property 
226.2 	will lose its current homestead status. 
226.3 	(f) If the homestead application is not returned within 30 days, the county will send a 
226.4 	second application to the present owners of record. The notice of proposed property taxes 
226.5 	prepared under section 275.065, subdivision 3, shall reflect the property's classification. If 
226.6 	a homestead application has not been filed with the county by December 15, the assessor 
226.7 	shall classify the property as nonhomestead for the current assessment year for taxes 
226.8 	payable in the following year, provided that the owner may be entitled to receive the 
226.9 	homestead classification by proper application under section 375.192. 
226.10 	(g) At the request of the commissioner, each county must give the commissioner a 
226.11 	list that includes the name and Social Security number of each occupant of homestead 
226.12 	property who is the property owner, property owner's spouse, qualifying relative of a 
226.13 	property owner, or a spouse of a qualifying relative. The commissioner shall use the 
226.14 	information provided on the lists as appropriate under the law, including for the detection 
226.15 	of improper claims by owners, or relatives of owners, under chapter 290A. 
226.16 	(h) If the commissioner finds that a property owner may be claiming a fraudulent 
226.17 	homestead, the commissioner shall notify the appropriate counties. Within 90 days of 
226.18 	the notification, the county assessor shall investigate to determine if the homestead 
226.19 	classification was properly claimed. If the property owner does not qualify, the county 
226.20 	assessor shall notify the county auditor who will determine the amount of homestead 
226.21 	benefits that had been improperly allowed. For the purpose of this section, "homestead 
226.22 	benefits" means the tax reduction resulting from the classification as a homestead under 
226.23 	section 273.13, the taconite homestead credit under section 273.135, the residential 
226.24 	homestead and agricultural homestead credits under section 273.1384, and the 
226.25 	supplemental homestead credit under section 273.1391. 
226.26 	The county auditor shall send a notice to the person who owned the affected property 
226.27 	at the time the homestead application related to the improper homestead was filed, 
226.28 	demanding reimbursement of the homestead benefits plus a penalty equal to 100 percent 
226.29 	of the homestead benefits. The person notified may appeal the county's determination 
226.30 	by serving copies of a petition for review with county officials as provided in section 
226.31 	278.01 and filing proof of service as provided in section 278.01 with the Minnesota Tax 
226.32 	Court within 60 days of the date of the notice from the county. Procedurally, the appeal 
226.33 	is governed by the provisions in chapter 271 which apply to the appeal of a property tax 
226.34 	assessment or levy, but without requiring any prepayment of the amount in controversy. If 
226.35 	the amount of homestead benefits and penalty is not paid within 60 days, and if no appeal 
226.36 	has been filed, the county auditor shall certify the amount of taxes and penalty to the county 
227.1 	treasurer. The county treasurer will add interest to the unpaid homestead benefits and 
227.2 	penalty amounts at the rate provided in section 279.03 for real property taxes becoming 
227.3 	delinquent in the calendar year during which the amount remains unpaid. Interest may be 
227.4 	assessed for the period beginning 60 days after demand for payment was made. 
227.5 	If the person notified is the current owner of the property, the treasurer may add the 
227.6 	total amount of homestead benefits, penalty, interest, and costs to the ad valorem taxes 
227.7 	otherwise payable on the property by including the amounts on the property tax statements 
227.8 	under section 276.04, subdivision 3. The amounts added under this paragraph to the ad 
227.9 	valorem taxes shall include interest accrued through December 31 of the year preceding 
227.10 	the taxes payable year for which the amounts are first added. These amounts, when added 
227.11 	to the property tax statement, become subject to all the laws for the enforcement of real or 
227.12 	personal property taxes for that year, and for any subsequent year. 
227.13 	If the person notified is not the current owner of the property, the treasurer may 
227.14 	collect the amounts due under the Revenue Recapture Act in chapter 270A, or use any of 
227.15 	the powers granted in sections 277.20 and 277.21 without exclusion, to enforce payment 
227.16 	of the homestead benefits, penalty, interest, and costs, as if those amounts were delinquent 
227.17 	tax obligations of the person who owned the property at the time the application related 
227.18 	to the improperly allowed homestead was filed. The treasurer may relieve a prior owner 
227.19 	of personal liability for the homestead benefits, penalty, interest, and costs, and instead 
227.20 	extend those amounts on the tax lists against the property as provided in this paragraph 
227.21 	to the extent that the current owner agrees in writing. On all demands, billings, property 
227.22 	tax statements, and related correspondence, the county must list and state separately the 
227.23 	amounts of homestead benefits, penalty, interest and costs being demanded, billed or 
227.24 	assessed. 
227.25 	(i) Any amount of homestead benefits recovered by the county from the property 
227.26 	owner shall be distributed to the county, city or town, and school district where the 
227.27 	property is located in the same proportion that each taxing district's levy was to the total 
227.28 	of the three taxing districts' levy for the current year. Any amount recovered attributable 
227.29 	to taconite homestead credit shall be transmitted to the St. Louis County auditor to be 
227.30 	deposited in the taconite property tax relief account. Any amount recovered that is 
227.31 	attributable to supplemental homestead credit is to be transmitted to the commissioner of 
227.32 	revenue for deposit in the general fund of the state treasury. The total amount of penalty 
227.33 	collected must be deposited in the county general fund. 
227.34 	(j) If a property owner has applied for more than one homestead and the county 
227.35 	assessors cannot determine which property should be classified as homestead, the county 
228.1 	assessors will refer the information to the commissioner. The commissioner shall make 
228.2 	the determination and notify the counties within 60 days. 
228.3 	(k) In addition to lists of homestead properties, the commissioner may ask the 
228.4 	counties to furnish lists of all properties and the record owners. The Social Security 
228.5 	numbers and federal identification numbers that are maintained by a county or city 
228.6 	assessor for property tax administration purposes, and that may appear on the lists retain 
228.7 	their classification as private or nonpublic data; but may be viewed, accessed, and used by 
228.8 	the county auditor or treasurer of the same county for the limited purpose of assisting the 
228.9 	commissioner in the preparation of microdata samples under section 270C.12. 
228.10 	(l) On or before April 30 each year beginning in 2007, each county must provide the 
228.11 	commissioner with the following data for each parcel of homestead property by electronic 
228.12 	means as defined in section 289A.02, subdivision 8: 
228.13 	(i) the property identification number assigned to the parcel for purposes of taxes 
228.14 	payable in the current year; 
228.15 	(ii) the name and Social Security number of each occupant of homestead property 
228.16 	who is the property owner, property owner's spouse, qualifying relative of a property 
228.17 	owner, or spouse of a qualifying relative; 
228.18 	(iii) the classification of the property under section 273.13 for taxes payable in the 
228.19 	current year and in the prior year; 
228.20 	(iv) an indication of whether the property was classified as a homestead for taxes 
228.21 	payable in the current year because of occupancy by a relative of the owner or by a 
228.22 	spouse of a relative; 
228.23 	(v) the property taxes payable as defined in section 290A.03, subdivision 13, for the 
228.24 	current year and the prior year; 
228.25 	(vi) the market value of improvements to the property first assessed for tax purposes 
228.26 	for taxes payable in the current year; 
228.27 	(vii) the assessor's estimated market value assigned to the property for taxes payable 
228.28 	in the current year and the prior year; 
228.29 	(viii) the taxable market value assigned to the property for taxes payable in the 
228.30 	current year and the prior year; 
228.31 	(ix) whether there are delinquent property taxes owing on the homestead; 
228.32 	(x) the unique taxing district in which the property is located; and 
228.33 	(xi) such other information as the commissioner decides is necessary. 
228.34 	The commissioner shall use the information provided on the lists as appropriate 
228.35 	under the law, including for the detection of improper claims by owners, or relatives 
228.36 	of owners, under chapter 290A. 

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

229.2 	Sec. 13. Minnesota Statutes 2006, section 273.124, subdivision 21, is amended to read:
229.3 		Subd. 21.Trust property; homestead. Real property held by a trustee under a trust 
229.4 	is eligible for classification as homestead property if:
229.5 	(1) the grantor or surviving spouse of the grantor of the trust occupies and uses the 
229.6 	property as a homestead;
229.7 	(2) a relative or surviving relative of the grantor who meets the requirements of 
229.8 	subdivision 1, paragraph (c), in the case of residential real estate; or subdivision 1, 
229.9 	paragraph (d), in the case of agricultural property, occupies and uses the property as 
229.10 	a homestead;
229.11 	(3) a family farm corporation, joint farm venture, limited liability company, or 
229.12 	partnership operating a family farm in which the grantor or the grantor's surviving spouse 
229.13 	is a shareholder, member, or partner rents the property held by a trustee under a trust, and 
229.14 	the grantor, the spouse of the grantor, or the son or daughter of the grantor, who is also a 
229.15 	shareholder, member, or partner of the corporation, joint farm venture, limited liability 
229.16 	company, or partnership occupies and uses the property as a homestead, or is actively 
229.17 	farming at least 40 acres, including undivided government lots and correctional 40's the 
229.18 	property on behalf of the corporation, joint farm venture, limited liability company, or 
229.19 	partnership; or
229.20 	(4) a person who has received homestead classification for property taxes payable in 
229.21 	2000 on the basis of an unqualified legal right under the terms of the trust agreement to 
229.22 	occupy the property as that person's homestead and who continues to use the property as 
229.23 	a homestead or a person who received the homestead classification for taxes payable in 
229.24 	2005 under clause (3) who does not qualify under clause (3) for taxes payable in 2006 
229.25 	or thereafter but who continues to qualify under clause (3) as it existed for taxes payable 
229.26 	in 2005.
229.27 	For purposes of this subdivision, "grantor" is defined as the person creating or 
229.28 	establishing a testamentary, inter Vivos, revocable or irrevocable trust by written 
229.29 	instrument or through the exercise of a power of appointment.

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

229.31 	Sec. 14. Minnesota Statutes 2006, section 273.13, subdivision 22, as amended by Laws 
229.32 	2008, chapter 154, article 2, section 11, is amended to read:
229.33 		Subd. 22. Class 1. (a) Except as provided in subdivision 23 and in paragraphs (b) 
229.34 	and (c), real estate which is residential and used for homestead purposes is class 1a. In the 
230.1 	case of a duplex or triplex in which one of the units is used for homestead purposes, the 
230.2 	entire property is deemed to be used for homestead purposes. The market value of class 1a 
230.3 	property must be determined based upon the value of the house, garage, and land.
230.4 	The first $500,000 of market value of class 1a property has a net class rate of 
230.5 	one percent of its market value; and the market value of class 1a property that exceeds 
230.6 	$500,000 has a class rate of 1.25 percent of its market value.
230.7 	(b) Class 1b property includes homestead real estate or homestead manufactured 
230.8 	homes used for the purposes of a homestead by 
230.9 	(1) any person who is blind as defined in section 256D.35, or the blind person and 
230.10 	the blind person's spouse; or
230.11 	(2) any person who is permanently and totally disabled or by the disabled person and 
230.12 	the disabled person's spouse.; or
230.13 	(3) the surviving spouse of a permanently and totally disabled veteran homesteading 
230.14 	a property classified under this paragraph for taxes payable in 2008.
230.15 	Property is classified and assessed under clause (2) only if the government agency or 
230.16 	income-providing source certifies, upon the request of the homestead occupant, that the 
230.17 	homestead occupant satisfies the disability requirements of this paragraph, and that the 
230.18 	property is not eligible for the valuation exclusion under subdivision 34.
230.19 	Property is classified and assessed under paragraph (b) only if the commissioner 
230.20 	of revenue or the county assessor certifies  that the homestead occupant satisfies the 
230.21 	requirements of this paragraph.
230.22 	Permanently and totally disabled for the purpose of this subdivision means a 
230.23 	condition which is permanent in nature and totally incapacitates the person from working 
230.24 	at an occupation which brings the person an income. The first $50,000 market value of 
230.25 	class 1b property has a net class rate of .45 percent of its market value. The remaining 
230.26 	market value of class 1b property has a class rate using the rates for class 1a or class 2a 
230.27 	property, whichever is appropriate, of similar market value.
230.28 	(c) Class 1c property is commercial use real and personal property that abuts public 
230.29 	water as defined in section 103G.005, subdivision 15, and is devoted to temporary and 
230.30 	seasonal residential occupancy for recreational purposes but not devoted to commercial 
230.31 	purposes for more than 250 days in the year preceding the year of assessment, and that 
230.32 	includes a portion used as a homestead by the owner, which includes a dwelling occupied 
230.33 	as a homestead by a shareholder of a corporation that owns the resort, a partner in a 
230.34 	partnership that owns the resort, or a member of a limited liability company that owns 
230.35 	the resort even if the title to the homestead is held by the corporation, partnership, or 
230.36 	limited liability company. For purposes of this clause, property is devoted to a commercial 
231.1 	purpose on a specific day if any portion of the property, excluding the portion used 
231.2 	exclusively as a homestead, is used for residential occupancy and a fee is charged for 
231.3 	residential occupancy. Class 1c property must contain three or more rental units. A 
231.4 	"rental unit" is defined as a cabin, condominium, townhouse, sleeping room, or individual 
231.5 	camping site equipped with water and electrical hookups for recreational vehicles. Class 
231.6 	1c property must provide recreational activities such as the rental of ice fishing houses, 
231.7 	boats and motors, snowmobiles, downhill or cross-country ski equipment; provide marina 
231.8 	services, launch services, or guide services; or sell bait and fishing tackle. Any unit in 
231.9 	which the right to use the property is transferred to an individual or entity by deeded 
231.10 	interest, or the sale of shares or stock, no longer qualifies for class 1c even though it may 
231.11 	remain available for rent. A camping pad offered for rent by a property that otherwise 
231.12 	qualifies for class 1c is also class 1c, regardless of the term of the rental agreement, as long 
231.13 	as the use of the camping pad does not exceed 250 days. The portion of the property used 
231.14 	as a homestead is class 1a property under paragraph (a). The remainder of the property is 
231.15 	classified as follows: the first $600,000  of market value is tier I, the next $1,700,000 of 
231.16 	market value is tier II, and any remaining market value is tier III. The class rates for class 
231.17 	1c are: tier I, 0.50  percent; tier II, 1.0 percent; and tier III, 1.25 percent. Owners of real and 
231.18 	personal property devoted to temporary and seasonal residential occupancy for recreation 
231.19 	purposes in which all or a portion of the property was devoted to commercial purposes for 
231.20 	not more than 250 days in the year preceding the year of assessment desiring classification 
231.21 	as class 1c, must submit a declaration to the assessor designating the cabins or units 
231.22 	occupied for 250 days or less in the year preceding the year of assessment by January 15 of 
231.23 	the assessment year. Those cabins or units and a proportionate share of the land on which 
231.24 	they are located must be designated as class 1c as otherwise provided. The remainder of 
231.25 	the cabins or units and a proportionate share of the land on which they are located must be 
231.26 	designated as class 3a commercial. The owner of property desiring designation as class 
231.27 	1c property must provide guest registers or other records demonstrating that the units for 
231.28 	which class 1c designation is sought were not occupied for more than 250 days in the 
231.29 	year preceding the assessment if so requested. The portion of a property operated as a 
231.30 	(1) restaurant, (2) bar, (3) gift shop, (4) conference center or meeting room, and (5) other 
231.31 	nonresidential facility operated on a commercial basis not directly related to temporary 
231.32 	and seasonal residential occupancy for recreation purposes does not qualify for class 1c. 
231.33 	(d) Class 1d property includes structures that meet all of the following criteria: 
231.34 	(1) the structure is located on property that is classified as agricultural property under 
231.35 	section 273.13, subdivision 23; 
232.1 	(2) the structure is occupied exclusively by seasonal farm workers during the time 
232.2 	when they work on that farm, and the occupants are not charged rent for the privilege of 
232.3 	occupying the property, provided that use of the structure for storage of farm equipment 
232.4 	and produce does not disqualify the property from classification under this paragraph; 
232.5 	(3) the structure meets all applicable health and safety requirements for the 
232.6 	appropriate season; and 
232.7 	(4) the structure is not salable as residential property because it does not comply 
232.8 	with local ordinances relating to location in relation to streets or roads. 
232.9 	The market value of class 1d property has the same class rates as class 1a property 
232.10 	under paragraph (a). 

232.11 	EFFECTIVE DATE. This section is effective for taxes payable in 2009 and 
232.12 	thereafter.

232.13 	Sec. 15. Minnesota Statutes 2006, section 273.13, subdivision 34, as added by Laws 
232.14 	2008, chapter 154, article 2, section 14, is amended to read:
232.15 		Subd. 34. Homestead of disabled veteran. (a) All or a portion of the market value 
232.16 	of property owned by a veteran or by the veteran and the veteran's spouse qualifying 
232.17 	for homestead classification under subdivision 22 or 23 is excluded in determining the 
232.18 	property's taxable market value if it serves as the homestead of a military veteran, as 
232.19 	defined in section 197.447, who has a service-connected disability of 70 percent or more. 
232.20 	To qualify for exclusion under this subdivision, the veteran must have been honorably 
232.21 	discharged from the United States armed forces, as indicated by United States Government 
232.22 	Form DD214 or other official military discharge papers, and must be certified by the 
232.23 	United States Veterans Administration as having a service-connected disability. 
232.24 	(b)(1) For a disability rating of 70 percent or more, $150,000 of market value is 
232.25 	excluded, except as provided in clause (2); and
232.26 	(2) for a total (100 percent) and permanent disability, $300,000 of market value is 
232.27 	excluded.
232.28 	(c) If a disabled veteran qualifying for a valuation exclusion under paragraph (b), 
232.29 	clause (2), predeceases the veteran's spouse, and if upon the death of the veteran the 
232.30 	spouse holds the legal or beneficial title to the homestead and permanently resides there, 
232.31 	the exclusion shall carry over to the benefit of the veteran's spouse for one additional 
232.32 	assessment year or until such time as the spouse sells, transfers, or otherwise disposes of 
232.33 	the property, whichever comes first.
233.1 	(d) In the case of an agricultural homestead, only the portion of the property 
233.2 	consisting of the house and garage and immediately surrounding one acre of land qualifies 
233.3 	for the valuation exclusion under this subdivision.
233.4 	(e) A property qualifying for a valuation exclusion under this subdivision is not 
233.5 	eligible for the credit under section 273.1384, subdivision 1, or classification under 
233.6 	subdivision 22, paragraph (b).
233.7 	(f) To qualify for a valuation exclusion under this subdivision a property owner must 
233.8 	apply to the assessor by July 1 of each assessment year, except that an annual reapplication 
233.9 	is not required once a property has been accepted for a valuation exclusion under paragraph 
233.10 	(b), clause (2), and the property continues to qualify until there is a change in ownership.

233.11 	EFFECTIVE DATE. This section is effective for assessment year 2008 and 
233.12 	thereafter, for taxes payable in 2009 and thereafter, except that the application date in 
233.13 	paragraph (f) for the 2008 assessment year is extended to September 1, 2008.

233.14 	Sec. 16. Minnesota Statutes 2006, section 274.014, subdivision 3, is amended to read:
233.15 		Subd. 3.Proof of compliance; transfer of duties. (a) Any city or town that 
233.16 	conducts local boards of appeal and equalization meetings must provide proof to the 
233.17 	county assessor by December 1, 2006, and each year thereafter, that it is in compliance 
233.18 	with the requirements of subdivision 2. Beginning in 2006, this notice must also verify 
233.19 	that there was a quorum of voting members at each meeting of the board of appeal 
233.20 	and equalization in the current year. A city or town that does not comply with these 
233.21 	requirements is deemed to have transferred its board of appeal and equalization powers 
233.22 	to the county beginning with the following year's assessment and continuing unless the 
233.23 	powers are reinstated under paragraph (c).
233.24 	(b) The county shall notify the taxpayers when the board of appeal and equalization 
233.25 	for a city or town has been transferred to the county under this subdivision and, prior to 
233.26 	the meeting time of the county board of equalization, the county shall make available to 
233.27 	those taxpayers a procedure for a review of the assessments, including, but not limited to, 
233.28 	open book meetings. This alternate review process shall take place in April and May.
233.29 	(c) A local board whose powers are transferred to the county under this subdivision 
233.30 	may be reinstated by resolution of the governing body of the city or town and upon proof 
233.31 	of compliance with the requirements of subdivision 2. The resolution and proofs must be 
233.32 	provided to the county assessor by December 1 in order to be effective for the following 
233.33 	year's assessment.
234.1 	(d) A local board whose powers are transferred to the county under this subdivision 
234.2 	may continue to employ a local assessor and is not deemed to have transferred its powers 
234.3 	to make assessments.

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

234.5 	Sec. 17. Minnesota Statutes 2006, section 276.04, subdivision 2, as amended by Laws 
234.6 	2008, chapter 154, article 2, section 19, is amended to read:
234.7 		Subd. 2. Contents of tax statements. (a) The treasurer shall provide for the 
234.8 	printing of the tax statements. The commissioner of revenue shall prescribe the form 
234.9 	of the property tax statement and its contents. The statement must contain a tabulated 
234.10 	statement of the dollar amount due to each taxing authority and the amount of the state 
234.11 	tax from the parcel of real property for which a particular tax statement is prepared. The 
234.12 	dollar amounts attributable to the county, the state tax, the voter approved school tax, the 
234.13 	other local school tax, the township or municipality, and the total of the metropolitan 
234.14 	special taxing districts as defined in section 275.065, subdivision 3, paragraph (i), must 
234.15 	be separately stated. The amounts due all other special taxing districts, if any, may be 
234.16 	aggregated except that any levies made by the regional rail authorities in the county of 
234.17 	Anoka, Carver, Dakota, Hennepin, Ramsey, Scott, or Washington under chapter 398A 
234.18 	shall be listed on a separate line directly under the appropriate county's levy. If the county 
234.19 	levy under this paragraph includes an amount for a lake improvement district as defined 
234.20 	under sections 103B.501 to 103B.581, the amount attributable for that purpose must be 
234.21 	separately stated from the remaining county levy amount. In the case of Ramsey County, 
234.22 	if the county levy under this paragraph includes an amount for public library service 
234.23 	under section 134.07, the amount attributable for that purpose may be separated from the 
234.24 	remaining county levy amount. The amount of the tax on homesteads qualifying under the 
234.25 	senior citizens' property tax deferral program under chapter 290B is the total amount of 
234.26 	property tax before subtraction of the deferred property tax amount. The amount of the 
234.27 	tax on contamination value imposed under sections 270.91 to 270.98, if any, must also 
234.28 	be separately stated. The dollar amounts, including the dollar amount of any special 
234.29 	assessments, may be rounded to the nearest even whole dollar. For purposes of this section 
234.30 	whole odd-numbered dollars may be adjusted to the next higher even-numbered dollar. 
234.31 	The amount of market value excluded under section 273.11, subdivision 16, if any, must 
234.32 	also be listed on the tax statement. 
234.33 	(b) The property tax statements for manufactured homes and sectional structures 
234.34 	taxed as personal property shall contain the same information that is required on the 
234.35 	tax statements for real property. 
235.1 	(c) Real and personal property tax statements must contain the following information 
235.2 	in the order given in this paragraph. The information must contain the current year tax 
235.3 	information in the right column with the corresponding information for the previous year 
235.4 	in a column on the left: 
235.5 	(1) the property's estimated market value under section 273.11, subdivision 1; 
235.6 	(2) the property's taxable market value after reductions under section 273.11, 
235.7 	subdivisions 1a and 16; 
235.8 	(3) the property's gross tax, before credits; 
235.9 	(4) for homestead residential and agricultural properties, the credits under section 
235.10 	273.1384; 
235.11 	(5) any credits received under sections 273.119; 273.123 273.1234 or 273.1235; 
235.12 	273.135; 273.1391; 273.1398, subdivision 4; 469.171; and 473H.10, except that the 
235.13 	amount of credit received under section 273.135 must be separately stated and identified 
235.14 	as "taconite tax relief"; and 
235.15 	(6) the net tax payable in the manner required in paragraph (a). 
235.16 	(d) If the county uses envelopes for mailing property tax statements and if the county 
235.17 	agrees, a taxing district may include a notice with the property tax statement notifying 
235.18 	taxpayers when the taxing district will begin its budget deliberations for the current 
235.19 	year, and encouraging taxpayers to attend the hearings. If the county allows notices to 
235.20 	be included in the envelope containing the property tax statement, and if more than 
235.21 	one taxing district relative to a given property decides to include a notice with the tax 
235.22 	statement, the county treasurer or auditor must coordinate the process and may combine 
235.23 	the information on a single announcement. 

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

235.25 	Sec. 18. Minnesota Statutes 2006, section 290B.04, subdivision 1, is amended to read:
235.26 		Subdivision 1.Initial application. (a) A taxpayer meeting the program 
235.27 	qualifications under section 290B.03 may apply to the commissioner of revenue for the 
235.28 	deferral of taxes. Applications are due on or before July 1 for deferral of any of the 
235.29 	following year's property taxes. A taxpayer may apply in the year in which the taxpayer 
235.30 	becomes 65 years old, provided that no deferral of property taxes will be made until the 
235.31 	calendar year after the taxpayer becomes 65 years old. The application, which shall be 
235.32 	prescribed by the commissioner of revenue, shall include the following items and any 
235.33 	other information which the commissioner deems necessary: 
235.34 	(1) the name, address, and Social Security number of the owner or owners;
236.1 	(2) a copy of the property tax statement for the current payable year for the 
236.2 	homesteaded property;
236.3 	(3) the initial year of ownership and occupancy as a homestead;
236.4 	(4) the owner's household income for the previous calendar year; and
236.5 	(5) information on any mortgage loans or other amounts secured by mortgages or 
236.6 	other liens against the property, for which purpose the commissioner may require the 
236.7 	applicant to provide a copy of the mortgage note, the mortgage, or a statement of the 
236.8 	balance owing on the mortgage loan provided by the mortgage holder. The commissioner 
236.9 	may require the appropriate documents in connection with obtaining and confirming 
236.10 	information on unpaid amounts secured by other liens.
236.11 	The application must state that program participation is voluntary. The application 
236.12 	must also state that the deferred amount depends directly on the applicant's household 
236.13 	income, and that program participation includes authorization for the annual deferred 
236.14 	amount, the cumulative deferral and interest that appear on each year's notice prepared by 
236.15 	the county under subdivision 6, is public data.
236.16 	The application must state that program participants may claim the property tax 
236.17 	refund based on the full amount of property taxes eligible for the refund, including any 
236.18 	deferred amounts. The application must also state that property tax refunds will be used to 
236.19 	offset any deferral and interest under this program, and that any other amounts subject to 
236.20 	revenue recapture under section 270A.03, subdivision 7, will also be used to offset any 
236.21 	deferral and interest under this program. 
236.22 	(b) As part of the initial application process, the commissioner may require the 
236.23 	applicant to obtain at the applicant's own cost and submit:
236.24 	(1) if the property is registered property under chapter 508 or 508A, a copy of the 
236.25 	original certificate of title in the possession of the county registrar of titles (sometimes 
236.26 	referred to as "condition of register"); or
236.27 	(2) if the property is abstract property, a report prepared by a licensed abstracter 
236.28 	showing the last deed and any unsatisfied mortgages, liens, judgments, and state and 
236.29 	federal tax lien notices which were recorded on or after the date of that last deed with 
236.30 	respect to the property or to the applicant.
236.31 	The certificate or report under clauses (1) and (2) need not include references to 
236.32 	any documents filed or recorded more than 40 years prior to the date of the certification 
236.33 	or report. The certification or report must be as of a date not more than 30 days prior 
236.34 	to submission of the application.
236.35 	The commissioner may also require the county recorder or county registrar of the 
236.36 	county where the property is located to provide copies of recorded documents related to 
237.1 	the applicant or the property, for which the recorder or registrar shall not charge a fee. The 
237.2 	commissioner may use any information available to determine or verify eligibility under 
237.3 	this section. The household income from the application is private data on individuals as 
237.4 	defined in section 13.02, subdivision 12.

237.5 	EFFECTIVE DATE. This section is effective for data collected or maintained by 
237.6 	the commissioner of revenue beginning the day following final enactment.

237.7 	Sec. 19. Minnesota Statutes 2006, section 469.040, subdivision 4, is amended to read:
237.8 		Subd. 4.Facilities funded from multiple sources. In the metropolitan area, as 
237.9 	defined in section 473.121, subdivision 2, the tax treatment provided in subdivision 3 
237.10 	applies to that portion of any multifamily rental housing facility represented by the ratio of 
237.11 	(1) the number of units in the facility that are subject to the requirements of Section 5 of 
237.12 	the United States Housing Act of 1937, as the result of the implementation of a federal 
237.13 	court order or consent decree to (2) the total number of units within the facility. 
237.14 	The housing and redevelopment authority for the city in which the facility is located, 
237.15 	any public entity exercising the powers of such housing and redevelopment authority, or 
237.16 	the county housing and redevelopment authority for the county in which the facility is 
237.17 	located, shall annually certify to the assessor responsible for assessing the facility, at the 
237.18 	time and in the manner required by the assessor, the number of units in the facility that are 
237.19 	subject to the requirements of Section 5 of the United States Housing Act of 1937.
237.20 	Nothing in this subdivision shall prevent that portion of the facility not subject to 
237.21 	this subdivision from meeting the requirements of section 273.126 273.128, and for that 
237.22 	purpose the total number of units in the facility must be taken into account. 

237.23 	EFFECTIVE DATE. This section is effective retroactively for taxes payable in 
237.24 	2006 and thereafter.

237.25 	Sec. 20. Minnesota Statutes 2006, section 469.174, subdivision 10b, is amended to 
237.26 	read:
237.27 		Subd. 10b.Qualified disaster area. A "qualified disaster area" is an area that 
237.28 	meets the following requirements:
237.29 	(1) parcels consisting of 70 percent of the area of the district were occupied by 
237.30 	buildings, streets, utilities, paved or gravel parking lots, or other similar structures 
237.31 	immediately before the disaster or emergency;
238.1 	(2) the area of the district was subject to a disaster or emergency, as defined in 
238.2 	section 273.123, subdivision 1 273.1231, subdivision 2, within the 18-month period 
238.3 	ending on the day the request for certification of the district is made; and 
238.4 	(3) 50 percent or more of the buildings in the area have suffered substantial damage 
238.5 	as a result of the disaster or emergency.

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

238.7 	Sec. 21. Minnesota Statutes 2006, section 469.177, subdivision 1c, is amended to read:
238.8 		Subd. 1c.Original net tax capacity adjustments; presidential disaster area. (a) 
238.9 	The provisions of this subdivision apply to a district located in a disaster area, as described 
238.10 	in section   273.123, subdivision 1, paragraph (b) 273.1231, subdivision 3, paragraph (a), 
238.11 	clause (1), and are effective for taxes payable in the first calendar year beginning at least 
238.12 	four months after the date of the determination. 
238.13 	(b) For a district certified before the date of the disaster area determination as 
238.14 	provided in section   273.123, subdivision 1, paragraph (b) 273.1231, subdivision 3, 
238.15 	paragraph (a), clause (1), upon the request of the municipality, the county auditor shall 
238.16 	reduce the original net tax capacity of the district by the reduction in the net tax capacity 
238.17 	of properties in the district that is attributable to the physical effects of the disaster, but not 
238.18 	below zero. The assessor shall determine the amount of the reduction in market value that 
238.19 	is attributable to the physical effects of the disaster to be used by the county auditor in 
238.20 	computing the reduction in net tax capacity. 
238.21 	(c) For a district that does not qualify under paragraph (b) and for which the request 
238.22 	for certification is made in the same calendar year as the disaster area determination, 
238.23 	upon the request of the municipality, the assessor shall determine the reduction in market 
238.24 	value of properties in the district that is attributable to the physical effects of the disaster. 
238.25 	The county auditor shall use the reduced market value in certifying the original net tax 
238.26 	capacity of the district.

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

238.28 	ARTICLE 16
238.29 	DEPARTMENT MISCELLANEOUS

238.30 	Section 1. Minnesota Statutes 2006, section 16D.02, subdivision 3, is amended to read:
238.31 		Subd. 3.Debt. "Debt" means an amount owed to the state directly, or through a 
238.32 	state agency, on account of a fee, duty, lease, direct loan, loan insured or guaranteed by 
238.33 	the state, rent, service, sale of real or personal property, overpayment, fine, assessment, 
239.1 	penalty, restitution, damages, interest, tax, bail bond, forfeiture, reimbursement, liability 
239.2 	owed, an assignment to the state including assignments under section 256.741, the Social 
239.3 	Security Act, or other state or federal law, recovery of costs incurred by the state, or any 
239.4 	other source of indebtedness to the state. Debt also includes amounts owed to individuals 
239.5 	as a result of civil, criminal, or administrative action brought by the state or a state agency 
239.6 	pursuant to its statutory authority or for which the state or state agency acts in a fiduciary 
239.7 	capacity in providing collection services in accordance with the regulations adopted under 
239.8 	the Social Security Act at Code of Federal Regulations, title 45, section 302.33. When the 
239.9 	commissioner provides collection services pursuant to a debt qualification plan, debt also 
239.10 	includes an amount owed to the courts, local government units, Minnesota state colleges 
239.11 	and universities governed by the Board of Trustees of the Minnesota State Colleges and 
239.12 	Universities, or University of Minnesota for which the commissioner provides collection 
239.13 	services pursuant to contract. 

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

239.15 	Sec. 2. Minnesota Statutes 2006, section 16D.02, subdivision 6, is amended to read:
239.16 		Subd. 6.Referring agency. "Referring agency" means a state agency, local 
239.17 	government unit, Minnesota state colleges and universities governed by the Board of 
239.18 	Trustees of the Minnesota State Colleges and Universities, University of Minnesota, or 
239.19 	a court, that has entered into a debt qualification plan with the commissioner to refer 
239.20 	debts to the commissioner for collection.

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

239.22 	Sec. 3. Minnesota Statutes 2006, section 16D.04, subdivision 2, as amended by Laws 
239.23 	2008, chapter 154, article 15, section 2, is amended to read:
239.24 		Subd. 2. Agency participation. (a) A referring agency must refer, by electronic 
239.25 	means, debts to the commissioner for collection. Responsibility for the debt, including the 
239.26 	reporting of the debt to the commissioner of finance and the decision with regard to the 
239.27 	continuing collection and uncollectibility of the debt, remains with the referring agency.
239.28 	Decisions with regard to continuing collection and the uncollectibility of referred debts 
239.29 	shall be made by the commissioner who shall then notify the commissioner of finance and 
239.30 	the referring agency. A decision by the commissioner that a referred debt is uncollectible 
239.31 	does not prevent the referring agency from taking additional collection action.
239.32 	(b) Before a debt becomes 121 days past due, a referring agency may refer the 
239.33 	debt to the commissioner for collection at any time after a debt becomes delinquent and 
240.1 	uncontested and the debtor has no further administrative appeal of the amount of the debt. 
240.2 	When a debt owed to a referring agency becomes 121 days past due, the referring agency 
240.3 	must refer the debt to the commissioner for collection. This requirement does not apply if 
240.4 	there is a dispute over the amount or validity of the debt, if the debt is the subject of legal 
240.5 	action or administrative proceedings, or the agency determines that the debtor is adhering 
240.6 	to acceptable payment arrangements. The commissioner may provide that certain types of 
240.7 	debt need not be referred to the commissioner for collection under this paragraph. Methods 
240.8 	and procedures for referral must follow internal guidelines prepared by the commissioner. 
240.9 	(c) If the referring agency is a court, the court must furnish a debtor's Social Security 
240.10 	number to the commissioner when the court refers the debt. 

240.11 	EFFECTIVE DATE. This section is effective for debts referred after December 
240.12 	31, 2008.

240.13 	Sec. 4. Minnesota Statutes 2006, section 270A.08, subdivision 1, is amended to read:
240.14 		Subdivision 1.Notice to debtor. (a) Not later than five days after the claimant 
240.15 	agency has sent notification to the department pursuant to section 270A.07, subdivision 1, 
240.16 	the claimant agency shall send a written notification to the debtor asserting the right of the 
240.17 	claimant agency to the refund or any part thereof. If the notice is returned to the claimant 
240.18 	agency as undeliverable, or the claimant agency has reason to believe the debtor did not 
240.19 	receive the notice, the claimant agency shall obtain the current last known address of the 
240.20 	debtor from the commissioner and resend the corrected notice. 
240.21 	(b) If a debt has been referred to the commissioner for collection under chapter 16D, 
240.22 	and the referring agency meets the definition of claimant agency under this chapter, the 
240.23 	commissioner must notify the debtor prior to using revenue recapture under this chapter 
240.24 	for collection of the debt. The notice must be sent by United States mail or personal 
240.25 	delivery to the last known address of the debtor.

240.26 	EFFECTIVE DATE. This section is effective for debts referred after December 
240.27 	31, 2008.

240.28 	Sec. 5. Minnesota Statutes 2006, section 270C.33, subdivision 5, is amended to read:
240.29 		Subd. 5.Prohibition against collection during appeal period of an order. No 
240.30 	collection action can be taken on an order of assessment, or any other order imposing a 
240.31 	liability, including the filing of liens under section 270C.63, and no late payment penalties 
240.32 	may be imposed when a return has been filed for the tax type and period upon which the 
240.33 	order is based, during the appeal period of an order. The appeal period of an order ends: 
241.1 	(1) 60 days after the order has been mailed to the taxpayer by the commissioner; (2) if an 
241.2 	administrative appeal is filed under section 270C.35, 60 days after determination of the 
241.3 	administrative appeal; (3) if an appeal to Tax Court is filed under chapter 271, when the 
241.4 	decision of the Tax Court is made; or (4) if an appeal to Tax Court is filed and the appeal is 
241.5 	based upon a constitutional challenge to the tax, 60 days after final determination of the 
241.6 	appeal. This subdivision does not apply to a jeopardy assessment under section 270C.36, 
241.7 	or a jeopardy collection under section 270C.36.

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

241.9 	ARTICLE 17
241.10 	MISCELLANEOUS

241.11 	Section 1. Minnesota Statutes 2006, section 60A.196, is amended to read:
241.12 	60A.196 DEFINITIONS.
241.13 	Unless the context otherwise requires, the following terms have the meanings given 
241.14 	them for the purposes of sections 60A.195 to 60A.209: 
241.15 	(a) "Surplus lines insurance" means insurance placed with an insurer permitted 
241.16 	to transact the business of insurance in this state only pursuant to sections 60A.195 to 
241.17 	60A.209. 
241.18 	(b) "Eligible surplus lines insurer" means an insurer recognized as eligible to write 
241.19 	insurance business under sections 60A.195 to 60A.209 but not licensed by any other 
241.20 	Minnesota law to transact the business of insurance. 
241.21 	(c) "Ineligible surplus lines insurer" means an insurer not recognized as an eligible 
241.22 	surplus lines insurer pursuant to sections 60A.195 to 60A.209 and not licensed by any 
241.23 	other Minnesota law to transact the business of insurance. "Ineligible surplus lines 
241.24 	insurer" includes a risk retention group as defined under the Liability Risk Retention 
241.25 	Act, Public Law 99-563. 
241.26 	(d) "Surplus lines licensee" or "licensee" means a person licensed under sections 
241.27 	60A.195 to 60A.209 to place insurance with an eligible or ineligible surplus lines insurer. 
241.28 	(e) "Association" means an association registered under section 60A.208. 
241.29 	(f) "Alien insurer" means any insurer which is incorporated or otherwise organized 
241.30 	outside of the United States.
241.31 	(g) "Insurance laws" means chapters 60 to 79 inclusive.
241.32 	(h) "Stamping" means electronically assigning a unique identifying number that is 
241.33 	specific to a submitted policy, contract, or insurance document.

242.1 	EFFECTIVE DATE. This section is effective the day following final enactment 
242.2 	and applies to policies written or renewed on or after that date.

242.3 	Sec. 2. [60A.2085] SURPLUS LINES ASSOCIATION OF MINNESOTA.
242.4 		Subdivision 1.Association created; duties. There is hereby created a nonprofit 
242.5 	association to be known as the Surplus Lines Association of Minnesota. All surplus lines 
242.6 	licensees are members of this association. Section 60A.208, subdivision 5, does not apply 
242.7 	to the provisions of this section. The association shall perform its functions under the 
242.8 	plan of operation established under subdivision 3 and must exercise its powers through a 
242.9 	board of directors established under subdivision 2. The association shall be authorized 
242.10 	and have the duty to:
242.11 	(1) receive, record, and stamp all surplus lines insurance documents that surplus 
242.12 	lines licensees are required to file with the association;
242.13 	(2) prepare and deliver monthly to the commissioners of revenue and commerce a 
242.14 	report regarding surplus lines business. The report must include a list of all the business 
242.15 	procured during the preceding month, in the form the commissioners prescribe;
242.16 	(3) educate its members regarding the surplus lines law of this state including 
242.17 	insurance tax responsibilities and the rules and regulations of the commissioners of 
242.18 	revenue and commerce relative to surplus lines insurance;
242.19 	(4) communicate with organizations of agents, brokers, and admitted insurers with 
242.20 	respect to the proper use of the surplus lines market;
242.21 	(5) employ and retain persons necessary to carry out the duties of the association;
242.22 	(6) borrow money necessary to effect the purposes of the association;
242.23 	(7) enter contracts necessary to effect the purposes of the association;
242.24 	(8) provide other services to its members that are incidental or related to the 
242.25 	purposes of the association; and
242.26 	(9) take other actions reasonably required to implement the provisions of this section.
242.27 		Subd. 2.Board of directors. (a) The commissioner shall appoint an interim board 
242.28 	of five directors within 30 days of enactment of this section. The interim board must:
242.29 	(1) establish a plan of operation within 60 days after the appointment of the interim 
242.30 	board;
242.31 	(2) create a stamping office that is operational no later than December 31, 2008; and 
242.32 	(3) conduct an election for a board of directors by the membership after December 
242.33 	31, 2008, and no later than one year after the appointment of the interim board.
242.34 	(b) Once the responsibilities of the interim board in paragraph (a) are fulfilled, the 
242.35 	association shall function through a board of directors composed of the following:
243.1 	(1) one director appointed by the commissioner of revenue;
243.2 	(2) one director appointed by the commissioner of commerce; and
243.3 	(3) at least five but no more than seven directors elected by the members. The 
243.4 	elected directors must be members of the association.
243.5 	Directors may serve until their successors are appointed or elected and their terms 
243.6 	are completed as outlined in the plan of operation.
243.7 		Subd. 3.Plan of operation. (a) The plan of operation shall provide for the 
243.8 	formation, operation, and governance of the association. The plan of operation must 
243.9 	provide for the election of a board of directors by the members of the association. The 
243.10 	board of directors shall elect officers as provided for in the plan of operation. The plan 
243.11 	of operation shall establish the manner of voting and may weigh each member's vote to 
243.12 	reflect the annual surplus lines insurance premium written by the member. Members 
243.13 	employed by the same or affiliated employers may consolidate their premiums written 
243.14 	and delegate an individual officer or partner to represent the member in the exercise of 
243.15 	association affairs, including service on the board of directors.
243.16 	(b) The plan of operation shall provide for an independent audit once each year of all 
243.17 	the books and records of the association and a report of such independent audit shall be 
243.18 	made to the board of directors, the commissioner of revenue, and the commissioner of 
243.19 	commerce, with a copy made available to each member to review at the association office.
243.20 	(c) The plan of operation and any amendments to the plan of operation shall be 
243.21 	submitted to the commissioner and shall be effective upon approval in writing by the 
243.22 	commissioner. The association and all members shall comply with the plan of operation or 
243.23 	any amendments to it. Failure to comply with the plan of operation or any amendments 
243.24 	shall constitute a violation for which the commissioner may issue an order requiring 
243.25 	discontinuance of the violation.
243.26 	(d) If the interim board of directors fails to submit a suitable plan of operation 
243.27 	within 60 days following the creation of the interim board, or if at any time thereafter the 
243.28 	association fails to submit required amendments to the plan, the commissioner may submit 
243.29 	to the association a plan of operation or amendments to the plan, which the association 
243.30 	must follow. The plan of operation or amendments submitted by the commissioner shall 
243.31 	continue in force until amended by the commissioner or superseded by a plan of operation 
243.32 	or amendment submitted by the association and approved by the commissioner. A plan 
243.33 	of operation or an amendment submitted by the commissioner constitutes an order of 
243.34 	the commissioner.
243.35 		Subd. 4.Reporting requirement. The association shall file with the commissioner:
243.36 	(1) a copy of its plan of operation and any amendments to it;
244.1 	(2) a current list of its members revised at least annually; and
244.2 	(3) the name and address of a member of the board residing in this state upon 
244.3 	whom notices or orders of the commissioner or processes issued at the direction of the 
244.4 	commissioner may be served.
244.5 		Subd. 5.Examination. The commissioner shall, at such times as deemed necessary, 
244.6 	make or cause to be made an examination of the association. The officers, managers, 
244.7 	agents, and employees of the association may be examined at any time, under oath, and 
244.8 	shall exhibit all books, records, accounts, documents, or agreements governing its method 
244.9 	of operation. The commissioner shall furnish a copy of the examination report to the 
244.10 	association. If the commissioner finds the association to be in violation of this section, the 
244.11 	commissioner may issue an order requiring the discontinuance of the violation.
244.12 		Subd. 6.Immunity. There shall be no liability on the part of and no causes of action 
244.13 	of any nature shall arise against the association, its directors, officers, agents, or employees 
244.14 	for any action taken or omitted by them in the performance of their powers and duties 
244.15 	under this section, absent gross negligence or willful misconduct.
244.16 		Subd. 7.Stamping fee. The services performed by the association shall be 
244.17 	funded by a stamping fee assessed for each premium-bearing document submitted to 
244.18 	the association. The stamping fee shall be established by the board of directors of the 
244.19 	association from time to time. The stamping fee shall be paid by the insured to the surplus 
244.20 	lines licensee and remitted electronically to the association by the surplus lines licensee.
244.21 		Subd. 8.Data classification. Unless otherwise classified by statute, a temporary 
244.22 	classification under section 13.06, or federal law, information obtained by the 
244.23 	commissioner from the association is public, except that any data identifying insureds is 
244.24 	private data on individuals or nonpublic data as defined in section 13.02, subdivisions 
244.25 	9 and 12.

244.26 	EFFECTIVE DATE. This section is effective the day following final enactment 
244.27 	and applies to policies written or renewed on or after that date.

244.28 	Sec. 3. [60A.2086] LICENSEE'S DUTY TO SUBMIT DOCUMENTS; PENALTY.
244.29 		Subdivision 1.Submission of documents to the Surplus Lines Association 
244.30 	of Minnesota; certification. (a) A surplus lines licensee shall submit every insurance 
244.31 	policy or contract issued under the licensee's license to the Surplus Lines Association of 
244.32 	Minnesota for recording and stamping. The submission and stamping must be effected 
244.33 	through electronic means. The submission must include:
244.34 	(1) the name of the insured;
244.35 	(2) a description and location of the insured property or risk;
245.1 	(3) the amount insured;
245.2 	(4) the gross premiums charged or returned;
245.3 	(5) the name of the surplus lines insurer from whom coverage has been procured;
245.4 	(6) the kind or kinds of insurance procured; and
245.5 	(7) the amount of premium subject to tax.
245.6 	(b) The submission of insurance policies or contracts to the Surplus Lines 
245.7 	Association of Minnesota constitutes a certification by the surplus lines licensee, or by the 
245.8 	insurance producer who presented the risk to the surplus lines licensee for placement as a 
245.9 	surplus lines risk, that the insurance policies or contracts were procured in accordance 
245.10 	with sections 60A.195 to 60A.209.
245.11 		Subd. 2.Stamping requirement; penalty. (a) It shall be unlawful for an insurance 
245.12 	agent, broker, or surplus lines licensee to deliver in this state any surplus lines insurance 
245.13 	policy or contract unless the insurance document is stamped by the association. A 
245.14 	licensee's failure to comply with the requirements of this subdivision shall not affect the 
245.15 	validity of the coverage.
245.16 	(b) Any insurance agent, broker, or surplus lines licensee who delivers in this state 
245.17 	any insurance policy or contract that has not been stamped by the association shall be 
245.18 	subject to a penalty payable to the commissioner as follows:
245.19 	(1) $50 for delivery of the first unstamped policy;
245.20 	(2) $250 for delivery of a second unstamped policy; and
245.21 	(3) $1,000 per policy for delivery of any additional unstamped policies.

245.22 	EFFECTIVE DATE. This section is effective January 1, 2009, and applies to 
245.23 	policies written or renewed after December 31, 2008.

245.24 	Sec. 4. [62U.071] HEALTH INSURANCE CREDIT.
245.25 		Subdivision 1.Definitions. (a) For purposes of this section, the following terms 
245.26 	have the meanings given them.
245.27 	(b) "Commissioner" means the commissioner of commerce.
245.28 	(c) "Employee" means an employee currently on an employer's payroll other than a 
245.29 	retiree or disabled former employee.
245.30 	(d) "Employer" means a person, firm, corporation, partnership, association, business 
245.31 	trust, or other entity employing one or more persons, including a political subdivision of 
245.32 	the state, filing payroll tax information on such employed person or persons.
245.33 	(e) "Section 125 plan" means a cafeteria or premium-only plan under section 125 of 
245.34 	the Internal Revenue Code that allows employees to pay for health insurance premiums 
245.35 	with pretax dollars.
246.1 	(f) "Small employer" means an employer with two to 50 employees.
246.2 		Subd. 2.Tax credits allowed; generally. (a) Upon application, the commissioner 
246.3 	shall allow tax credits to eligible small employers as incentives for the employers to 
246.4 	provide section 125 plans or to encourage their employees to participate in existing section 
246.5 	125 plans. The applications for the credits must be made in the form and manner and at 
246.6 	the times prescribed by the commissioner.
246.7 	(b) The credits allowed under this section must not exceed the liability for tax paid 
246.8 	by the employer. The liability for tax includes tax paid by the employer under chapter 
246.9 	290, ad valorem property tax on property used in the conduct of their trade or business, 
246.10 	and the insurance premiums tax under chapter 297I. The commissioner must verify that 
246.11 	the amount of the credit paid under this section does not exceed the employer's liability 
246.12 	for tax paid in the previous calendar year.
246.13 		Subd. 3.Establishment credit. (a) The commissioner shall pay a tax credit to 
246.14 	eligible small employers that establish section 125 plans to the extent that credit authority 
246.15 	is available under subdivision 5 for the fiscal year. An eligible small employer is eligible 
246.16 	for a credit under this subdivision only once.
246.17 	(b) To be eligible for a credit, a small employer must: 
246.18 	(1) not have offered health insurance to employees through a group health insurance 
246.19 	plan, as defined in section 62A.10, or through a self-insured plan, as defined in section 
246.20 	62E.02, in the 12 months before applying for a tax credit under this subdivision;
246.21 	(2) have established a section 125 plan within 90 days before applying for a tax 
246.22 	credit under this subdivision, and must not have offered a section 125 plan to employees 
246.23 	for at least a nine-month period before the establishment of the section 125 plan under 
246.24 	this subdivision; and
246.25 	(3) certify to the commissioner that the employer has established a section 125 plan 
246.26 	and meets the requirements of 2008 S.F. 3780, article 4, section 10, subdivisions 2 and 
246.27 	3, if enacted.
246.28 	(c) The amount of the credit under this subdivision equals the lesser of:
246.29 	(1) the employer's actual cost to establish the section 125 plan; or
246.30 	(2) $350.
246.31 		Subd. 4.Participation credit. (a) The commissioner shall pay a tax credit to 
246.32 	eligible small employers with section 125 plans. The amount of the credit equals the 
246.33 	least of the following amounts:
246.34 	(1) 50 percent of the amount the employer spends during the calendar year for 
246.35 	incentives to encourage participation by the employer's nonparticipating employees in 
246.36 	the employer's section 125 plan;
247.1 	(2) $200 for each nonparticipating employee who begins participating in the 
247.2 	employer's section 125 plan; or
247.3 	(3) the amount of credit certificates the employer received for the calendar year.
247.4 	(b) An eligible employer is a small employer that:
247.5 	(1) offers a section 125 plan to its employees;
247.6 	(2) has five percent or more of its employees not participating in the section 125 plan 
247.7 	during the quarter prior to the application for the tax credit; and
247.8 	(3) pays average compensation to its nonparticipating employees of no more 
247.9 	than the maximum annual income of an individual who is eligible to participate in the 
247.10 	MinnesotaCare program under chapter 256L.
247.11 	(c) For purposes of this subdivision, "incentives to encourage participation" includes 
247.12 	paying an increased employer share of the premium or other costs of the insurance, 
247.13 	contributing to the employee's health savings account, or taking other measures that the 
247.14 	commissioner considers likely to foster higher rates of participation; and "nonparticipating 
247.15 	employee" means an employee who is not participating in the section 125 plan, and who is 
247.16 	not otherwise covered by health insurance other than MinnesotaCare.
247.17 		Subd. 5.Credits and credit certificates. (a) The commissioner may transfer 
247.18 	all or part of the appropriation provided in 2008 S.F. 3780, article 4, section 10, 
247.19 	subdivision 4, if enacted, to provide tax credits under subdivision 3. The commissioner 
247.20 	shall allow tax credits under subdivision 3 to applicants on a first-come-first-served 
247.21 	basis and the maximum amount of credits allowed for each fiscal year is limited to the 
247.22 	amount transferred from the appropriation provided in S.F. 3780, article 4, section 10, 
247.23 	subdivision 4, if enacted. If applications for credits exceed the allowance for the fiscal 
247.24 	year, the commissioner shall hold the applications and award the credits from the amount 
247.25 	appropriated for that purpose in the next fiscal year. If the commissioner does not transfer 
247.26 	any of the appropriation provided in 2008 S.F. 3780, article 4, section 10, subdivision 4, if 
247.27 	enacted, no tax credits are allowed under subdivision 3.
247.28 	(b) Upon application, the commissioner shall award credit certificates to eligible 
247.29 	employers for credits under subdivision 4. The maximum amount of credit certificates 
247.30 	is limited to $730,000 per fiscal year. The commissioner shall award the certificates to 
247.31 	eligible employers on a first-come-first-served basis, and certificates will apply to the 
247.32 	calendar year in which the employer intends to provide incentives for nonparticipating 
247.33 	employees to begin participating in the employer's section 125 plan. No employer may be 
247.34 	awarded more than $5,000 in credit certificates. Following the close of the calendar year, 
247.35 	employers who have been awarded certificates must report to the commissioner on the 
247.36 	amount spent for incentives to encourage participation by nonparticipating employees, 
248.1 	and the number of nonparticipating employees who became participating employees, and 
248.2 	the commissioner must allow the appropriate credit amount as provided in subdivision 4, 
248.3 	paragraph (a).
248.4 	(c) The commissioner may transfer credit authority between the authorizations in 
248.5 	paragraphs (a) and (b) based on the applications for the credits under subdivisions 3 and 4 
248.6 	or on other factors so that in the commissioner's opinion the allocation between the two 
248.7 	credits will provide a more effective incentive to expand health care coverage.
248.8 		Subd. 6.Appropriation. The amount necessary to award credits under subdivision 
248.9 	5, paragraph (b), is appropriated from the general fund to the commissioner of commerce 
248.10 	in fiscal year 2009.

248.11 	EFFECTIVE DATE. This section is effective for fiscal year 2009.

248.12 	Sec. 5. Laws 2006, chapter 269, section 2, is amended to read:
248.13 	Sec. 2. DEDICATION FEE.
 248.14 	The Minneapolis Park and Recreation Board and the Minneapolis City Council 
248.15 	may jointly exercise the powers conferred under Minnesota Statutes, section 462.358, 
248.16 	with respect to requiring that a reasonable portion of land be dedicated to the public 
248.17 	or imposing a dedication fee on new housing units and new commercial and industrial 
248.18 	development in the city, wherever located, for public parks, playgrounds, recreational 
248.19 	facilities, wetlands, trails, or open space. The dedication of land or dedication fee must 
248.20 	be imposed by an ordinance jointly enacted by the park board and the city council.  The 
248.21 	ordinance may exclude senior housing and affordable housing from paying the fee or the 
248.22 	dedication of land. The provisions of Minnesota Statutes, section 462.358, subdivisions 
248.23 	2b, paragraph (b), and 2c, apply to the imposition, application, and use of the dedication of 
248.24 	land or the dedication fee.

248.25 	EFFECTIVE DATE. This section is effective upon compliance by the Minneapolis 
248.26 	Park and Recreation Board and the Minneapolis City Council with Minnesota Statutes, 
248.27 	section 645.021, subdivision 3.

248.28 	Sec. 6. DATA UPDATE.
 248.29 	The commissioner of revenue must continue to maintain, update, and make available 
248.30 	the information required under Laws 1987, chapter 268, article 7, section 1, subdivision 
248.31 	6, paragraph (b). The commissioner must provide the most complete and current data 
248.32 	available, when requested, to the chairs of the senate and house of representatives 
248.33 	committees on taxes.

249.1 	Sec. 7. APPROPRIATIONS.
 249.2 		Subdivision 1.Department of Revenue; assessment assistance. $100,000 is 
249.3 	appropriated to the commissioner of revenue from the general fund for fiscal year 2009 to 
249.4 	assist local assessors in valuing industrial special-use industrial properties.
249.5 		Subd. 2.Department of Revenue; onetime appropriations. (a) $15,000 is 
249.6 	appropriated to the commissioner of revenue to administer the study of the property tax 
249.7 	exemption for institutions of purely public charity.
249.8 	(b) $200,000 is appropriated to the commissioner of revenue to prepare the database 
249.9 	required in section 5 matching homeowners' property, property tax, income, and income 
249.10 	tax information.
249.11 	(c) The appropriations under this subdivision are onetime appropriations from the 
249.12 	general fund for fiscal year 2009 and are not added to the agency's base budget.
249.13 		Subd. 3.Department of Administration. $60,000 is appropriated from the general 
249.14 	fund in fiscal year 2009 to the commissioner of administration to pay the cost incurred by 
249.15 	the Land Management Information Center to prepare township acreage data. $50,000 of 
249.16 	this appropriation is onetime and is not added to the agency's base budget; $10,000 of this 
249.17 	appropriation is added to the agency's budget.